The tech PR market took a small hit during the pandemic year, but there were plenty of bright spots in the midst of a taxing situation.
While the top 10 firms overall saw net fees from tech clients drop by 4.9 percent in 2020, six of those firms—Highwire PR (#4) , Walker Sands (#6), PAN Communications (#7), ICR (#8), The Hoffman Agency (#9) and Inkhouse (#10)—actually billed more last year than they did in 2019. The top 50 firms were down 5.3 percent, from $620 million to $586.9 million.
While Edelman remained in the top spot, it experienced an 8.7 percent slide from $274.7 million in tech-related net fees to $250.6 million. Number-two Hotwire was also down a bit, dropping from $42.2 million to $41.7 million.
Meeting the Challenges
Hotwire CEO, North America Heather Kernahan said that despite the hurdles of the past year, the agency “maintained a really strong business.”
It remained in the number-two spot in the tech rankings, and Kernahan said “the business performance underscores our position as trusted, strategic consultants for our clients and our ability to create momentum in challenging circumstances.”
She adds that the accelerated pace demanded by the past year’s many changes has both a downside and an upside.
The speed of technological development has led to a growth in opportunities for communicators, she notes. “Companies have had to deliver at an incredible pace and I think we’ll continue to see the need for enterprise tech to continue to deliver in new ways, faster.”
But she also warns of tech burnout. “There is nothing like the ‘always-on’ nature and pace of tech communications and PR and with the lines between work and home blurring even more this past year, we have had to be hyper-aware of making sure our teams take the time to unplug.”
Client needs have changed as well, Kernahan says, with the uncertainty of the current environment meaning that for many clients “throwing out the playbook and navigating how to adjust plans” was a necessity.
She also says that the changes brought about by the work-from-home environment are here to stay. “Many of the tools and technologies that are now core components of the enterprise technology stacks that make WFH possible will remain critical.”
One of the biggest challenges firms face in the coming year, she says, is making sure that the lessons learned from the pandemic remain in place. “As the world creates a new normal, communicators can’t lose sight of the guidelines we put in place this past year that helped determine what messages were most important, most helpful and most authentic.”
Making an Impact
Highwire PR brought on 15 people in 2020, and grew by 24 percent. According to Highwire principal Emily Borders, that’s because the agency “outlined a strategy at the beginning of the pandemic that saw us through the entire year.”
That strategy was based on helping clients and employees navigate the disruption caused by the pandemic. “With swift action,” Borders said, “we were able to create an environment where our teams and work had a real impact.”
There was an increased demand for integrated digital offerings, virtual event support and experiential marketing in the past year, according to Borders. She also says that Highwire has “noticed more conversation around data-driven PR and the use of data-driven insights.”
Highwire’s beefed-up digital team allowed the agency to expand its digital services “beyond owned social media program into sophisticated amplification across multiple channels.”
Borders sees “the intersection of health and technology” as an area primed for major growth over the next year. That doesn’t mean just COVID-related efforts, either. “We’re also seeing the same level of transformation across treatment for chronic conditions, heart health and mental health/wellness.”
Cybersecurity and the enterprise technology space should also experience major growth, she says.
For success in 2021 and beyond, Borders says that “creating a thoughtful approach to building culture and positive team dynamics will be critical.”
She also stresses the importance of creating “full top-to-bottom strategic communications programs,” including brand building, sales enablement, lead generation and internal employee engagement. “Demonstrating a distributed wealth of expertise,” she says, “will put agencies in the best position to succeed.”
Getting Closer to Clients
Moving up one spot on the list, Walker Sands had “a great 2020,” according to CEO Mike Santoro. Fees from tech clients rose from $18.8 million to $20.2 million, a jump of 7.5 percent.
In addition to a team that has been “working their butts off,” that performance was driven by “our strong reputation for B2B marketing and a world-class sales and marketing team.”
As far as the tech sector is concerned, Santoro zeroes in on two major trends: SPACs and a potential antitrust backlash against Big Tech. “Tech companies have been the big beneficiaries” of SPACs, he says, and any meaningful activity on the antitrust front “could unleash new VC investment as money follows new opportunities.”
Some other areas of potential growth are “no-code and low-code platforms for the enterprise, asynchronous learning solutions for K-12 education, and telehealth technology.”
Walker Sands’ clients exhibited increased interest in branding, web design and development, and marketing strategy work, Santoro says. “In Q2 and Q3,” he notes, “many clients ramped down customer acquisition spend and took a fresh look at brand-oriented projects they had been putting off.”
One positive effect of the pandemic, he says, is that “we’ve been able to get closer and much more personal with many of our clients… That personal connection has led to more candid conversations and ultimately stronger relationships.”
While Santoro says that Walker Sands has “learned to pitch new business and handle large quarterly business reviews remotely,” he still sees some role for in-person professional interaction in the new normal. “But given the time saved and the nature of distributed teams, I think you’ll continue to see some of the big in-person moments continue in a virtual environment.”
A Focus on Flexibility
“There’s no doubt this year challenged us in all aspects,” said PAN Communications executive vice president Mark Nardone, “but we saw a roughly five percent increase in revenue.”
PAN saw its tech-related fees rise from $19.3 million in 2019 to $20 million last year, an increase that Nardone attributes to “solid performance around organic growth and a very healthy new business pipeline.”
Another strong point is the resiliency and flexibility of the tech sector in general, allowing tech companies “to be able to adapt to the potential crisis that arose during the pandemic.”
Nardone also says that in the past year “companies relied upon agencies and corporate communications teams to help them step into a bigger role in their industries, and some cases, in society.”
Sectors that had a good year include remote work, cybersecurity, automation, healthcare, vertical tech, fintech, and logistics and supply chain. Areas facing a bit of pushback included B2B technology that sold into travel-hospitality, small businesses and early-stage brands.
PAN executive vice president, client relations Darlene Doyle said that the agency “built more trust equity in 2020 than ever before.” She attributes that rise to the agency’s collaboration with clients on quickly refocusing programs to meet changing needs, coming up with new creative ideas to fill program gaps and being flexible on budgets.
Nardone is optimistic about what the coming year will bring. He says that “HRtech and enterprise tech are a driving sector that is becoming increasingly important as remote work remains relevant.” He also sees major opportunities in such sectors as fintech, automation, cybersecurity and healthcare.
But he cautions against growing too rapidly and “losing focus on what truly differentiates your firm.” To keep that focus, he says that firms should be “people-first” operations, prioritizing “great talent, amazing training and development, and a culture that emphasizes work/life balance.”
Clients are Asking for More
With $9 million in tech-related fees in 2020, Clarity enters the O’Dwyer’s tech listings at #14.
Clarity founder and CEO Sami McCabe said that his agency achieved growth across several fronts last year. “We increased revenues by 47 percent, staff numbers by 42 percent and promoted 19 people globally.” The firm also established a partner network across 30 countries and acquired a wholly owned office in Amsterdam.
Clients are asking more from agencies in the wake of 2020’s events, according to McCabe. “When the world shut down, clients were looking for a team that could adapt to their needs in real time,” he said, “as well as one that could service their business in a world that had suddenly become borderless.”
To succeed with tech clients, he says, firms need to look at the sector “not just as an industry vertical but as a mindset for businesses looking to drive positive change.”
Because of that, the definition of a tech client has extended outside the sector’s previous boundaries. “We are seeing more and more opportunities to partner with companies outside of the traditional ‘tech’ industry, but companies that have established and grown themselves with the mentality of the new tech business model.”
The necessity of redefinition applies to tech-related agencies as well as to tech companies, McCabe says. “Firms need to reimagine the mold of what a ‘tech communications agency’ is, and can offer to clients.”
Demonstrating the Importance of PR
Although Bospar principal and co-founder Curtis Sparrer says that the early days of the pandemic caused the loss of nearly a quarter of the firm’s business, it came back in a big way over the course of 2020, with an 8.8 percent jump in tech-related fees (from $5.7 million to $6.2 million), moving up one spot on the O’Dwyer’s tech rankings to #18.
Bospar fought the “knee-jerk reaction” from many companies to cut PR spending during the COVID-19 crisis by providing clients with research and talking points showing the need for PR during economic downturns. “The research was compelling,” Sparrer said, “showing a near majority of Americans can trace their purchase decisions to PR.”
Sparrer says that “anything the cloud touched” had a good 2020, while “anything that related to travel, hospitality and being around people” took a hit.
One major trend Sparrer saw in the past year: “More executives were communicating on video than ever before—either on Zoom or in webinars.” In response to that trend, the agency retooled its broadcast media training service and led a webinar for the San Francisco PRSA chapter on the best ways to make webcasting work for executives.
He also noted that the virtual landscape has sped up the pace of business. “Before COVID, you would meet in person for brainstorms, and then finally with the clients for a presentation,” Sparrer said. “Now we just show up at our computer.”
On the horizon for the coming year, Sparrer sees a big comeback for the travel and hospitality clients that were so strongly impacted by the pandemic.
And power of the cloud will remain front and center. “The cloud is the infrastructure of the future,” he says. “And infrastructure matters.”