A lot of people would tell you that it matters not a jot who is the biggest agency in any country, ranked by media billings. Creative agencies don’t spend the media money and, in the YouTube age, fees don’t necessarily relate to billings either. Income therefore is a more accurate measure.
Campaign has just produced its top agency list and attendant ‘school reports’ and its top five agencies by Nielsen billings are AMV/BBDO (again) with £377m, McCann Erickson (£309m), RKCR/Y&R (£264m), Leo Burnett (£234m) and M&C Saatchi (£230m). One of the biggest risers in the table is sixth-placed Bartle Bogle Hegarty, up from £170m billings in 2010 to £215m in 2011.
And all these agencies have been invited to submit their income figures, which some of them have. Here they are: AMV/BBDO £49.3m (2010 figures when billings were slightly higher), McCann, owned by Interpublic and WPP’s RKCR/Y&R declined, Leo Burnett (£45m in 2010), M&C (£42.2m/2010) and BBH (£46.7m last year). Interestingly DDB London (Omnicom like AMV) declared a 2010 income of £55.6m on 2010 billings of just £108m (£181m in 2011), a pretty extraordinary 50 per cent profit margin. No wonder it finds it hard to win new business (maybe it doesn’t need it). A pretty extraordinary billings rise too, although Virgin Media has since departed to BBH.
But billings do tell us which agency has big-spending clients. So can anyone catch AMV, which has been top of the tree for ages now? For as long as Campaign has been doing this (billings used to be supplied, unaudited, by agencies which led to lots of fibbing) there have been three big winners – JWT in the Sixties and Seventies, Saatchi & Saatchi in the days of the brothers before the great split in the early Nineties and then AMV, initially as an independent agency, latterly as part of the BBDO network. McCann has been top a couple of times I think.
So can anyone catch AMV? BBH, 49 per cent owned by Publicis Groupe, just might be able to. BBH recovered strongly last year after a rather fallow period and the latter part of 2011 saw a flood of new business including Dulux, Virgin Media, Sol, Waitrose and the Guardian (not likely to trouble the scorers in billings terms but great publicity). British Airways has returned to the airwaves too (although maybe not for long, you get the feeling that boss Willie Walsh doesn’t really like this advertising lark).
In 2011 Waitrose spent a few quid on Christmas advertising but Dulux (which has a new campaign breaking next week) and Virgin Media have yet to uncork their wallets. So, if BBH’s other clients keep it up, that should put the agency quite close to AMV.
But that’s the key issue: clients don’t necessarily spend on main media year-in, year-out these days, taking a year off now and then and/or letting digital take the strain.
Lurking just outside Campaign’s top 20 is an outfit called, rather mysteriously, Gratterpalm. Based in Leeds in the north of England, Gratterpalm describes itself as a ‘retail marketing services specialist’ so its offer presumably includes more than ads. But there were £120.68m of those in 2011 and, although Gratterpalm held station at 21, it billed only a few million less than the mighty TBWA and Saatchi & Saatchi, just ahead of it in the table.
Which shows,among other things, the importance of retail (Gratterpalm handles some or all of Asda, DFS (furniture) and Greggs (bakers). John-Lewis-owned Waitrose was probably BBH’s biggest win of 2011 and if Waitrose keeps spending heavily the top end of this table could become interesting (although we’ll have to wait until March 2013 to find out exactly how interesting).
The Campaign/Nielsen table is available in this week’s print version of Campaign, at a (relatively) bargainous £6.95p. Well magazines are bewilderingly expensive these days.