With the release of WPP's results this morning, the Q1 financials for the major marketing services groups are now all in – and they make encouraging reading for the PR and communications sector.
Up to now, everyone felt things had improved in 2010, with clients starting to spend again, agencies looking to hire and the economy stabilising – but these figures provide the first hard evidence.
Omnicom, whose PR firms include Ketchum, Porter Novelli, Fleishman-Hillard, Brodeur and Cone, was first to report, posting an encouraging 5.9% year-on-year increase in Q1 PR revenue, to $275.5 million. In a further sign of confidence, Ketchum made 50 new US hires in Q1.
Harris Diamond, chief executive officer of IPG's Constituency Management Group (CMG) - home to agencies including Weber Shandwick, GolinHarris, MWW Group, DeVries PR, and Roger & Cowan – told PRWeek that US PR revenues were up approximately 6.5%.
US PR revenue at Publicis, which houses its PR operations under the MS&LGroup banner, was up about 4%.
PR was the strongest performer of WPP's four business groups. Finance director Paul Richardson said in an earnings call that revenues for the PR and public affairs unit increased 4% in March, with the company attributing in a statement “strong growth in specialist PR business in the US” as an example. Group agencies include Hill & Knowlton, Burson-Marsteller, Ogilvy PR Worldwide, Public Strategies, Quinn Gillespie & Associates, and Cohn & Wolfe.
Havas didn't break out PR revenue but its overall US operations, which include Euro RSCG and Abernathy MacGregor, were up 5.2%. And Next Fifteen, owner of Text 100, Bite and M Booth & Associates, posted a pre-tax profit of $3.17 million on revenues 2% up at $52.1 million.
All this backs the findings of PRWeek's Agency Business Report, the print version of which is about to hit the streets. PR agency businesses went into the recession leaner and meaner than other services groups and were better able to cope with the downturn than their peers in media and advertising.
Their services were valued by clients in the harsh economic environment that ensued and they were ushered to the top table to dispense the advice and strategic counsel that corporate America required to navigate its way through the storm.
It would be foolish to think that all is yet rosy in the garden, and the fear of a double-dip recession still remains, but I believe our industry can look forward to the rest of the year with renewed confidence.