One PR agency has been making great waves about their payment by results, 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 for PR seems like a good idea, why should clients not pay on results? 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 it. It might be a really successful tactic but it will have a cost.

I like technology but I am not adept at using it.

I managed to delete a lot of my archive, so I am going to re-publish some of those articles.

If you have already read them on Networking4Business‘ newsletter or somewhere else, please excuse me.

I have a couple of really interesting articles to come.

So if you have a few minutes I hope this will be of interest:

PR is often discounted by smaller businesses as a way to generate real interest and leads. Many reasons are cited but none should really stand in your way. The following short article explains why.

Many small to medium enterprises (SMEs) do not consider PR seriously enough as a way to really generate business. The reasons fall into two broad categories. Firstly, can we find a PR supplier that we can afford and will take our business seriously? Secondly, does it really work?

The answer to the first question can pose a lot of problems for a small business venturing into PR for the first time. PR agencies can seem intimidating places to approach if you do not know what to expect. When you are presented with the £600 per day plus tariff, you might wonder what you will get for your hard earned cash. Will you be treated with the same respect and diligence as bigger name clients? After all, you do not want the most junior member of staff to champion your livelihood.

There are ways to find a provider that will be cost effective and work well for you. Ask trusted business associates for recommendations. Go outside the big agencies. Smaller agencies and freelancers will often provide a better service because your fee will be more important to them. And without the overheads of a prestigious office to pay for, you will have a smaller bill without any loss of performance.

The second question concerns PR’s effectiveness. How can you be sure it works? An often-used objection is that with advertising you can be sure your product or service will appear in the paper, with PR you cannot.

Unfortunately, you cannot guarantee PR coverage. But you cannot guarantee your advert will make anyone pick up the phone or that your mail shot will even be opened.

A good PR man – with imagination, tenacity and a good product to promote – should generate excellent results.

What is more, as a form of marketing communications it is hard to better. Potential clients will trust and take notice of a good piece of PR more than they will of direct mail, advertising or tele-marketing. After all, if a well-respected paper or trade magazine says your product is newsworthy, then, in effect they are saying to your target market, your product and services are worthy of their interest and attention.
This does not mean that you should give up other ways to bring in leads. When PR is combined with your other business development work, it adds up to more than the sum of its parts. Networking, referrals and PR can be a highly effective combination in itself. By all means, use advertising but add PR to increase your leads pipeline.