'Growing appreciation for P.R. on Madison Avenue'

From the New York Times:

THE recently acquisitive MDC Partners is at it again, with a deal that is indicative of the growing recognition along Madison Avenue of how much more interested marketers are becoming in using public relations to reach consumers.

Kirshenbaum Bond Senecal & Partners in New York, which is owned by MDC, is acquiring a majority stake in Kwittken & Company, a public relations agency in New York with annual revenue approaching $10 million and clients like Better Homes and Gardens Real Estate, McGraw-Hill and Thomson Reuters.

The acquisition is costing MDC an estimated $10 million to $15 million. Kwittken will become an operating unit of Kirshenbaum Bond Senecal, the second-largest MDC agency after Crispin Porter & Bogusky. Additional information about the deal is to be announced on Thursday by executives of Kwittken and Kirshenbaum Bond Senecal.

The transaction is the third in five months for MDC involving a public relations agency; the others were Sloane & Company in New York, in April; and Allison & Partners in San Francisco, in May. And it is the sixth deal over all for MDC since last September.

None of the six agencies in which MDC has bought majority stakes specialize in traditional ad tasks like creating television commercials. Rather, their specialties, in addition to public relations, include social media, database marketing, experiential marketing and analytics.

Marketers want “to find firms that can deliver performance,” said Miles S. Nadal, chairman and chief executive at MDC, which is based in Toronto, and public relations agencies are excelling in “understanding the changing dynamics of the marketplace,” as what happens with a campaign in social media and earned media has become as important as its presence in paid media and owned media.

As a result, Mr. Nadal said, “we love the P.R. space — social, blogging, crisis management, events.”