Payment by results PR: sounds great but take a closer look

One PR agency has been making great waves about their payment by results PR, but if you look closer it is not all it seems. It has been featured in Crain’s and How-Do. As far as I am concerned and many other PRs it is just a publicity stunt.

On the face of it payment by results PR seems like a good idea, why should clients not pay on the return? But delve a little deeper and not all is at seems.

Firstly it is a guarantee, not payment on results. It is not a smaller fee with a target driven bonus. There is still the retainer or project fee, the same as anywhere else. If targets are not met you get your money back.

I believe this will store up trouble for any agency that uses this strategy. It will not do too much for the clients because:

  • Agencies should be delivering anyway. If they do not they will lose the clients.
  • Unlike advertising you cannot guarantee coverage. If a publication (s) is / are not interested in your story you cannot make them have it. We could get a lot of pushy PRs and some irritated journalists as a result.
  • There are going to be arguments or disagreements between clients and agencies about what is a “result” unless very specifically defined.
  • Will agencies simply hit certain targets (even if they prove less effective than first anticipated) and ignore opportunities not initially discussed because the target must be met? Agencies should be working out what is effective as the campaign progresses and adapt accordingly.

As Tom Cheesewright, a former PR account director in London, says in his letter to Crain’s on their article simply totting up coverage is a one dimensional way to measure achievement. Tom argues if you are working with key influencers to support or champion your campaign how does that tie in with payment by results?

I have got clients in broadcast media and this contact can be developed and coverage achieved long after I have stopped working with the client. How do you measure that and within what time frame? One of my clients is a physical training instructor and he trains a journalist, a contact that I initiated. It has resulted in some good coverage and an on-going relationship. A payment by results model would have to be very flexible to incorporate such a scenario.

There is a need for agencies to be accountable. There are agencies that do not deliver. This is an issue as in any other profession.

If a client is choosing an agency it is more important to (and this is not exhaustive):

  • Use recommendations and use testimonials to find out if they are the right agency
  • See if you can work with the personnel you will be working with if that agency is selected. Ensure the people pitching are the people delivering.
  • Have a reporting structure and regular meeting to discuss how a campaign is progressing
  • Open two way communication to discuss expectations, goals and issues
  • Look at the enthusiasm of your agency, do they really want to work with you?
  • Are the agency’s clients similar to your profile? Go to an agency that handles BP and Mark’s and they are not likely to be interested in your business if you are a small company, but they might like your money.

For an agency to use such a model ads another layer of admin. Time and effort that could be re-invested in getting on with the job. It might be that this time is included in the time allocated to the client.

One agency has been making much mileage of this, they say: “We are very excited to be innovating the regional market, by becoming the only local PR agency to be putting our money where our mouth is and take away the risk associated with PR.”

Well the standard of English does not fill you with hope. Like a couple of other agencies that have been telling everyone else in the sector how rubbish they are or how they are so much better, it does make you vulnerable if it does not come off. If you say that you had better deliver.

I expect some clients will go for “payment by results PR.” It might be a really successful tactic but it will have a cost.