Posts Tagged ‘economy’
November 13th, 2008
There has been plenty of discussion on the topic of how the current economic climate will affect the development of social media. Dawn Foster at Fast Wonder wrote a particularly good post on the subject earlier in the week, and her findings seem to match our experiences.
At Liberate Media we too have noticed an upsurge in enquires and opportunities, but as Dawn rightly points out, enquires are not the same as signed contracts. However, it still begs the question: why more interest now?
It will come as no surprise to suggest that PR, like the majority of other sectors, is being hit by the economic downturn. Traditionally PR is the first to be reviewed when times are tough and budgets are disappearing.
Now admittedly, Liberate Media straddles the realm between traditional PR and social media. We are comfortable in both areas and believe the two work well together, so we are positioned a little differently. Therefore, this upsurge may not be what traditional PR agencies are experiencing, although I would be interested to hear what traditional agencies think on the matter?
Either way, it still begs the question; why is confidence in social media and digital communications continuing to grow, at least on the evidence from our own experiences, when in the past PR and the comms sector has been hit hard and fast by a financial downturn?
You could argue that social media understanding is beginning to turn into social media spend, and we are now seeing the second layer of adopters dipping a toe in the water. Brands in general are at least realising that they need to get to grips with social media, even if it isn’t always turning into involvement just yet. That would certainly explain some of the interest, but surely that clashes with a reduction in available marketing spend, so there must be other reasons.
As many commentators have already pointed out, the more measurable nature of social media also makes it a more reliable strategy in a downturn. It must also be said that the current financial climate has given consultants an added incentive to find a final solution to the social media ROI and measurement issue much faster than during any of the preceding years, which also suggests measurement is a strong differentiator in attracting marketing spend.
So, are we experiencing a positive side effect from the current market conditions? Brought on because spend must be carefully allocated and measureable, and encouraged by a growing understanding of social media? Well, it’s far too early to say and if the worst of the economic issues are yet to be revealed it’s certainly not a safe bet, but the positive signs are there.
If this is a growing trend will it also lead to a growth spurt in social media service offerings from the traditional PR agencies? Who up until this point have been quick to talk about, but slow to develop, social media specialisms? Perhaps those that invested in the development of social media and related digital communications early can at least take some solace that their endeavors are baring fruit at the time it is most needed.
Before closing, I should also point out that we believe the recession will not be all bad for the PR industry, as my colleague Wendy McAuliffe pointed out recently in her excellent post: the role of PR in a recession.
Let me know what you think.
September 10th, 2008
It’s official – the UK will fall into recession in 2008, the European Commission has this afternoon predicted. The gloomy facts can be read here in this BBC report.
So what does this mean for the PR industry, and what can we expect to see happen over coming months? Here are a few of my own predictions…
The PR industry will reinvent itself
Over the past couple of years, there has been increasing pressure on the PR industry to wake up to the impact social media is having on communications, and evolve. Some have responded more quickly than others. Liberate Media was infact set-up back in August 2006 to respond precisely to this change, and since then we’ve seen other agencies set-up in-house digital divisions. However, this movement has not spread across the whole of the PR industry at the speed it should – it hasn’t gone unnoticed by industry critics and observers that many more traditional PR agencies have turned a blind eye, largely through fear of the unknown.
A recession will force PR consultancies to get their houses in order, and evolve or die. So, in actual fact, a recession could ultimately be a good thing for this industry, separating the quality, digitally-aware practitioners from the run-of-the-mill.
The profiles of individual PRs will become more important
We’re living in an era of Personalised Relations – PR has always been about engaging with people, but the personal touch is today more important than ever. Jeremiah Owyang, senior analyst at Forrester, in his blog talks about PR folks becoming their own hubs, where “they’ve developed real relationships with influencers regardless of who their client list is”. If you’re looking to hire a PR who ‘gets’ online PR, it’s becoming easier and easier to spot them. Blogging and microblogging is making it so simple for PRs to build their own profiles, above and beyond the agency they work for – it’s a great way of assessing who’s truly active within social media, and who’s just talking about it.
PR will no longer be a beauty parade
This prediction is somewhat biased, but I say it with the experience of having worked as a trade journalist for six years. For decades, selecting a PR agency has been somewhat a beauty parade. Large brands have often felt more comfortable employing a well-know London-based agency, based on the kudos of having their contact details on their press releases. However, in my mind, a recession will place smaller, more niche PR consultancies in a position of strength, based on their ability to adapt their business model more rapidly in line with changing economic conditions. Definitions of ‘beauty’ will evolve, and be more about the ROI and quality of service a consultancy can deliver.
New business will be won/put to tender in less orthodox ways
The pitch process has been perfected by PR practitioners – weeks go into preparing, and the delivery is generally rehearsed to perfection. But as many brands will have discovered, this is not always the best way to select a suitable PR partner. The team who present will not always be the team you end up working with, and once the business is won, enthusiasm levels will quickly switch to the next exciting pitch that comes through the door.
As budgets become reduced, and ROI becomes key, word-of-mouth and recommendation, as well as networking, will I think become a more widely used route to winning business.
In addition, as all aspects of digital communications merge, new business will also be won through collaboration with partner agencies. Keeping yourself isolated is no longer an option for successful PR agencies.
And finally…CEOs will need to prioritise PR more highly
It goes without saying, that in order to get the most out of your PR resource, you need to make it a two-way relationship. This takes time, and many PR campaigns fall down on senior people not dedicating enough time to their PR campaign, be it for media interviews, signing-off press materials, or attending meetings etc. In a recession, brands who continue to see the importance in PR will need to make sure their investment is working harder for them, which means devoting more time to it.
We’re living in an age where conversations happen online about your products and services, in real time. When consumer spend is low, those who engage with their publics will reap the best reward. Your PRs cannot pretend to be you – and so CEOs etc will need to make more time to engage in these conversations around their brand.
** These are just my humble opinions. It’s an unsettling time for the PR industry (which has never done a great job of doing its own PR), but let’s hope the recession offers the shake-up the industry needs. Please let me know if you have other predictions to add to my list above.