Danny Rogers: Chime could be the catalyst for a recovery

London's Evening Standard wrote an interesting article on Monday, based on the analysis that PR had outperformed the rest of the marketing sector.

Danny Rogers
Danny Rogers

The news hook was Chime Communications' full-year 2009 results last week, which revealed nine per cent growth in like-for-like revenues and a 15 per cent jump in annual profit. The spotlight has also been thrown on the sector after Chime boss Lord Bell described it as the 'best ever year' for the group, which owns Bell Pottinger, Resonate, Good Relations and Harvard PR. Chime was the last of the big PR-owning groups to report its 2009 figures and, unfortunately, its experience was not universally shared.

The world's biggest independent PR group, Edelman, is reporting a flat year. But global PR spend among the big groups dipped, on average, by five per cent in 2009, in stark contrast to five years of enjoying double-digit growth.

In the UK, I expect PR spend to have been cut by less than five per cent overall, thanks to the growing interest in its digital marketing and crisis management potential, but this will not be clear until PRWeek publishes the Top 150 UK Consultancies Report on 22 April.

To take a glass half-full perspective, ad spend looks like it has dipped by significantly more, suggesting that brands have been less willing to cut their PR budgets. Indeed, analysts are reasonably bullish about those firms with heavy PR interests, with the vast majority rated as Outperform or Buy.

Globally, the PR groups that have performed worst - Next Fifteen and Omnicom - are those that are most exposed to the tech PR sector, or in the US geography.

Those that have performed better - Chime, Edelman, Interpublic - are those that are less exposed to financial PR and that have more focus on public affairs and high-level corporate work.

All this chimes (if you will excuse the pun) with the theory that PR consultancy is being taken more seriously at board level and in government, yet still struggles to justify its value in marketing departments, where it is still too often seen as the 'cost-effective' promotional option.

Anecdotally, the first quarter is panning out rather better for most PR groups than for any single quarter in 2009, so we may be seeing a recovery. Developing economies are investing heavily in PR and one is confident that modest growth will revive in the Western economies this year.

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