Will Traditional PR Firms Survive?

By Paul | Posted March 4, 2009 | 0 Comment(s) | Filed in: Public Relations

I recently read the PRWeek article, “Efficiency Is Crucial in Agency Review,” which provides further proof that the traditional PR agency model is shifting, possibly towards the inbound marketing agency model of value-based pricing on services designed to build Website traffic, inbound links and leads.

According to the article, “Agency reviews in the last several years have often led to clients consolidating their PR firms, but today's deepening recession has accelerated this trend as clients seek to cut budgets and economize.”

While PRWeek concentrates on major brands such as Coke, Pfizer, eBay and Philips, the lesson apparent in the article is that organizations of all sizes are expecting more results on tighter budgets.

Here are a few of the more telling excerpts from the piece:

“The recession has acted as a catalyst, pushing clients to stretch their agencies across more disciplines.”

“Traditional advertising isn’t a particularly healthy field, so that’s not a good place to broaden services.” (Jerry Swerling, director of PR studies and the USC Annenberg Strategic PR Center and management consultant)

“I’m seeing clients saying they don’t feel like they’re getting as much bang for their buck.” (senior level source at procurement firm)

“. . . Some clients are responding by eliminating AOR agencies and working with firms on a project basis. . . .”

Is it time for the Inbound Marketing Agency?

In September 2008, we published a blog post titled, “Dawn of the Inbound Marketing Agency,” stating that a mass-market revolution had begun that threatens to make traditional PR agencies obsolete, and spawn a new generation of industry leaders and influentials.

“If you’re a PR firm, you can’t ignore or resist where the market is taking us. It’s time to expand our knowledge and services. Think critically about the value we deliver to clients. Consider the state of MSM, and the future of our industry.”

Here’s a snapshot of the inbound marketing agency from the original post:

Staff: Expert copywriters (as most PR professionals are), who function as Internet marketing consultants. All employees/consultants are heavily engaged in social media.
Services: Content marketing, social media, search engine marketing and Website development, as well as evolved forms of publicity, brand marketing and crisis communications.
Pricing: Value-based instead of prohibitive hourly rates.
Results: Truly measurable and meaningful outcomes, including: inbound links, Website traffic, leads and sales.
Infrastructure: More agile, scalable and tolerant to risk than most traditional PR firms.