Holmes Report 17 Oct 2017 // 2:26PM GMT
NEW YORK — Omnicom Group, which owns numerous PR firms including FleishmanHillard, Ketchum and Porter Novelli, has reported that its PR revenues declined 0.4% on an organic basis during Q3 of 2017.
The result marks the second consecutive quarter of PR revenue decline, after a drop of 0.3% during Q2, which prompted Omnicom Group CEO John Wren to say that leadership of the group's PR firms is being adjusted.
The group's PR revenue reached $345.9m during the quarter, down 0.5% on a reported basis. For the year to date, Omnicom's PR firms have grown by just 0.3% on an organic basis, after returning to growth in 2016.
On an organic basis, PR lagged all of the group's other units — advertising (+4.7%), specialty (+5.1%) and CRM (+0.1%). Overall, the group grew global revenue by 2.8% on an organic basis for the quarter.
While discussing the results on the group's earnings call, Omnicom CEO John Wren said that he expects the PR unit to "bounce back", but that management changes are still required at one of its agencies. Wren did not elaborate further and the group did not respond to further request for comment.
"People are changing the product to meet the market," said Wren. "And there's probably one unit in particular where there still has to be more management changes which haven't occurred yet."
The comments come after Wren said that leadership of the group's PR firms is being adjusted following Q2 results. He noted at the time that Omnicom PR firms have suffered from "too many farmers in a place" — referring to executives that manage business rather than winning it.
While there have been no material changes in senior leadership at Omnicom's major PR firms — FleishmanHillard, Ketchum and Porter Novelli — it is understood that several agencies, in common with publicly-held firms in general, are restructuring resources and shedding staff in response to this year's downturn.
Despite returning to growth in 2016, Omnicom's PR firms — which includeFleishmanHillard, Ketchum and Porter-Novelli — has struggled to record sustained growth in recent years, helping to usher in the appointment of Karen van Bergen as CEO of the newly-constituted Omnicom PR Group almost 18 months ago.