MARKETING TECHNIQUE: TOP SALES PROMOTION AGENCIES - Overview - Promotion based on merit/This year’s sales promotion league tables are based on gross profit rather than turnover. It is seen as a better measure - but the same names still dominate at

There is a significant difference in this year’s sales promotion league table, which means that it cannot be directly compared with those of previous years. After a lot of consideration, we have based the ranking on gross profit rather than turnover.

There is a significant difference in this year’s sales promotion

league table, which means that it cannot be directly compared with those

of previous years. After a lot of consideration, we have based the

ranking on gross profit rather than turnover.

The move is a response to pressure over several years from leading

consultancies, who argue that this, rather than turnover, is how they

measure their own growth. The decision seems to have gone down well with

the industry.

More information on the reasons for the change are given in our article

on agency remuneration, on page 17. Sufficient here to say that the

measure we have adopted this year, gross profit, is closely aligned to a

consultancy’s actual income - fees, plus mark-ups and commission.

Has it made a big difference to individual rankings? The short answer is

no. Allowing for a slight shuffling of the pack, to accommodate the rise

of those achieving above-average growth, and the first appearance of a

couple of ’biggies’, there is a very familiar look to the top 30.

Like other areas of marketing services, ’sales promotion’ is enjoying a

boom. I put the term in quotation marks because sales promotion is less

and less adequate to describe what the sector does.

Jon Claydon, a founding director of one of the fastest growing agencies,

Claydon Heeley, even argues that the industry is due for a relaunch:

’Sales promotion may be a literal description of some of the work that

is done, but it has connotations that are no longer appropriate.’

Be that as it may, the 68 companies in our table this year report gross

profits up in total by 21%, from pounds 165.2m to pounds 199.9m. The

number of staff employed is estimated to have risen from 3095 to 3627, a

rise of 17%.

What’s in a name?

The difficulty of pinning down what a sales promotion agency does gave

us a freak result last year. Wunderman Cato Johnson - an early-90s

merger between Young & Rubicam’s direct marketing and sales promotion

arms - topped the table, even though, by its own admission, sales

promotion was a fast-dwindling part of its activities. It hasn’t

submitted a form this year, and we haven’t pushed the point beyond a

telephone reminder.

In WCJ’s absence, Carlson has leapfrogged IMP to the head of the


Eyebrows may be raised at this, too. After all, when we do our annual

direct marketing agency league table, Carlson president Robert Janes

claims: ’Everything we do is direct.’

But he has a point. All of the work which Carlson does for one of its

biggest clients, British Airways, goes out by direct mail, but it is all

very promotional and offer-based. Of another of his clients, Beefeater,

Janes says: ’It doesn’t distinguish between direct marketing and sales

promotion. It’s interested in the results and customer trial and

retention, not the method.’

Endorsing this is John Quarrey, chief executive of IMP. ’The Institute

of Sales Promotion, the Direct Marketing Association and the Sales

Promotion Consultants Association will one day realise they represent

one industry and will merge,’ he says. ’That’s my prediction.’

As it is, half of the consultancies listed in the table now claim

membership of the DMA, as well as one or more of the sales promotion

bodies. This indicates how far their interest in direct marketing has

gone. There are even one or two classic direct marketing agencies that

are members of the ISP.

Stephen Callender, a founder of the fast-rising Black Cat Agency, argues

that below-the-line agencies of the future will use many different

techniques and media.

They will be where to go to change customer behaviour, as opposed to


’To me,’ he says ’this suggests we should no longer refer to the ’sales

promotion’ or ’direct marketing’ industry - we are now in the ’response

marketing’ industry.’

For the moment, however, Marketing will continue with separate DM and SP

tables. We think most clients still distinguish between the two skill

sets, even though some agencies can justifiably claim to combine


Culture clash

It is also a fact that there are marked cultural differences between

consultancies whose backgrounds are primarily in one discipline or the

other. As Mike Halstead, managing director of HH&S, points out, his

agency now does a substantial amount of direct marketing, but it is all

promotionally driven. A similar point is made by Brian Francis of Cramm

Francis Woolf.

Other key trends? Ownership and rationalisation is one. Last year saw

the Lowe Group merge Interfocus and The Brompton Agency to produce a

’through-the-line’ agency with more clout. This year, a similar thing

has happened with Tequila and Option One in the GGT/BDDP empire.

Barnett Fletcher Promotions (BFP) - an atypical agency, more heavily

involved in field and event marketing that most other companies in this

table - had the distinction of being the fastest-growing agency in last

year’s SP league.

It heads the growth table once again, although in fairness there is some

overlap in the periods quoted, so we’re not saying it has had two full

years of rocket propulsion.

Even so, there’s no plan to ease the throttle. In September, the company

was bought by international advertising group McCann-Erickson, with

which it has long shared a number of clients, including Nestle.

Renamed BFP Momentum, it will function as the European headquarters of

McCanns’ US-based event company, Momentum. More on this in two weeks, in

our review of the field marketing sector.

There is no connection with Abbott Mead Vickers BBDO’s through-the-line

agency, also called Momentum, and ranked 16th in this year’s table. The

latter is what Top of the Pops would brand as ’the highest new entry’,

just pipping Bates Dorland offshoot One Four One. At the risk of

confusing matter, AMV’s Momentum is also active in event marketing,

being the agency responsible for the Holsten Beer Fest.

McCanns’ BFP Momentum, on the other hand, has a brief to expand its

involvement in other areas of sales promotion, not just in the UK but

across Europe.

Given such ambitions, it seems McCanns will have to flourish its cheque

book again, to acquire existing consultancies, or poach top talent.

On a similar quest is Mosaic. That’s a name that won’t be very familiar

to many readers. It is a publicly-quoted Canadian company which has

signalled its intention to become a world force in below-the-line


Already it has moved, via some significant acquisitions, from a turnover

of Cdollars 12m (pounds 5.5m) in 1995 to Cdollars 135m (pounds 61m). In

January, it absorbed one of the leading UK field marketing specialists,

Mike Cottman’s FMCG, and other acquisitions are believed to be in the


Nearer the bottom of the table, PDM was bought last year by Milton

Marketing Group. This is worth highlighting because Milton is also

ambitious, and worth watching.

Most eyes, however, are focused on the top of the table. The top five

this year are almost all members of big, international groups. The one

exception is Holmes & Marchant, a publicly-quoted group which claims to

derive about half of its income from sales promotion, with the rest

split evenly between PR and design.

Within the top 10, there are only three independents: The Marketing

Store (claimed by chairman Graham Kemp to be the biggest independent in

Europe), Triangle Group and Claydon Heeley.

They, and a few in the following pack, such as The Haygarth Group and

ZGC, under managing director Mark Zimmer, must be favourite targets for

takeover by advertising agencies anxious to strengthen their presence

below-the-line. Marketing Drive is known to have been in talks with

Bozell, but so far without result.

The other bit of restructuring worth noting is that LGM, the main

operating company in the publicly-quoted Incepta Group, struck a deal

with the bigger but privately owned Citigate, the financial PR

specialist. The merger gave Citigate the public quote it wanted, but led

to the departure of LGM’s outspoken founder, Graham Green - allegedly

because he found it difficult to work in a more junior role in the

merged operation.

According to LGM managing director Susie Vivian, however, Green’s

departure doesn’t mean that the new bosses have no interest in sales


’They have made it clear that we are part of their expansion plans, and

they are providing the funds for development,’ she says.

Many of the trends explored in this article and elsewhere in this issue

of Marketing Technique suggest that the future lies with the biggest


These trends include mergers and takeovers at the top; a growing need

for in-depth skills across a range of disciplines; the resources to

conduct long-running, major campaigns; and the ability, in a growing

number of cases, to run campaigns internationally.

However, we have always argued that there is a lot of creative talent in

some of the smaller shops. Two examples are the rival Scottish

consultancies The Boroughloch Agency in Edinburgh (now also in London)

and Biggart Donald in Glasgow. Both figure in our top 20 growth table.

Willie Biggart says: ’There’s no creative frontier at Berwick on Tweed,

and most of our clients now come from the South.’

Opportunity knocks

For the last word, we will turn to Steve Ward, an ex-Procter& Gamble

marketer and founder of one of the youngest consultancies in this year’s

table, Spearhead.

’I don’t think I like to accept any fait accompli,’ says Ward. ’If you

assume the industry will remain more or less the same, then it will be

harder for new firms to come in. In fact, the opposite is true. The

industry is changing like mad, creating opportunities for those who

understand what is happening.’

He points out that competition will continue to increase. Sometimes it

will come from unexpected sources, such as the management consultancies,

Internet designers, and even printers. But this also creates new

openings - ’for instance, where the management consultants make their

recommendations, wave goodbye, but leave the implementation to be done

by others’.

’It doesn’t have to be specifically sales promotion marketing,’ adds

Ward, reflecting the sector’s trend to broaden its offering. ’We all

have big company or agency backgrounds, so it can be anything from

reorganising the sales force to PR.’


- Direct marketing skills have become essential for so-called sales

promotion agencies. However, there is still no agreement on the best

structure. Carlson, IMP, Grey Integrated and Interfocus are among those

who favour integrated teams. The Haygarth Group, ZGC and Marketing

Perspective prefer separate subsidiaries. KCJB has just decided to merge

its SP and DM subsidiaries because, according to managing director Keith

Johnston: ’The companies increasingly have common clients, and we best

meet our clients’ needs by providing a single, unified, below-the-line



Rank  Consultancy                 Gross Profit   Gross profit   % change

                                       1996-97        1995-96

                                        pounds         pounds

1     BFP Momentum                   1,790,000        736,000     143.21

2     Positive Thinking                879,000        452,000      94.47

3     Biggart Donald                 1,460,000        850,000      71.76

4     The Yellow Submarine           1,495,000        901,000      65.93

5     Claydon Heeley International   6,109,000      3,691,000      65.51

6     Curtis Hoy                       631,000        389,000      62.21

7     Logistix                       2,411,000      1,569,000      53.66

8     Black Cat Agency               1,982,000      1,295,000      53.05

9     Quantum Leap                     717,000        487,000      47.23

10    Dynamo                         2,311,000      1,590,000      45.35

11    ZGC                            3,505,000      2,419,000      44.89

12    Carlson                       17,511,000     12,163,000      43.97

13    Cramm Francis Woolf            2,520,000      1,770,000      42.37

14    KCJB                           1,123,000        789,000      42.33

15    Ignition Marketing Group         803,000        567,000      41.62

16    Grey Integrated                9,072,000      6,803,000      33.35

17    The Boroughloch Agency         2,244,000      1,689,000      32.86

18    Marketing Principles           1,593,000      1,207,000      31.98

19    The Haygarth Group             5,545,000      4,227,000      31.18

20    Poulter Sales Promotion        1,123,000        857,000      31.04


Rank  Consultancy                 Gross profit   Gross profit  % change

                                       1996-97        1995-96

1     Carlson                       17,511,000     12,163,000     43.97

2     IMP                           10,778,000      9,844,000      9.49

3     Holmes & Marchant Group       10,629,000     10,228,000      3.92

4     KLP Marketing                 10,050,000      9,526,000      5.5

5     Grey Integrated                9,072,000      6,803,000     33.35

6     The Marketing Store            8,646,000      9,282,000     -6.85

7     Purchasepoint                  7,561,000      7,684,000     -1.6

8     Tequila Option One             6,595,000      5,931,000     11.2

9     Triangle Group                 6,394,000      5,010,000     27.62

10    Claydon Heeley International   6,109,000      3,691,000     65.51

11    Interfocus Network             6,064,000      5,875,000      3.22

12    The Haygarth Group             5,545,000      4,227,000     31.18

13    Promotional Campaigns Group    4,952,000      4,398,000     12.6

14    Marketing Drive                4,712,000      3,765,000     25.15

15    CbH & Partners                 4,257,000      4,030,000      5.63

16    Momentum Integrated

      Communications                 4,186,000      3,372,000     24.14

17    One Four One London            3,782,000      2,935,000     28.86

18    Clarke Hooper Consulting       3,726,000      3,412,000      9.2

19    ZGC                            3,505,000      2,419,000     44.89

20    Perspectives                   2,903,000      2,392,000     21.36

21    Geoff Howe & Associates        2,751,000      2,357,000     16.72

22    LGM Marketing Services         2,747,000      2,475,000     10.99

23    HH&S                           2,684,000      2,245,000     19.55

24    Cramm Francis Woolf            2,520,000      1,770,000     42.37

25    Logistix                       2,411,000      1,569,000     53.66

26    Dynamo                         2,311,000      1,590,000     45.35

27    Communicator                   2,290,000      2,008,000     14.04

28    The Boroughloch Agency         2,244,000      1,689,000     32.86

29    CSP                            2,082,000      2,093,000     -0.53

30    Retail Marketing Partnership   2,080,000      1,610,000     29.19

31    Black Cat Agency               1,982,000      1,295,000     53.05

32    Mercier Gray Group             1,881,000      1,483,000     26.84

33    Billington Cartmell            1,864,000      1,644,000     13.38

34    Scope Creative Marketing       1,831,000      1,405,000     30.32

35    BFP Momentum                   1,790,000        736,000    143.21

36    MPP Marketing Group            1,715,000      1,556,000     10.22

37    Marketing Principles           1,593,000      1,207,000     31.98

38=   The Navigation Consultancy     1,495,000      1,165,000     28.33

38=   The Yellow Submarine           1,495,000        901,000     65.93

40    Teamwork Marketing             1,469,000      1,319,000     11.37

41    Biggart Donald                 1,460,000        850,000     71.76

42    BBL Marketing Communications   1,374,000      1,385,000     -0.79

43    Signal Box Marketing Comms.    1,168,000        990,000     17.98

44    IMC                            1,160,000        909,000     27.61

45=   Poulter Sales Promotion        1,123,000        857,000     31.04

45=   KCJB                           1,123,000        789,000     42.33

47    Brewer Blackler                1,048,000        863,000     21.44

48    Team Marketing Communications    991,000              -      -

49    The Ingram Agency                913,000        903,000      1.11

50    Positive Thinking                879,000        452,000     94.47

51    The Marketing &

      Communications Business          871,000        804,000      8.33

52    TSM (UK)                         829,000              -       n/a

53    Fingherhut Associates            816,000        673,000     21.25

54    Milton PDM                       809,000        751,000      7.72

55    Ignition Marketing Group         803,000        567,000     41.62

56    S.T. Marketing                   731,000        750,000     -2.53

57    Quantum Leap                     717,000        487,000     47.23

58    The Marketing Services Centre    673,000        528,000     27.46

59    SMP                              650,000        500,000     30

60    Curtis Hoy                       631,000        389,000     62.21

61    Combination                      522,000        412,000     26.7

62    KHWS                             499,000        427,000     16.86

63    The Marketing Partnership        480,000        588,000    -18.37

64    The Creative Minds Consultancy   415,000        353,000     17.56

65    CGW Soho                         405,000        350,000     15.71

66    Spearhead                        295,000        238,000     23.95

67    Right Angle                      197,000        181,000      8.84

68    Marketing in Action              139,000        124,000     12.1

Rank  Consultancy                      Current    (and 12   Gross profit

                                         staff     months       per head


1     Carlson                              420       340          41,693

2     IMP                                  170       149          63,400

3     Holmes & Marchant Group              210       230          50,614

4     KLP Marketing                        203       168          49,507

5     Grey Integrated                      130       105          69,785

6     The Marketing Store                  140       105          61,757

7     Purchasepoint                        135       140          56,007

8     Tequila Option One                   134       107          49,216

9     Triangle Group                       107       100          59,757

10    Claydon Heeley International         100        55          61,090

11    Interfocus Network                   118        80          51,390

12    The Haygarth Group                    92        74          60,272

13    Promotional Campaigns Group           61        75          81,180

14    Marketing Drive                       57        44          82,666

15    CbH & Partners                        75        75          56,760

16    Momentum Integrated

      Communications                        50        45          83,720

17    One Four One London                   74        62          51,108

18    Clarke Hooper Consulting              55        52          67,745

19    ZGC                                   65        62          53,923

20    Perspectives                          52        52          55,827

21    Geoff Howe & Associates               50        38          55,020

22    LGM Marketing Services                38        39          72,289

23    HH&S                                  50        45          53,680

24    Cramm Francis Woolf                   57        48          44,211

25    Logistix                              21        15         114,810

26    Dynamo                                42        30          55,024

27    Communicator                          40        40          57,250

28    The Boroughloch Agency                39        39          57,538

29    CSP                                   34        35          61,235

30    Retail Marketing Partnership          30        26          69,333

31    Black Cat Agency                      37        28          53,568

32    Mercier Gray Group                    48        45          39,188

33    Billington Cartmell                   30        28          62,133

34    Scope Creative Marketing              42        35          43,595

35    BFP Momentum

36    MPP Marketing Group                   39        34          43,974

37    Marketing Principles                  25        20          63,720

38=   The Navigation Consultancy            16        15          93,438

38=   The Yellow Submarine                  25        18          59,800

40    Teamwork Marketing                    50        50          29,380

41    Biggart Donald                        26        22          56,154

42    BBL Marketing Communications          22        24          62,455

43    Signal Box Marketing Comms.           11        11         106,182

44    IMC                                   21        18          55,238

45=   Poulter Sales Promotion               16       n/a          70,188

45=   KCJB                                  27        12          41,593

47    Brewer Blackler                       26        16          40,308

48    Team Marketing Communications         27                    36,704

49    The Ingram Agency                     25        25          36,520

50    Positive Thinking                     22        14          39,955

51    The Marketing &

      Communications Business               16        14          54,438

52    TSM (UK)                              17        13          48,765

53    Fingherhut Associates                 17        14          48,000

54    Milton PDM                            25        23          32,360

55    Ignition Marketing Group              12         9          66,917

56    S.T. Marketing                        18        17          40,611

57    Quantum Leap                          14         9          51,214

58    The Marketing Services Centre         20        18          33,650

59    SMP                                   22        22          29,545

60    Curtis Hoy                            14        11          45,071

61    Combination                           10         8          52,200

62    KHWS                                  14         9          35,643

63    The Marketing Partnership              8         8          60,000

64    The Creative Minds Consultancy         6         6          69,167

65    CGW Soho                               8         7          50,625

66    Spearhead                             10         7          29,500

67    Right Angle                            7         5          28,143

68    Marketing in Action                    5         5          27,800


- Marketing In Action, the smallest agency in the table, points out that

it has recently taken on regional projects for Guinness, Bulmers’

Strongbow, and Coca-Cola - ’auguring well for regional agencies, as

budgets are devolved into the field’.

- WPP subsidiary Promotional Campaigns claims to be moving towards

becoming a broader consultancy-based business.

It bought a ’creative communications’ agency in 1996 and has also

created client-focused teams incorporating account handling, planning

and creative.

- Teamwork Marketing and Quantum Leap have both recently set up separate

DM divisions, to meet an increased demand for targeted communications.

’Another noticeable trend,’ Quantum says, ’is that we find, like many of

our competitors, that FMCG clients represent far less of our total

income this year than in previous years.’

- Purchasepoint is among the consultancies arguing that the marketing

role of the Internet and Intranets ’is perhaps one of the most

significant opportunities of the 21st century’. Other consultancies

adopting a high profile in this area include IMP, Clarke Hooper and

Curtis Hoy. Sheffield-based Scope, which has just hit a pounds 5m

turnover for the first time, has bought a multimedia company.

- Team expects to be moving into new media in the next 12 months. This

is a new company, which achieved pounds 3m turnover in its first year.

The name was acquired from TG Holdings by some of the former senior

managers, but the new operation has a completely new board of directors,

and 95% new staff.

- Greg Tustain, ex-Aspen Business-to-Business, has joined The Ingram

Consultancy as creative director.

- Triangle is threatening to enter more awards competitions, having won

the ISP grand prix for the supporting promotions to go with Cadbury’s

sponsorship of Coronation Street. ’We have never really supported any

award schemes,’ says chairman Kevin Twittey. ’However, I was genuinely

surprised by the client interest this award generated, and the

subsequent new business enquiries.’


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Google's revenues surge but shares drop as it grapples with transition to mobile
Facebook beats Twitter to most 'marketing friendly' social media site crown, says DMA
Fableists believe children like Finn should be outdoors enjoying life
Homebase, Baileys and Camelot join the line-up at Media360
MasterCard renews Rugby World Cup sponsorship to push cashless message
Lynx unleashes £9m 'Peace invasion' campaign
Social Brands 100 Youth: Pizza Hut most social youth brand in UK
Cheryl Cole is wild and arresting in new L'Oreal work
Morrisons told not to show alcohol ads during YouTube nursery rhymes
O2 head of brand Shadi Halliwell departs after 23 years at company in restructure
Tesco hit by further sales decline as it turns to digital Clubcard and social network
Branding guru Wally Olins dies aged 83
Duracell short film captures epic Transatlantic voyage
Ash runs Tinder experiment to show smokers are less desirable to opposite sex
British Airways teams up with Gerry Cottle Jnr for summer of rooftop film screenings
Arklu says 'girls can be superheroes too' with doll design competition
Coke enters squash market with Oasis Mighty Drops
Virgin Galactic signs up Land Rover as space flight sponsor
Motorola marketer Andrew Morley departs as Google gears up for sale to Lenovo
US Airways apologises after tweeting obscene image at a customer