Category: General PR

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General PR tech pr Technology PR

Most PR people believe print coverage is more valuable than online: an exercise in cognitive dissonance?

Gordon Macmillan at Brand Republic reports on a new survey which claims that “most PR professionals still favour offline media coverage over digital despite recent consumer research identifying online as the more influential medium.”

He continues: “More than half, or 53%, see it as more valuable, but the real story is that it’s their clients who are still deeply attached to print. Apparently nearly two-thirds or 64% of PRs believe their stakeholders prefer print coverage more than online, television or radio and more than half or 53% believe their stakeholders are more influenced by print coverage than television, online or radio.”

He rightly picks up on the word “believe” and asks: “I mean, don’t they ask? Apparently not according to the Parker, Wayne & Kent survey. It seems to be all about the permanence of print. The fact you can hold it in your hand and turn the page (maybe they never heard to the printer?).” If you examine PWK’s own press release on it, the whole thing is predicated on the “belief” of PRs.

I continue to be fascinated by what appears to a widespread cognitive dissonance in the PR industry (an uncomfortable feeling or stress caused by holding two contradictory ideas simultaneously. Or to keep with the Orwellian sub theme of this blog, doublethink).

In this case, the two contradictory attitudes are: the belief that print media continues to be the dominant media influence and the fact that most of the real data on the subject seems to suggest the opposite.

Why is this happening? Here’s my theory.

In spite of claims to the contrary, the main reason clients still hire PR firms is for “media relations” (although as PR Week has previously reported, clients are spending most of their budget on account management, admin and reporting). And media relations still tends to be geared around getting print based coverage – because that is the skill set (inventory) that most PR firms still have to sell.

So you can see the temptation to try and justify what you have to sell by implying there is still a need for it. And I don’t deny that there is still a large education job to be done client side regarding what are the most effective techniques today. Some cynics might argue that if clients want print coverage lets sell what they ask for – even though we know it isn’t best solution. However, you get the sense from the PWK survey that no one is really asking the questions clients really want answering – namely, how can you help me understand how my target audiences behave, what really does influence them and what is the most effective means of delivering a measurable impact on those audiences?

Over the last 18 months I’ve tried not to miss the opportunity to quiz people about their media consumption habits. On a number of occasions, I’ve asked people to try a little test – basically, to write down what they think their average media consumption is over a week – and then to actually write down what they really do. Most of the time, people are very surprised about the divergence between their belief and reality. The most common is to over-estimate the time they spend reading newspapers and magazines and to underestimate the amount of time they spend online – as well as how online influences their decision making process.

However, before I get accused of being some kind of online obsessive, let’s be clear – I’m not saying print media is completely irrelevant. That’s patent nonsense – and my own recent experience bears out the role it can play in a purchase decision. However, to automatically assume that print is the most influential medium is more an act of faith than rational judgment. And don’t forget the shelf life of print coverage is a few hours.

The starting point has to be the data and evidence that justify an approach. When you actually start to gather real information about how people really do consume media – both on and offline – you build a picture of a very different world to the one that PRs in PWK’s survey seem to inhabit (the emphasis placed on buyer personas by search marketing agencies is an example of how PR could and should be helping their clients).

It’s a bit like when a relationship is going down the tube. Although logically he may know its over, he still clings to the belief that “she still loves him really.” Surely better to face reality and move on – the heartbreak will be more painful the longer you refuse to face facts.

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General PR Technology PR Web/Tech Weblogs

UK search marketing agencies vs UK PR firms (updated)

NMA recently published its “league table” of UK search marketing agencies – the equivalent of PR Week’s Agency top 150. Admittedly it only contains 36 firms, but it is interesting to compare with PR Week’s list – both for general PR and tech PR.

For example, the number one search marketing agency is The Search Works recording an £88m turnover for 2007. Quite impressive when you consider that the company was only founded in 1999 and employs a mere 64 staff. Number one in PR Week’s league table is Bell Pottinger with fees of £52.5m and 467 people (and before anyone asks, of course, we aren’t comparing like with like ie turnover with fees – but I’ll come to that in a minute).

Number five search agency Steak Media was only founded 3 years ago and has already raced to over £20m annual turnover. Number 5 PR firm Citigate Dewe Rogerson turned over £25m last year – though it has been around considerably longer.

According to my calculations, the combined turnover of the UK’s top 36 search firms is around £330m, employing around 1300 people in total. Contrast that with the top 40 UK tech PR firms who brought in around £71m in fees last year and collectively employ around 850 people.

Of course, the billing model for search agencies and PR firms is different. Search firms business tends to fall into three broad camps – paid search, natural search and other stuff (which can be a mix of anything from e-mail marketing, affiliate networks, etc). Based on the NMA figures, the average search firm seems to get around 50pc of its sales from paid search, 25pc from natural search and 25pc for other activity.

Paid search is renumerated either via commission or management fee basis. As far as I can glean, commission varies between 5 and 15pc (though Google Best Practice Funding is due to end at the beginning of next year). This is a traditional ad agency model and you can thus begin to see a correlation between those agencies with high turnover and the majority of their revenue coming from paid search. For example, 90pc of The Search Works business comes from paid search – likewise Steak Media (around 80pc).

Natural search is much more akin to the PR fee model – so those agencies that tend to do more natural search may well have lower turnovers, but have higher margins than paid search. For example Netrank has a turnover of £1.3m and 35 staff – but 100pc of its business is in natural search.

Various sources have pointed out that some search firms that rely upon paid search (and specifically the Google BPF rebate) may be in trouble come next year. However, those that have taken a management fee approach or are moving more work into natural search seem well placed. Interestingly, the move to a fee based, natural search offering seems to parallel issues for PR agencies. It requires more human beings ie brains to do it properly – and thus you hear from various quarters that there is a growing demand for people with the right kind of skills to be able to deliver on natural search. As far as I know, unlike PR, there are no MAs in SEO and online marketing yet – so the search firms are having to train people themselves.

Nevertheless, it is easy to see why the worlds of search and PR are going to get closer together in the future – to borrow from Deep Throat in All The President’s Men: “Follow The Money”.

As far as I can see at the moment, the profitability of search firms is generally better than PR agencies. Whether that will last remains to be seen.

NOTE: This is an updated version of this post – my thanks to Nick Clarke at Profero for pointing out that I’d got the figures wrong for the percentage volume of their natural search business. I have thus replaced it with Netrank as a more accurate example.  My sincere apologies to Nick and Profero – it’s called looking in the wrong column on the spreadsheet with tired eyes.

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General PR tech pr Technology PR Web/Tech

Google reveals keyword search volumes – and why you should care

Don’t know how I missed this one, but last week – and without much fanfare – Google announced that it would now reveal approximate search volumes from within its Keyword Tool.

The excellent Jason Baer at the Convince and Convert blog makes some very good observations as to why this is going to have a big impact on digital marketing. In particular when he says:

“If Google makes the marketing and advertising business as transparent as travel planning and stock purchases, the only agencies that will be able to survive are those that can add real value in messaging, creative, and integrating data into actionable tactics.”

I would of course include PR in the above too. So why should the availability of search volumes bother the PR community? (Or at least the tech/B-to-B world?).

If you accept that 95pc of B-to-B purchase decisions involve search, then you can now put a real figure on just how many people are actually searching on terms that you believe they find important – and are relevant to your business.

Let’s take an imaginary example. The Borked Corporation makes dilithium consoles. Av. profit on a console is $20. The company is aiming to make an additional $1m in profit over the next 12 months. That means selling an extra 50,000 consoles – or just over 4000 consoles a month. All marketing to date has been based around the key term “dilithium consoles”. The company has invested a lot in PR-ing the term dilithium console. Their digital agency has persuaded them to invest heavily in PPC. As of last week, Borked Corporation can see actual search volumes on “dilithium console” – a mere 1000 for the month and an average of 1500 for the last 6 months. It doesn’t take much to work out that Borked needs to answer some major questions – what terms ARE our potential purchasers searching on? How we can understand and influence the non-line buying process and incorporate the most relevant and impactful content at the appropriate juncture? Or more fundamental, is there a big enough market for our products at the current price/profit point?

Let’s not forget that Google’s Keyword Tool can be segmented by geography. For example, here’s the results for the UK last month on the terms digital PR and online PR.

It makes for interesting reading. For example, the keyword term digital PR was searched for in the UK 480 times last month. Online PR got 2400. Exactly 5 times the volume. Or thought of another way, a total of 2880 searches for combined digital/online PR. Or around 100 times a day. And how many of those searches are from people looking to buy digital/online PR services? This is the kind of thinking that helps to bring a forceful clarity to all PR and marketing activity.

Why not see how many times your company/product name was searched on last month? The results may surprise you.

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General PR Technology PR Web/Tech

Social networking reduces profitability by 1pc at Edelman

According to BBC reporter Maggie Shiels in a story today headlined: “Firms miss social site success”:

“At a recent corporate executive summit in Gleneagles, Scotland, PR company Edelman revealed that social networking shaved 1% off its bottom line by encouraging its staff to use such websites as a recruitment tool.”

Shaved 1pc off its bottom line? Unless the meaning of shaved has changed, that means Edelman has seen profitability drop by 1pc as a result of social networking.

I presume Edelman or Maggie Shiels meant that costs rather than profits were shaved by 1pc.

In business, it is usually wise to know the difference between the two.

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General PR tech pr Technology PR Web/Tech Weblogs

How to use 80/20 analysis and thinking to maximise blog effectiveness (And thank you, Rory Cellan-Jones)

I’m a big fan of Richard Koch’s 80/20 analysis and thinking. So I thought I’d put my money where my mouth is and apply the 80/20 principle to analysing my own blog.

Since setting up In Front of Your Nose in January, I’ve discovered that 5pc of my blog posts generated 54pc of my page views. And, spookily, I find that 20pc of my blog posts have generated 80pc of page views (OK, it was 78pc, but you get the point).

To use Koch’s terminology, these are “the vital few” – again demonstrating the natural imbalance in nature – blogging being no different.

From an 80/20 perspective, I decided to focus on analysing the characteristics of the top traffic generating posts to identify what factors contributed to their success eg subject matter, keywords, comments, in-bound links, etc.

For example, my 2 most popular blog posts (generating nearly 20pc of my traffic) were: How to start a PR company with Google and a credit card and BBC’s Rory Cellan Jones and the death of the journalistic backgrounder.

A little further analysis reveals why they proved so popular. With the first post, it got picked up on Social Media Today and this generated a lot of inbound interest. Second, an analysis of the most popular search terms that attract traffic to my blog all centre around starting a PR company eg: how to start a pr company, setting up a pr company, etc. (More 80/20: these terms constitute 10pc of the total number of search terms – and yet generate nearly 70pc search generated traffic).

With the Rory Cellan-Jones piece, one factor stood out like a sore thumb – it was listed on the BBC Dot Life Technology blog as a “Link We Like” for nearly a month – it doesn’t take a genius to work out that if you get link love from such a high profile site then you are bound to benefit. But what made the BBC link to the post in the first place? Simple. Rory Cellan-Jones himself thought it was a great post (he told me) ie it was good, relevant content.

An analysis of search terms is also quite revealing. As I said, until I’d looked at it closely, I hadn’t appreciated the volume of searches around starting a PR business.

What does this tell us? That there are a lot of people out there thinking about doing it and looking for information related to “going it alone” in PR? And is that the kind of person I want to attract? How will that help my own business and revenue goals? (Well, if people want to give me a free stake in any new business venture they start, that’s different).

My search analysis also showed me that terms like online PR and digital PR are still in their search infancy – they are still very much in the early adopter search phase. I’m confident that these terms will increase in popularity (in which case, this blog should be well positioned to pick up on that trend). But clearly there is no guarantee – and it shows that mainstream PR buyers are still using traditional terms to find what they want.

So what now? It has certainly given me some pointers in terms of the type of content I might create in the future – and to think more clearly about linking conversion goals and the relationship between input and output. But perhaps most importatnly it has helped to FOCUS my resources and energy. Which can’t be a bad thing. 80/20. You know it makes sense.

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General PR

Do PR agency directors earn less than £20 per hour?

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.

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Books General PR People Technology PR

How the 80/20 principle dominates PR, social media and life

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.

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General PR Web/Tech

Why Search Marketing Is Eating PR’s lunch

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.

Categories
General PR

What is your attitude to marketing investment risk?

One of the first questions a financial advisor will ask you is: “what is your attitude to investment risk?”.

Whatever response you give – cautious, moderate, high – should determine the financial products the IFA recommends to you. Broadly speaking, the higher the potential return, the higher the risk (profit is the reward for risk).

What if we used a similar analogy with marketing investment?

Are clients and prospects seeking well above average marketing returns? In which case, they may need to spend money on original and creative programmes that have never been tried before – and thus have no track record or guarantee of success (much social media activity could be placed here). Then again, more cautious clients may seek safe returns on tried and trusted approaches (traditional media relations).

Or perhaps they need a balanced portfolio of safer and riskier marketing investments?

Of course, many clients want greater than average returns with money back guarantees. If it were a financial product, they’d be highly suspicious. So beware those who claim to be able to deliver huge ROI with little or no risk.

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General PR Technology PR Web/Tech

More tips on journalist backgrounders

While I’m on the subject, I forgot to mention that you can use Diigo to create a neat little slideshow of your saved bookmark lists – here’s my nascent list of UK technology journalists. With Diigo you can add annotations to each page – and you can choose to do this publically, privately, or by sharing with a specified group.

It also made me wonder about the data protection implications of using this kind of approach. Previously, by creating an internal journalist briefing document, an agency was bound by the Data Protection Act. By using publically available web-based information, does this change anything? All comments welcome.
As a result, I got a strong full sleep. The plus is also the fact that for quite a long period of reception Ambien Without a Prescription, it doesn’t cause absolutely any addiction.