PR consultancies in the financial services sector are propping up revenues with crisis and emergency comms briefs, but Russia, India and the Middle East are more attractive markets, according to agency chiefs.
The findings, resulting from discussions with a range of City and corporate agency chiefs, show that expectation of international growth far exceeds that of the UK, despite crisis briefs, such as FD's work for Northern Rock (PRWeek, 8 March), becoming increasingly frequent.
This week, £1.5bn Islamic Investment bank Gulf Finance House swapped Bell Pottinger London for Cubitt Consulting in a good example of an international firm using London expertise for a global brief.
Cubitt will advise on strategic positioning, facilitated by London's position as an international hub.
Hudson Sandler chief executive Andrew Hayes said being based in London helps, but agencies generally find work through outreach or recommendations.
'Internationally, we are seeing around double the business we saw last year,' reported Hayes.
'Russia has been a particularly active market for that. The business generally comes through identifying companies that are growing and getting out there to meet them.'
Hudson Sandler is currently advising a company embroiled in the BP-Russia saga. AAR is a consortium of Russian shareholders including Access Industries, Alfa Group and Renova Group that collectively own 50 per cent of TNK-BP, Russia's third largest oil company.
The business is indicative of the wins Hudson Sandler has seen through international contacts.
One agency chief said focus on international clients was a matter of 'future-proofing'.
'If the recession bites hard, we could see IPO and M&A deals stall for a couple of years,' he said. 'If you want to succeed you have got to find alternative regions to generate cash.'
Not all sectors are suffering in the same way. Agencies in general have been diversifying their offerings, and large players such as Brunswick and FD are unlikely to suffer as much as those that depend solely on IPO or AIM work.
HOW I SEE IT - Simon Brocklebank-Fowler, Managing partner, Cubitt Consulting
M&A is down roughly half, AIM financings down more, and FPR firms have reasons to be worried. But our sector has a tremendous asset as the world's most powerful financial and media hub. Our PR market barely existed a decade ago. A look at last quarter's new business wins at our firm tells the story: $13bn Australian takeover defence; $5bn US energy sector private equity group; and a $2bn Bahraini investment bank. Not really British PR at all. The UK merchant banking sector built itself on foreign trade through London in the 19th century, and there is every chance FPR can do the same in the 21st.