WPP PR giant Hill + Knowlton Strategies was starting to revive its US business. Now the pandemic threatens to unwind those efforts.

News
AnnaMaria DeSalva

Once a juggernaut in PR, Hill + Knowlton is seeing some wins after a series of losses over the past decade.
The agency has embarked on a turnaround plan, changing how it charges clients and investing in creative and digital work and changing its leadership.
It folded one of its best-known subsidiaries, Blanc & Otus.
But morale problems and internal divisions linger at Hill + Knowlton after a decade of restructurings and changing strategy.
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Hill + Knowlton Strategies seemed poised for a comeback in the US, winning more than 70% of all of its business pitches for the past year.

Then employees were hit with the news in mid-May that the WPP-owned public relations firm would lay off a small percentage of staff in response to the coronavirus pandemic’s impact, following similar moves by PR firms like Weber Shandwick and ad giants like Publicis.

Founded in 1927, Hill + Knowlton used to be considered a global PR juggernaut. But it’s lost big accounts and shed headcount over the past decade, including about half of its staff in the New York and Washington, D.C., offices. It was on a path to turn around its US business by restructuring its operations, cutting billing rates, changing how it pitches, and spending in areas like creative, behavioral science, and data analytics when the pandemic struck.

Business Insider spoke to 10 former Hill + Knowlton employees of varying seniority and former clients who said constant restructurings and leadership changes precipitated the agency’s decade-long slide.

Hill + Knowlton’s global chair and CEO AnnaMaria DeSalva, global president Richard Millar, and Sam Lythgoe, global chief business development officer, also spoke with Business Insider about how they’re trying to revive the business.

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Leaked documents show the agency cut its 2020 billing rates

Hill + Knowlton’s turnaround efforts started back in April 2019, when DeSalva was named global CEO and Millar got oversight over the US a few months later.

In September 2019, Hill + Knowlton gathered its highest-ranking executives for a summit in New York City to lay out a plan to turnaround the fading PR giant, according to two attendees.

The plan called for Hill + Knowlton to focus on winning healthcare, technology, and energy clients, which includes industrials. The agency also was going to spend more on digital planning, crisis strategy, behavioral science, data analytics, and creative.

Along with laying out the plan, Hill + Knowlton execs introduced a new title structure, with eight levels of seniority replacing five, and cut its 2020 billing rates, according to leaked documents from the meeting.

For example, Hill + Knowlton managing directors used to charge $500 per hour. After the restructuring, managing directors became EVPs or SVPs. Now, EVPs’ standard rate is $450 per hour and SVPs’ is $375 per hour.

Millar told Business Insider the point of the additional three layers was to give the agency more flexibility in how it charges clients.

Millar also said he relaxed most staffers’ billing targets. Former employees said those targets were unrealistic, making it hard to win new accounts. …read more

Source:: Business Insider

      

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