Twenty years ago I was working at Burson-Marsteller London which was then a 240 person office with an in-house creative agency, a research arm and access to heavyweight brand data. It was the only agency with a properly defined practice structure, modern offerings like employee engagement, real staff training, the only fully thought-through PR methodology of its day with truly global clients running truly global programming and which even then employed planners and creatives. It was the world’s biggest PR firm and the only one most CEOs had heard of and it had Harold Burson, the icon of the industry. It was ahead of its time and it defined public relations.
So I was shocked to hear the news today of its merger with baby sibling WPP agency Cohn & Wolfe. But then years of low growth/no growth in WPP makes even the biggest vulnerable, so perhaps I should not have been.
It’s a big roll-of-the dice by WPP. If it goes well, they inject Cohn & Wolfe’s much more successful and dynamic management team into the be-calmed super-tanker of Burson. If even a third of that Cohn & Wolfe growth rate of 12% can be transferred to Burson, then it will have been worth it. And despite the claims that no jobs will be lost, the opportunity to eradicate duplications in the back office functions and some of the client facing staff, might see more of that extra revenue passing through to bottom line.
But the risks are huge and having managed agency integrations (both successful and spectacularly unsuccessful) I know how hard they can be. There has to be a rationale. Why is this better for clients? ‘Bigger’ and ‘access to more services’ can be hard to actually deliver across brand and P&L boundaries and through teams that don’t know each other and will tend, in a vacuum, to protect their own turf.
Why is it better for staff? ‘Better career opportunities, more chances to travel and better training’ are the usual claims, but again, they are really hard to deliver and very expensive. And no WPP outfit will put up for long having two global heads of health or tech or two heads of region or HR and so just when you need leaders to drive this for you, you could be saying ‘good-bye’ to some of them.
And managing all of that at scale; creating a combined vision for the new firm; setting out a fair and transparent pathway to that vision and then communicating to all stakeholders along the way is a massive job for Donna Imperato and the leadership team (whoever ends up on it).
And don’t think Weber, Edelman, Golin and Ketchum are not right now calling talent and stirring up clients.
But the biggest risk is that everyone in the combined firm ends up looking inward and not focusing on clients and the market. Burson was past it’s peak when I was there 20 years ago and was already being out-thought and out-fought by competitors, so I know it has a habit of introspection and bureaucracy. The ‘Cohn-heads’ will need to cure that fast.
As an ex ‘Burson-person’ I wish them well and I hope they succeed.
*Apologies for the ‘About’ part of this blog which still has me as at Edelman. I’m not. WordPress skills need brushing up.
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David:
My memories of BM in late 1990s is more in tune with your penultimate paragraph than your first. But, as you rightly say, they lost their way.
I was senior at C&W then. One of our mantras was ‘not to be BM’ i.e. inward looking, overly inflated sense of their value to clients, poor customer service ethic. My guess though is that this is really a bog standard story of a once powerful business simply slowly declining losing out in the face of improved competition and a shrinking in the value of its market – PR.
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Great post, David. And bang on.
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The very amazing “heavy brand data base” you mentioned in your to-the-point post, David, defined the reasons for the decline of B-M, once the best brand in the industry. Y&R’s Brand Asset Valuator defines relevant differentiation as the critical factors for sustained success and growth of any brand. Burson-Marsteller lost its way at the point when it stopped focusing on its two differentiators: top notch clients and top notch talent, and switched attention to shares, profit performance, “fungible people management” and more goodies of a business that forgot how to be creative,innovative and edgy.
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