EschermanMarketing, PR and media sector jobs registered the steepest decline in availability in June, according to online recruitment site Monster.
However, “opportunities increased significantly in hospitality and tourism; and healthcare, social work whilst the arts, entertainment, sports, leisure sector surged year-on-year.”
A bit of data extrapolation. Recent PR Week features say that the average PR agency director’s salary is £75,000 and senior agency folk work on average 59 hours a week. In which case, that means the average PR agency director earns around £26.50 per hour (this assumes they take 4 weeks holiday – which I suspect in some cases they don’t – so that would drop the rate slightly further). Of course, the £26.50 is before tax – a £75,000 salary of course attracts a tax rate of 40pc on everything above £34,000 (allowing for personal allowances, amount taxed at lower rate, etc) . So this could mean take home pay is actually below £20 per hour.
PR Week’s data would also suggest that if the average PR agency account exec is earning £19,800 and working 50.5 hours a week, then the average hourly rate is about £8 pre-tax). Post tax takes the figure closed to £6 per hour. Which may explain the lack of morale cited by PR Week – or why office cleaning offers a similar rate of pay for shorter hours.
A very instructive interview with IDG founder Pat McGovern in today’s Guardian – with some unavoidable conclusions for the tech PR sector.
McGovern hasn’t built a $3bn empire by getting things too wrong – so worth listening to his views on the future of B-to-B publishing (he says all B-to-B publishing will be online in 10 years).
A few things in the feature did stand out. For example, many questioned his decision to drop the print edition of Infoworld in the US – saying farewell to distributing 180,000 copies every week. “Many said without print people wouldn’t be reminded every week of our brand and 40% of our revenue would disappear overnight,” claims McGovern.
One year later, InfoWorld’s online revenues had trebled, the magazine’s overall revenues were up 10%, and without the costs of print, paper and postage, profit margins went from -3% to 37%.
He also says it costs around $20,000 to launch a new online magazine title – compared with $400,000 for a print version.
And here’s an eye-opener – 60pc of the content on IDG’s B-to-B sites is user generated. As McGovern rather too gleefully admits: “It’s nice to have more than half your content generated for free.”
So what are the implications for tech PR?
1. Any PR approach that prioritises print over online needs to be seriously questioned.
2. Tech buyers still trust media brands such as Computer Weekly, Computerworld, etc – however, the way they consume and interact with the magazine is very different. They are unlikely to pay much (if any) attention to the print title. And even when they get information from the online version, it is most likely to be via search rather than because they treat the online title as a destination. Even the small proportion of readers who will subscribe to a magazine RSS feed are likely to filter the content. The 80/20 principle applies ie 80pc of individual reader value will lie in 20pc of the content – readers will increasingly select only the really relevant stuff.
3. If 60pc of content is user generated, then the way in which PR is involved in the process of content generation and conversation is going to be very different.
4. Paradoxically, some magazine related events may become more valuable eg I’d wager that Information Age events are seen as more valuable by many of its readers than the print version of the magazine. They trust the brand, but they don’t have time to read the print version. And they will get content from the magazine online – and via search (and RSS if the magazine reinstated its RSS feeds….). Particular events, however, allow for networking, peer contact, etc.
Given the importance of search in this whole equation, any tech PR programme that doesn’t integrate with a carefully thought through approach to buyer behaviour and search is seriously flawed.
My thanks to Mashable for the tip on a new site called Web Of Fate:
20-word Description: Web of Fate is a semantic analysis engine that extracts meaning from historical, present and future events and draws connections among them.
CEO’s Pitch: The Web of Fate semantic analysis engine can visualize and uncover hidden relationships among historical, present and future events allowing people to:
– Study the flow of events and decision paths chosen by historical figures.
– Take snapshots of the exact state of when a predictive event is made. So future generations can understand why certain choices were made.
– Identify trends, locate anomalies, detect threats and track multiple/alternate futures with FutureGraph.
Web of Fate also provides semantic web services, allowing users to integrate semantic and decision analysis into their own products and services.
It is quite an intriguing concept. I particularly like the Quote feature that allows you to highlight predictions made by 3rd parties – and then you can check back at the appropriate time to see whether the prediction came true or not (and how likely other people think the prediction will come true) – so checking on, say, Gartner predictions now becomes easy.
You can enter your own predictions – perhaps, I intend to get a client featured in the Financial Times – and people can then vote on how likely the outcome might be. Could be a useful tool for setting management expectations appropriately.
Richard Koch’s book The 80/20 Principle was first published in 1997 and went on to become a cult business classic (500,000+ copies sold. He later wrote the 80/20 Way which extended the approach to life generally).
I only properly read both books recently as a result of the suggested reading list in Tim Ferris’ Four Hour Work Week (it made me realise what a big debt Ferris owes to these earlier works – in many ways, the 4HWW philosophy is a practical application of Koch’s 80/20 approach).
So what is the 80/20 Principle? In short, it is an extended application of Pareto’s Principle (Vilfredo Pareto, an Italian economist, 1848 – 1923, was looking at patterns of wealth and income in 19th century England. He found that 20pc of the population enjoyed 80pc of the wealth – he also found that you could reliably predict that 10pc would have 65pc and 5pc would have 50pc. The key point is not the percentages, but the fact that the distribution of wealth across a population was predictably unbalanced).
Koch’s insight was to apply this predictable imbalance across a whole host of business and life phenomena. However, reading his books made me realise that although the 80/20 concept gets bandied around a lot, people often miss the subtlety of what Koch was getting act. For example:
80/20 is simply shorthand – the ratio could be anything 90/10, 70/30, etc. In fact, it doesn’t need to add up to 100 eg 70/20. The key point is that a 50/50 relationship between two sets of related phenomena is the exception rather than the rule. And yet, we naturally act as though the norm is a direct correlation between input and output or effort and reward.
The principle is thus counterintuitive. As Koch points out: “High performers are not 10 or 20 times more intelligent than other people – it is the methods and resources they use that are unusually powerful.”
Take some of his examples: Less than 20pc of all recorded music is played more than 80pc of the time; Fewer than 20pc of clouds will produce 80pc of rain, etc.
Let’s look at the world of PR and social media (I have no scientific evidence for these examples – I suggest them as possible ratios – why not analyse these in your own business and see what results you get:
20pc of agency employees do 80pc of the work clients value
5pc of companies gain more than 80pc of press coverage
Less than 1pc of press releases generate 99pc of press interest
Less than 10pc of your press contacts generate 100pc of the press coverage
Less than 10pc of your blog posts generate more than 90pc of the blog hits
I’m sure you can come up with many more. The point Koch would no doubt make is that in many cases, people will carry on behaving as though there is a 50:50 relationship in the above examples.
As Koch says, the world is resolutely non-linear. By focussing on and analysing the 20pc of inputs that generate the 80pc benefit in all cases, you should be able to obtain significant gains. Less is more.
Actually, not weird at all – but gave me an excuse for a gratuitous Doors song title reference in the headline.
For those who keep an eye on these things, you’ll know that Charlie Hoult has recently changed roles at Loewy Group – from CEO to VP of corporate development. He remains the largest single shareholder and is now casting his not insignificant entrepreneurial eye to new projects. As his Opencast Project blog says, he’s looking for the next big thing in digital marketing and business. If anyone is going to find it, don’t bet against Mr Hoult.
Expect a steady stream of interesting developments over the coming months from Opencast.
If you are looking for fresh ideas to stretch your mind, look no further than Ted.com. TED (Technology, Entertainment, Design) has been around since 1984 – a greater array of great minds and great ideas would be hard to come by. The TED Talks are well worth a look. Be inspired.
[youtube=http://www.youtube.com/watch?v=71APLHK-Ykk&hl=en]
Ask any traditional PR company – large or small – whether they consider £300K per annum as a sizeable PR account and I don’t think you’ll find anyone who’ll disagree with you.
What about £300K a month? There probably isn’t a PR account in the country that would come close to this kind of spend.
Guess what. Search marketing agencies are now beginning to command that kind of expenditure. Some will (rightly) argue that much of this is going on PPC campaigns ie the actually revenue and profit claimed by the agency on this will be a smaller percentage. However, in spite of this, the bigger search marketing firms are clearly achieving much better margins than most PR firms. And they are gaining a greater slice of overall marketing budgets – and taking the lead role in influencing the rest of the marketing mix.
(Quick caveat: the above applies primarily to the consumer sector – however, it can’t be long before we start to see a similar trend in B-to-B marketing).
Another trend that could get PR firms worried is that the search budgets are moving towards natural search rather than PPC ie this is a much more fee/consultancy led spend – and starts to encroach upon some of the traditional revenue areas for PR.
Others are already highlighting the need for PR firms to work more closely with their search bretheren – but it doesn’t appear to happening quick enough.
So why is the traditional public relations consultancy sector is suffering from a special form of cognitive dissonance?
On the surface, things appear rosy. Agency top line fee income is on the rise. Martin Sorrell at WPP says PR is seeing a healthy growth rate compared to other areas of the marketing mix (though PR is coming from a very low base).
However, even though agencies appear to be billing more, they don’t seem to be any more profitable. Recent research from Plimsoll suggests that one third of PR agencies are making a loss, one third are breaking even and one third are profitable (but the margins here range from a measly 2 – 3pc to around 25pc for a handful of top performing agencies).
And PR agencies aren’t helping themselves either. Another recent survey featured in PR Week showed that overservicing is rife. It almost beggars belief that 10pc of PR agencies say they regularly overservice clients by 100pc. In fact, all PR agencies appear to overservice – it is merely a question of how much. On this evidence, 95pc of PR companies overservice their clients by 25pc or more.
In which case, it is no surprise that this is leading to widespread staff dissatisfaction through repetition of the same tasks, length of working hours and volume of administration (another PR Week survey showed that the average PR company spends nearly 75pc of its time on account management and administration as opposed to value added client work).
For many years, PR consultancies have tried to improve their standing within the marketing mix – seeking to take on the mantle of brand custodian and chief marketing partner to clients. However, the reality is that for the vast majority of PR companies, PR still means one thing and one thing only – press relations. And to be fair, that is what most clients still see as the primary function of PR.
Clearly the PR industry has not been unaware of the impact of the Internet. However, it seems to have got sidetracked by peripheral, tactical issues such as whether journalists prefer to get press releases via e-mail or RSS; should the social media press release template be more widely adopted; what is the appropriate press etiquette for using Twitter, etc.
Somewhere along the line, many people seem to have missed the following:
– the Internet is the fulcrum of most buying/influencing decisions today (80pc of all web traffic begins with a search; 90pc all B-to-B buying decisions, irrespective of purchase value, will begin with a web search). Influencing the customers customer is (or should be) why PR companies exist. Yet hardly any build PR programmes based on today’s reality.
– the level of insight that can be gained into buyer behaviour and intention via the Web is immense (and yet hardly any PR companies seem to base their recommendations to clients around this).
– because the Internet landscape changes almost daily, a testing and experimentation mindset has to become the norm (again, PR agencies, with their much vaunted creativity, are still sending out crap press releases in a written format that has remained largely unchanged in 50 years).
– many PR companies are still fixated with print based media coverage – even though the anecdotal evidence is filtering through that many readers don’t read print any more (even though they may still buy or purchase a publication – unsurprisingly, publishers aren’t exactly rushing to admit this either).
– the organisational structure of PR agencies has remained unchanged since the 1930s ie directors, account managers, account execs or “Finders, minders and grinders”. The organisational structure and traditional skill set of the PR professional is out of kilter with what will deliver real marketing value in today’s world. PR companies almost all use a retainer model for billing – they need to do this in order to generate the cash flow to pay people’s salaries every month and cover their office costs. The danger is that in many cases they are recommending approaches to clients on the basis of what work will justify the utilisation of their current staff and skill set – rather than what is the best and most valuable approach for the client.
– PR metrics remain on the whole unaligned with genuine business metrics. Worse, there is no “line of sight” between PR metrics and the business goals of a client. For example, many PR companies will tout advertising equivalence as a metric of success. In other words, a positive article appears in a publication, the space occupied is measured and compared with the equivalent cost of taking that as ad space, and the equivalent cost calculated. 99pc of all PR companies using this method will also use a multiplier – anywhere between 2 and 10 – to inflate the figure on the basis that “editorial is more valuable than advertising”. It doesn’t take much to work out why this is nonsense. Worse than that, the metric never had any real, direct connection with a meaningful business outcome
Given all the above, it isn’t hard to see why PR companies believe client expectations are becoming more unreasonable – and why chronic over servicing is on the rise, which in turn is a path to ruin.
It also isn’t hard to see why SEO/SEM is taking an ever increasing share of marketing budget. It naturally begins with a focus on the end customer and provides a level of tracking, measurement, ROI visibility and “line of sight” to fundamental business objectives perhaps unparalleled in the history of marketing. In short, it is data driven and outcome focussed. The two things PR companies seem to fall down on regularly.
So is it all doom and gloom for the PR profession?
Absolutely not. Smart PRs are beginning to notice that particular PR skills coupled with SEO/SEM approaches could provide the most powerful marketing approach the world has seen. Also, what many SEO/SEM agencies are now finding is that they have the opportunity to take a much more strategic role in marketing overall – in some cases, they are already getting involved in strategic work – they just don’t know it. However, in order to sustain growth, these organisations will need to add complementary skill sets that will convince buyers of their ability to deliver.
In short, those PR firms that bite the bullet and make the necessary (and in some cases, painful) structural adjustments to develop a properly integrated (and genuine) search/PR approach are the ones best placed to thrive in the long term.
[youtube=http://www.youtube.com/watch?v=1yKeoNxAJA4&hl=en]
I’m sure some PRs would dearly love to see certain journalists get a punch in the mouth – so you have to hand it to IT writer Nick Booth for volunteering to get beaten up in front of a paying audience. Albeit in the name of charity.
The fight took place last Thursday night at the Chiswell Street Brewery, EC1. I’d seen the rather amusing press release announcing the bout earlier in the week (the inaugural Computer Reseller News Fightnight, a night of white collar boxing – the mind boggles as to possible future combatants in the ring).
The bit I liked best was:
Astonishingly, a new survey says only 54 per cent of all PR people would pay good money to see a journalist beaten up. However, a further 46 per cent said they were pretty sure they would. But they’d have to check first, and would get an answer before the end of play. Or maybe Monday?
Anyway – view above for Nick’s valiant but ultimately doomed titanic battle with the Toshiba Titan, Jason Philips
Hat tip to David Meerman Scott for pointing out a neat new (and free) online utility called Press Release Grader.
It’s very simple. You copy and paste the content of your release into a box and hit submit. The site then generates a report about the press release – it checks to see if the release contains a valid contact phone number for example. But where it gets very funky is in checking any embedded links in the release – not only to ensure they are valid, but also whether the anchor text is reflected by the target link – very handy for SEO purposes. It also has a word “cloud” that lets you see keyword density at a glance – good for checking that the release is highlighting the right things. And lets not forget the Goobledygook checker – it’ll tell you how many suspect buzzwords your release contains.
Finally, it provides you with an overall score out of 100. Imagine if PR agencies started putting their Press Release Grader scores on their releases. Journalists could then choose to only view those that score, say, 85 or above.
Why not check your own releases? Or test out a few from Sourcewire to see what the general standard is.