Hill & Knowlton: Agency Business Report 2009

In 2009, the agency is seeing new businesses in many sectors that stand to benefit from Barack Obama's administration.

Outlook
In 2009, the agency is seeing new businesses in many sectors that stand to benefit from Barack Obama's administration. Taking that into account, Paul Taaffe, chairman and CEO of the firm, acknowledges that many companies are cutting their marketing budgets.

Although H&K couldn't disclose many of its financial statistics, Taaffe says that 2008 was the agency's best year in about a decade. He adds that the firm is seeing new business from international companies, financial firms, as well as entities in the environmental and energy sectors.

"If we can be flat, year on year [in 2009], I think we could call it a success," Taaffe notes. "That's what we're trying to achieve."

The agency also hopes to continue its strong growth in the healthcare and digital sectors throughout this year, as well as build on its "incredible growth on the international level" from 2008, he adds.

"Tech continues to be very strong for us," Taaffe says.

Staff
H&K did not disclose headcount nor the identity of senior staff members who have left the firm, but it revealed headcount was up 4.2% since FY 2007. Its percentage of staff turnover was 27% in 2008.

The agency hired 15 senior staff members, including Seattle EVP and GM William Ludlam and Washington GM Michael Kehs. It also hired six SVPs, including Steven Immergut, Peggy O'Neill, and Glen Rochkind. It also brought on six VPs, including Sean Leous, Laurent Pernot, and Kristen Wilson Syrek.

Structural changes
The agency became the majority stakeholder in Synergy H&K in 2008.

Regional performance
H&K opened a Dallas office, and saw more than 15% growth in its New York, San Francisco, Los Angeles, and Florida offices. It reported that all regions grew in 2008.

Practice areas
The agency's core practice areas are corporate, marketing communications, public affairs, digital, research and strategic services, and b-to-b. Corporate equals 51.2% of account business, marketing communications (23.2%), b-to-b (10.8%), public affairs (6.6%), and the others (5.2%) all have less. Corporate (12%) and marketing communications (9.3%) showed the most growth in 2008.

Accounts
Key 2008 wins included Ubisoft, Pringles, Medtronic, Michelin, LinkedIn, and Treehouse Foods.

Financial performance
Global revenue was between $300 million and $400 million, US revenue between $70 million and $100 million. This represented a 10.2% global revenue increase over 2007, while US revenue increased 11.2%.

Key facts:
Principals: Paul Taaffe, global chairman and CEO; MaryLee Sachs, chairman, H&K USA

Ownership: WPP

Subsidiary agencies: Blanc & Otus

Offices: 73 offices worldwide in 41 countries

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