Peppercom: Agency Business Report 2009

Steve Cody, cofounder and managing partner, attributes new account wins and continued success to the strength of his workforce.

Outlook
Steve Cody, cofounder and managing partner, attributes new account wins and continued success to the strength of his workforce. "We have a core group who has been with us from eight to 10 years," he says. "We're also good at self-analysis."

With the present economy, Peppercom looked internally to determine how it could improve from a cultural standpoint, with programs like its third annual Dream Day, where staffers go off-site to discuss better practices. Cody also notes the firm's creative approach to netting its largest client, Whirlpool, which recently added the Maytag and Amana brands to its roster.

The fourth quarter was tough for the firm, but moving forward it continues to be vigilant about finding unique angles for clients, such as leveraging partnerships to organizations looking to green their businesses with smaller regional NGOs, rather than nonprofits like Greenpeace. "We try to fill gaps left by our competitors," says Cody.

Staff
Peppercom's headcount of 85 has risen 9% since FY 2007, with a turnover of 17% in 2008. Key hires for the year include Sam Ford, director of customer insights; Sandy Pfaff, director, West Coast; and Michael Dresner, CEO of Brand2Squared. One staff departure was Gene Colter, editorial director. Ted Birkhahn was promoted to MD and became the agency's first COO.

Structural changes
No mergers or acquisitions in 2008.

Regional performance
All regions are minimally shrinking due to the current economic climate.

Practice areas
Peppercom does not have definitive practice areas. Instead, accounts are handled by the staffers best suited to the task. Its service offerings include Pepperdigital, GreenPepper, Peppercommotions (events and sponsorships), Business Intelligence Group (BIG), and Brand2Squared (licensing), which is the newest. The digital and green practices grew the most during 2008. The least growth was found in professional services due to clients' decreased spending.

Accounts
Key wins in 2008 include Maytag, Amana, and Yahoo, with expanded accounts with Ernst & Young and Genworth. One key account loss was Unisys. Of clients, 70% are on retainer, with the agency finding a slight decrease in traditional retainers.

Financial performance
Global revenue was $14.7 million – up 13% from the previous year. US revenue was $13.6 million, a 15% increase. There was both top- and bottom-line growth due to new wins, growing existing business, and effective cost management. Of that growth, 65% was organic, 35% new business.

Key facts
Principals: Steve Cody and Edward Moed, cofounders and managing partners

Ownership: Independent

Offices: Two in US – New York (HQ), San Francisco; one globally – London

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