Competing for the PR dollar

Ad agencies are offering PR services as part of the integrated solutions clients are increasingly demanding.

Competing for the PR dollar

Ad agencies are offering PR services as part of the integrated solutions clients are increasingly demanding. Chris Daniels looks at the opportunities and obstacles this presents to PR firms.

At the Cannes Lions International Festival of Creativity earlier this year, the PR Grand Prix was awarded for the second straight year to an ad agency. Australia's Clemenger BBDO won for National Australia Bank's “Break up” campaign, which staged a public breakup between the bank and its rivals through paid and earned media. TBWA/Chiat/Day, Los Angeles, won the year prior for Gatorade's Replay effort. Ad agencies are dominating the PR categories at Cannes – despite the fact marketing dollars have shifted from traditional paid media to earned media and channels such as social media, what should be the sweet spot for PR service providers.

This doesn't mean ad agencies are trying to replace PR firms, however.

“We don't want to displace any of the current PR functions or PR agencies of our clients,” says Joani Wardwell, global PR director for Wieden + Kennedy, a leading independent integrated ad agency. “We're never going to be a PR firm that takes on clients outside of our current roster.”

While the majority of ad agencies may not want to replace their PR counterparts, ad agencies are positioning and organizing themselves as integrated providers who can provide ideas and expertise across virtually every discipline, from traditional creative and media planning and buying to digital media and, now, PR. In the case of the latter, they are achieving that through in-house capabilities and, in larger part, through strategic alliances and affiliations.

Clemenger BBDO, for example, can tap into its “consulting network,” which includes four different PR firms, among them Porter Novelli.

“That's the real question facing firms like ours,” says Dave Senay, president and CEO of Fleishman-Hillard and Cannes PR jury president. “Competing against an ad agency with a PR firm is not nearly as intimidating as pitching against a multifaceted firm ‘made for integration.' ”

Senay tells PRWeek that's why Fleishman's work inside its holding company is so vital. “We have more than 100 collaborations under way right now with non-PR agencies within Omnicom. We are also increasingly pitching as part of integrated teams, often with ad agencies in the mix.”

“Clients are driving all of this; they want more and more integrated solutions,” he adds. “They don't care if we are leading the integration or if we are simply part of a team. They just don't want to work with eight different agencies and eight different contacts.”

Outside of marketing communications PR (see “Maximum exposure” sidebar), Simon Bond, CMO for BBDO and Proximity Worldwide, says collaboration has become the name of the game for integrated campaign execution.

“We have close relationships with Omnicom partners Ketchum, Porter Novelli, and Fleishman-Hillard,” he explains. “We recommend them when we can, but we also work with anyone.”

The search for talent

With clients increasingly looking for integrated advertising solutions, PR firms and ad agencies alike are looking for individuals who are comfortable working across marketing disciplines.

Dale Bornstein, senior partner and director of global practices at Ketchum, says, “We understand that to be at the integrated marketing table, we have to be able to speak the client language and understand what they are looking for in terms of outcomes.”

In addition to staff training, Bornstein says Ketchum is hiring more people with strong MBA backgrounds, non-traditional backgrounds, as well as practitioners from integrated marketing firms.

Ad agencies are also looking for PR talent who can demonstrate their ability to work on integrated campaigns. Peter Krivkovich, president and CEO of Cramer-Krasselt, says, “Recruiting is hard for a fully integrated firm like C-K because up until recently PR was isolated from other disciplines, as were all the others from each other. What we look for is someone who has either had exposure to strategic processes in a company, reported to a CMO, or has a degree that included marketing in addition to journalism.

“The last thing we want when we're recruiting,” adds Krivkovich, “is someone who is so steeped in one thing.”

Slow rise to prominence
Five years ago, Wieden + Kennedy brought on Wardwell to help integrate PR into the agency's thought process for clients. She admits it didn't happen overnight.

“For the first two years, I was begging the creative teams to invite me into brainstorming meetings with clients,” she says. “At the time, nobody [at the agency] really understood PR. They just thought it was crisis management, and that's certainly part of it, but that's not exactly what I wanted to be doing on a daily basis.”

Today, she has four people reporting to her at the Portland, OR, head office, in addition to one PR pro in each of Wieden + Kennedy's seven other offices. Those practitioners are assigned to specific client accounts.

“Creative teams now come to us and say, ‘Can you help add some PR thinking to this creative deck that we're presenting to the client?' Or clients will say, ‘Hey, can we brainstorm with you?'” says Wardwell.

While Wieden + Kennedy may provide the strategic thinking for PR elements of a campaign, she says it then often hands over the execution to an outside PR firm with more resources. Perhaps the most high-profile example of that approach is the work for P&G's Old Spice featuring Isaiah Mustafa. Wieden + Kennedy came up with the idea, while PainePR helped promote it.

But Wardwell says some PR firms are resistant to partner with Wieden + Kennedy because they worry the agency is after its accounts. “I tend to go with smaller firms. The bigger firms are so scared,” she says. “And fear is going to be a PR firm's demise. Unless they adapt, start working together, and sit at the same table with us, they are going to be siloed and, eventually, outdated.”

Some PR firms have adapted, or at least are trying to do so. Ketchum, for instance, trains both its senior managers and account managers on the role they can play in integrated teams, says Dale Bornstein, the agency's senior partner and director of global practices.

The training helps staff understand the role of various marketing disciplines, and the kind of metrics clients expect to see from each. “We want our current and future leaders to understand what it means to do really good integrated marketing, in terms of both leading at the table, but also contributing well with other agency partners,” she says.

It is undoubtedly a paradigm shift – competitors one minute can be your partners the next. But Bornstein says by being the best possible partner, other agencies both within and outside Omnicom will be more likely to work with them again or suggest them to a potential client.

Not all ad agencies, however, have adopted a collaborative model. Cramer-Krasselt, the second-largest independent ad agency in the US, offers a full suite of in-house services, including PR.

Because the agency has no profit centers, Peter Krivkovich, president and CEO, says staff and resources can be shifted to where a campaign idea naturally takes them.

“Even in a pitch for an advertising account, we may say, ‘OK, here's the portion you asked about in the RFP, but we think the real solution is here with this PR initiative,'” he explains. “Now if you don't want to do it all with us, that's fine, you can parcel it out, but this is what we think you need to do to solve the problem.”

He says the problem with the collaborative model is ultimately each provider is still going to push a solution they are most comfortable with and that will bring it the most revenue. “The client can try and coordinate it all, ” he adds, “but are all these players going to play nice in the sandbox? Probably not.”

Maximum exposure

In the past, some ad agencies wanted the creative to speak for itself. Today, agencies from Wieden + Kennedy (which began adding a PR function about five years ago) to big multinationals grasp the need to extend their campaigns' reach through earned media.

“We try to have a PR element built into all campaigns, especially in the social media space,” says Simon Bond, CMO for BBDO and Proximity Worldwide. “We want to give our campaigns maximum exposure and reach.”

BBDO has created campaigns and supported them at launch through PR for clients including GE, Pinnacle Foods, and HBO. BBDO has a five-person PR team in North America led by Roy Elvove, EVP, director of worldwide communications.

For GE, the agency has secured coverage about its ad campaigns in the business section of The New York Times and The Wall Street Journal.

“There is a huge advantage in working with your ad agency in terms of consumer marketing PR,” says Judy Hu, global executive director for advertising and branding at GE. “Roy's team is there from the start, from strategic planning through to creative and development. They know what we're working on before we've finished it, so they fully understand it and can move forward before launch.”

Danger ahead?
The other potential issue is one that could befall PR firms in a few years – and one that is facing digital shops now. Initially, digital pure plays enjoyed fantastic growth, but have since scaled back considerably.

“One executive at a digital agency told me they are not getting as much work from the ad agencies as they used to; the traditional agencies can do it in-house now,” says Krivkovich. “Everybody's learning the other's craft, just like the ad people and the PR people are now sitting in the same room together from the very start of a campaign.”

As ad agency executives better grasp earned media, could PR firms eventually lose their place at the proverbial table?

Dean Jarrett, SVP of marketing communications at Martin Agency, part of the Interpublic Group, doesn't think so. In fact, he says the agency has seen less opportunity to provide PR counsel to clients than it did five years ago.

“As we've grown and secured more national brands, a lot of those companies already have PR counsel in-house or externally with a PR firm,” says Jarrett. “You can come here and get analytics, strategic planning, creative, media planning, and buying – just about everything – but PR seems to be the one area where clients typically do their own thing.”

With the increased exposure social media and even Cannes has brought to earned media, Bornstein says there is also no reason why PR firms can't lead integrated efforts, as well. “I don't think clients today are automatically turning to their ad agency,” she says. “They are turning to the agency where great ideas are being brought forth by great talent. And that is a real opportunity for PR firms.”

Senay says PR firms can help seize that opportunity by being world class in terms of earned media and proactively creating partnerships outside of their core competencies.

He explains: “PR firms would be wise to find partners for various adjacent disciplines and develop the ability to nimbly dance between them and create momentary alliances as required by each unique assignment.”

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