NEW YORK: The PR firms within Interpublic Group’s Constituency Management Group posted a mid-single-digit revenue decline in Q3 on both an as-reported and organic basis, CMG chairman and CEO Andy Polansky said on Wednesday.
In the first nine months of 2020, CMG PR firms also had a mid-single-digit decline on an organic and as-reported basis, Polansky said.
“We saw a sequential improvement in terms of the number in Q3 compared to Q2,” he said. CMG’s PR firms reported a high-single-digit Q2 revenue drop.
Polansky added that he doesn’t anticipate additional layoffs or furloughs due to the pandemic.
“It is encouraging to see that our pipeline is stronger than it was in Q2 and even this time last year; it shows that our services are in demand in this environment,” he said.
CMG contains IPG’s specialty marketing firms across disciplines, including PR, sports marketing, experiential and events marketing, brand consulting and digital and social media marketing. Its PR firms include Weber Shandwick, Golin, Rogers & Cowan PMK, DeVries Global and Current Global. The unit also includes specialist marketing agencies such as Jack Morton, FutureBrand and Octagon.
CMG saw an organic revenue decline of 16.5% in Q3 to $269.1 million.
“Broadly, the PR sector in the face of the pandemic and the associated recessionary environment is holding up well in relation to some other sectors,” said Polansky. “Our services are in high demand as companies are navigating through this complex environment and with that we are picking up quite a bit of work in our corporate and issues practices across the agencies.”
He noted that the PR firms within CMG are seeing a strong performance in healthcare, technology and consumer products and geographically in North America, Latin America and Continental Europe.
“What I am really encouraged by is how, as part of our open architecture model, we are partnering more and more with IPG agencies, and we are seeing a lot more collaborative activity across our group,” Polansky said.
Last month, for example, Micron Technology consolidated its global PR and marketing work under a cross-agency Interpublic Group team. Golin is the lead agency of the group, called teamM, which also includes Weber Shandwick and digital marketing shop MRM.
Golin in particular has had a very strong performance in the first nine months of the year and in Q3 with a series of high-profile new business wins, said Polansky. Noteworthy accounts Golin recently picked up include General Mills and Johnson & Johnson.
Polansky also cited Weber Shandwick, Current Global and the unit’s specialty healthcare brands, including ReviveHealth and dna Communications, for their performance. He added that CMG is seeing “vibrancy” in its Rogers & Cowan PMK offering on the brand side.
“I am really proud of how our teams are pulling together and showing a tremendous amount of resiliency while working largely from home around the world and staying connected to our clients and each other,” Polansky said.
Interpublic’s largely creative-driven Integrated Agency Networks division posted an organic revenue decline of 1.4% to $1.7 billion.
The holding company as a whole reported an organic revenue drop of 3.7% in Q3, including 2.4% in the U.S., to $1.95 billion and net income of $279.7 million.
Broken down by region, organic revenue decreased in the U.S. by 2.4%, in Asia-Pacific by 15.2%, in the U.K. by 10.3%, and in Latin America by 0.3% in Q3. Internationally, organic revenue also fell 6% in the quarter. Organic revenue was positive in Continental Europe (2.3%) and all other markets (0.6%).
IPG has been the strongest performer of the big six agency groups in recent years, including during the pandemic, and the Q3 organic revenue decline of 5.2% was better than Publicis at 5.6% and Havas at 10.4%, the other two groups to report so far for this quarter.
Interpublic also said Wednesday that CEO Michael Roth will step down at the end of the year and will be succeeded by EVP and COO Philippe Krakowsky.