PRWeek and Boston University’s Communications Bellwether Survey has quickly become the most extensive and credible snapshot of the PR industry, winning awards, garnering positive peer reviews and being featured at high-profile academic conferences.
But this year’s second edition of the survey, based on 1,633 responses from in-house, agency and other practitioners, portrays an industry frustrated at the slow pace of change in their organizations and hampered by bureaucracy. (For an in-depth look at all the data and even more content, purchase the Bellwether Premium Edition.)
When commenting on their biggest obstacles to external change, many in-house PR pros took issue with out-of-touch leadership.
Comments ranged from "Dinosaurs in the board" and "Dinosaurs running it" to "Executive leadership is tone deaf to the realities of the organization from a PR/comms perspective." Another said: "The people making the decisions in my organization don’t match the demographics of those creating or calling for external change."
PR practitioners see their role as bringing authenticity and transparency to enterprises, being the voice of ethics and creating narratives for the organization — they ranked 4.60, 4.01 and 4.59 in terms of importance on a 5-point scale, with 5 being very successful.
But to do their job in a 24/7 digital environment requires being able to act with speed and agility — something 40% of corporate pros believe is hindered by corporate culture.
"Internal resistance to change; lack of recognition that the world is changing," said one respondent, while another lamented "My organization isn’t comfortable being uncomfortable, making adapting to change a timely and costly process."
More than a few respondents characterized their cultures as "slow" to react or make decisions.
One respondent even offered some insight into why an organization might fail to act with speed. "It is difficult to know which areas of change are meaningful enough to invest the time and resources to address; it’s often hard to tell until you are either ahead or behind," shared the pro.
Like last year, the majority of survey respondents agreed it is important for them to have access to the CEO (4.31) and a smaller number think the function should report directly to the top (3.93).
However, some of the qualitative responses referenced an over-involved CEO as their biggest obstacle to responding to external change. "A CEO who micromanages," said one. "CEO/cofounder overly involved in PR decisions," lamented another.
But when it comes to deal-breakers among respondents when considering new employment, fit with team members (4.43), direct supervisor (4.63) and the organization’s culture (4.49) scored higher than access to the CEO — supervisor and culture fit even trumped compensation in importance.
Katie Boylan, CCO at Target, says the retailer invested a lot of time integrating internal and external comms teams.
"Part of developing a successful integration model was building a team structure that promoted collaboration, developing clear job descriptions for everyone and establishing a clear process for how the team needs to work together," says Boylan. "With this in place, team members clearly understand their roles and consistently tap into the talents of their colleagues."
Purpose rises up corporate agenda
The importance of purpose also scored highly (4.07) with respondents, though this shouldn’t be confused with taking a stand on social issues (3.21), which can be surface-deep and not intertwined with elements including sales, suppliers and product development.
"Purpose is so important and we’re certainly seeing that with people we’re attracting," says Sandy Pound, who heads Johnson & Johnson’s medical device comms and sits on CCO Michael Sneed’s leadership team.
"We need to make sure people are aligned when they join, both culturally and with the purpose of the company. They can always gain new skills, but having that core connectedness around purpose is essential. It can’t be just a tagline. Internally, we always talk about how what we are doing ladders up to our purpose."
That purpose mission extends to Johnson & Johnson’s comms partners. This August, the company hosted for a second consecutive year a large number of its agency partners for a full day on purpose.
"We consider it critical for our agency partners to understand the story and thinking behind our purpose," says Pound. "We want them to integrate it in all the work they do for us."
The trend toward the integration of PR with marketing is here to stay. The united front also looks to have imbued the in-house communications person with renewed confidence.
These are two more top-line takeaways from the survey, which found more than half of corporates (55%) work in a somewhat or fully integrated fashion, a figure in line with last year’s survey. Of those respondents, half say the integration is going well.
The survey can also trace a line between a thriving integrated workplace and how respected respondents feel in their positions.
Two out of every three of the 1,633 practitioners surveyed agreed the advice of PR/comms is valued in their organizations, which is a solid, if not spectacular, number.
But that figure skyrockets among corporates in integrated departments, who ranked the success of the integration at least 4 on a 5-point scale, with 5 being very successful. Almost 83% of this group agreed the advice of PR/comms is valued in their companies.
Ray Kotcher, former Ketchum CEO and now professor, practice of public relations at BU’s College of Communication, is encouraged to see the influence of the in-house role going in a positive direction.
"Most in-house counsel are gaining confidence about PR’s place in their respective organizations," he says. "As a purchaser of PR services, these corporates are in good position to set the function up for continued success. That’s why the survey found aspects of comms being kept in-house and others being outsourced. They are earning the budgets to make investments in how they execute the role."
That the integrated model has stuck year over year with success suggests fewer territorial battles are being waged — and that the CMO (or equivalent) sees the value of collaboration, too.
Ryan Green, SVP and CMO at Southwest Airlines, notes his department’s effectiveness is intertwined with the airline’s comms group, which is led by SVP and CCO Linda Rutherford.
"As the industry evolves, we continue to develop our internal transparency, dialogue and cross-functional goal-setting," says Green. "For example, social media is a critical part of both marketing and comms, so we must build an integrated approach that achieves goals for both groups while staying true to the company’s mission.
"A successful integration begins when everyone is aligned to a shared objective from ideation to execution," he adds.
And an integrated approach doesn’t mean comms pros are trying to become ad people, or vice versa. The survey shows respondents aren’t all that interested in becoming experts in areas such as paid media and media buying, which ranked low in importance to the future success of PR.
Meanwhile, corporate pros in a more siloed function are firmly in the minority.
However, according to both quantitative and qualitative results, comms pros may be at a disadvantage in earning the respect of their organization and the resources to measure PR’s impact.
One of four open-ended questions in the survey this year asked: What are some obstacles you or your organization face in responding to external change? Of those who answered, some cited a lack of integration.
And it’s worth noting that not everyone has found the magic formula to making integration work. Of those who said the two departments are at least somewhat integrated, slightly over 5% rated it a 1 and 9.5% gave it a 2 on that 5-point scale of success.
New normal: disruption
While most corporates feel comfortable, the same can’t be said for agency pros based on a revealing data point: 72% of agency respondents and 62% of clients agree we are in an era of agency disruption.
Google is among the companies re-evaluating its agency support. Corey duBrowa, the tech behemoth’s VP of global comms and public affairs, is halfway through a process with procurement to cull comms partners down from almost 200.
He started the process after joining Google a year and a half ago, following 11 months at Salesforce, eight years at Starbucks and 10 years at Waggener Edstrom.
CMO Lorraine Twohill led a similar exercise in 2016 with Google’s marketing agencies. DuBrowa, who reports directly to CEO Sundar Pichai and works closely with Twohill, says the same procurement partners who developed the marketing agency roster are working with comms to streamline its roster, focusing on strategic counsel, execution and measurement.
"Our goal is to develop a master, strategic partner subset. Who are the 10 to 20 comms agencies around the world we do most work with and would benefit from a more strategic engagement?" explains duBrowa. "In the to-and-fro of the business day you can lose sight pretty quickly of what the world is saying and show the empathy you need to successfully engage with and respond to your customers."
"That perspective is invaluable and what an agency really brings to the table," he says, adding "a PR agency should be counselor, idea generator and creative engine."
In a list of 20 services, clients indicated which of them resided in-house or outside. They reported outsourcing media relations to PR agencies more than any other discipline (27%), indicating that, for all the changes in the industry, the skill set remains critically important — and the bread and butter for so many firms.
That is particularly true for smaller, local firms, says Amy Rosenberg, founder and president of seven-person Portland, Oregon, shop Veracity. "The first thing my firm leads with is always press coverage," she says.
But that doesn’t mean the rise of social and digital media hasn’t impacted business. Rosenberg says her firm’s earned media work is designed as much to build positive buzz for clients as it is to get links back to their websites, thereby getting customers into clients’ purchasing funnel.
"Clients have done all they can in the SEO world and turn to us for old-school media relations tactics to earn links," she explains.
Still, the survey results showed conflicting numbers around actual ownership of media relations — 69% of agency respondents and 70% of corporates said they had ownership of it.
"One hypothesis," says Kotcher of the discrepancy, "is that corporates are keeping the really important, industry-specific media relationship building in-house. So an aerospace company keeps the aerospace reporter at The Wall Street Journal close, but when it comes to a special situation like a takeover or crisis and the company needs all hands on deck, it gives work to their agencies."
Keeping services in-house
Discrepancies over who owns what isn’t limited to media relations. At least half of clients reported keeping each of the 20 services included in the survey in-house.
The hypothesis that clients are sharing more work and not giving them the entire pie is supported by big agency leaders.
"I don’t know that we’re seeing the death of the AOR, but there is a lot more project work," says Scott Allison, cofounder, global chairman and CEO of Allison+Partners. "It may be cyclical, but we are embracing it because projects tend to be well-budgeted with well-defined goals and objectives. And, frankly, some of our clients started with rather small projects and once you get that seal of approval, they ask about what else you can do."
"Without a doubt in-house teams are getting bigger," adds Allison, "but it has more to do with the expansion of comms rather than taking everything in-house at the cost of the PR agency."
"We still get some AORs, but over the past three years we’ve seen a trend toward project work," concurs Ketchum’s global CEO and president Barri Rafferty. "A lot of clients hire us for individual launches, so we’re pitching project by project. Some hire us to do a video series or a big global research project or predictive analytics modeling. Clients are coming in via a different door than the traditional PR entrance."
Both Ketchum and Allison+Partners have invested in video production and won first-time clients through this capability.
After media relations, creative ideation ranked as the second-most outsourced service to PR agencies (24%), followed by multimedia content development (22%).
It’s no surprise, then, that creativity is seen as vitally important to the future success of the industry. On a 1 to 5 scale, with 1 being no importance and 5 being strong importance, creativity inched up from last year’s survey (to 4.58 from 4.54), and ahead this year of research/measurement skills (4.29), having a global mindset (3.96) and application of new technologies (3.81).
The latter stat for the second year running scored low in importance, a spot of concern for Kotcher. "The marketing world has really advanced in its use of apps and new technologies, so to see this number still way down is troubling given the move to integrated marketing," he says.
Demands by top management and boards for accountability and measurement have never been greater, according to 79% of respondents. It is not surprising, then, that half of corporate PR pros report keeping research and measurement in-house.
This finding was reinforced by agency pros, who did not report this area as one of the top three services being outsourced.
It’s no wonder some marketers and agencies invest so much effort on culture through team-building initiatives.
Google is building an internal measurement function for comms, says duBrowa. Earlier this year, he also hired Jenna Clark away from Edelman to be head of measurement and insights.
But if only half of corporate pros reported keeping research and measurement in-house, where is the rest of the work going? Almost one in five clients (19%) reported research and measurement work going to management consultants, versus 14% for PR firms.
PR agencies are way ahead of consultancies in winning creative ideation work (24% versus 6%), multimedia content development (22% to 6%) and crisis management (15% to 4%), but the spread in other service areas is narrow. In addition to research and measurement, PR firms have lost ground in what powers measurement: data and analytics, which is also going to more consultancies (14% versus 12%).
A similar pattern was found for change and cultural management (14% to consultancies versus 4% to PR agencies).
These figures are disconcerting for agencies because research and measurement, data and analytics and change and cultural management are all potential growth areas.
Julie Batliner, president of Carmichael Lynch Relate, says this is an area of the PR industry that needs to be better aligned with marketing.
"There’s no reason why PR shouldn’t be measured through the traditional brand health metrics advertising has always used, like ‘Did you hear about this from an influencer? Did you read about it the news?’" says Batliner. "We do some clients’ entire measurement dashboard and for others we’re still pushing for more effort, resources and budget, because they are prioritizing other things."
So what is making clients decide to keep something in-house, with a PR agency or a management consultancy? Clients cited cost (42.5%) as driver No. 1, but quality (36%) followed closely behind. Time-savings was considered least important.
Kathryn Metcalfe, SVP and CCO at CVS Health, says the healthcare and insurance company has built up a roster of agencies on a project basis, but challenges the comms team to use them judiciously.
"Agencies make money generally speaking by the hour, so doing 36 versions of a document is actually very profitable for them — but it’s not an effective way for us to do comms. I challenge my team to finish something in a way that is successful but efficient and effective, because we play our best when we’re bringing strategic thinking," explains Metcalfe. "Oftentimes, we will do an assignment in-house if we have the timelines, skill sets and resources, or if the project has a lot of nuance. Otherwise it’s better to freelance it out."
Metcalfe is also "agnostic about the kind of companies we partner with. I go where the ideas and thinking are the richest."
But a lot of hopeful partners make a poor pitch, she says.
"I must get 20 emails from outside groups saying, ‘Hi, this is my company and what you should know about us,’ without adding any value about what they can specifically do for my company and the challenges we are facing. I don’t even respond to those emails," explains Metcalfe. "But when someone shows me they can add value to my business — those kind of pitches I always have time for."
DuBrowa agrees the category of company is becoming less important in marcomms work.
"My marketing counterpart and I spend a fair bit of time in meetings where the discipline is less important than the integrated campaign we’re putting together," he says. "There’s a lot less religion about — ‘is it a comms firm, a local public affairs firm, a marketing firm, a creative firm?’ — if it’s going to get us where we need to be."
For an in-depth look at all the data and even more content, purchase the Bellwether Premium Edition.