Here are my predictions for the PR industry in 2009. None of my analysis or comment is particularly groundbreaking and almost all my predictions have their roots in the current market conditions.
1. Growth
We work in a client-led industry that tracks the performance of each of the markets that we serve. The economic outlook for next year is lousy for the most part, with no external impetus to drive additional client demand for our services. The next election or the Olympics may help in the second half, but not much. Digital programmes, Government spending, niche brands and marketing directors using PR as a cost-effective alternative are the only bright lights. At Rainier PR we’ve written three forecasts and will review spending and investment on a month-by-month basis.
Prediction: The PR industry will be flat in 2009. Where there is growth it will result from PR agencies moving out into other disciplines or digital programmes, providing they can clearly deliver tangible return of investment.
2. Debt
Lack of business rarely drives a PR business to bankruptcy. Staff costs are the only significant variable and if you stick tight to fundamental ratios it is difficult to go far wrong. Cashflow is typically the killer. Lack of debt facilities, weakening margins, delayed debtor payments and bad debt are a lethal cocktail that will bring an agency to its knees. That all four are a feature of the current market means that businesses need to be fit and smart to survive.
Prediction: 2009 will unfortunately see some PR consultancies go out of business.
3. Breakaway agencies, start-ups and sole traders
Market uncertainty and major shifts in budgets create opportunity. Opportunity for innovation to deliver better, more cost effective results, for clients. 2008 has seen a clutch of new PR start-ups break away from larger agencies, some of which are driving real innovation through the way they engage and deliver campaigns.
Prediction: 2009 will see the emergence of further sole traders and new agency start-ups, fuelled by redundancies and market instability that will rise to become leaders in years to come.
4. Overservice
In a tight market, service businesses stick to their clients to ensure continuity. In the PR sector monthly account planning is critical. And unless there is a formal programme within place within your agency to review relationships and ensure that you’re delighting and exceeding the expectations of your clients week in, week out, some overservice is inevitable. Escherman’s Andrew Smith regularly discusses this topic on his blog.
Prediction: Overservice is a monster to be both tamed and nourished. Staff will burn out in agencies where account planning is not a formal discipline and the clients will ultimately go elsewhere as their expectations will never be met.
5. Recruitment
Social media is making it easier than ever before to make connections. There will always be a role for a proactive, well connected recruiter, but Rainier PR is amongst a number of consultancies this year that has used platforms such as Facebook, LinkedIn and Twitter, resulting in significant savings. This, coupled with the fact that people tend to move about less in a tight market due to job uncertainty, adds up to difficult times ahead for the recruitment industry.
Prediction: 2009 will see a shake-out amongst recruiters in the PR industry and there will be a reduction in the number of businesses that serve the sector. The ropey ones will probably sink.
6. Graduates
The back end of 2008 has been a tough market for this year’s crop of graduates to find roles within the industry. Knowledge of blogging and active participation within the social media PR community are good ways to create cut through. Coming to a first interview clueless will mark your card and see you disappointed.
Prediction: Entry-level recruitment will dry up in 2009, but smart candidates will continue to be hired and find roles in the industry to replace those leaving the sector.
7. Supply side
PR agencies are demanding efficiencies from their suppliers to meet client-side demands. Suppliers such as Gorkana, Huddle, Sourcewire, Vocus and Webit have been quick to spot this as an opportunity and are delivering real innovation and transparency via their on-demand pricing and engagement models.
Prediction: Smart suppliers that have aligned their businesses with PR consultancies, enabling them to deliver better results to clients, more efficiently, will thrive during 2009. Any other supplier in the current market is a commodity.
8. Clippings agencies
These beasts deserve a special mention. Quality of product, service and delivery is typically poor. As pixels replace paper, on-demand services such as Factiva and Meltwater, coupled with free tools such as Google News and Twilert, are eroding the core business of a conventional press clipping agency. Clippings agencies are failing to respond with any degree of product innovation and those that annoy most of us agency-side with their consistent underperformance will surely die.
Prediction: Clippings agencies will continue to fail to innovate in 2009 and maintain the slow march to their eventual demise.
9. Digital versus traditional
Levels of awareness of digital PR within clients is high, but knowledge and skills are low. Here lies a massive opportunity for the PR industry. But the early signs are that we are letting it pass us by. The e-consultancy report published last week reported that SEO and digital agencies threaten PR agencies in this space. I’m optimistic – when it comes to content, we know our onions. The PR digerati is holding its own and producing really excellent work but three distinct camps are emerging in the industry: consultancies that are embracing and actively creating the digital PR future, consultancies that believe digital is blogger relations, and those that have stood still.
Prediction: Digital will be one of the few growth areas for programmes in 2009 and those at the forefront of the market will benefit.
10. Mobile
There can be no doubt that 2008 has seen the true emergence of digital, community, or social media PR. The industry has seen campaigns conceived and delivered via this new channel in consumer and business-to-business. Mobile is on the cusp of a similar epiphany, albeit 12 to 18 months behind.
Prediction: 2009 will see a few innovative PR consultancies utilise mobile as a communication channel to devise and deliver campaigns.
11. Measurement
Whenever we meet with colleagues from Branded, the elite team of former marketing directors that joined Loewy in April, they tell us that the PR industry needs to fix its engagement model and improve planning and measurement, to better justify spend. It’s an age old issue. Planning and measurement tools have traditionally been expensive. No longer: the rise of digital tools means that I can plan a campaign and churn out analysis on clients from my desktop at minimal cost. And in a bid to better prove the value of our work we should have the confidence to share our client’s marketing metrics.
Prediction: Programme planning and measurement will start to become in-house PR consultancy disciplines, but I don’t think we’re brave enough yet for a breakthrough business model where the link between time and payment is completely broken.
12. Collaboration
Again, digital is having a huge influence on industry collaboration. Blogs, Twitter and communities such as Marcom Professional are enabling us the share thoughts and ideas like never before. In the last few months 3WPR’s Stephen Davies, Waggener Edstrom’s Ged Carroll and Porter Novelli’s Mat Morrison have all shared ideas and intellectual property with the PR community and promoted debate in a way and at a speed that the PRCA or the CIPR has never managed. This level of collaboration is unprecedented and is driving the industry forward at a terrific pace.
Prediction: No real prediction here, but I just hope that this new found level of industry openness and cooperation will continue.
I love this industry for its speed and pace. It’s particularly a really great place to work at the moment as almost every day we seem to be breaking new ground.
What does your business plan look like for 2009, and how do you read the market?
Tags: 2009, PR, predictions
We’re grateful to Broadsword for showing us an unusual view of Dunstanburgh Castle and Davey P for taking us to a location 10 miles further north up the coast that has fantastic panoramic views of Budle Bay, Cheviot, Seahouses and Holy Island.
