NEW YORK: The PR industry saw its greatest growth rate since the tech boom in 2004, and further revenue increases are expected over the next five years, according to a newly released communications industry forecast.The report, issued annually by the private equity firm Veronis Suhler Stevenson (VSS), says that PR revenue in the US hit $3.41 billion in 2004, a 12% growth over the $3.05 billion earned in 2003. Last year's growth rate was triple that of the previous year, and represented the first double-digit annual increase since a 33% rise in 2000.
Technology remained as the largest sector of PR, with a 27.4% share of the market. Tech PR posted its first growth of any year since 2000, with a modest 5.8% rise over 2003.
Consumer and retail PR, however, appear to be challenging technology for primacy. The consumer sector grabbed 25.5% of the PR market last year, a hefty 20.7% increase over 2003. That share has grown steadily over the past five years, from 19.5% in 2000, a year when technology held over 40% of the market.
Likewise, healthcare's strong and steady progress over the past five years marks it as the most consistent growth sector in the PR industry. Its 22.7% share in 2004 was almost a 20% jump from the previous year.
VSS predicts a relatively bright future for the industry as well, forecasting a 10.1% growth rate in 2005 and an 8.9% growth rate for the next five years, on average.
"The public relations segment will benefit from the general trend toward alternative marketing, as well as the trend toward full-service advertising and marketing programs," the report said. "[PR] firms are becoming more proactive in selling to organizations multiple services from brand loyalty campaigns to crisis management."
Kathy Cripps, president of the Council of PR firms, said that Council members attributed the growth to new business wins and more corporate clients buying in to the concept of PR.
"The last couple of quarters, the numbers [in our member survey] have been up," Cripps said. "Definitely, the members have been optimistic."