THEY ARE the bread-and-butter of the public relations world, but retainer agreements are no longer an industry given, according to Gerry Davis, chief executive of the Public Relations Institute of Ireland and its sister body the Public Relations Consultants Association.
In a BDO report on the professional services sector, Davis reveals he was “quite surprised” by a recent survey of its members that showed the number of retainers were holding up. “But we are also hearing from our members that project-based work is becoming more and more common,” he tells Teleprinter.
Although fees vary, PR agencies can earn about €1,500 a month from a typical retainer with a corporate client, for which they agree to provide a certain number of hours’ service a month. Rates are similar for project work, but the income lasts for just two or three months.
The switch is one reason why “visibility isn’t great” for PR agencies and sole traders, despite a greater level of optimism in the industry than existed 12 months ago. The other advantage of retainers is that “you’re in a relationship with clients” and can plan their PR on an ongoing basis, whereas agencies may not think much about clients in between projects, says Davis.
The shift from retainers to short-term projects has coincided with a reduction in fee rates, with both reduced client budgets and competition from low-overhead sole traders taking their toll on the bigger agencies. As a whole, industry revenues have contracted an average of 30 per cent. “Some of the fees that you hear being offered around the place are completely unsustainable,” says Davis. “There is huge pressure.” Ultimately, it is up to PR consultants to “work to convince their clients of the true value of what it is they offer”.
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