I can’t make the nmk debate tonight but the debate about the future of the PR industry as it modernises is likely to be highly engaging. There’s a reason for this – some people are leading the way, others are crawling slug-like under stones.
At Speed we’ve been tracking the size of the market and the emergence of digital for more than 18 months. Outside the public groups, commentary on the industry is hard to come by even from the trade associations. Probably because no-one has had the balls to do it and reveal their own weakspots. We should wise-up and be honest though – no-one has got this right yet, because we don’t know exactly what the future holds.
What is certain is that conventional PR is having a battle. Redundancy and agency closure news is almost a weekly occurrence in PR Week. In the last two quarters it has reported on almost a 100 positions that have been made redundant at 23 agencies. An undisclosed (so, probably, high) number of redundancies have been made at three agencies and three agencies have closed.
Today’s news of Next Fifteen’s consolidation of Bite and Inferno is further evidence that the traditional PR market is contracting.
In 2007 the top 150 agencies grew by 22 per cent. The comparative figure for 2008 is due from PR Week any day. The latest number from the IMF predicts that the economy will shrink by 2.8 per cent in 2009.
It’s a tough time for the industry. But it undoubtedly has a strong future which is why I remain resolutely upbeat. Now more than ever companies need guidance to manage the conversations around their brands and modern PR has a lot – much of it tangible – more to offer.
The question is whether the industry has been quick enough to adapt. PR consultancies fall into three distinct camps: consultancies that are embracing and actively creating the digital PR future, consultancies that believe digital is blogger and Twitter relations, and those that have stood still.
The real threat is not the contraction of the industry but the army of new digital agencies that is capitalising on the disruption in the market.
Good luck tonight to Wolfstar’s Stuart Bruce, iCrossing’s Antony Mayfield, Weber Shandwick’s James Warren and Content and Motion’s Roger Warner, as they grapple with the issues.
And perhaps a few slugs.
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Agree with your segmentation, but I am more optimistic Mr Wadds. In New Zelanad (where I have just been) they say that winning runners pass the competition on the hill. In other words, even if you are going slower (as the PR industry certainly is) most of the big competitors for client spend are going even slower. Don’t lose the faith mate, Keep Calm and Carry On and the best of us will ewmerge even stronger. Give my regards to your fellwo speakers in the debate tonight.
I’m optimistic. I count Speed among at the front of the pack innovating. As I said, now more than ever companies need guidance to manage the conversations around their brands and we can prove our value. Yes, we’ll emerge even stronger. I can’t make tonight, hence my post.
Stephen
I’d like to add another “camp” to your existing three: that of PR companies actually selling digital PR services to clients.
Glad to say we’re doing that, but it’s taken some considerable effort to persuade clients of the communications shift that’s taken place and the necessity to shift with it.
When budgets are under pressure already, a new departure may be something only the bravest marketeers choose to go with. But from what we’re seeing, the times are a-changing.
Nicely done Wadds. Broadly I’d agree with the x3 camps idea. The crux of the issue is how many of them have stood still and/or think it’s all about bloggers. I’ll report back after tonight
It figures there is now a greater need for economies of scale. The thing is, given the combined tier-1 client list for the two agencies, I can’t help but think keeping all those competing clients happy under one roof is going to be like sticking half a dozen feral cats in a sack.
Great post Wadds. Adds an air of common sense to my inane ramblings below:
http://blendingthemix.com/2009/04/09/supplier-side-social-media-services-time-to-shape-up-part-i/
As you’ll see from the above, I’d been looking at the same issue, albeit from the angle of the digital/tech agency who were trying to move into your and David’s spaces. I certainly feel that there is a land-grab of sorts around social media by tech and pr – and that ultimately, the successful firms will be the ones who can integrate the two most successfully.
I am a firm believer that the technology is fast (if not already) becoming commoditised and as such, the onus will be on *someone* to manage, nurture and build upon the relationships the technology has put in place. How many tech agencies can offer that kind of relationship building?
Equally, is it taking things too far to only recruit people who are both social media/pr AND tech savvy? Is that sustainable as a recruitment policy or will there be enough of these types of people emerging onto the market in, say 5 years to make it a basic requirement from someone entering the industry?
I’m as optimistic as the ever optimistic Mr Brain. Our experience is that yes spend is slowing down, but it’s not stopping and it doesn’t appear to be at the expense of the PR industry. We’re even seeing people put more resource into PR (not a lot!), as they are cutting back on ad spend (a lot!).
Nice post Wadds and I was weeping blood about this issue over the weekend for three reasons…..
1) when people say, “traditional PR” they mean media relations. If that was all an agency was doing anyway (ie not building advocacy through heaps of different methods to reach ALL markets) then yes, they are probably screwed. Just like if you only do hard copy direct mail or only sell print advertising, you might want to look at expanding into new areas.
2) digital is a way of reaching people…you can learn how to do it pretty easily. So can everyone else. It is a way of reaching your communities who by the way, are there anyway, PR agencies just need to help their clients figure a way of joining them and talking to them. Then persuade them to take what they hear and learn from it.
3) What are PR skills anyway? In my opinion, the skill still lies in being able to tease out the interesting stories and narrative from the river of marketing outpourings that every company produces. Sounds easy? It isn’t. Then we need to help people be able to understand it, see why it fits into the wider world and increasingly, to find it. That is not just about platforms or applications or tweeting with your little toes. It is about knwoing what makes a story and a memorable and remarkable story where possible.
I think the real threat are the people who don’t get it and you find them everywhere
[...] Read the original here: Speed Communications – Wadd&… [...]
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[...] Much to my delight, the PR industry seems to be taking a very myopic view of the current state of play (as evidenced by PR Week’s coverage of the event). It fails to realise that there is a great game afoot, one that involves all of the advertising and marketing industry, that will be merciless on those that fail to adapt. [...]
Really interesting, both the article and the responses. I’ve heard more than once, people with long careers in PR say this social media stuff is just the same thing that they’ve been doing for years, only with different technology and jargon.
The principles – talk about something interest, talk to the right people, network with influencers and opinion formers – it’s all exactly the same as it’s ever been.
I’m probably looking at it in more of a relaxed way than some people as I’m not actually from a PR background. I’ve taken a long and winding road from journalism, through product marketing, to PR at a search agency and there are so many overlaps, it has been a pretty seamless transition..
Hi Stephen,
Your observations certainly ring true with my experience of the PR industry. The spend on the printed word is decreasing as they media channels close at a rapid space and advertising (and thus PR) spend is going online.
Also as Marketing Directors’ budgets are being squeezed they are being questioned like never before to justify spend. Online PR provides solid and quantifiable results where as “traditional” PR has always been difficult to quantify for clients. AVE simply will not do any more, where as social media monitoring provides invaluable feedback on campaigns.
Certainly, advertising, marketing and digital agencies have been quick to occupy OUR space in the online PR market. They are all providing services for blogging, “SEO” optimised press releases, forums (stakeholder comms) and viral campaigns that drive word of mouth online.
I think that it is time for the PR industry to wake up and smell the coffee….
[...] Steven Waddington published before the debate but agrees "real threat is not the contraction of the industry but the army of new digital agencies that is capitalising on the disruption in the market" [...]