ANALYSIS: Global outlook for WS chief Diamond - Harris Diamond, chief executive of the world's biggest PR firm, looks to consumer PR to fuel global growth at Weber Shandwick

As CEO of the world's largest PR firm Harris Diamond spends a disproportionate amount of time in the air, so much so that his son's pre-school group mistakenly listed his profession as a pilot. 'My office is American Airlines,' he quips during the most recent of his frequent visits to Weber Shandwick's UK offices.

It has been a momentous 12 months for Diamond, which has taken in not only the biggest merger in PR's history and his elevation from the helm of the then BSMG Worldwide, but also the effects of 11 September and the harshest economic downturn for a decade.

In February, WS's parent Interpublic Group reported a five per cent downturn in global PR revenues for 2001, with a 14 per cent reduction at WS to just over £400m. While Diamond won't comment on exact figures, around 1,000 staff have disappeared from the payroll since the merger. The bulk of these losses, unsurprisingly, were in the tech and financial sectors.

'If you took tech and financial out, the rest of the business is actually reasonably healthy,' says Diamond. 'In Germany, for example, we have around one IPO a year, which is probably one more than any other firm.

The US and UK has very little M&A activity. Right after 11 September, public affairs basically stopped as there was only one issue being discussed, but that has now returned.'

According to Diamond the company has now stemmed any losses from last year and for four months now has been winning an average £7m of annualised business per month: 'The UK in particular had a rash of pitches in January and February, though it has quietened down again now.'

While cautious, Diamond is more optimistic in his prognosis for the PR sector than many of his peers. 'I've tremendous respect for (WPP boss) Sir Martin Sorrell but I think the business overall has been healthier than the impression he has expressed in the press,' says Diamond. 'I wouldn't say we are returning to the times of 1999 and 2000 - that really was propelled by the tech and financial sectors - but I think growth in the marketing services arena will come back.'

The main engine of that growth over the next few years, according to Diamond, is going to be consumer PR, which at present accounts for around 55 to 60 per cent of WS's global revenues.

'Consumer in its broadest sense is growing exponentially because of the expansion of budgets but also the need for clients to segment by constituency and to have to reach out to so many constituencies,' he says.

WS's UK operation has already tempered the City and Westminster heritage of Weber Shandwick with the appointment of marcoms expert David Brian as joint CEO alongside experienced PA operator Colin Byrne.

The decision to appoint Countrywide Porter Novelli director Sally Ward as head of consumer in January also makes sense, given Ward's experience of co-ordinating with other Omnicom firms. According to Diamond the UK has been particularly successful in cross-selling across disciplines and he is now looking to develop this approach within the IPG network.

Joint projects are already underway with Futurebrand, McCann-Erickson and its event management company Momentum.

A further goal involves Diamond focusing on growth for WS's global healthcare offering. In particular, he is looking to build the European healthcare practice, headed by Karen Winterhalter, capitalising on the opportunities being created by changing legislation on direct-to-consumer communications: 'Healthcare has been growing exponentially but there is more we can do. As regulations change in the EU, allowing us to talk more directly to the consumer, we want to be there.'

Continental Europe as a whole remains a growth area for the firm, while Asia continues to be dogged by its reliance on Japan. While the Tokyo office recorded a modest growth of between three and five per cent - a rarity given the depth of the region's recession - it continues to lose out against the dollar with the gradual devaluation of the yen.

While Diamond believes there are still opportunities in Asia, the more likely focus for acquisition in the near future will be Latin American markets such as Chile and Brazil, Scandinavia and South Africa, with a strong focus on healthcare opportunities in all markets.

At present the company has 53 clients, such as GE and Siemens, which they count as 'global', although Diamond is realistic about the prospect of 'global domination'. 'You aren't going to get a cheque for the world,' he says.

But he is adamant that WS is a global firm: 'We are different from other firms in the US in that we are much more international. Around 37 per cent of our business is non-US. The success of our firm will be defined by bringing this ratio up to 50:50.'

No imminent reduction in air-miles, then.

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