“Who does a CEO call first in crisis? Now it’s the PR” (Evening Standard, 15th March 2010)
This article highlights the renaissance of the PR industry as it has bucked the trend of depleted budgets and spending during the recession. Chime Communications has recently unveiled a 15% increase in profits and Martin Sorrell concurs with the uplift, emphasising the rise in financial importance of his portfolio of PR agencies.
Undoubtedly, there has been, as the article explains, an increase in the importance of PR for corporations and high-profile individuals. Danny Rogers of PR Week (as he should) believes the discipline has “moved up the food chain” over the past 5 years. We would agree. Ten years ago, a high proportion of the Alchemis client base consisted of PR agencies of varying size, stature and sector experience. Since then we have seen a marked dip in the number of clients in this industry, and it has been a much smaller proportion of our turnover for some time. Whereas we used to work in financial, corporate, technology, manufacturing and pharmaceutical markets, more recent PR clients have been consumer focused and even here, it has been a tough environment to be working and driving business development. However, I believe the recession has helped the PR industry. Agencies are often viewed as a cost effective alternative to advertising and we have seen this, with several PR clients in varying markets enjoying successful new business campaigns over the past 12 months.
This perceived cost benefit is just one side of the coin. More importantly, corporate reputations are far more fragile with the rise of the internet, digital media and almost instant worldwide coverage. PR agencies have adapted in recent years to embrace a digital offer. Whilst a reputation can be damaged at the click of a mouse button, they can also be protected and enhanced. PR agencies that will survive and thrive will understand the importance of the digital space and be equipped to use it to good effect for their clients.
What is very interesting from a new business agency perspective is the identification that, despite prominent PR agencies being full of talent, the power and hence profits remain with the founders. This, Rogers believes, will result in the emergence of many breakaway agencies. I believe that this has always been the case to a degree as we have worked with many PR agency start-ups utilising that “big agency” experience as a key selling point. Additional agencies entering the market should only be positive news for a specialist business development agency such as Alchemis. We have always built strong relationships with PR people who tend to be extremely loyal taking us from agency to agency throughout their careers. The offers are diverse and the very nature of the discipline lends itself to more in-depth, engaging and interesting conversations for our New Business Managers. Not every sales person “gets” how to sell PR as it is not as tangible or quantifiable as other disciplines, but we have a real heritage in the area and a bank of highly capable people ready to fill a PR gap in their client portfolios.