Stephen Waddington, Partner and Chief Engagement Officer, Ketchum explains how this latest #FuturePRoof project set out with a bold and simple ambition: to characterise a cross section of agencies that make up the modern public relations business.
Download the whitepaper here.
Progressive public relations agencies are rapidly modernising. They are embracing new skills in data, research and paid media, and are investing in creative teams.
The public relations agency sector is strong. Profits are healthy in well-managed businesses, and the market overall is growing according to both the PRCA and ICCO.
Innovation is everywhere in practice from freelancers through to the largest agencies.
However one area in which there remains surprisingly little innovation is around billing models. The dominant structure continues to be fees charged on an hourly basis, albeit on retainer or project basis.
These are the headline findings of this #FuturePRoof project on the future of the public relations agency, backed by ICCO and the PRCA.
The project identified eight drivers of change in the agency business.
Value
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.
Opportunity
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.
Billing models
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.
Service innovation
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.
Threats
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.
Project ambition: characterise agency models
The goals of the project were straightforward. We wanted to build on the issues raised in #FuturePRoof, the project developed by Sarah Hall to explore the future of public relations.
We wanted to identify how agencies were responding to the shifting client and media environment.
The project started with a roundtable at the PRCA in London, where we debated some of the macro issues.
My thanks to the following people for helping set the agenda for the project: Sam Theobold, Text100; Alicia Mellish, Stir PR; Colin Cather, Bottle PR; and Dominic Shales, Lexis.
Next, we reached out through the #FuturePRoof community, ICCO, the PRCA, and via personal networks, and invited agency bosses to tell us about their businesses.
We’ve worked hard to get a cross section of contributions but also to balance the gender diversity of contributors. The public relations profession is frequently criticised for poor representation of women in senior positions. Female contributors to this project outnumber men.
We wanted to cover a broad cross section of agency services and types:
- Business types – freelance, owner-managed, independent and public; regional and international; specialist and integrated
- Agency models - project, retainer, payment by results and performance based
- Services - creative, integrated, earned, paid, shared and owned
We asked about the shape of each consultancy, and their responses to the demands of modern clients.
Thank you to the contributors
Seventeen agency bosses have candidly laid bare their agencies. Trade associations have also shared their expertise.
My thanks to Francis Ingham for supporting this project on behalf of ICCO and the PRCA.
Thanks also to all the contributors: Ruth Allchurch, George Blizzard, Alison Clarke, Colin Cather, Julius Duncan, David Gallagher, Jim Hawker, Nicky Imrie, Dieter Lloyd, Pam Lloyd, Ella Minty, Alex Myers, Laura Richards, and Renee Wilson.
You'll meet them all in the essays that follow. Each contribution contains valuable insights. You can download them HERE and we’ll be publishing them one a day on this #FuturePRoof blog. I hope that you find them useful.