Europe has just been through one of its biggest changes in years.
Enlargement means the EU now rivals the US in budget terms as a single market. While the PR opportunities from EU enlargement are yet to be fully realised, a new European identity will shape cultural and political issues more than ever.
Discovering how PR consultancies with a European remit fared in 2003, however, has been slightly more difficult. The Sarbanes-Oxley Act has, once again, prevented a variety of owned groups, including Grey, Havas, Interpublic, Omnicom, Publicis and WPP, from submitting figures for inclusion in the European league tables. PRWeek, therefore, cannot publish comparative figures for 2003. The same legal bar has also been cited as the reason for the majority of European trade associations - apart from those in Germany, Austria and Switzerland - being unable to provide information from their countries' PR markets.
We can, though, look at the year-on-year performances of the top six European consultancies' networks. Fee income for top-ranked network PROI fell 11 per cent to £34m in 2003, although it took the number one slot ahead of Pinnacle Worldwide, whose fee income dropped by two per cent, and third-placed Worldcom Europe, whose fee income slipped 29 per cent to £20.4m. But new partners, such as IT specialist Powerofthepen (covering Denmark and Norway), M&CM in Italy and Schwartz PR in Munich helped to boost Eurocom Worldwide's fee income by 62 per cent to more than £15m.
This still leaves it behind ECCO International, which took on Acumen as an affiliate in 2003, but was down on fee income by eight per cent year on year.
In the technology sector, European PR suffered as US companies remained broadly focused on home markets and budgeted for little activity elsewhere.
And where business was on offer, agencies had to work hard to justify their worth. Agencies are also finding larger pitch lists commonplace and clients are expecting more for their money.
This downward pressure on fees can be compounded by the desire of local managers to demand control over choosing suppliers. ECCO director Sara Render explains: 'One of the biggest barriers for European PR directors to overcome is getting local operations to accept central control over budgets, when you have local agencies desperately cutting down their own fees to hold onto business when threatened by networks.'
Public sector work continues to be a valuable source of income, but healthcare has been the main area of cheer for European networks, with margins generally higher than in other sectors. 'It's the hottest European growth sector,' says Ketchum CEO Europe Jon Higgins, whose ethical pharma wins include Solvay Pharmaceuticals and Organon, both led from the London office. GCI Europe is now working in six countries for medical tech giant Metronic, which has interests in cardiology, diabetes and chronic pain management, and is handling all of Eli Lilly's Zyprexa work outside the US.
Traditional areas for PA work have born fruit for Edelman, with its Brussels office winning assignments in global and European healthcare for Pfizer and Novartis. Yet messages across Europe are mixed. Chime Communications chairman Lord Bell says its German agencies, MMK in Hamburg and Harvard in Munich, are ahead of budget. But Edelman European president and CEO David Brain says the German, French and Italian markets have been tough.
It is clear that, despite some confidence, progress in many regions and sectors has been slow. The economic upturn may have started in many countries, but PROs expecting a positive effect on PR spending overnight will be disappointed. Clients will also remain demanding. The European PR industry's greatest challenge - that of functioning more efficiently and with greater transparency - lies ahead.
Rank Network Fee income pounds Growth
2003 2003 2002 %
1 PROI 34,000,000 38,000,000 -11
2 Pinnacle Worldwide 27,738,392 28,437,302 -2
3 Worldcom Europe 20,352,332 28,540,057 -29
4 ECCO International 18,268,833 19,788,675 -8
5 Eurocom Worldwide 15,047,000 9,271,968 62
6 Euro PR Group 7,896,955 8,258,066 -4
Rank Network Total network staff Clients Location
2003 2003 2003
1 PROI 1,0001 - Vancouver
2 Pinnacle Worldwide 430 419 Minneapolis
3 Worldcom Europe 444 727 London
4 ECCO International 431 532 London
5 Eurocom Worldwide 120 218 Bergen
6 Euro PR Group 166 - London
All figures relate to year ended December 2003. Fee income = PR fees
only. 1 Based on number of consultants on staff