The latest update of the Bellwether Report, published today, shows that whilst marketing spend declined for the ninth quarter running, PR budgets saw a slower rate of decline in the final quarter of 2009 compared to the previous quarter – from 24.4% down to just 4%. The report also shows that the rate of budget trimming in the industry is at its slowest since the first quarter of 2008.
Whilst times are undoubtedly still tough, these results suggest the industry can be optimistic about the year ahead, with marketing spend predicted to increase in 2010.
For those in the PR industry, the report underlines the importance of providing a service that delivers strong results and offers value for money. Whilst the green shoots of recovery are perhaps starting to surface, the recession continues to hit people and businesses hard and there is no guarantee that the renewed optimism within the PR industry will be replicated elsewhere.
Despite these positive findings, the purse strings of the average UK business are still a lot tighter than they used to be when it comes to budgeting for PR and marketing campaigns, and many might well still opt for the cheapest option rather than best option in this climate.
For businesses tempted to engage the services of a PR agency, finding the balance between value and price can be tough. Before you leap on the cheapest option on the table, here are some questions to help put ‘value’ in perspective:
Is saving money worth the risk?
If a painter does a bad job, you can always get someone better in to make it as good as new. The risk involved in opting for the cheapest provider is relatively low. Not so in marketing, where the risk of damage is much greater.
Any PR work undertaken will reflect on both your product and your company as a whole, helping to determine their success or failure potentially well beyond the duration of the campaign.
Is the pricing of the service blinding you to the true value?
Some agencies might seem expensive, while others might seem cheap, but neither is necessarily an indication of the quality of the service they offer.
Look at each option on the table and consider the agency’s track record and exactly what they are offering first. Once you have a sense of the hierarchy of quality, compare this against the prices. Is the cheapest agency offering the lowest value? You might be surprised, but equally you might simply find proof of the old adage, “you get what you pay for.”
Can the potential return on investment justify a higher spend?
While larger companies tend to have a tried and tested formula for setting the budget around a product or service launch, many smaller firms will simply set their budget based on a combination of what they feel they can afford at the time, balanced against the mean cost put forward by competing providers.
When you have all of your quotes in front of you, assess the potential return from each proposed campaign. In many cases, getting value for money may mean spending more, but you will get a better return in terms of campaign reach, support and quality. Pound for pound, the value could be higher.
Put simply, when setting your marketing/PR budget this year, remember: you’re not just paying for the hours worked, you’re also paying for the contacts, the support, the experts and, most importantly, the results.
In my view, PR is a difficult area to begin with, as, unless you are Microsoft or Coca-Cola or another giant within your industry, editorial is never guaranteed. For start-ups and other small businesses, small budgets and relative anonymity mean that your product or service offering has to either be unique or really stand out from the crowd.
As a small business PR, I am always aware of this and so extend my offering, which is something that in my view, all small business PRs should do. If a story isn’t picked up by traditional media for whatever reason, I will work on other areas (such social media posts or online PR distribution) to ensure that a presence is gained in some way and that my client has received a good service and value for money. Cutting corners, such as trying to write your own press release, or recruiting cheap and cheerful “professionals” will more than likely come back to bite you where it hurts most – in the pocket.
Great points, Claire. PR isn’t about writing a press release, bashing it out, and then shrugging if nothing comes of it. It’s about setting realistic expectations at the outset, creating a rounded campaign plan, and then doing everything you can to make sure those expectations are met and, where possible, exceeded.
Love the integration of social media you mention. It seems freelancers and smaller agencies are making some real headway here for SMEs – long may it continue!
One of the things that always amazes me is the departments who suffer when there are budget cuts. Marketing, PR, advertising – very often the ones that can actually bring a company back around.
Good to see that PR spend isn’t decreasing too much, but companies still need to take a measured risk and keep competing in this field. Often it’s the hit taking that can lead to the hit making.
Cheers, Emily!
Thanks for the comment, Danny.
Thinking more about this, in some cases I suspect the recession has actually been good for smaller PR firms in that a lot of businesses have stopped assuming big and expensive is best and gone for smaller firms with smaller prices, giving those agencies a much needed chance to prove themselves.