BREAKING NEW GROUND: Winning over first-time clients is tough, but potentially fruitful

Helen Ostrowski, the recently appointed global CEO of Porter Novelli, has more than 25 years' experience in corporate communications and marketing.

Helen Ostrowski, the recently appointed global CEO of Porter Novelli, has more than 25 years' experience in corporate communications and marketing.

She has advised members of the Fortune 500, received an award for professional service, and written erudite articles on her business and its practices.

But get Ostrowski talking about the dynamic that emerges when a company hires outside PR counsel for the first time, and she can sound more like the protagonist of a Jackie Collins novel than the thought leader she is.

"For some companies that haven't used an agency before, there's an intrigue, an excitement factor, a sort of seductive quality that is interesting to them, she says. "Once that switch is turned on, they start to ask, 'Could you do this for me? Could you do that?' In many ways, it's virgin territory. And if you have good chemistry, it could really become a long-term relationship if you bring it along the right way."

Considering how such relationships function, Ostrowski's choice of words makes sense. The interplay between agencies and first-timers can indeed resemble a singles scene, and the initial months of a campaign are often fraught with both the exhilaration - and exasperation - that comprise courtships of the romantic kind. As the dot-com boom turned computer geeks into chic, sought-after companions, so too do shifts in the economy enhance the attractiveness of prospective clients in different sectors. And just when all the plum prospects seem to have been snapped up, an attractive candidate always seems to come along.

In the first quarter of 2002, members of the Council of PR Firms reported signing more than 200 clients to their inaugural agency contracts - and industry veterans feel that that reserve is in no danger of being exhausted.

"Twenty years ago, people were really in the dark about what PR agencies do. Now, when we present to a company, they have a much better feel for it, contends Phil Morabito, president of Pierpont Communications. "With the explosion of the media, I think the supply of first-timers is growing."

Adds Deborah Radman, president of KCSA: "There are a lot of companies out there - small, medium, large - that haven't even begun to look at PR agencies as a marketing resource."

These days, there exists a directory for almost anything. Unfortunately, the PR business is still waiting for a savvy opportunist to compile an exhaustive registry of those corporations and organizations that have yet to work with agencies. "We don't sit here and say, 'Let's specifically target first-time PR users,' says Morabito. "First of all, how would we know where to look? It's not like they are going to wear a sign."

What agencies do instead is scout for prospects in sectors that both fit their strengths and seem under-served on the communications front.

"You can mount a process, says Radman. "At KCSA, we've gone into research mode, looking for industries we are interested in working in and companies within them that fit the profile of an ideal client. She predicts that biotech companies, healthcare providers, and professional services will look to agencies in increasing numbers. Local niches can also represent fertile ground for finding leads: Pierpont, for example, has tapped new billings from the oil field service equipment companies that operate near its offices in Texas.

Even when an agency is actively hunting for newbies, the vast majority of first-time clients are less likely to be won over by a dazzling pitch than by an influential recommendation. "We have been successful in this market when we have been referred, says Kathy Obert, CEO of Cleveland's Edward Howard & Company. "The fruitful way to approach a company that hasn't done this before is to go through a third party, someone who knows how to use an agency. It's good to cast your line where there are fish."

One of the added benefits of securing first-time clients is their frequent eagerness to suggest your services to their own customers; in Morabito's experience, "they are liable to crow about you more than an in-house corporate communicator would. When technology start-ups were still springing up at the rate of dozens per day, venture capitalists could be counted upon for a particularly potent multiplier effect. "Once you had a solid VC as a client, if you were doing a good job, you were soon going to find yourself working with their entire portfolio of companies, recalls Radman.

That heady era has of course ended, but a similar trend appears to be taking hold among law firms and accounting outfits.

"Law firms tend to get asked a lot of questions by their clients that extend beyond just legal advice, says Paul Jensen, VP of Magnet Communications.

"In the financial PR arena, for example, there are practices that rely on law firms as their primary feeder."

Magnet, which represents a number of top law firms, has recently benefited from this phenomenon. "One of our clients recently helped an apparel retailer prepare for potential litigation, says Jensen. "The firm told the company that it should really consult a PR agency, so they came to us for message points and consulting."

In the end, the retailer was never brought into court. "We wound up turning a potentially defensive strategy into an offensive one, he continues.

"A month or two later, we secured a placement for them in USA Today, and got a nice assignment out of it."

In politics, entire Presidential terms may be defined by what takes place in the first 100 days. The same can be said of accounts with uninitiated agency clients - except that in the corporate world, if the transition isn't handled adroitly, the incumbent will be long gone by the time four years are up.

"There's a sense in this industry that you never want to be the first internal PR manager at a company, and I think the same could be said for being a company's first agency, says Jensen. "It's very hard to manage expectations; working with an agency can be a lot harder than they thought, the whole process a lot more sophisticated than they anticipated."

"There's definitely a learning curve, agrees Mike Cherenson, VP of The Cherenson Group. "They sometimes think we have this magic dust we can sprinkle, and all of a sudden The New York Times and Wall Street Journal will want to write about them."

Agencies can sidestep those potential stumbling blocks by starting with "smaller, well-defined, measurable projects, notes Ostrowski. But in order for any first-time client to grow into a significant source of revenue, it will also have to be coaxed into attempting strategies and tactics it might not even have known existed. "They may be open to wider services, but you have to able to deliver, she says. "They'll get smart very quickly."

While there are well-established enterprises that have yet to take the plunge, a large number of first-time clients come from companies that are still in - or have not long ago emerged from - their launch phase.

"What I like about the first-time PR user is that a lot of them are smaller or midsize operations, and typically you are working directly with the CEO, says Morabito. "A lot of the newbies are entrepreneurial, says Cherenson. "And it's easier to be the conscience and voice of an organization when you are dealing with a senior management team that has a strong, clear vision."

Those agencies that convert those enthusiastic first-timers into agency loyalists wind up boosting not only their own bottom line, but also that of the industry as a whole. "The idea that more companies are using agencies, and therefore there must be fewer that still need agencies - I don't know if I buy that, says Ostrowski. "I think it's the quality of the relationships themselves that has a bigger impact."

After all, she concludes, this much is clear: "If they've had a bad experience with an agency first time out, you can be sure it will be a long time before they will work with one again."

MY FIRST TIME WITH A PR AGENCY

"I believed in PR before, says Tory Parks, director of sales and marketing for Del Lago, a conference center and resort located north of Houston.

"But before you actually experience it day to day, it's hard to appreciate the value an agency can bring."

Parks' indoctrination began last year, when Del Lago hired Pierpont Communications to publicize the property, which was planning a major renovation. Then came the September 11 attacks, and with them, a dramatic reduction in tourism and business travel. Del Lago shelved its construction projects and had to rethink its marketing strategy as well - a development that wound up allowing Pierpont to demonstrate its full worth.

"It's just like they are an extension of us, says Parks. "At least, that's the way things are now; as with any first-time relationship, it took a lot of hard work before the results could look effortless. I guess there's always a ramp-up period during which you have to get a lot of stuff backlogged, she concedes. "But I don't know that I had any reservations. I knew it was going to be a big job. And it was.

"It was amazing how one day it all started popping, Parks adds, pointing out that when Del Lago relied on ads alone, its messages hewed to a single pitch. "Group business is what we do the majority of, and you tend to focus on that with the advertising. But we have a lot of different elements here - a marina, golf, a fine restaurant. With PR, we've been able to throw all of those into the mix. It's a whole part of marketing a property that we had been missing, and we're really seeing the benefits."

That's not to suggest, however, that Parks' satisfaction with Pierpont has prompted her to give the agency carte blanche. "I'll admit there are times when stuff is thrown at you and you're like, 'I'm not sure that would be a good story for us, or that that would be something we would want to promote,' says Parks, who has wasted no time in becoming a savvy PR consumer. "But they always add a fresh perspective, and it does get your wheels turning in a different way."

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