News analysis: Agencies pursue American dream

London-based marketing communications agencies are increasingly dipping their toes in the water of the US market. Ian Hall reports on both the challenges and opportunities they face in trying to make it big in America

As Mirella Cameran looks out across New York City, from her new office in midtown Manhattan, she will see a horizon glimmering with an optimistic hue for the PR business.

Cameran, who launched The Red Consultancy's New York office late last year (PRWeek, 5 December 2003), describes the start of 2004 as an opportune time for the UK-based and Incepta-backed consumer PR agency to capitalise on an 'economy that has begun to turn' upwards from its post 9/11 malaise.

Red's London rivals will watch Cameran's fortunes closely as an increasing number are planning to plant a metaphorical Union Jack in the sidewalks of the Big Apple or Los Angeles.

Cunning, formerly known as Cunning Stunts Communications, has appointed Mark Voysey as its first-ever NYC general manager.

Marcoms agency Exposure will also open an office in Los Angeles within the first three months of 2004, according to joint MD Raoul Shah.

It would be wrong to create the impression of a British invasion, however, and many independent PR shops remain content to work with affiliates or 'partner agencies'.

Jackie Cooper PR founding partner Robert Phillips is one such sceptic.

'A New York office looks good on your stationery, but we think it could turn into a potential nightmare,' he says.

Overseas outposts often become overly reliant on one individual to run the office - and one major client to fund the show. Critical mass needs to be reached if the office is to become more than a token marketing device for an agency keen to promote an international presence to potential UK clients.

UK consumer agency Joe Public Relations is living proof that opening in NYC itself is far from a cakewalk: the agency launched in New York three years ago, but closed its office last July.

JPR joint head Matthew Wood says the office was 'profitable for a while', until the economic downturn took its toll and the 'risk became too great'.

The US consumer PR market is more fragmented than in the London-centric UK, with Chicago one of many regional consumer PR hot-spots.

But despite JPR's failure and the regionally focused nature of the market, some see the US marcoms market as ripe with potential, with a wholly-owned US sister office able to boost turnover and enable greater influence on US-based clients' PR strategy.

Ben Elliot, who runs members-only concierge service Quintessentially, has been open in New York for 18 months. He says British PR agencies are often 'more creative' than their US counterparts and those most likely to succeed are the ones offering services such as celebrity tie-ups or direct marketing, rather than solely media relations.

Elliot warns that 'standard' PR firms will fail in the face of stiff competition from US agencies, which he describes as usually 'more professional and commercially up-front' than those in London. 'US companies have a better work ethic and are better at getting the basics right,' he says, before adding: 'That doesn't mean the quality is as good. '

Exposure has in the past worked on PR projects in the US, including the promotion of an edition of style magazine Visionaire themed around its client Levi's, with which it worked alongside local agency KRT.

But with its own bureau, Exposure plans to offer services such as brand tie-ins and 'experiential marketing', with PR as an 'output', according to Shah.

London-based Cunning MD Anna Carloss says much of her agency's NYC work so far has been 'brainstorming for the creative market', but adds that her man in Manhattan has 'proved that there is PR business out there for us'.

Along with Exposure, other British PR agencies also have their sights set on the Hollywood Hills.

Jenny Halpern, who runs her eponymous PR agency, is considering a permanent US office in NYC or LA, citing client demand for a presence at events such as the Oscars.

Halpern celebrity director Amanda Kyme is temporarily to relocate to LA in advance of next February's Academy Awards on behalf of clients including handbags brand Shizue.

London agency Henry's House has worked alongside BWR Public Relations in Los Angeles to promote TV shows American Idol and Pop Idol.

Although HH founder Julian Henry hopes to have sufficient US clients to make such a US bureau worthwhile in 'two to three years', he describes the opening of a US office as 'a big leap for a relatively small agency such as ours'. He adds that it is 'more cost-effective' to work with an affiliate for the moment.

In terms of the practicalities of setting up a US office, the consensus is that such a bureau should be managed by a British national, or at least an American who has worked alongside UK managers for a significant period.

At Red, Cameran, a Brit, has recruited three US staff and is working on a corporate PR brief for security firm Global Risk Strategies, a client she formerly worked for in London.

She says Red is already on pitch-lists for 'half a dozen US projects', alongside sister Incepta firms, but stresses the extent to which the parent group's CEO Richard Nichols has done a 'huge amount in terms of opening doors'.

Without such backing, the challenges of opening a US office are daunting and require considerable contacts and research of opportunities. But Cameran adds: 'PR is taken very seriously here. PR people are often higher up in organisations than they are in the UK'.

Red's rivals back in Britain will be watching Cameran's fortunes closely as they themselves consider whether crossing the Atlantic full time is a risk worth taking.

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