MSLGroup: Agency Business Report 2009

MS&L experienced a strong 2008 with a 6% increase in global revenue.

Outlook
MS&L experienced a strong 2008 with a 6% increase in global revenue.

"In the top-tier [regions], we took a hard look at local markets, innovation strategies, and we've executed and held on to our most important clients," says Jim Tsokanos, president of North America.

Agency growth was attributed to new global account wins, in addition to expansion on existing client work and global clients' movement into new markets. In total, the agency has at least five accounts across three or more countries.

In terms of the current economic climate, Tsokanos noted the importance of a diversified portfolio of geographies "that go deep and wide," as well as an agency with distinctive thought leadership, which MS&L is seeking to accomplish through more proprietary research.

"Today, everything we have to do has to be measured and benefit the bottom line," he adds. "So, when we talk about making investments in insights and research, it's because it has to be proof-based... Clients are looking to get more for less and it's a buyer's market."

Staff
Headcount is 1,250. It has remained flat globally since FY 2007. Net staff turnover was about 2%. Senior hires included Joel Curran, MD of Midwest region; Neil Dhillon, MD of Washington, DC, office and North American director of public affairs; and David Chamberlin, SVP of global corporate. Renee Wilson was promoted to New York office MD. CEO Mark Hass left in 2009 to pursue other opportunities.

Regional performance
Ten offices provided better than 20% margins, including MS&L Digital, New York, McGinn MS&L, and MS&L Boston. Offices in Asia grew 40%.

Practice areas
Main areas are consumer, healthcare, corporate, tech, public affairs, b-to-b marketing, and financial communications. Makeup of business is 35% consumer, 30% healthcare, 30% corporate, and 5% tech. The Social Activism Marketing specialty was launched in early 2009, combining CSR, cause marketing, and digital tools. Digital showed the most growth, alongside consumer, corporate, and healthcare. Tech experienced the slowest growth.

Accounts
New accounts include Outback Steakhouse and Nestlé Infant Nutrition. In North America, about 10% of clients are on retainer, whereas internationally it is 30% to 40%.

Financial performance
Global revenue was between $200 million and $300 million, US revenue was in the $100 million to $200 million range. MS&L saw both top- and bottom-line growth, with 15% of global revenue created by new business and 10% organic growth.

Key facts:
Principal: Jim Tsokanos, president of North America

Ownership: Publicis Groupe, as part of SAMS (Specialized Agencies and Marketing Services)

Offices: 42 wholly owned offices globally, 11 in North America, 18 in EMEA, and 13 in Asia-Pacific; a number of offices are partially owned

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