Public relations industry growth improved significantly to 11% in 2013, cracking the double-digit barrier for the first time since the global recession took hold in 2008.

Growth was again powered by independent PR agencies, which were up 12.5% on 2013, according to the 2014 World Report, which is produced by the Holmes Report in conjunction with ICCO.

The World Report ranks the 250 largest PR firms in the world, revealing a global PR industry that grew 11% in 2013, compared to 8% in 2012 and 2011. This year, the ‘floor’ for the Top 250 was $2.8m, a remarkable jump on the $1.6m reported by the 250th ranked firm in 2012, reflecting the significant increase in the number of agencies around the world that are submitting numbers to the World Report survey.

Once again, publicly-held MNC firms lagged, with those owned by the major holding groups growing by 6% in 2013 to around $5.3bn. That figure still represents a considerable improvement on 2012, when the major public-owned MNC PR firms grew by just 3.3%.

Reported PR growth at the ‘big four’ holding groups — WPP, Omnicom, Interpublic and Publicis Groupe — was more modest, at around 4%. However, when accounting for all of the publicly-owned firms in the Global Rankings, including smaller and specialist agencies, reported growth was a much healthier 11%.

The market share of globally reported revenue—slightly more than $9.7 billion—held by the four giant holding companies, which was around 50 percent three years ago, holds steady at around 45 percent. Their share of the overall global PR industry revenue—now estimated by The Holmes Report at close to $12.5 billion based on the vast number of smaller firms that do not provide revenue figures— remains well under 40 percent.

Also of note is that independent PR firm fee income has almost reached parity with the big four holding groups, with the former reporting $4.5bn compared to the latter’s $4.7bn.

“Public relations agencies in general are beginning to experience the kind of growth we should expect to see in the current environment,” said Holmes Report publisher/CEO Paul Holmes. “The things that PR firms should be good at — authenticity, engagement, credibility, conversation — are all increasingly valuable in the digital age, and while it has taken some firms a few years to adapt and expand their service offerings, these numbers suggest that as a whole the industry is getting it right.

“If we had to point to a single reason for the increasing growth rate of the PR industry around the world, it would be that the firms in our survey are really coming to terms with the challenge of digital and social media,” added Holmes. “Throughout the survey, we see firms increasing their investment in digital build and production and social community management, and competing successfully for so-called ‘non-traditional’ assignments. This appears to be making a real difference to topline growth.

“Another factor is growth in Europe. While continental firms have a lot of concerns about growth and profitability—compared to their American and Asian counterparts—the best of them are growing again.

“But once again we are seeing disappointing growth for many of the industry’s flagship agencies — and particularly those owned by the larger holding companies,” pointed out Holmes. “It’s not entirely clear why this should be. Perhaps they are restricted from expanding their offering out of a concern that will cannibalize sister agencies; perhaps their sheer size makes them less flexible or less nimble in times of rapid change; or perhaps holding company profit targets make it more difficult to make the necessary investments. Whatever the cause it is clear that they are losing market share to midsize and independent firms.”

This year’s global rankings also finds a welcome rebound in revenue per capita for those firms reporting both fee income and headcount to an average of around $155,000, compared to $142,000 last year, and ahead of the $151,000 reported in 2011. Based on its research, the Holmes Report estimates that the global PR agency industry employs more than 80,000 people, up from 75,000 last year.

“New technologies and new frontiers – under the broad banner of digital and social media – mean demand for our services is greater than ever,” added ICCO chief executive Francis Ingham. “With double-digit growth for the first time since the recession, we’ve adapted well precisely because these changes allow us to operate in a manner which shows us in the best possible light.”

“Assignments have morphed, priorities have shifted, and the necessary investments needed to maintain our edge have changed even more, but our flexibility and mutability as an industry means the quality and innovation we offer remains constant, even if the exact work has changed.

“The landscape we operate in has changed– and it’s changed firmly in our favour.”

To view the 2014 World PR Report click here.

So the question is back again, as the Cannes Lions Festival has started: why is it that the PR industry is not “more creative” – if creative at all?

With 60% of PR professionals and 69% of clients believing that “the PR industry lacks big ideas” (according to the Holmes Report’s 2013 Creativity in PR study), it looks like the answer is not very encouraging….

In my humble opinion, there could be some sort of misleading-ness here and a quite unfortunate semantic misunderstanding.

When you hear people telling you that PR professionals are not good at putting forward and driving “big ideas”, what these people actually refer to, and “come from”, is the traditional mindset of advertising: for them, a “big idea” is still what organizes a 30 second commercial, and is eventually carried through collateral material.

No need to say that this vision is a bit outdated.

Let’s look at figures: three years ago, TV commercials still represented 55% of cases. In 2013, digital channels, and particularly social media, jumped to 85% of the cases, “making it by far the most-used channel in the competition” (See “Why Creativity Sells” in Sunday, June-15-2014 Lions Daily News 2014).

I would argue that, in 2014, the only valid criteria when it comes to judging creativity is today’s Engagement environment.

A creative campaign is above all a campaign, which creates a high level of engagement with people and communities.

(The rest is literature, or food for endless debates in ADs’ clubs)

Having been one of the three judges, together with Marnie Kontovraki, Global Heineken Consumer PR Officer, and Michael Frohlich, Managing Director UK and EAME Consumer Marketing Practice for Ogilvy PR, for the inaugural Young PR Lions competition at the Cannes International Festival of Creativity, I lived a vibrant and very insightful experience with 14 teams from 14 countries, with each team comprising two young agency PR professionals, all Millennials born after 1985 – an experience which brutally challenges the current doxa on what creativity is about.

It’s so inspirational to see the hunger and passion with which these young professionals are taking up Citizenship challenges – but then that shouldn’t surprise us: as a global survey MSLGROUP ran last month in 16 countries underlined, Millennials today consider themselves empowered to help businesses and organizations change the world. As our survey reveals it, Millennials really are « Game Changers », with a « fresh » vision on business and Citizenship. (http://blog.mslgroup.com/why-and-how-businesses-need-to-partner-with-millennials-to-better-manage-resilience-relevance-resonance-in-troubled-times/)

My colleagues and I at the jury saw a lot of genuine enthusiasm and strategic clarity in the vision the 14 teams developed, a true maturity from a creative standpoint and a lot of agility in the execution : these Asian, African, European, Latin American Millennials are global, boundless minds and really bold folks – their future is bright, and so is the future of our industry. They definitely don’t see big ideas the good old way, but as powerful 360° weapons which actually transform and reinvent PR the way we used to do it. And no need to say that it’s all digital and social, therefore effective and costless.

Many insights provided by the teams were about Millennials’ commitment to make the world a better place. « Rouse the Millennial Army ! »,  « We can change the world ! », like one of the awarded teams said ! Yes, they love to be part of the change they want to see, and that’s terrific.

Self-expression, storytelling, sharing, crowdfunding – all the key ingredients of what creates succes today in the world of PR (People Relations) are here, and it’s an amazingly refreshing and rewarding lesson. The Millennials are passionate about many things, global issues and causes, and they expect businesses, organisations and PR agencies to tap into their passion.

We should agree that the age of conversation is very different from the age of advertising, with its vertical “big ideas”. It’s now all about big data and smart ideas, which is pretty different, in many ways:

• the ideation and very often the content are largely “people generated”: tools like Spike, Trendsboard or Topsypro help gather “People’s insights” to deliver successful “People’s inside” campaigns
• the tempo of guerilla marketing is real-time, with daily messages if needed, whether a viral video, a social game, an event etc.
• the interaction between brands, agencies, people and communities is permanent, and fruitful

Over the past few years, we thus moved from mass propaganda, with its heavy bombardment of “big” and simplistic top-down messages, to multifaceted engagement strategies. Advertisers are good at bombardment, we – experts in PR, for People Relations – are far better at the latter.

Our PR “agency of the future” model should indeed derive business intelligence and data analytics to build creative content, nurture shareable conversations, and engage people and communities.