AGENCY BUSINESS REPORT “e's the fits time in a recession that PR outperformed he says. "For the frst time, we gd acess to Following a year in which client budgets yc. and agency revenues decreased, industry she money thats digital Like our chances were not the talon the dog again. We' heads are cautiously optimistic about the —Andinwhate re ewes boa | outlook for 2010. Erica lacono reports asks SRE epee eta | The positive lasting effec is that mind issue, i more focused on their corporate reputation, ‘tsamazing the difference ayear can make.Last spring, which can carry them through e€amoppic downturns, | there wasa palpable tension inthe air as agency CEOs Polansky says. “We play a lage role in Supporting com tried to predict what type of business outcomes 2009 panies in those areas. would ring Faced with he uncertainties ofreduce client Edelman agers tha the SA stey in particular Tardgets stalled RFPS and holding company-mandited willbe good growth area aes in ers of rep- | Ani thoagh thse neem gape eded Ther ore nga nl evn ‘deed a ough ye Quarter after quarter, holding com= corporate eputacon alga» PR.” panies reported declines in PR and advertising revenues, Liz Kaplow,CEO g hw PR, says there are other agencies went through layoffs, and large AOR assign- ways that the new en@iQmiplent created by the recession en, could ultimately have a postive ef “[Last year] mag the idea of value and getting the Cause for optimism most out of high he notes forward 12 months and it’s vastly different envi- “That disciplin and the change is immediately noticeable in Indeed, as cies ofall sizes. There is again, a num] ments were few and far bet mance come to life, sson for the industry” ronme stry begins to show signs of life nes surface a8 necessary discussions with CEOs optimism in the air. I’sa“cautious” optimism, as everyone for growth seis an emphasis on measurement, will offer asa caveat, but optimism nonetheless. especially i al age Andy Polansky, president of Weber Shandwick, says “Meas 4s exploding in importance,” reports that QI 2010 has already shown a strengthening of the Ketchun Ray Kotcher, a business from last year search and metsurement group is ‘extraordinarily busy “The business pipeline is much improved,” he notes. “We will sce it steadily increase throughout the yea, ‘Marian Salzman, president of Euro RSCG Worldwide PR North America says that in recent months she has noticed decisions being made on previously tabled RFPS, as well a a raumber of new business opportunities. “You're seeing people wake up,” she notes. “You're ‘economy have feet. [t may not have arms and legs, but it has feet Although 2009 was tough for the industry, Richard Edelman, CEO of Edelman, says there were some posi~ tive signs that are continuing in 2010, 2pprmeekus.com/Agency Business ReportMay 2010lar nd her the tes. life “In 2009, it was [about] making sure you could show the ROL on the work you were doing,” he adds. “In 2010, in’ still about measurement, but also about research and forward-looking insights, Paul Taaffe, CEO of Hill & Knowlton, agrees that measurement ist key area on which firms should focus, “Marketing clients are inereasingly demanding the measurement and ROI piece,” he says. "If you're doing whole series of experiments, you must be able to record what's working and not workin “The idea of PR on its own is really gone,” adds Kaplow. "We are accountable to C-suite executives, With that, PR will he expected to measure its contribution really quickly” to identifiable business objectives” The digital picture Digical is radar as they look to invest in both talent and technology Mark Rapes, CEO of CRT/tanaha, says the investment in digital and social media must continue for agencies 10 compete in the new landscape. “The past 18 months have been the wake-up call for agencies,” he explains. “The future will be dictated by how they used the time the past 18 months, As a private company, CRT/tanaka chose to make investments in the social media space, despite the re- other area that continues to be on agencies’ cession, aequiring Livingston Communications, a bow ‘ique social media firm, in April 2009, “The whole idea of investing is important,” Raper say. ‘Though digital is still a competitive space, Taaffe says PR agencies will continue to take an increasing share as the market expands, “The reason PR can be are going more tactical, they need to do that on an ‘opportunistic basis,” he adds. “That's not the speed that most ad agencies can move at, In the world of PR, thats a traditional skill” ‘Though many firms are investing more in the tech nical eapabilities associated with digital, Euro RSC Salzman says PR's real benefit in this space will be from the t “We'll have to prove value in the message creation department,” she adds." We won't win the tech wars.” Kotcher adds that measurement is going to be the key competitive is that if clients tional skill in its wheelhouse. for PR to succeed in the digital arena as well. AGENCY BUSINESS REPORT “As an industry, what we need to be mindful of that when you take alookat the other digital disciplines, they have very sophisticated analyt hat will they can apply,” he notes bea make or break [issue] In an industry where revenue is based on idea generation, it s vital to maintain a high level of talent, expecially For agencies It really does come down to tal- cent, says K potent dri for an agency tches. "That isthe most and differentiation “THE IDEA OF PR ON ITS OWN IS GONE. WE ARE ACCOUNTABLE TO C-SUITE EXECUTIVES” Liz Kaplow, Kaplow PR Hill & Knowlton's Taaffe says that as the PR economy opens up abit, there will be a lot of movement in the . "That's an issue for an e adds, zman says her agency has had to be creative in keeping staff motivaed throughout the downturn. It has turned to the idea of *microbonusing,” offering gift cards worth a couple hundred of dollars fora job well, done. And being part of Havas’ global network, she’s also been able to offer global assignments and travel as incentive for some employees. “People have to feel like they own what they're doing,” she explains Edelman argues that especially when motivating his younger staffers, the new generation has a unique ‘opportunity to take the leading role on the pro- gramming of campaigns, particularly given their expertise in digital “My job was simply to call reporters an placed,” he says. “Their job is literally cob conversations. IP such a better jl volved in