Over breakfast with the Observer this summer, Havas PR CEO Marian Salzman sat back in her banquette and sighed.
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“I don’t know what business we’re in anymore,” she said.
It wasn’t a cry for help; it sounded more like a victory lap.
More than ever, agencies—and clients—are blurring the lines between public relations, marketing, content creation and branding. It’s a wave we noted last year. But over the last 12 months, the blurred lines have continued transforming the business in ways that are surprising even industry veterans. “Clients aren’t choosing specializations anymore,” said Salzman, whose company now brings in just a third of revenue from conventional media relations. “They’re choosing people.”
Nelson Fernandez, North American chairman of APCO Worldwide and its managing director in New York, agreed. “There’s a convergence between PR, advertising and digital. It’s channel-agnostic,” he said. “It’s all about who understands how to get inside people’s heads. We’re the ones who can read trends in how people are connecting, behaving and communicating. And if we keep doing that, I think we’ll continue to be a very important—perhaps the most important—part of the marketing mix.”
Agencies are even moving away from describing themselves as PR firms. “We are content providers and distributors. Media relations no longer defines what we do,” said Florence Quinn, founder of Quinn, the travel and lifestyle powerhouse. “We create strong ideas that resonate with people and the media. This is incredibly exciting because there are a gajillion ways to produce content and even more ways to distribute it. The line between earned and paid media has been crossed forever; there is no going back.”
At firms like Sunshine Sachs, whose clients range from A-list celebs (Lin-Manuel Miranda to blue-chip nonprofits (Human Rights Campaign) to corporations like Facebook, the transformation’s been even more radical. “We’ve got 35 people who don’t do traditional communications,” said Shawn Sachs, the firm’s CEO. “That’s pretty significant for a firm with about 160 people. We hired our second art director this year. If you’d said that 10 years ago, people would have thought you were crazy.”
In the broadest sense, he said, “we’re a communications company. But we’re also an advertising company, a marketing company, a digital company, an events company, an idea company. We’re a lot of things.”
The upheaval in media has also transformed what clients need, said Cindi Berger, chairman and CEO of entertainment and marketing giant PMK*BNC—and agencies like hers have benefited.
“Sharing and providing content—that’s the goal,” Berger said. “Our ability is to really craft a narrative for a specific client, pursue media for that client, work with influencers and generate partnerships, whether they’re brand related or fan-related. Fans are partners too. Our job is to make sure fans download the book, buy the record or use a provider we’re working with.”
But don’t give up on traditional PR just yet, said Andy Polansky, CEO of Weber Shandwick, where more than two-thirds of growth is coming from digital, social and content-marketing arm Mediaco. “We call ourselves an engagement firm,” he said. “But in my view, it’s a mistake to decide you’re no longer in the public relations business. If you think about changes in the media world, and the impact earned media still has, PR continues to be absolutely critical. Sure, we’ve evolved as a firm. But we’re proud of our heritage.”
And while creative destruction hasn’t been great for media, it’s keeping PR mavens buoyantly optimistic (and well compensated—according to The Holmes Report, the global PR industry grossed $14.2 billion in 2015).
“We’re in the message business,” Sachs said. “And our business is as exciting and interesting as it’s ever been.”
SEE ALSO: New York’s Top Specialty PR Agencies
A word about the PR Power 50 list:
Rather than rely on revenue or size as criteria for our rankings, the Observer considers subjective factors. What kind of year did a firm have? Did it hire superstars? Has it won covetable clients? Does it feel like the agency’s got momentum and juice? Did it avoid serious screw-ups—or at least keep its screw-ups out of view? And, of course, did its people return our calls and emails?
Every one of the 50 firms we’ve chosen pushed those buttons, but our agency of the year for 2016 boasted an especially stellar performance. We’re eager to hear what you think about where the industry’s been this year—and where it’s going in 2017 and beyond.