Demand for specialized services such as Internet site design, crisis management and public affairs helped drive global revenues for public relations firms up 34% to $4.6 billion in 2000, according to a just-released report from The Council of Public Relations Firms.
U.S. revenues grew to $3.38 billion in 2000, a 33% increase.
Better yet, the boom in PR reached well beyond the go-go economy of early 2000, when Internet start-ups had plenty of money to throw at marketing services, said Bob Druckenmiller, CEO of Porter Novelli International. His company grew 28% in 2000, and with $208 million in billings ranked No. 7 among the largest firms worldwide.
"The dot-com boom gave the industry an extra boost that made it unrealistically fast-growing, but we’ve been riding a high double-digit growth wave since 1995," Druckenmiller said. That should slow to about 10% growth in 2001, he said.
Several PR sectors were particularly strong in 2000, including technology with 46% growth and financial services with 37% growth, the report said.
So far in 2001, health care is strong, and international billings are providing resiliency against a slower domestic market, Druckenmiller said.
Companies have long talked about strengthening international PR campaigns, but they "seem more willing and eager to invest in multinational coverage" today, Druckenmiller said. That’s been a factor in keeping European PR expenditures healthy this year, he said.
The cost benefit of PR over advertising drove 2000 gains, said Steven Cody, managing partner with PepperCom Inc., New York, which had about $9.2 million in billings last year.
PepperCom’s recent work with Richmond, Va.-based GE Financial Assurance demonstrates the benefit, Cody said. The GE unit, through acquisitions, had become one of the largest financial services companies, but its awareness was near zero at the beginning of 2000, he said.
PepperCom led an effort to create a Financial Literacy Web site, which was financed by GE Financial Assurance. More than 25 content partnerships were created to add depth to the site.
"At long last, public relations has moved up the marketing food chain, and decision-makers are seeing the leading role it should take in strategic positioning and strategy," said Cody, whose firm also represents such companies as Steelcase Inc., Grand Rapids, Mich., and GE Capital Corp., Stamford, Conn.