For many years, the biggest obstacle to creating a viable business of politics in the United States was financial. Political work was variable and uncertain. Clients did not always pay on time; sometimes they failed to pay at all. Consultant Bob Goodman, who estimated that in any given election season 10 percent of his billings would fail to come through, commented, “I’d never see it. I’d have to write it off.”
Cash flow problems often plagued consultants, especially in odd-numbered years when few elections were held. Charlie Black recalled that “it would’ve been very hard to live on what you could make as a political consultant” during the off year of a cycle.
The cyclical nature of political work could make it difficult to stay in business, much less keep qualified staff from one election to the next. For Joe Cerrell, looking back on his early years as a consultant, the operative question was, “How do I stay alive? How do I keep the doors open so that I’m available come the next election season?”
Consultants working in the 1970s and 1980s found that corporate clients paid well and helped firms secure a reliable source of revenue immune from the periodic ups and downs of political campaigns. That relationship has since evolved.
In 2010, the world’s largest advertising and public relations company, WPP, acquired Blue State Digital for an undisclosed sum. With the move, BSD became part of a large, multinational holding company that generates $17 billion in annual revenues and includes more than 350 firms operating in forty-nine countries around the world. The company’s chief executive, Martin Sorrell, built WPP through an aggressive acquisition strategy, turning an obscure United Kingdom manufacturer of wire baskets into a global provider of advertising and communications services with marquee holdings that include J. Walter Thompson, Young & Rubicam, Burson-Marsteller, and Ogilvy & Mather.
If it seems strange that Blue State Digital, a firm specializing in campaign services for Democratic candidates, would become part of a global advertising powerhouse, consider that WPP’s holdings include twenty-six firms in the United States alone that specialize in political consulting, polling, and lobbying. These companies, in turn, form part of a worldwide group of fifty-six firms based in seventeen countries that specialize in public affairs, a somewhat vague category of activity that combines corporate public relations with grassroots lobbying techniques designed to mobilize or energize public support on behalf of a client, particularly in regulatory matters or other policy areas that potentially impact the bottom line. Because of the skills of its practitioners and the demand for their services, public affairs is an important and growing branch of political work.
In the United States, WPP’s holdings in this field include Benenson Strategy Group (whose founder, Joel Benenson, worked as the lead pollster for President Obama in 2012) and the Dewey Square Group (whose principals include former senior strategists for John Kerry in 2004 and Hillary Clinton in 2008). Both firms have provided key personnel for Clinton in her 2016 presidential run. Another WPP-owned firm with an impressive Democratic pedigree is the Glover Park Group (founded by the chief strategist for Al Gore’s campaign in 2000 along with two veterans of the Clinton administration).
On the Republican side, WPP owns the Prime Policy Group, whose chairman, Charlie Black, worked for Presidents Reagan and Bush (41 and 43) and is an inductee of the American Association of Political Consultants Hall of Fame. Another prominent Republican in the WPP fold is Mark McKinnon, who is currently a senior adviser at Hill+Knowlton Strategies (and was formerly the company’s global vice chairman). McKinnon, who served as chief media adviser to George W. Bush in 2000 and 2004, sold the consulting firm he co-owned to WPP in 2006. Another valuable asset is Burson-Marsteller, the third-largest public relations firm in the world (in billings), acquired by WPP in 2000 along with its parent firm, advertising giant Young & Rubicam.
The current head of Burson-Marsteller is Donald Baer, a former senior adviser and speechwriter in the Clinton Administration. Baer’s predecessor at Burson-Marsteller was Mark Penn, a former pollster for both Clintons who sold his consulting firm to WPP in 2001. (Separately, Penn’s investment firm, Stagwell Media LLC, last October acquired SKDKnickerbocker.)
More recently, Burson-Marsteller has sought to position itself in the digital marketplace through various mergers, acquisitions, and strategic partnerships. As noted previously, WPP bought Blue State Digital in 2010. In 2013, Burson-Marsteller tapped BSD managing partner, Thomas Gensemer, to be its chief strategy officer. Meanwhile, in 2011, Burson-Marsteller announced it had entered into a strategic partnership with the Republican firm Targeted Victory, perhaps laying the groundwork for a future acquisition of the leading provider of digital services to the GOP.
The acquisitions by WPP and its subsidiaries point to a corporate consolidation of political work in the United States. Unlike an earlier age when public relations firms and advertising agencies struggled to square their commercial interests with the partisan nature of campaigns, today industry consolidation makes it possible to acquire multiple firms whose principals are connected to Democratic or Republican clients.
Although WPP is the most aggressive on this front, it is not the only large player in the political consulting marketplace. Omnicom, Publicis, and InterPublic, rivals of WPP for control of the global advertising market, have also been acquiring assets in political consulting, polling, and public affairs. For instance, the public relations giant Weber Shandwick, a subsidiary of InterPublic, is itself the product of a merger with the firm started by political consulting pioneer David Sawyer.
As James Harding detailed in his book Alpha Dogs, Sawyer built a profitable consulting firm by bringing American-style campaigns to the Philippines, Colombia, and other countries. Jack Leslie, who went to work for Sawyer after a stint in Ted Kennedy’s office, eventually became president of the firm and then managed several successful mergers of the company before it was acquired by InterPublic.
Today, Leslie is the chairman of Weber Shandwick, currently ranked as the second-largest public relations firm in the world. Similarly, the French conglomerate Publicis owns political consulting firm Winner & Associates, whose CEO, Chuck Winner, is a leader in the management of ballot initiatives. Finally, Omnicom, through its public relations subsidiary FleishmanHillard, owns the largest Democratic media firm, GMMB.
What explains the acquisition of these firms and their integration in a broader field of corporate communication and public affairs? In financial terms, political consulting generates paltry revenues compared with advertising agencies and public relations firms.
The public may be aghast at the $6 billion spent on the 2012 election, but it is worth remembering that the top 100 advertisers spend more than $100 billion on marketing each year, and Procter & Gamble alone spent $5 billion on advertising in 2012. More than the dollar value of consulting services, however, the value of firms that specialize in political work is their ability to provide corporate clients a menu of services that extend beyond the traditional offerings of an advertising agency or public relations firm.
The value of campaign techniques is in the capacity to cultivate public support, whether on behalf of a candidate or a corporation. In the case of the latter, consultants can provide a focused, carefully orchestrated campaign designed to improve a company’s public image. In some cases, the same metrics used in politics, such as a candidate’s favorable ratings, can be used to measure the success of a corporate campaign.
As Mark Penn once put it, writing in the Harvard Business Review, “While politics has always been an avid spectator sport, lately it’s become a field that offers valuable lessons for business.” In particular, Penn advised, “Campaigns and consumer choices share one important thing in common: they are about alternatives, not ideals.” Whether working for a candidate or a corporation, the job of the consultant is to make the public prefer the client over a lesser alternative.
But the corporate consolidation of political work also represents a new phase in the way campaign tools are integrated into a broader corporate strategy. As Jack Martin, global chairman and CEO of Hill+Knowlton Strategies, put it, “Our approach … is called the 5th Seat. The 5th Seat puts us in the [corporate] c-suite of our clients, next to the lawyers, accountants, management consultants, and bankers.”
Now, this concentration makes it unlikely that new technologies will produce a radical opening of the political process in which candidates have the capacity to connect directly with a circle of supporters without the services of a professional consultant. Although recent elections illustrate the enduring importance of grassroots activism and energy, the ability to locate, engage, and deploy volunteers still relies on technologies supplied by the same industry that provides the traditional tools of media and direct mail.
With the rise of digital campaigns, consultants have developed another service to sell.
Correction: An earlier version of this piece identified Thomas Gensemer as the cofounder and CEO of Blue State Digital. He was the firm's managing partner.
Adapted from Building a Business of Politics by Adam Sheingate with permission from Oxford University Press USA. Copyright © Oxford University Press 2016 and published by Oxford University Press USA. All Rights Reserved.