Revenue growth at Ogilvy was around 7 percent in 2010, slightly above the average for multinational agencies, and the first few months of 2011 saw even stronger performance, which is encouraging. New business included a host of social marketing assignments from the Agency for Healthcare Research & Quality, the Centers for Medicare & Medicaid Services, FEMA, the Department of Health & Human Services and CDC (worth more than $80 million over multiple contract years). On the corporate front, the firm has picked up work from All-Clad, BP, Dow, Durex, Grohe, Merck, Pfizer, Ralph Lauren, Smith & Nephew and more.
Ogilvy now has hugely impressive operations in the three key US markets: New York, where the firm has particular strength in consumer and healthcare, but can boast a more balance portfolio of business than ever before; Washington, where the world-class social marketing offer exists alongside a very sold public affairs capability; and California, where there are strong operations in Angeles, Sacramento, San Francisco offering entertainment, technology, public affairs and more. Other US operations include Atlanta, Cambridge, Chicago, and Denver offices.
With 1,000 people across 38 offices in 16 countries, Ogilvy remains by far the dominant player in the Asia-Pacific market, by most measures twice the size of its closest competitors. It is China’s largest public relations firm, and China continues to contribute the largest single slice of Asia revenues (about 30 percent of the whole) for the firm. Australia, where Ogilvy is the largest of the multinationals, is the firm’s second largest market. A major focus over the past 12 months has been expansion in the ASEAN markets, and the firm saw impressive growth in Malaysia, the Philippines and Vietnam, particularly in digital and social media counsel. Ogilvy’s EMEA network does not dazzle in the manner of its operations in North America and Asia-Pacific, because of two potential weaknesses: it is not a major force in the UK, and its continental presence includes a mix of wholly-owned, partially-owned and affiliate offices. But the recent appointment of Stuart Smith as the latest in a long succession of new regional CEOs may help put the firm’s regional operations on a par with those in the rest
of the world.
Ogilvy has one of the largest digital and social media groups among the top tier multinationals, with more than 100 “digital strategists” in its US operations, and specialists in more than 25 markets around the world, working for clients such as American Express, IBM, and Unilever. It is now building on that foundation with the launch of Ogilvy Media Influence, which will help clients develop content across a variety of platforms (of which digital is only a part) to drive stakeholder engagement. The firm also remains a leader in healthcare, moving beyond pharma—where a sparse pipeline is cause for caution—into other areas, and continuing its market and thought leadership in social marketing, with nine papers accepted by the 2nd World Non-Profit & Social Marketing Conference. Corporate work, meanwhile, accounts for almost a quarter of revenues and has been growing thanks to major clients such as LG and LexisNexis and new additions such as BP and American Express. Other new specialties include sustainability practice OgilvyEarth and a new US-based China practice that will help companies traveling in either direction.
One early personnel move—the transfer of Samantha Allen from Sydney to New York to lead the global consumer practice—created some disruption, with several high-level departures from the existing US consumer team as a result of what Graves admits was a culture clash. The firm also added MS&L healthcare veteran Monique da Silva to lead the health practice; Peter Hirsch, former head of the corporate practice at Porter Novelli, to lead a reputation and risk management group; and former Wall Street Journal and ABC News correspondent Betsy Stark. Other significant additions in 2010 included two executive VPs in the public affairs practice: Brendan Day, formerly with Nancy Pelosi’s office, in DC and Matthew Winokur, most recently of Philip Morris in New York; Alyssa Garnick, previously with Ketchum, as EVP of consumer marketing in New York; and Suzanne Lopez, ex-Thornburg Mortgage and Weber Shandwick, as EVP of corporate in Chicago.
Graves talks about cultivating an atmosphere of “divine discontent,” by which he means never being satisfied with either the culture or the client service standards in the agency. He also talks about “building a company of giants,” an idea very much in the tradition of David Ogilvy, and started last year by inviting some select younger employees to the firm’s leadership meeting in Istanbul and asking them to present some new ideas for improving both the work environment and the work. There has been an increased investment in training too, with Ogilvy’s own professional development twist on WPP’s well-regarded Maestro leadership training and a social media “belt” system that includes on-demand training online. The firm has also stepped up its interoffice transfers, with Allen, another Sydney veteran Josh Levin and Dubai’s Nabil Ashour moving to the US and a half-dozen US execs moving to Europe and Asia.
Ogilvy has been working to develop an integrated approach it calls “Fusion,” its response to what it diplomatically (given the advertising heritage of the Ogilvy brand) calls “channel imperialism,” the increased emphasis on relationship building, and the demand for increased accountability. The firm has been developing an approach that starts with a client’s “business ambition” and proceeds through an analysis of the customer experience, a communications blueprint, the creative solution, and culminates in a report card that focuses on business results. Ogilvy has developed a real-time analytics tool called OgilvyLive that combines traditional measures (impressions and share of voice, for example) with a gauge of brand health and business metrics such as sales and revenues. The firm is also venturing into new areas such as neuroscience, harnessing new scientific research to assist in the storytelling process.
One example of the firm’s “fusion” approach is its work for the American Express Members Project. A PR idea drove the integrated campaign, which included social media, traditional public relations, advertising and direct. Another major assignment has seen Ogilvy handling an integrated tourism and economic development program for the government of Mexico, addressing several complex issues. The firm’s work for AHRQ, Advancing Excellence in Health Care (an education initiative focused on health outcomes) puts it in the forefront of the healthcare reform discussion. The firm also won SABRE recognition for its work on the launch of Virgin America’s new services.
In Asia, longtime regional chief executive Chris Graves helped to craft a leadership positioning for Ogilvy that was dependent not only on its size, but also on its intellectual contributions. Ogilvy doesn’t have the same cachet in North America (far less in Europe), where it is somewhat overshadowed by its ad agency parent/namesake and its larger WPP-owned brethren, and Graves has not been able to affect change overnight. But the firm’s digital capabilities are outstanding, and have the potential to set it apart.
Several of the initiatives instigated by Graves since his arrival a little more than a year or so ago have the potential to transform Ogilvy’s position in the US, strengthening the culture and taking it in some new directions. The results so far have been encouraging, particularly in the digital and social media realm, and competitors will continue to underestimate Ogilvy in North America at their peril. To be a truly global force, however, the firm needs to address continued weakness in Europe.