FULL SERVICE - Hill and Knowlton
The choice of Hill and Knowlton as the full service agency to watch this
year is a little unconventional. At number three in the 1998 PR Week
league tables, H&K is already one of the UK’s biggest agencies.
Nevertheless, over the last 18 months the agency has astounded rivals by
the regularity with which it has appeared on shortlists for the largest
This year’s new wins include the Department for Education and
Employment, with a pounds 750,000 budget campaign for the National Year
of Reading, British Digital Broadcasting, IT company Oracle and
H&K has a team of five people in the UK dedicated to generating new
local and international business. Comp-anies within the group, such as
internal comms outfit Banner McBride, are increasingly using H&K to work
on their own clients, and vice versa.
But, according to chief executive David McLaren: ’Half of new business
is additional business from existing clients, which is exactly as we
want it. You’re not getting new business because of things you’ve
promised but things you’ve achieved.’
Last year Kellogg, a Hill and Knowlton client in the UK since the early
1970s, extended the agency’s brief right across Europe, the Middle East
and Africa . As did another existing client, Motorola.
The strategy of growing existing clients, and of attracting fewer and
more profitable accounts, seems to be working for H&K. Fee income
increased by 16 per cent to nearly pounds 19 million, despite a one
third drop in retained and project clients.
Another reason for H&K’s continuing success is that it has not ignored
consumer marketing at the expense of the more high brow corporate
H&K estimates that it derives half of its income from consumer PR.
H&K’s reputation for brand building is now standing it in good
Clients in the healthcare or technology sectors, which previously relied
on business-to-business PR, are increasingly seeking to position
themselves as mainstream brands, using PR to reach consumer
But for McLaren, the key to H&K’s success is simply its reputation as a
successful agency, boosted by the fact that it won Consultancy of the
Year at the 1997 PR Week Awards. ’We’ve got sustainable momentum.’
CONSUMER - Life PR
Last September the agency best known for inspiring one of the PR world’s
betes noires, Absolutely Fabulous, shed its Lynne Franks skin and
emerged as Life PR.
Opinion was divided on how much of a risk dumping the best known brand
in PR was, but as chief executive Samantha Royston said at the time:
’Our name change is reflecting the fact that we have grown up.’
The new name wasn’t the only change at the agency - it also restructured
to create three new units. Influencers, to identify influences on
consumers, Futures to pinpoint trends, and Exposure to maximise media
exposure for brands. ’Clients have responded very positively to the
restructuring,’ says managing director Graham Goodkind.
It must have been reassuring for the Life team that two months later, in
November it had a record month which carried through to 1998. In January
Rover Group picked the agency to promote the 40th anniversary of its
classic car, the Mini, and in February Wrangler chose Life to handle its
repositioning as a contemporary brand. The agency also expanded its long
term relationship with Procter and Gamble, to handle the sponsorship of
the England Football Team for the 1998 World Cup.
One of 1997’s highlights was winning a brief from Lotus Development
Corporation to run special projects aimed at business directors and key
company decision makers.
’We are still perceived as a fashion PR company, but that’s just one
area of strength,’ insists Goodkind.
Despite the loss of board director Tanya Hughes at the end of 1996, and
director Jane Boardman who left in January 1997, Goodkind says there is
a core of middle and senior level managers who are ’really doing some
excellent stuff’. ’People believe they are going places,’ he says.
’Clients can sense an energy about the place when they come here.’
The big challenge in the next year is looking at the international
Life has an informal network of affiliated agencies across Europe, but
Goodkind predicts that the agency will be looking at some Life branded
PUBLIC AFFAIRS - Shandwick
The past year has seen the transformation of Shandwick public affairs
from a small, almost indistinct part of its parent agency to a thrusting
public affairs agency on the cutting edge of politics and lobbying. It
now regularly secures prominent positions on pitch-lists for FTSE 100
clients and has ferociously poached new recruits from rival
Since Christmas alone, the agency has won competitive pitches for the
BBC World Service and the BBC Policy Unit, financial services companies
Scottish Widows and Fidelity Investments.
During the same period, the agency has poached four consultants from
rival agencies. This process culminated this month with the appointment
of Chris Savage, a former head of industry policy at the TUC who joins
from competitor agency the Public Policy Unit. Savage will become the
agency’s second director and head up its new regulation and competition
Shandwick public affairs managing director, Colin Byrne, is undoubtedly
the driving force behind the agency’s journey to the forefront of public
affairs. His success owes as much to the election victory last May,
which created an unprecedented opening for well-connected lobbyists -
Byrne worked as Peter Mandelson’s deputy for four years and helped his
former boss out during the election - to gain access to the new
Government, as to Shandwick’s innovative approach to political
’When Shand-wick public affairs was set up in February 1997 it liberated
the potential of public affairs within Shandwick, previously buried
within a financial PR company. Then the run-up to the election put us
politically on the map as the hottest new Labour shop,’ says Byrne.
Eyeing the success of his public affairs offshoot, Shandwick UK CEO Mike
Murphy is keen to cement the relationship between Shandwick UK and the
group holding company International PR.
’The future is a good one for us,’ says Byrne, ’having a profile of our
own but being able to leverage off a huge international PR company. We
could double our growth potential’.
HEALTHCARE - Cohn and Wolfe
Cohn and Wolfe has worked hard to break away from its image as
Burson-Marsteller’s little sister, and has generally been recognised as
a strong creative consumer agency. Therefore it may come as a surprise
to some to know that the healthcare division accounted for 30 per cent
of its income in 1997, and if it continues to grow as expected,
healthcare will become the biggest division in the agency.
In 1996 the healthcare team pulled in fee incomes of pounds 700,000. By
the end of 1997 that figure had risen to pounds 1.2 million, and the
predicted year end fee income for 1998 is already in excess of the 1997
International director of healthcare Martin Ellis says it has been
particularly encouraging that a large part of the growth has been from
new wins from existing clients. ’What we are doing right is delivering
the communications output to support and grow clients’ brands,’ he
Ellis’ role as international director of healthcare for C&W is a recent
promotion, and means he is responsible for managing relationships with
international clients across Europe and Asia Pacific.
With a total of 12 retained clients the healthcare team has also doubled
in 1997, from ten people to 20, recruiting account director Fiona
Stratford, whom the agency snapped up from her post as public affairs
manager at Bristol-Myers Squibb when the in-house department was axed in
June last year.
C&W has a long-term relationship working on ethical and over-the-counter
products for Boehringer Ingelheim, and won the pharmaceutical giant’s
account to promote the phasing out of CFC metered dose inhalers in July
In January C&W won an account from Windsor Healthcare, to work on
Pharmaton, a unique combination of vitamins and ginseng which is said to
A major campaign for the healthcare team has been the ’Fab After Fifty’
health education programme sponsored by Eli Lilly and launched last
October with backing from broadcaster Gloria Hunniford. The campaign has
relied completely on PR, and the freephone number has already received
over 100,000 calls.
The healthcare division was also commended for its ’Tea and Health’
campaign for the Tea Council at the 1997 PR Week awards. C&W produced a
report on the potential value of tea drinking to the nation’s health
which attracted significant coverage.
’Healthcare is an increasingly important part of Cohn and Wolfe’s
network, and we are looking to develop further capabilities across
Europe,’ says Ellis of the agency’s future plans. ’A few years ago we
had to fight very hard for a relatively small percentage of the
pharmaceutical industry’s marketing budget. That percentage is now much
greater because the industry understands the positive effect PR has on
HI-TECH - Icas PR
The year ahead holds strong potential for growth at Icas PR for a number
of reasons. Firstly, the recruitment last August of Alison Starbuck,
formerly head of planning at The Rowland Company as director of consumer
PR, signalled an intention to diversify the agency’s range of
Carl Courtney, managing director of Icas, says: ’We have succeeded in
attracting good quality staff and have built a strong team across the
agency. The next obvious area of growth is IT consumer.’
Starbuck is working with existing corporate clients such as Black Horse
Agencies and Continental Tyres on consumer work but Icas plans to extend
her remit to hi-tech clients.
Icas’ international focus may become particularly important with regard
to hi-tech clients and the move in the sector toward pan-European and
even global accounts.
Courtney’s claims of growth on the international side are borne out by
the recent win of a pan-European account for Hitachi Data Sytems and an
account won last year to work with Santa Cruz, which provides Unix
server systems, across Europe and Middle East, India and Africa.
Icas’ potential for growth has been exhibited in the past few months
with its presence on some heavyweight hi-tech pitch lists including
Nokia Mobile in the UK and training and recruitment firm CRT Group.
It is significant that both these clients required the combination of
corporate and hi-tech capability that Icas can now offer to prospective
clients. Though the agency missed out on these accounts, 1998 could be
the year that promise is converted into results.
Icas’ clear intention is to grow its hi-tech division alongside its
corporate and consumer sections. The hi-tech division has grown
significantly enough to enable it to relocate from Hemel Hempstead to
offices in central London sometime in the next few weeks. The next few
months could be a watershed for the agency.
FINANCIAL - Finsbury
Over the past few years there has been little to challenge the standing
of the top City agencies. However, Finsbury, launched in October 1994 by
former Financial Times political correspondent Roland Rudd, has stirred
up the sector.
The past year has been particularly good for Finsbury. It won new
clients including Carlton Communications, HMV Media Group, Great
Universal Stores, Virgin Express, Laporte, Pilkington, and Capital
Through such impressive client acquisitions Finsbury has quickly entered
the heavyweight agency league. Indeed, half of its 22 retained clients
are FTSE 100 or FTSE 250 companies. Another factor in Finsbury’s favour
is the democratic nature of its structure. While it has three partners
in Rudd, Rupert Younger and James Murgatroyd, its culture isn’t run
around job titles. All 17 of its staff are expected to have in-depth
knowledge of clients they work on. This means, in theory at least, that
whoever a client speaks to at the agency they are reaching similar
levels of expertise.
Finsbury has very fixed ideas on how it operates and the types of client
it most wants to work with. While it would like to maintain a strong
proportion of FTSE 100 and 250 clients it has a preference for clients
who use it as their sole PR agency, encompassing disciplines such as
public affairs in addition to core financial work. It has recently
advised on public affairs for Great Universal Stores following its bid
for Argos, and for Somerfield and Kwik Save on their proposed
The next year is a big one for Finsbury. It is likely to see an increase
in referrals for bid and M&A work but its handling of retained clients
is perhaps more vital if it is to become a long-term rival to the likes
of Brunswick and Financial Dynamics.
REVIEW OF 1997 - Last year’s ones to watch
How reliable are PR Week’s predict-ions? Here is a brief look at how the
agencies we tipped last year fared
- Scope Ketchum was chosen as the full service agency. In 1997 it moved
two places up the ranking. Fee income and staff levels were both up by
around 20 per cent-this is in line with the company’s target.
- Consumer agency Jackie Cooper PR also moved up the ranking, by five
places. It had high profile client wins in 1997 with Cable and Wireless,
L’Oreal and Shellys Shoes.
- Lobbying agency Westminster Strategy also had a strong year,
appointing several new consultants and promoting Mike Lee to deputy
managing director. Client wins included the England and Wales Cricket
Board and the Association of Train Operating Companies.
- August 1997 saw a management buyout of hi-tech choice Profile PR by
former directors Richard Hewitt and Allan McDonald. Big wins this year
included new networking technology company Virtual Access and work for
BT on corporate reputation and regional initiatives.
- The Hogarth Partnership started out with one client when it formed in
1997. A year later it had a list of 22 clients including the Thomson
Travel Group and the Nationwide Building Society - almost double what it
set out to achieve.
- Finally, GCI Healthcare exceeded its hopes of fee income of pounds
500,000. New work included antibiotic Klarisid from Abbott Laboratories,
SmithKline Beecham Clinical Laboratories and it increased work for
existing client Johnson and Johnson.