With Omnicom’s public relations operations—of which Fleishman-Hillard accounts for almost half—significantly underperforming the market in recent years, it’s pretty clear that FH is no longer the global number one even if it does retain a market leadership position in North America. Omnicom’s PR revenues were down 15 percent in 2009, but bounced back to 5 percent growth in 2010—both numbers considerably lower than the market as a whole. The firm’s management insists that FH outperformed its parent company as a whole, with $100 million of new business from new clients including General Motors and GLG Life Tech Corp as well as increased spending from existing clients such as AT&T, Boy Scouts of America and Procter & Gamble.
Fleishman-Hillard has the largest geographic footprint in North America, with 25 offices in the US (including markets otherwise untouched by the big multinationals, like Charlotte, Indianapolis, Little Rock and Raleigh) and five more in Canada. The firm has demonstrated its ability to grow big business in smaller markets—its St Louis headquarters is the engine that drives the entire firm, and it has a long-established Kansas City operation that’s a leader in food marketing. The firm is also a formidable force in all of the major US markets, of course. Its Washington operations—which include several brands, including GMMB and Vox Global—are particularly strong, but FH is also among the market leaders in New York, Chicago, Los Angeles and San Francisco.
Fleishman’s European business—which earned its second Consultancy of the Year award in 2010—has continued to grow. The UK operations are its largest, with about 125 people and strength across all major practice areas, but FH also has an increasingly formidable presence in the region’s two other key markets: in Germany, it has consolidated its Frankfurt, Berlin and Munich offices; while in Brussels there are close to 50 under the leadership of Caroline Wunnerlich. FH is also among the market leaders in some secondary markets, including Ireland and South Africa. In the Asia-Pacific region, no other firm returned to growth as quickly or an impressively as Fleishman, which saw regional revenues rise by about 30 percent in 2010, fuelled by the addition of two new offices (Jakarta and Bangalore) and a new practice (adding the Vox Global Public Affairs brand to its Tokyo office). The firm now has a formidable footprint in China, with 100 people across its three offices; continues to be the leader among western firms in Japan and has been expanding its presence in Australia, while the Tokyo, Seoul and Singapore offices in particular recorded an outstanding year in 2010.
Fleishman-Hillard has a well-balanced portfolio of business, shared across five major practice areas. The public affairs group is the firm’s largest, accounting for about 25 percent of revenues, spread across its branded Washington, DC, office and several specialist subsidiaries. The corporate practice contributes slightly more than 20 percent of revenues, which will come as no surprise given the firm’s historic strength in the corporate and business-to-business realm, but the healthcare practice comes in just behind it. The remainder of the business comes from the marketing communications practice and healthcare and technology sectors. The firm’s digital capabilities are impressive, although they don’t get the industry recognition afforded to some of its major competitors.
While stability has traditionally been the hallmark of Fleishman-Hillard, chief executive Dave Senay is not reluctant to shake things up when change is needed, and four of the firm’s largest North American offices—New York, Chicago, San Francisco and Toronto—have new leadership. FH has lost some significant talent in the past 18 months, including market leaders such as Curt Kundred (former president of the west and east regions) in California, Doug Bell in Ohio, and Mia Pearson-Wedgbury in Canada. But it has also recruited some impressive names, including former McDonald’s Canada communications exec John Blyth; Grey advertising veteran Steve Hardwick, who now runs the New York office; ex-Cohn & Wolfe GM Stephanie Marchesi as managing director of integrated marketing; automotive PR expert Jason Vines as senior VP in St Louis; and Maxine Winer from Edelman, as GM in Chicago.
Fleishman-Hillard declined to participate in our Best Agencies to Work For research in 2011, although the firm has consistently been among the top performers in the large agency category in previous years. And internal research ranks FH among the best firms in Omnicom’s diversified agency services groups when it comes to employee engagement. Another increasingly important aspect of Fleishman’s culture is its ability to play well with others, particularly within the Omnicom family, and last year saw the firm working alongside sister agencies such as TBWA (promoting the World Innovation Summit for Education and providing integrated marketing counsel to Gatorade), BBDO (on the Hyatt Hotels business and AT&T’s global marketing), and other Omnciom PR units on the global Philips business.
While Fleishman-Hillard’s Communications Consulting Worldwide unit has established itself as a leader in using data and analytics in public relations planning and evaluation—securing mainstream media as well as trade coverage for its innovative approach—FH itself has not produced the volume of research that has helped rivals such as Burson, Edelman and Weber Shandwick launch and lead industry-wide conversations. But over the past couple of years the firm has launched its Digital Influence Index, seeking to understand the impact of the Internet on purchasing decisions and in 2010 it conducted in-depth research looking at “Women, Power and Money” and the role of women as “household CFOs.” In addition, chief executive Dave Senay has been a participant in major conferences, including the World Economic Forum in Davos.
Fleishman-Hillard’s major public relations awards success of the year—it won two PR Week awards—went to its work on behalf of the Department of Defense, supporting the “That Guy” alcohol abuse education program. But there were plenty of other notable campaigns, including work on the launch of three of Time magazine’s top four new gadgets of 2010 (for AT&T, service provider for the iPhone; Barnes & Noble’s Nook; and Motorola’s Droid). The firm also worked on a global branding campaign for Brazil, with a focus on economic and climate change issues, and helped Tourism Australia secure a high-profile hit on The Oprah Winfrey Show.
By now it’s a familiar complaint—and one senior management is apparently tired of hearing—but Fleishman doesn’t generate nearly as much sizzle as some of its competitors, despite the generally strong quality of the firm’s steak. Its digital capabilities are a case in point—an in-person review of the firm’s work suggests that it’s as strong as any of its competitors, but FH doesn’t have anything like the buzz that attaches to perceived leaders such as Edelman or Ogilvy.
Fleishman-Hillard’s international growth has been impressive in recent years (it won our Consultancy of the Year awards in both EMEA and Asia last year) but while the domestic operations continue to hold a dominant market position—and to generate the lion’s share of the firm’s profits—there’s a feeling that FH is no longer the undisputed leader it was a decade ago. The firm’s “digital, integrated, global” mantra does little to differentiate it from other similarly-focused competitors and its culture is no longer quite so clearly superior to its rivals.