Monday, April 30

Redefining Public Relations: Convergence Or Confusion

There are several things you can take away from the Current State Of The PR Industry (Annenberg Study 2012), a guest post on PR Squared, written by Burghardt Tenderich, associate director for the Strategic Communication and Public Relations Center at the USC Annenburg School for Communication and Journalism. But if you had to pick one: the field is in a state of change.

• There are significantly fewer agency-of-record relationships in the industry.
• The number of agencies that an organization hires has increased over time.
• The areas of specialization, including proximity, have become more significant.
• Social media is mainstream, whether public relations manages it or not.
• Public relations is being divided into tactical and strategic communication.

It's the last bullet that ought to raise eyebrows among public relations firms. It pinpoints why some firms, which sought specialization as a means to become more competitive, may have moved themselves further away from a strategic level of participation. As they become more known for specialties — planning special events, managing social networks, working with the media, crisis mitigation — they become less likely to work with executive management on a meaningful level.

Fewer firms manage the message. More firms are managed by it. 

One of the reasons, it seems to me, that more firms are being hired by organizations and fewer firms are being asked to manage the entire public relations component of a campaign is by accidental design. In developing their own comparison and contrast points, clients began to think of them as specialists.

This, along with the size of most firms, led to clients becoming more inclined to assign each firm smaller and smaller  "project work" such as Facebook, a special event, a product launch, a specific short-term campaign, etc. This benefits the organizations three-fold: it negates high monthly retainers, expands the potential reach of the organization (with each contracted firm handling its pool of contacts), and frees the client from having to perform too much task work.

A few years ago, I was brought in to to oversee one project managed much the same way. One firm handled New York, one firm handled Los Angeles, one firm handled secondary national markets, one firm handled radio stations, one firm worked with talent and street teams, and one firm handled social media. Along with these firms, there were four organizations designated as strategic partners.

There were two takeaways for me then. First, while the firms were invited to make suggestions, none of them were given the responsibility for a strategic plan. Second, each component was easier to replace if need be. It seems somewhat dangerous. All of them had made themselves reasonably replaceable.

Another outcome that I did not see at the time is hinted at in the full study released by USC Annenberg. The study notes that organizational communication/public relations budgets have increased but the fee allocation to an increasing number of public relations firms is shrinking. While the study points out that the increasing budgets exaggerate the chart, the takeaway is the same. The shift is toward tactical.

The number one reason agencies are hired is to increase arms and legs. 

While some firms are finding themselves more inclined to provide strategic or regional insight (the number two and number three reason to hire a firm), the majority of organizations hiring firms are looking to offset task work. This doesn't mean public relations is becoming less strategic as a whole, but it does demonstrate that there is a division occurring within the field.

Some public relations firms, much like internal departments, are gaining more relevance within the organization. In fact, according the Annenberg study, 60 percent of departments say they are involved in the senior-level decision making process and 70 percent say their recommendations are taken seriously. In other words, departments (along with a few firms) are increasing their relevance as strategic partners, but the majority of the industry is not.

While there is nothing wrong with this, it does illustrate a trend. Over the long term, it may diminish the importance of public relations firms despite the recent definition change proposed by the Public Relations Society of America in an effort to bolster the strategic importance of the industry. Or, at minimum, concentrate the most important strategic aspects of public relations to a smaller pool of strategic communication firms and in-house departments.
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