AT THE CROSSROADS: PR links to the Web - Clients see the Internet as a vital communications vehicle, yet many agencies still outsource Web services. Phil Leggiere looks at top agencies' progress in bringing these capabilities on board

Twenty years ago, the tools of the trade for most PR firms were no more hi-tech than a telephone and a typewriter. But the explosion of digital technologies, particularly the Web, with its unprecedented potential for interactivity, has changed the situation dramatically.

Twenty years ago, the tools of the trade for most PR firms were no more hi-tech than a telephone and a typewriter. But the explosion of digital technologies, particularly the Web, with its unprecedented potential for interactivity, has changed the situation dramatically.

Twenty years ago, the tools of the trade for most PR firms were no more hi-tech than a telephone and a typewriter. But the explosion of digital technologies, particularly the Web, with its unprecedented potential for interactivity, has changed the situation dramatically.

'Net-based communication is becoming as essential in our profession as the press release,' explains David Wickenden, VP and director of Internet practice at Fleishman-Hillard. 'Firms looking not only to adapt but to lead have to make new media knowledge part of their DNA.'

While most established PR agencies would agree with Wickenden, the industry's transition to the digital age has nonetheless moved forward slowly and by trial and error, as firms have struggled with how best to make their organizations fully Web-integrated. A major challenge has been how to find the right mix of in-house technology expertise and outside partnerships with technology service providers.

'Public relations and interactive communications are the most natural allies in the world,' says Jason Teitler, VP of the Global Interactive practice at Porter Novelli International. 'PR has always been geared toward two-way communications in a way advertising and broadcasting aren't. In many ways, PR should take to the Internet like a fish to water.'

At the same time, making interactivity a reality has been easier said than done. 'There is a big gap between how PR and information technology (IT) people look at things and communicate,' Teitler continues. 'Whole new skill sets have to be mastered to bring the two areas together in an effective way for clients.'

Separation anxiety

Industry leaders, including Wickenden and Teitler, believe addressing this gap involves both the development of in-house Internet expertise and the judicious use of IT partners - a tricky balancing act.

'Five years ago the thinking among most agencies was to set up separate Internet divisions and charge them with building Web sites for their clients,' recalls Mike Spataro, EVP in charge of Web communications at Weber Shandwick Interactive.

For instance, from 1995 to 1996, Fleishman's Internet technology division operated as a stand-alone unit, with little relationship to either the rest of the firm or the clients.

'Building Web sites was viewed as a primarily technical matter,' Wickenden remembers. 'Whatever could be done in-house to build client sites was done, and from there, hosting and maintaining the sites was farmed out to an (Internet service provider) or Web-hosting specialist. There wasn't yet a lot of thinking about how the Web would really function as a strategic communications tool.'

This approach, however, completely missed the critical synergy between account teams and clients that is the basis of good PR, for the simple reason that communications professionals stood outside the process.

'Once you get beyond looking at building and servicing a Web site as a commodity, and do some really creative thinking about how the Web can become a value-added part of client communications and marketing, it becomes crucial to get much more hands-on from the inside,' explains Spataro.

He argues that not only in-house expertise but a widespread change within the organizational culture is needed to take Web-based PR beyond the 'static' phase to a 'dynamic' phase. 'Thus far in the short history of interactive technology,' he says, 'much of the effort has gone into creating virtual equivalents to traditional PR functions - virtual press releases, crisis sites and hosted online events. These are very useful examples of using the Web to disseminate information more rapidly and effectively than before.'

'But,' he adds, 'that's still only one-way communication. The real promise of the medium is to be able to establish two-way relationships, through e-mail campaigns, community dialogues and chat - even e-commerce. These are activities that transcend old boundaries between PR and things like direct marketing.'

As an example of the kind of two-way communication flow he has in mind, Spataro cites a recent online site developed by Weber Shandwick for a coalition of environmental activist groups in Minnesota. The organizations banded together to stop highly polluting coal trains from running through residential areas. The Web site,, contains extensive research and press releases on the dangers coal poses for communities and also enables Webcast community forums and online discussions.

Spataro believes a full-scale commitment to training is necessary to adequately develop and distribute Web savvy throughout an organization.

'Our goal is to develop the capacity to handle most facets of Web and interactive communication in-house,' he says.

For Weber Shandwick, that means a lot more than having people with advanced IT skills. It means demanding that a representative from each account team work on all Web projects, and receive training to become conversant with the technology. Account representatives, according to Spataro, then become teachers to their clients.

Fleishman also has made a priority of fully briefing all key account team managers in cutting-edge technologies, with the goal of having these managers spearhead further in-house efforts. The agency uses Cisco Systems' IP/TV streaming video to educate staff throughout the organization. The server-based product allows video training programs to be delivered directly to employees' desktop computers. Wickenden credits this process with making account teams far more capable of working with clients in developing creative online strategies.

Fleishman recently launched a redesign of Healthy Choice's Web site, creating cooking, wellness and travel content channels, as well as a dynamic database that allows visitors to search more than 200 products using various criteria, such as number of calories and ingredients. The purpose of the redesign was to align and integrate the company's online efforts with its overall brand values of knowledge and healthy lifestyles. The effort was done primarily in-house, with active collaboration from the client - a working relationship that would have been impossible had Fleishman outsourced the project.

Jeff Raleigh, US director of Internet practice at Hill & Knowlton, says his agency is conducting a road show in which its major technology partner, the interactive service firm extension11, will tour each H&K office to train account supervisors.

'We gain nothing from having an IT provider set up a communication system an account manager can't understand or audit for performance, and can't educate clients about,' says Raleigh.

And Porter Novelli's in-house professional development department has placed a fundamental emphasis on making all account managers fluent in interactive media. The company has also reoriented its hiring policies over the past two years to reflect a changing take on technology. 'We're now actively looking for PR folks with technology expertise,' says Teitler. 'We need people who can translate IT lingo into PR action.'

PN's global network of in-house managers and developers now provide core services, including Web consulting; site design and development; online news bureaus; and front-end, e-commerce and other transaction services to clients including BASF Corporation, Gillette, Nissan and SmithKline Beecham. The company recently developed a new Web site for Gillette to promote the design and performance of its new MACH3 shaving system. The site used shockwave tools to simulate audio/visual 'sonic booms' symbolizing Gillette's success in breaking the shaving performance barrier. It also offered a 'test flight' sweepstakes and an online feedback questionnaire on the shaving system.

Question the experts

While development of extensive in-house capability is viewed as crucial, some still feel that it is in PR's best interest to regularly seek outside IT counsel. As David Gorodetski, director of interactive services at Ogilvy Public Relations Worldwide, puts it: 'Technology is moving too fast not to take advantage of every source possible. When it comes to new developments like cold fusion, active server pages and specialized e-billing systems, of course we need to look outside for best-in-class practices as they're needed.'

Though firms report now handling upwards of 80% of Web-based functions in-house, finding IT partners to fill in the gaps, or more importantly, to add the finishing touches, will remain a key consideration.

Unlike traditional arrangements in which a one-stop service provider sufficed, PR firms are now screening multiple technology service providers and using them on an as-needed basis for specific tasks. 'If a client needs, say, specialty healthcare news on demand, and that service is being done very well by a provider, then there's no point in us starting from scratch just to say we did it,' observes Raleigh. 'Of course, we'll outsource it then.'

The era of exclusive providers is over, according to Raleigh. 'We're not going to limit ourselves to one provider. We'll outsource as needed, but the responsibility for turning technology into real value-added service is in-house,' he explains.

Many larger firms are also tapping their extended corporate networks for technology partners. Porter Novelli makes extensive use of the Omnicom corporate division group to which it belongs, a network that includes such interactive technology firms as Razorfish and And Ogilvy's Web site development efforts for clients like Coca-Cola were made possible because of expertise provided by the corporate network of digital technology companies owned by WPP, the agency's parent company.

The acquisition of equity interest or outright ownership of smaller Internet-based interactive technology companies is another strategic component being carefully considered by PR firms. In October 2000, H&K bought a stake in extension11. According to Raleigh, the move was designed to extend the firm's existing in-house capacity without usurping control of the company's overall tech strategy.

'Companies that become strategic partners with us, now and in the future,' explains Raleigh, 'do so with the understanding that they need not only provide technical expertise, but will work with us in marrying technology to the specific communications needs of our clients.'

Other firms also acknowledge having their eye on potential acquisitions.

'We expect, even as we work toward our goal of full in-house Web development and management capabilities, to continue to work with third parties. Integrating an existing Net-based firm via acquisition may well be a part of that process,' says Wickenden.

However, the opportunities for outside tech providers won't be for companies who just offer what Spataro describes as the 'standard laundry list' of online technology services. 'Any PR firm that's going to be competitive will be fully able to do those things themselves,' he says, adding that there will definitely be room for providers who can help firms set themselves apart from the pack by customizing solutions for clients.

'The next big step in Web-based communications,' predicts Spataro, 'will be to use technology in new ways as a tool to help forge community relationships, both between organizations and consumers, and on a peer-to-peer basis, where customers actually interact with one another as well as the company.'

Another frontier of Web communications, says Teitler, is offline digital applications - public kiosks and Digicards, which bring a net-like interface to credit cards. These inventions bring Web-based interactive features out of the virtual world and closer to people's everyday life.

A work in progress

Though major PR firms have made great strides toward self-sufficiency and mastery of the new technology, Wickenden thinks that Web-based PR remains an unpredictable work in progress.

'We're only beginning to get at the possibilities two-way communications hold for clients,' he says.

'If we keep learning and do this right, though, this is going to be remembered as a golden age for our profession.' Indeed, a recent survey by IMT Strategies for the Council of Public Relations Firms predicts that if agencies capitalize on the new Internet communications models, the now dollars 4 billion US industry could double by 2003.

As liberating as the new technologies are, PR people should not get so carried away with the tools that they lose perspective. 'We must place limits on what we can and should use technology for,' Gorodetski says.

'There is a real temptation in working with the Web to ignore the line between PR and direct sales or e-commerce.'

That temptation, Gorodetski insists, should be avoided. 'We need to remember that while there may be a direct-sales component to some online campaigns, in the final analysis e-commerce is about transactions, and our industry is about shaping and educating opinion, just as it has always been. The Web is not going to change that.'


Agency: Fleishman-Hillard

Interactive practice: mostly in-house (less than 3% outsourced)

Size of in-house team: 133 in global practice and interactive business units

Date established: 1996, expanded 1999

Typical work: Web-based design, application and development; Internet-based strategic communications; and Internet-based research and measurement

Client Web sites built/designed: White House Office of National Drug Control Policy, Rubber Manufactures Association, Healthy Choice,, SVC Corporation,, Forest Park

Agency: Weber Shandwick

Interactive practice: mostly in-house (less than 10% outsourced)

Size of in-house team: 20

Date established: 1995

Typical work: Internet PR; interactive marketing; and Web design and development (36 individual services under these categories)

Client Web sites built/designed: Northwest Airlines, Direct Deposit Federal Reserve Bank, Baltimore Life Insurance, Calvert Group Mutual Funds, Louisville Water Company, State of Kentucky Pro Basketball, Vertis, Advance Technology Ventures

Agency: Burson-Marsteller

Interactive practice: TPS division (also operates independently to market services beyond the PR industry)

Size of in-house team: 40

Date established: 1984

Typical work: Web strategy; Web creation; hosting; technical architectural programming; design; animation; consultation; competitive Web site analysis; interactive sales presentations; and complete output services, including full video facility, two sound stages, nonlinear editing, streaming media and CD roms

Client Web sites built/designed: Burson-Marsteller, US Treasury, Arbros, Armstrong, iPrivacy, Work Zone, Citibank, Astrolink

Agency: Hill & Knowlton

Interactive practice: in-house and outsourced (dollars 1 million in outsourcing expected in 2001)

Size of in-house team: 18

Date established: 2001

Typical work: collaborating with Web developers to make staff use the interactive space to further client's efforts; concentrating on using the power of the Internet to further communications objectives rather than on building client Web sites

Client Web sites built/designed: California Olive Industry (in conjunction with extension11)

Agency: Porter Novelli

Interactive practice: mostly in-house; Webcasting is usually outsourced

Size of in-house team: 120 in global interactive practice

Date established: 1996

Typical work: online news bureaus; e-business solutions; international online monitoring; developing intranets and extranets; Web site building; and hosting

Client Web sites built/designed: Hewlett-Packard, Kellogg's, Gillette, SmithKline Beechman, BASF Corporation, DuPont, Telstra, MCI Worldcom.

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