KEY: () = Top 150 Ranking; CH = Companies House; G = Income Growth; H = Negative Income Growth
HILL & KNOWLTON - CH £21,774,000
Two years of investing in a new consumer technology division are starting to pay off for Hill & Knowlton.
Sally Costerton, head of the corporate communications practice, says the success of the division, which now numbers 20 and whose clients include Sega and Packard Bell, has been largely down to the efforts of Sam Clark, who joined H&K on its graduate trainee scheme and now runs the B2C tech business as a board director. 'She has built a huge business from nothing: we just didn't have a consumer tech business to speak of two years ago,' says Costerton.
H&K also hired Kim Hoedeman from Lexis as an associate director with a strong lifestyle and marcoms background, to boost the consumer tech business.Costerton says B2B is looking healthier already for 2004: 'Last year, there was some organic growth but not a lot of big pitches. This year, the budgets are beginning to come back.'
The biggest challenge will be recruiting good junior people. H&K has kept up investment in its graduate training programme, yet Costerton believes that as many agencies stopped hiring during the recession 'there are few good account executives in London at the moment'.
H&K's growth areas for 2004 will be the gaming sector, reputation management for tech firms, and digital. Costerton believes digital personalisation could become a new sector in its own right, as consumers move towards creating digital content, and mobile technology, broadband and 3G finally become a reality.
'I hope it will be an exciting year,' she adds. 'I'm bullish, but realistic - it's still going to be hard work.'
THE ITPR GROUP (18) £1,284,842 G
ITPR had a storming year, with a 46 per cent leap in fee income over 2002- from £881,489 to £1,284,842 - that would be more than respectable in a buoyant market, let alone during the current challenging environment.
The agency won 15 new clients last year, continuing a trend of upwards growth for the past five years, with partners Bob Dearsley and Ashley Carr at the helm. Both have backgrounds as in-house marketing directors in the tech industry, and Dearsley says this has helped them understand the issues their clients are facing, and to focus the agency on sales results for clients rather than PR for its own sake.
'Those technology companies that have successfully weathered the downturn are ever more discerning and demanding,' he says. 'PR buyers are now generally better educated and, as a result, have far higher expectations.'
ITPR has focused on its own marketing and PR as well in the past year, and is starting to be invited to pitch for larger accounts.
The agency now has a team of 20, which Dearsley describes as 'critical mass', and is looking for people at all levels.
Dearsley says although the sector is recovering, he sees mid-market companies such as resellers, systems integrators and software vendors are doing better than the big-name corporates.
One of the big growth areas for the agency is in looking after suppliers in the mobile sector, particularly in SMS. 'Just look at the number of TV programmes that are funded by having a text line where people can vote,' he says.
The agency's client portfolio now includes Philips Business Communications, Exchequer Software, Opera Telecom and Anker Group and, in response to demand from clients, the agency's big plan for the next 12 months is to open offices in France, Germany and the Netherlands.
JOHNSON KING (16) £1,320,391 H
2003 was arduous for Johnson King, which dropped tech fee income from £2,126,545 in 2002 to £1,320,391 in 2003. Managing director Mike King resisted the urge to diversify into consumer tech or straight consumer PR, however, and feels this has stood the agency in good stead for 2004.
'We decided early on in the recession that we would maintain our specialism in B2B technology so we spent a lot of time in 2003 redefining our services and looking at how we position ourselves so we were in the best position to maximise growth when the recovery started,' he says.
Business is picking up this year, however, and Johnson King has already gained six new clients, including Motive, which is involved in self-managing network technology for broadband suppliers.
The agency has also taken on two new people to bring the team to 20, and continues to hire. The management team remains stable, although operations director Helen Banyard has changed her role to new business development to reflect the upturn in the market.
Main growth areas for the agency in 2004 will be information storage and retrieval, particularly in the light of new IT governance rules, as well as security, and anything to do with collaboration and sharing of information. King says the telecoms hardware sector is slowly picking up, but is unlikely to be a growth area this year.
'We have managed to work our way through the downturn and now we have a really positive outlook,' says King. 'We've been going for 12 years now and the first nine years we had aggressive growth, so it takes some getting used to dealing with a downturn as your mindset has to be so different. But we have stayed profitable every year through the recession and we have a target for growth of 50 per cent this year - that's realistic.'
TEXT 100 INTERNATIONAL (11) £1,896,042 G
Text 100 had a good year after what Andy West, managing director EMEA, describes as an 'eventful' 2001-2002 period, with a lot of upheaval at the agency. But fee income last year was up eight per cent from £1,761,166 to £1,896,042 as the London team got behind the business and focused on client relationships and building the agency's reputation in the media.
West says Text 100 has settled into its work for IBM, and wins in 2003 included the global account for embedded microprocessor firm ARM, Internet Security Systems and, in a departure from the agency's B2B business, Bang & Olufsen, for whom Text 100 is handling the UK press office. 'It's a bit of a diversion for us, and has given us an opportunity to pitch for more consumer tech work,'he says. 'It's almost not technology, as the target media are men's lifestyle and the nationals: it shows we can deliver true technology PR but also go beyond the tech media.'
Other growth areas for the agency over the coming year are likely to include security, wireless and broadband. West also says corporate spend is starting to creep up slowly.
Over the past 18 months Text 100 has invested in developing a number of products for clients, including media training and message workshops.
Cathy Pitham joined Text 100 as UK managing director in August last year, and the London team has grown from 15 to 25 this year.
'We're on some good pitch lists and we're looking at a very aggressive approach for 2004/05,' says West. 'We will be continuing our focus on technology but extending our definition of it. Recovery is not yet established, and it would only take another atrocity or big interest rate rises for it to grind to a halt, but we're much more optimistic than a year ago, and we're a much tighter and more focused organisation.'
WEBER SHANDWICK - CH £14,255,000 (2001)
Weber Shandwick's tech practice in London had a better year in 2003 than 2002, although clients were still being careful with budgets.
The division grew through a combination of new client wins, including Computer Associates and lifestyle management software company PTC, and organic growth from big-name clients such as Intel, Agilent Technologies, and Microsoft, for whom the team added the Microsoft Research Centre in Cambridge.
Director Jonathan Hargreaves says clients were looking for very specific projects and programmes with an increased focus on measurable delivery and ROI during 2003.
During the year, the technology team created a new approach to analyst relations for tech companies, called Insight, to move its work for clients in this sector onto a higher level of consultancy.
This has led to work across the consultancy's tech accounts.
'It's a very positive move, as it's a sign of a much more mature industry,' says Hargreaves.
And in the London office, the team is growing - Weber Shandwick had 35 people in its UK tech practice last year and is actively hiring. Two account directors, Matt Warder and Cairbre Sugrue, were also promoted to the board last year as the practice concentrated on internal appointments to senior posts.
So far, 2004 is looking very much like an extension of 2003, according to Hargreaves: 'We're seeing a lot more work in positioning companies with more ambitious growth strategies, and more strategic planning and consultancy work.
'When companies tightened their budgets some of that work was toned down, but clients are spending more money in 2004.'
Nevertheless, there are clearly spikes of growth in certain sectors, such as biotechnology, mobile technology, and digital, rather than the industry as a whole being back on track. 'We're optimistic about those pockets of growth, but cautious about the rest of the industry,' Hargreaves adds.
THE WHITEOAKS CONSULTANCY (17) £1,288,763 H
Tech fee income may have been slightly down for The Whiteoaks Consultancy in 2003 - it dropped from £1,359,147 to £1,288,763 - but the agency is proud of its record of not letting a single person go through the downturn.
Whiteoaks director Gill Craig says the agency took a deliberate decision last year to concentrate on client and staff retention. As well as keeping staffing levels up, this meant that some client work was done for lower fees than normal to help clients whose budgets had been cut.
'We were happy to do that because a lot of our clients have been with us for years, and we've been with them through good and bad times,' says Craig. 'But new business was very tough last year - we did a lot of pitches that we "won", but then clients suddenly discovered that they didn't have a PR budget.
'Happily, some of the same people are starting to come to us again now with their budgets in place.'
The consultancy is picking up some good clients, particularly as a result of its broadcast specialism, including the launch of the new Horror Channel for Sky, and work for Noel Edmunds' Unique Group.
Whiteoaks has some aggressive targets, and Craig would like to see growth of between ten and 15 per cent this year. However, she adds: 'It's still tough for clients. Creativity is going to be very important to motivate them and us this year.'
The biggest challenge, though, is going to be recruitment: 'People have worked so hard over the past two to three years and many agencies haven't been able to give out bonuses and pay rises.
'I find a lot of people in the industry are just weary and need a change. A lot of agencies cut training during the downturn and it's very hard to find people with two to three years' experience.'