The main challenge facing Penny McDonald - the newly appointed MD at The Outside Organisation (PRWeek, 2 March) - is straightforward: to attract more consumer clients to an agency best known for working with musicians and celebrities.
Outside, run by CEO Alan Edwards, has worked with brands including Nokia and Virgin Radio in the past.
But it has recruited McDonald, previously editorial director at Publicis Blueprint, to help it make more permanent inroads into a sector dominated by international consultancies and consumer shops.
Can the agency follow Freuds?
It is unsurprising that Outside - like so many agencies whose heartland is music and entertainment - has this ambition.
Not only do celebrities tend to pay relatively little - from £500 to between £1,500 and £2,000 a month for a big name - they often require time-consuming and sometimes high-level personal counsel. This compares poorly with the average fee for a standard consumer brand campaign - around five times that amount.One comms consultancy that has successfully made the transition from specialising in entertainment to consumer and corporate work is Freud Communications.
Freuds was once best known for working with the likes of radio presenter Chris Evans and singer Geri Halliwell, but is now corporate adviser to heavyweight clients such as AEG and Carphone Warehouse.
The agency made inroads into consumer brands by winning a small account with Pepsi, and PepsiCo remains one of Freuds' most significant clients.
Tough act to follow
But Freuds' success will be difficult to duplicate. For one thing, few celebrity PROs have the CEO-level contacts that Matthew Freud has cultivated at his agency.
Recruitment, scale and ‘culture shock' can also be challenges, as detailed by four consumer and entertainment agency specialists (see below).
The Outside Organisation
Alan Edwards (pictured), CEO, The Outside Organisation: ‘When Outside started, our business was 100 per cent music. It now stands at 60 per cent music, 40 per cent brands. In five years we hope to see our business model at a ratio of 50:50.
‘Outside’s move into more brand PR is part organic, natural growth and development, rather than a change of direction.
‘We’ve always marketed music and celebrity clients as “brands” – Outside was an integral part of the development of Brand Beckham, for example.
‘At the moment, we are working with P Diddy on his fragrance and clothing range. This is the way the business was, and is, naturally developing.
‘Now, we need take our experience and skills and make a proactive assault on the brands market – using the skills we have and adding brands expert Penny McDonald to take on the market.
‘One of our major strategies is to merge a particular “celebrity” brand with a “consumer” brand, resulting in a win-win situation for both – far more exposure for both entities, which drives extra revenue.’
Ginny Paton (pictured), managing director, Henry’s House: ‘Henry’s House’s business has always been around 50:50 brands and celebrity, and we expect it to continue that way. Our culture, experience and interest are smack bang in the middle, and we think the two worlds can logically fit together.
‘Celebrity clients want solid strategic thinking on how their future pans out, while brands want to be linked to the world of celebrity. In music particularly, bands are brands. Many now have five-year plans with book, merchandise or perfume deals plotted from the start. They lay out their manifesto on their MySpace site, just as any brand would do in the boardroom.
‘To achieve this, agencies need to recruit people who can sit across both brand and consumer – and who have the marketing literacy and the discipline to work with brand managers to propagate brands, with the contacts to connect with celebrities.
‘This makes recruitment quite a challenge, but when you get the right people, they can work on both brands and entertainment using each to benefit the other.’
Mark Borkowski (pictured), founder, Borkowski PR: ‘At the start, our business was 100 per cent entertainment. Now it is around 80 per cent brands – and that is how I would like it to stay.
‘Entertainment clients have never paid adequately for senior counsel, particularly today, as so many PR people leave larger agencies, set up in their bedrooms and win work on the basis of price.
‘The same thing is starting to happen in some areas of consumer PR –procurement people are pushing for the best rates, and are buying on price rather than experience. Outside is coming to the market at a time when it is harder to build long-term relationships.
‘Another problem is that entertainment publicists don’t necessarily make great brand publicists – you can’t shoehorn entertainment PROs into a global or strategic role – you need multi-faceted teams.
‘It took us three years of hard pitching to turn the business around. Our turning point was 1996, when we won Hovis, Bacardi and Vodafone. How did we get on those pitch lists? I’m not telling.’
James Herring (pictured), co-founder, Taylor Herring: ‘We have gone from 100 per cent entertainment in year one to around 80 per cent. Getting on consumer brands’ radars is one of the biggest challenges.
‘It can also be tough to adapt to the way that big corporations work, and the brand jargon they use – some clients come from a different world, and you have to be bold to convince them to trust you.
‘Celebrity PR is often a very personal one-to-one relationship, whereas brand PR requires a minimum of three people on a team, which could be unfeasible for some smaller entertainment agencies.
‘I have stopped trying to recruit people who are interested in showbiz PR, because you meet so many wannabes. I’m more interested in people who have been working on big, serious campaigns, or people with public affairs experience, than someone who can tell me the star sign of every Celebrity Big Brother contestant.
‘Staff need to be solid, long-term, strategic planners, something that can be difficult for entertainment PROs given how quickly that industry moves.’