| Cover Story |
| Columns |
| Marketing Strategies: PR Investments |
| Column | |
| By Vivian Kelly | |
| Thursday, 21 June 2007 | |
![]() It is obvious that a company with a new product would want to get as much press coverage as possible to increase sales of that product, but there are often two other motives, as well. One common reason to want exposure is to increase the profile of a young company prior to raising venture capital, either as a first or a subsequent round of financing. The other is the not-unrelated objective of increasing the apparent value of a company prior to securing an acquisition by a larger organization. Public relations is the ability to get articles published in the press to promote a company and its products or services. Often confused with advertising or marketing (e.g., Web sites, collateral materials or trade shows), PR is increasingly seen as a cost-effective alternative and most companies outsource to an agency to support or completely manage their program. The cost advantage comes from the fact that placing an advertisement in a nationally distributed magazine or newspaper is expensive. This is especially true when you consider that only a long series of repeat exposures of any given advertisement is likely to have any effect. The cumulative costs can add up very quickly and usually exclude all but the largest of players in any given market. On the other hand, getting a reporter to write about a company in a magazine or newspaper is nominally “free” and is generally longer lived than an advertisement in the same publication. This is because, unlike an ad, a reporter’s article remains available online for some time after the publication’s issue date and will usually show up in Internet searches of related topics. Public relations is more effective because the reader of the article perceives it to be factual and independently written. It is not just a paid placement of the company’s self-promotion. It is more credible because it is obviously not marketing hype. This effect reaches its highest value when a reporter writes a review comparing similar products from several different vendors. The company which can best impress the reporter and so receive the most favorable commentary in the subsequent article gains a significant sales advantage almost automatically. The same is true with placements of real-world case studies highlighting how customers are benefiting from a company’s product or service. The naïve approach to getting the benefit of public relations is to write regular press releases and distribute them to as many reporters and publications as possible. There are services available to automate this but they are not generally successful at getting a the media’s attention, let alone coverage. Reporters are besieged with press releases daily and will only ever read those from the major names, such as GE or Microsoft, and even then they may not take much notice unless the subject is some event of major significance or relevant to that day’s writing assignment. The reality is that if any news about a company is to stand out amid the information overload facing most reporters, proactive steps have to be taken to draw the matter to their attention and identify the reasons why it is in their interest to write about it. This is the job of the public relations agency. Company executives are experts in their field but they are not necessarily aware of how or why their product or service might appeal to a magazine or newspaper reporter. Reporters write for readers who are usually generalists. Most reporters are generalists also and they are resistant to jargon. Therefore, it makes sense for companies to turn to a PR agency that can “translate” their product description into language more meaningful to the layman. The agency can also identify exactly which reporters and publications it is worth approaching for coverage and smooth the path toward achieving it. Most well-known PR agencies consider that size is important, both to themselves and to their clients. They feel that a large agency with hundreds of staff members will have more appeal to a major public company client with thousands or hundreds of thousands of staff. There is undoubtedly some truth in this. The inevitable consequence is that these agencies have high overhead. They need lots of office space and several tiers of highly salaried managers. This they recoup with sizeable retainer fees that their larger clients are easily able to absorb. In addition, these agencies charge hourly fees, over and above a notional minimum, from where they produce their operating profits. The total monthly bill from a large agency is often two or three times as much as the agreed retainer. In a large agency, the senior people, who are likely to have the most experience and knowledge, are almost totally dedicated to the management side of their responsibilities. This means the agency staff who interact on a day-to-day basis with the client are nearly always juniors. This is unfortunate when the subject matter is of a more complex nature and the coverage more difficult to obtain. Smaller agencies of 20 to 30 people tend to have more senior PR practitioners on staff and fewer less-experienced team members, so the client benefits greatly from a better service and lower costs. Also, many of the smaller firms specialize in a particular field such as telecommunications, government, biotech or energy, so their understanding of the industry and the reporters in that space helps to maximize coverage. The alternative to engaging an agency is to bring onboard a staff member to manage the program in-house or to hire a freelance consultant. These can be very effective approaches if the goals are realistic and the level of activity is manageable. However, a lone individual working for a single organization cannot get the breadth of exposure to all the reporters and publications needed to create a truly effective program. Having extensive contacts with the reporters and a sound knowledge of their interests and assignments enables a PR agency to tailor the presentation of news to maximize coverage. This requires skill and experience. Whatever the approach, a successful public relations campaign takes a team effort and requires close collaboration between the PR expert and the client. Vivian Kelly is founder and CEO of Interprose Inc., a public relations firm based in Reston, Va. Contact her at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it or 703-860-0577. |
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