Executive Summary / The PaceSetter

The recession and the Sept. 11 terrorist attacks took a toll on the public relations industry nationwide in 2001. L.A. firms, which had enjoyed significant growth a year earlier, saw their fee income fall by more than 8 percent.

The Top 25 PR shops in L.A. brought in a combined fee income of $218 million, vs. $237.2 million in 2000. Not surprisingly, the decline in work led to layoffs and a few shops were forced to shut down.

Stoorza Communications, once among the Top 25, closed its L.A. office as part of a company-wide cutback by the San Diego-based firm. WPP Group suspended operations at the L.A. office and laid off the local staff of Carl Byoir & Associates.

But it wasn't all bad news. Some firms were able to improve on their 2000 numbers, despite the challenging environment. Among the top performers, Weber Shandwick, Hill & Knowlton and Winner & Associates LLC all posted fee income gains. Meanwhile, Fleishman-Hillard Inc. fell only slightly, to $20.8 million, from $20.9 million in 2000.

Claudia Peschiutta

The PaceSetter

Weber Shandwick/Rogers & Cowan

Hard times didn't keep Weber Shandwick's L.A. office down last year. The firm managed to jump to No. 1, thanks in part to a merger with sister company BSMG Worldwide.

Weber Shandwick and BSMG, both part of the Interpublic Group of Companies, combined their four L.A. area offices into one, according to Thomas Tardio, president and chief operating officer for Weber Shandwick's Western Region.

The firm also landed some new work, including entertainment and sports marketing for Coca Cola Co., corporate publicity for Sempra Energy and promotional marketing for Luxottica Ray-Ban. Those three accounts totaled about $2 million in annual billings.

The changes helped Weber Shandwick boost its fee income to $29.6 million, up from $18.7 million in 2000. That also moved the firm up from fourth place to No. 1 on the Top 25 list.

Despite the growth, it wasn't an easy year for Weber Shandwick. Some accounts were lost and conditions were unpredictable.

"I often refer to it as a macroeconomic whirlwind because of everything from 9-11, recession, mergers with the clients and internally, and just the uncertainty of the consumer marketplace," Tardio said.

The spectacular growth of 2000 made the hit feel even harder. "We were not in reality. We were in a dream (in 2000) but it was beautiful. It was a wave you had to jump on," Tardio said.

Claudia Peschiutta

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