If you’re running an agency, big or small, or aspire to, the recently published #FuturePRoof white paper for the PRCA and ICCO should be top of your reading list.
Commissioned by the leading industry bodies with the aim of outlining the different business models in use, the paper identifies eight ways in which public relations agencies are evolving. It also benchmarks how they are responding to the shifting client and media environment today.
The results show that innovation is everywhere in practice from freelancers through to the largest agencies.
Progressive public relations consultancies are rapidly modernising. They are embracing new skills in data, research and paid media, and are investing in creative teams.
Where innovation remains slow however is around billing models. The dominant structure continues to be fees charged on an hourly basis, albeit on retainer or project basis.
A good sector to work in
Whatever business model your agency is based on, public relations is a good sector to work in right now. Profits are healthy in well-managed businesses, and the market overall is growing.
According to the ICCO World Report, agency income grew by 7% in 2015, breaching the $13 billion (£9 billion) mark and agency employment grew from around 80,000 people to more than 85,000.
There is no room for complacency though – blurring lines between disciplines means public relations professionals need a compelling argument against marketing, digital and SEO teams. So those who are introducing new billing models need to display clarity to avoid confusion over the service and deliverables on offer.
A lack of agile working despite public relation’s 24/7 culture is a clear threat to the industry.
The eight headline findings within the #FuturePRoof report are as follows:
1. Public relations is outsmarting rival disciplines through innovation. It is helping clients build better organisations. Therein lies its future, and huge value.
Drivers of innovation
2. Clients, shareholders and staff are the three drivers pushing agency-owners to build better businesses. That can only be a good thing.
3. There’s a chasm emerging between the business model of traditional agencies, and the demands of modern clients. Smart agencies are building businesses in this space.
4. Agencies are limited only by their skills and ambition. Small agencies are able to compete with large thanks to communications and travel.
5. Agencies are simple businesses that are well understood by clients. Innovative business models threaten clarity and risk confusion.
6. Better measurement systems are fundamental to business model innovation. It remains a work in progress for agencies.
7. Core services within a modern agency include storytelling, creative and content, as well as paid, earned and shared media, as they shift from traditional media and publicity based services.
8. A shift to 24/7 working and the cost of infrastructure are two big issues that need to be tackled by public relations agencies.
Public relations as a management discipline
As one of the authors of the report who created the call to action, it’s worth sharing that the agency bosses and contributors to the report were self-selecting, responding to an open call for information.
Each one is a leader of an agency, group or trade association seeking to break with tradition. Each consultancy has carved its own niche and some are moving beyond people to charge not for time but for creative, insight, and results. By the nature of their businesses they are natural pioneers within the industry.
As you’d expect, in each paper there are wide and varied insights and some differences of opinion.
But where all the authors unite is in their recognition of public relations as a management discipline focused on organisational growth.
This is their secret to success and once this approach is adopted more widely, that is when the public relations industry will be valued for the excellent work carried out.