PR Watch: The Disruption Of The PR Industry And Why Everyone Has Become A Consultant

Tom,

When you wrote in 2007 that the media was "going to hell in a handbasket" and it was only a matter of time before PR experienced the same pain, I weighed in with a different view.

Specifically, I shared that you can't compare the plight of the media and PR anymore because the practice of PR had evolved to include so many more communication vehicles beyond media relations(many of which involve reaching out directly to the target audience).

Yes, PR agencies are now feeling the pain but for the vast majority it has nothing to do with "old school PR." Market forces relegated agencies dependent on "old school" tactics to the bottom-feeder quadrant some time ago.

Instead, the state of today's PR agency business reflects the economic conditions that all companies are facing.

If you say there are companies paying $30K per month retainers for media relations and a few press releases I'll take you at your word.

But we haven't come across such situations since the dotcom meltdown.

Tom,

I agree with what you say and am one of those "consultants" you talk about. I left my PR agency and am working with one of my former clients on a contract basis. My client makes out because they are getting charged half of my rate from the agency for better, more dedicated work. I make out because I am getting paid double what I was paid by my agency and get to focus on one client that I love. Funny how that math works.

We are all much happier....except for the agency.

I totally agree that big changes are happening and that 'old school PR' has had its day. But I see the work split into two categories - consultancy and outreach. Using individuals for the consultancy can be a smarter and cheaper option, especially when using senior, seasoned and experienced professionals instead of paying $30k/month retainers. But individuals are limited in the outreach that they can do on behalf of their clients. Sometimes, lots of bodies are needed to communicate news and messages on behalf of a client - even with all the new tools at our disposal. Maybe the PR industry is about to split in two?

Hi Tom,
I'll second Lou's comment above. The current economic crunch causes contract resources to be cut in nearly any market. It's not a demonstration of "new PR." Anyone who's been around for a while has seen tech marketers slash ad and PR budgets in downturns.
Rather than claiming a whole new world of PR, suggest looking at the so-called "old school" talents which have always been and continue being essential. "Strategy, conversation, information, credibility and community" are all applicable to how PR has been and will continue being practiced by agencies, consultants or anyone. Some new technologies and perhaps somewhat shorter attention spans among certain groups don't really change the behavioral aspects of human nature. We're still dealing with homo-sapiens last time I checked.

yes, old school PR isn't going to go away. But what I do see happening is that the old AND the new approaches have to be combined and that clients are becoming less willing to pay extra for the new, it all has to be integrated into one package. And that means having to work harder for the same amount of money--as journalists have had to do for the past few years.

The PR consultancy "trend" has been a mainstay in the life sciences sector of this business for years. N.Y. firms such as Burson-Marsteller, Hill & Knowlton, Edelman, Ketchum, among others learned that the majority of companies here can't sustain the big-agency retainer model. This leaves small-to-mid-size locals like Swartz, Weisscom, Coactive and a few others trying to grow and get acquired. But there's a ceiling to this because, if they're nimble and resourceful, the smaller, consultancies tend to have the competitive edge. The alternative is to specialize (Zoomedia comes to mind). Nevertheless, these will be challenging times regardless of what size and model. At the end of the day, it's all about understanding your client's business and adding value.

I've seen clients moving away from agencies because of a combination of factors. The chief reasons are very tight budgets despite an urgent need for PR, a desire to work with senior people who can operate at all levels, and a need to associate PR very closely with revenue creation. The good news is that this demonstrates an ongoing appreciation of the benefits of PR, and it will probably influence some welcome changes in the way agencies structure and charge for their activities. I'm a consultant with three new clients who have each left agencies for the above reasons.

Hi Tom,
I agree with you that absolute technology disrupts absolutely. This is painfully evident in the media industry, and PR is certainly not immune. And I also think you're right that old and new approaches have to be combined, at least until business believes that the old is obsolete and the value of the new is a given. We're not all the way there yet; businesses are adopting social media at different speeds, depending on location, market, etc., so we need to take that into account.

But the issue is not about PR or media relations or even technology but about the fundamental changes to business and its relationship with its constituencies. Given that customers now have a platform and an expectation to participate actively with the brands they favor, where should companies focus? Some are naturals at social media; a lot are unconvinced, unprepared or dealing with immediate threats, which are many these days.

So professionals who can approach organizational communication pragmatically and authentically will ultimately be extremely valuable, because the biggest variable in social media adoption is people and their fear of change. Aside from the macroeconomic hell that we're in (and the state of journalism, about which we both are passionate), I'm actually really optimistic about the potential of social media. I think it's healthier, much more fulfilling, and a natural progression from old-school, hierarchical communication. It's also an extremely painful transition, as you point out. (So is childbirth, but luckily humans have a very short memory for pain, and the rewards are many, or we'd all be in serious trouble).