The table toppers
This year Tangible Group tops the list as the most efficient marketing business, but there are also a number of other success stories. (See the magazine for the full financial figures submitted by each of the Top 100 agencies.)
It would be fair to say that The Drum’s Top 100 Agency list published for the first time almost 12 months ago threw the biggest cat among the biggest pile of proverbial pigeons possible.
There were the usual gripes. The main one being that the Top 100 table was trying to compare apples and oranges – how can you compare a design agency to an integrated agency or a media specialist to an online marketing consultancy, they asked. But in today’s media and marketing community what exactly is an apple or an orange? Indeed, are there only apples and oranges left for us to compare? Is it not in this era of increasing integration and convergence that the vast majority of the apples around are also trying to be oranges as well and most oranges are also trying to persuade clients that they can be apples too...well some of the time. And what of the bananas, the pears and the plums out there in media and marketing land? Where do they fit into the great melting pot that is the modern marketing industry?
Before we disappear into a huge fruitbowl of metaphors and similes, it is important to recognise the primary purpose for a list like the Top 100 and that is to highlight the marketing businesses, regardless of their specific discipline, which are doing well with regards to handling good business, bringing in the money, satisfying clients time and again, and are ultimately growing and creating more jobs and more security for an industry which is always under fire.
It is for these reasons alone that The Drum is once again delighted to feature our Top 100 Agency list and to toast those agencies featuring in it who are clearly doing very well, thank you very much.
As with the first Top 100 table, this is much more than just a way to massage turnover egos, the primary criteria at the heart of this poll is quality and efficiency of how the business is actually run. After all it’s no good turning over £100m if you’re spending £100,000,001 during the course of the year is it?
The first pre-cursor for entry in to the Top 100 comes courtesy of the Recommended Agency Register, which every year polls more than 2,000 client companies to find out which are the best agencies in the land for quality of client service, quality of creative and overall value for money. Only agencies which pass a particular quality threshold make it into the Recommended Agency Register and it is only these agencies that are then invited to appear in The Drum Top 100 as they have clearly met a very high quality threshold.
It is these agencies also that can benefit from the Recommended Agency Register’s marketing intermediary service, which sees clients matched up with the most appropriate agencies for them when reviewing their marketing rosters.
This year saw more than 250 agencies invited to take part in this review and who submitted turnover, profit and employee figures. The ranking process employed ensured that only the 100 most efficiently run businesses make it into our final list, which is featured on the following pages.
That process saw us rank agencies in five dimensions:
• Turnover • Percentage turnover growth
• Gross profit • Gross growth profit
• Turnover per employee
In each of these criteria every agency was given a ranking according to where they finished in that particular criteria, with a ranking of 1 being the best and 150 being towards the bottom of the rankings. From all of these rankings an average rank was assigned to each agency and that is where they finished on the final list – the top 100 making it into this feature.
This system works because as well as brute size, we are also measuring areas such as growth, gross profit and turnover per employee, which are key performance indicators in terms of profitability and efficiency.
And as you can see from the table Tangible, the group consisting of The Leith Agency, Navigator, Blond PR et al stormed to the top of the table as the most efficient marketing services company once all the number work had been done.
Tangible, which operates across the broad spectrum of marketing services through a range of different branded agencies, reported a combined turnover of £49.3m compared to a turnover in the previous financial year of £27.1m, with a turnover per head of their 327 staff comes in at £150,835. Gross profit for the most recent financial year comes in at £19.8m, an increase of some £10m on the previous year - a sign that their group’s acquisitions have been well managed, well timed and have added to the bottom line from day one. In fact Tangible are only pipped to top spot for gross profit by McCann Erickson Manchester, which ranked as our most profitable agency.
Once again internet company Bigmouthmedia has ranked highly in the table, seeing its turnover grow from £27m last year to £39m this year with profit up by 25% to £10m, again an indication that the acquisition by Global Media last year has been a success financially from the moment Steve Leech, Heather Luscombe and Lynsey Menzies got things sorted out.
Another impressive rise up the table is BD, the marketing group with offices in Glasgow and London, which has seen some changes on the management front during the last 12 months. The business has seen turnover increase from £15.4m to £21.8m, which has bolstered profits at the agency to £13.3m from £8.9m last year.
The top media planning and buying specialist on our list is MediaVest Manchester, which has seen turnover grow by some £25 to £220.9m in the last 12 months. Gross profit at the agency has grown by £4m to £17.8m.
Also retaining its top five spot this year is The Direct Marketing Group (TDMG), which acquired Leeds-based direct marketing giant JDA last year. TDMG has bolstered its turnover by £5m to £21.4m this year, recording profits of £10m as opposed to £7.2m the year before.
The North West
MediaVest Manchester tops the North West region this year, beating McCann Erickson Manchester, which ranked number one in the region last year. Another media agency, Mediacom North ranked second in the region after a year which saw them pick up clients such as Home Form (£15), The Skills Centre (£5m) and Cruise 118 (£5m) among others. The top creative business in the North West was B2B specialist Gyro International, which is part of a network with offices around the world, and is headed up by Danny Turnbull in Manchester and former McCann Erickson creative Warren Gaskell as creative director. Amaze plc, the relatively new marketimng group formed through the merger of Connectpoint, Amaze and Pavillion is the next creative success story in the region covering advertising, digital and PR.
McCann Erickson Manchester has taken a tumble down the table this year due to a fall in turnover of £5m. However, it’s not all bad news because the business has increased its profit to £23m from £21m last year.
The top digital agency was, perhaps not surprisingly, Code Computerlove in Manchester.
TDMG is flying the flag this year for Yorkshire finishing as the highest ranking Yorkshire marketing business. That said Brilliant Media was only one place behind, though Brilliant does also have an office in the North West, which will have added to its turnover and profit this year. The creative crown for Yorkshire this year however rests in Sheffield with Dig For Fire, which works for clients such as The Open University, Warburtons and Express by Holiday Inn among others. New entrants to the table this year are Kanjo in Leeds, who also rank highly, though this is perhaps due to the fact that they have no figures from last year so the agency’s turnover and profit growth ranks are artificially inflated.
The Midlands & South West
The top Midlands and South West agency this year is design group 23Red, which has offices in Nottingham, Bristol and London and working for clients such as Bacardi, Martini and Vodaphone. Mason Zimbler in Bristol, Reading and London come close behind 23Red and again close behind them is Brey Leino, the 312-strong advertising powerhouse situated in picturesque Devon and with offices also in Bristol, Scotland and Chester.
What is interesting to note is that although the Scottish marketing industry is a fraction of the size of the UK marketing landscape and is widely expected to continue to shrink in the coming years, the top three businesses on the overall table all have their origins in Scotland. The Tangible Group in number one spot is primarily made up of Scottish businesses such as The Leith Agency, Navigator and Stripe PR, Bigmouthmedia was founded in Edinburgh and despite its acquisition by German company Global Media remains headquartered in the Scottish capital and BD can trace its roots back to Glasgow agency Biggart Donald. Also, the top independent creative agency on our overall table is also based in Scotland in the form of Newhaven Communications. Likewise Story, Frame, Marque, The Bridge, Spiritmedia, Denvir, Mediacom Scotland, Stand, The Union and Clayton Graham - all independent Scottish-based business finish in the top 50.
Whether this is an indictment of cheaper overall operating costs, which allows agencies to add to the bottom line and offer better value for money, is still a debateable point.
It would round out the Top 100 nicely to stipulate which agency had done best in each discipline, but in this age of integration, merger and acquisition it is virtually impossible to pigeonhole any of the agencies appearing in our table. The media agencies are simple enough to quantify, but as for groups such as Tangible, TDMG, Mission Group and Amaze it is impossible to define them as anything other than fully integrated marketing businesses. Even many of the smaller independent agencies are expanding their services across multiple creative communication platforms. Integration is a trend that has gone in and out of vogue over the last decade or so, but as the digital sector continues to grow in influence and attract the attentions of many clients, many agencies are shifting focus and accepting that maybe integration is the way forward.