Keeping up appearances
The PR industry has had an image problem, but the downturn just may be its saving grace, writes Shane Hegarty.
A BRITISH MAGAZINE ran a good news business story this month. "Professional services seek public relations in threat of recession," ran the headline.
"It's a useful time for these companies to invest further into PR and marketing," commented an expert. "They see the need to differentiate themselves in these times." The magazine was PR Week, and the tone was as you would expect from a publication dedicated to a profession that is built on putting up a good front. But that is a popular line in the industry at the moment: if the good times were generous to the PR industry, then the hard times may offer even greater opportunities.
You wouldn't have thought it this week, however. The Government's announcement that widespread cutbacks would include a halving of the PR, consultants and advertising budget was a sign that hard times may indeed be ahead. While details are still vague, the Government plans to save €21 million this year through the measure. It will trickle down to the high-profile firms which have specialised in State and semi-State work. Carr Communications is reported to earn €800,000 a year through such contracts, while they constitute about 10 per cent of Edelman's business. Other companies which specialise in the area include Murray Consultants and Bracken PR.
This week, however, people within the industry were expressing no great panic either publicly or privately. It is clear that they are either determined to hold steady, or that they are talking themselves up in a way that only PR people can.
They argue that much of Government spending in big campaigns, such as the €12.5 million Change campaign dedicated to raising awareness on climate change, goes on advertising, making the media's focus on PR alone somewhat skewed. The larger companies have diversified enough not to have to rely solely on the public contracts, while recruitment within the industry remains quite buoyant.
"There doesn't seem to be a slowdown," says Tom Murphy, head of PR and community affairs at Microsoft Ireland, who also writes a PR-related blog. "People are still busy, even in the summer months when we'd normally expect it to be quiet. Anecdotally at least, there has been a lot of hiring, and there seems to be a high demand for senior people. I certainly haven't noticed a sudden increase in the number of CVs, which would usually be a good indicator."
Mark Cahalane, who is general manager of Edelman, and also head of the Public Relations Consultants Association of Ireland, estimates that about 12 per cent of the industry's estimated €60 million annual turnover comes through Government contracts. However, he believes there is a public misunderstanding of what PR is actually about. Generally, firms deal in a wide range of services, including media training, crisis management, branding, corporate affairs, event management and large-scale campaigns. Regarding Government contracts, he says that there is an unfair emphasis on the idea of "spin".
"There is this notion of the dark arts," says Cahalane. "I'm so far from the dark arts I'd love to know what it is. And there is a perception of people walking the corridors of power. I've never been in a corridor of power in my life." He also challenges the industry's reputation for wasting taxpayers' money. "All public sector work is very competitive in terms of securing a contract and, from a value for money perspective, tends to be very rigorously managed."
The PR industry has flourished recently, although there may be concerns for the newer "boutique" agencies - smaller, niche operations which rely on a small number of clients. However, some see positives in a downturn. "Some will cut costs," says Murphy, "but there is no point in closing our eyes and hoping it will all still be there when we open them. Instead, many will take a more strategic way of looking at the difficulty and wonder if there is an opportunity there." Yet, the boom years may also have made the industry flabby. While many PR folk argue that Irish firms rate highly, their growth has not necessarily been matched by greater efficiency or more effective tactics. It is a deadline-driven business, with a high attrition rate among staff. Journalists regularly complain of blanket bombing campaigns, in which they are bombarded by material and information that's of no relevance to them. The advent of e-mail, in particular, means that PR "spam" is commonplace.
"If anything, that will get worse," predicts one experienced consultant. "More than ever companies will be looking for results. They'll be flogging things to death as the need to get coverage grows. If it's getting to the stage where companies do not have as many clients it will mean even more blanket bombing."
The next couple of years will show just what effect a downturn will have on the industry at large, and there is likely to be further scrutiny of PR firms' role in Government departments.
In the meantime, it remains a great irony that the PR industry still has image problems of its own.