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Omnicom, JWT top Adage annual rankings

CHICAGO: Omnicom Group is the top global ad organisation and the J. Walter Thompson unit of the WPP Group is the largest core US agency brand in the Ad Age rankings.

The 59th annual Adage agency report states that the US ad business in the year 2002-3 grew by 0.6 per cent growth in advertising and unbundled media shop revenue to an estimated $10.22 billion. The US led the advance in 2002 as international revenue grew 0.1 per cent to an estimated $8.85 billion, leaving worldwide revenue up 0.4 per cent to $19.07 billion.

The report states that agencies and their unbundled media combines rallied -- mostly at the end of the year -- to cut into their 2.2 per cent decline in 2001, the worst year and only negative reading recorded since the industry dropped 4.4 per cent in 1987.

As might be expected with such low growth from the parents of the agency brands, it was a mixed year for their brands -- the soul of the big ad organizations. Ad Age estimated WPP's Big 3 agency brands, JWT, Ogilvy & Mather Worldwide and Y&R Advertising, at a collective $785.1 million in US ad-only revenue, down 3 per cent. JWT was the nation's largest agency brand at an estimated $393.7 million in revenue, down 1.8 per cent. WPP Group, its total revenue down 0.3 per cent to $5.78 billion, found growth in media entertainment and healthcare.

Leo Burnett Worldwide finished a strong No. 2 among US shops at an estimated $379 million in ad-only revenue, up 8 per cent.

McCann-Erickson Worldwide, ranked No. 3 among agency brands, dropped 10.7 per cent to an estimated $327.1 million in ad-only revenue. Its parent, Interpublic, was buffeted by a spate of bad news in 2002 and 2003 -- accounting irregularities at McCann in Europe and an investigation by the US Securities & Exchange Commission. McCann Erickson president Santosh Desai said that the US ad industry was in the doldrums last year owing to a series of corporate scandals, overall recession (especially in IT) and the looming war-like situation.

In India, however, things were much better, simply because things are still unfolding and new industries and services are coming up. Though there are no hard statistics available, the industry should have grown by 5 percent. But northern head of O&M, Vibha Desai pegged revenue growth of the Indian ad industry between 8-9 per cent. On the contrary, Grey's Khanna said that agency income had fallen.

Foote, Cone & Belding Worldwide plunged to an estimated $193.2 million in ad-only revenue, down 29.5 per cent. FCB, which lost the $1.2 billion Daimler Chrysler account just months before it was bought by Interpublic in June 2001, proceeded to lose Quaker Oats and other business representing annualized billings of about $860 million. FCB also cut employment 28.1 per cent in the 12 months ended in October.

The report also states that the advertising-only component -- the fee income agencies get for creating campaigns (and a number often tied to the sales performance of those efforts) -- dropped 0.1 per cent from 2001 to $8.76 billion in US revenue. Internationally, the ad-only component was down 1.6 per cent with worldwide revenue down 0.8 per cent to $15.79 billion.

The tallies for the advertising and media segments of all marketing communications were the lion's share of the business, which fell 0.6 per cent to an estimated $17.45 billion in US revenue. Marketing communications dropped 3 per cent to an estimated $16.86 billion internationally, to leave worldwide revenue down 1.8 per cent at $34.30 billion.

Integrated marketing remained mired in the slump it entered in 2001, recording an estimated $6.5 billion in US revenue in 2002, down 4.8 per cent. Its international revenue segment plunged 10.1 per cent to an estimated $3.04 billion, placing worldwide revenue at $9.54 billion, down 6.6 per cent.

 

Foreign exchange rate $1 = Rs 47.35.

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