IN-HOUSE SURVEY: Home front - This year’s survey shows that in-house evaluation still has a long way to go. Stephanie France reports

If budget increases are evidence of the importance an organisation places on a particular department, then in-house PR has acquired a most favoured status. According to the 1998 PR Week In-House Survey, 65 per cent of in-house departments enjoyed a budget increase this year, compared with 46 per cent last year. The survey was based on information supplied by 229 organisations throughout the UK.

If budget increases are evidence of the importance an organisation

places on a particular department, then in-house PR has acquired a most

favoured status. According to the 1998 PR Week In-House Survey, 65 per

cent of in-house departments enjoyed a budget increase this year,

compared with 46 per cent last year. The survey was based on information

supplied by 229 organisations throughout the UK.

On average, in-house departments saw their budgets rise by around 38 per

cent, an approximately eight per cent greater rise than in 1997. Of the

nine per cent which saw budgets decrease, the average reduction was

around 30 per cent. Twenty-six per cent had no change. But, with 73 per

cent of in-house departments planning not to increase staff levels, and

a growing reliance on external PR expertise, it seems likely that the

communications strategy will be co-ordinated, although not necessarily

implemented, in-house. It follows that external PR agencies could stand

to profit from the increase in in-house PR budgets.

Whether the PR function is represented at board level appears to depend

on the type of organisation it represents. In general, 30 per cent of

respondents say that a PR director sits on the board. This rises to 41

per cent in hi-tech companies, but falls to 15 per cent in the

healthcare sector.

In the majority of cases, the in-house PR function is still firmly

linked to the marketing department. A quarter of respondents report to

the marketing director, while a further 25 per cent report to the

chairman/CEO of the company. Sixteen per cent of respondents report to

the managing director, nine per cent to the marketing manager, four per

cent to the human resources director and 21 per cent to other masters.

The close relationship between the marketing department and the PR

department becomes even more apparent when it comes to funding. The

majority - 55 per cent - of respondents say their PR budget is derived

from marketing resources, while 19 per cent have an autonomous budget.

Fourteen per cent operate out of a central or chief executive’s budget,

10 per cent are funded from a corporate/public affairs budget, while the

remainder operate from other sources.

Unsurprisingly, media relations emerges as the most common PR function,

accounting for 16 per cent of the average allocation of in-house


This is closely followed by consumer PR and business-to-business, both

scoring 13 per cent. Other key functions include investor relations and

international communications, each accounting for nine per cent of

resources; and financial PR and corporate PR, both at eight per


When it comes to the crucial issue of use of research for planning and

proper evaluation and analysis of results (R&E), the overall picture

that emerges from the 1998 In-House Survey is disappointing. Despite the

increasing pressure for communications departments to ensure that their

activities are accountable, the percentage of resources allocated to

evaluation has remained static at just two per cent. On a more

encouraging note the amount of funds allocated to research has doubled

from last year to three per cent. However, both figures still fall well

below the 10 per cent allocation of funds to R&E advocated by PR Week as

part of the Proof campaign.

While in-house departments remain lax about their own evaluation, the

failure of external agencies to properly evaluate campaigns emerges as

the joint third most common cause for complaint. It seems that in-house

departments are guilty of not practising what they preach.

In cash terms, the largest chunk of the PR budget - 14 per cent - is

spent hiring external consultancies. This is an interesting development

- last year, just eight per cent of the PR budget was earmarked for

external consultancies. It is clear proof of the complementary role that

outside agencies and consultants are now expected to play.

Conversely, the amount of cash directed towards in-house staff has

decreased to 13 per cent this year from 39 per cent last year. The fall

is another indication that companies are increasingly likely to spread

the costs of PR between their own departments and external agencies.

Seventy per cent of in-house departments now rely on the expertise of

external PR consultancies. Of that figure, 50 per cent employ one

consultancy, 41 per cent employ two or three, while nine per cent employ

four or more.

Last year’s survey showed that of those in-house departments which used

agencies, 34 per cent employed either one or two agencies. According to

59 per cent of respondents, the responsibility of hiring and firing

external consultancies falls to the PR/corporate affairs director or the

public relations manager. Otherwise, 21 per cent of the time it is the

marketing director who decides which consultancy to hire - an increase

of 16 per cent from last year.

Generally, agencies can expect to be retained for one to two years - 41

per cent of respondents opted for this time-frame. At the opposite end

of the spectrum, five per cent of in-house departments retain their

agencies without review for more than five years.

As with their own departments, media relations is the most common

required service agencies are asked to perform, according to 29 per cent

of respondents.

This is followed by strategic advice, which was quoted by 15 per cent

and crisis management and literature production, both claimed by 10 per


Strategic thinking scores highly on the list of the most important

aspects of the PR service agencies can provide to in-house departments.

The importance of strategic advice is perhaps an indication that PR is

increasingly involved at the inception of a campaign and not just an add

on service.

The most important contributions that an agency can provide are sector

knowledge and creativity, both scoring 19 per cent, followed by

strategic advice on 17 per cent; speed of response, 15 per cent; quality

of media contacts, 14 per cent; ability to evaluate work done, six per

cent; knowledge of radio and TV media,five per cent; international

capability, three per cent; and media planning capability, two per


The most common area where agencies fall down, according to their

in-house task masters, is failing to deliver. This accounts for 22 per

cent of complaints, followed by the complaint made by 15 per cent of

respondents that junior staff were left to handle their business. In

joint third place were budget over-runs, over-promising and lack of

evaluation. In terms of staff morale, moving to an agency is not a

priority for in-house PR people. The majority are happy where they are,

with just 31 per cent saying they would consider a move to a


Awareness of PR brands is high among in-house practitioners. The most

frequently cited were in descending order: Shandwick, Hill and Knowlton,

Countrywide Porter Novelli, Burson-Marsteller and Text 100.


AirWair is the sales and marketing division of R Griggs, which

manufactures Dr Martens footwear. While the brand is popular worldwide,

with new markets opening up in China and Hong Kong, the footwear is

still manufactured in and around England’s shoe capital,


Recently, to get away from its image of the classic black DM boot,

family-owned R Griggs introduced ’jazz heels’ and ’moc soles’. But its

communications strategy continues to focus on its loyal following of

16- to 25-year-olds.

’Our PR strategy is understated and aimed at grass-roots,’ says AirWair

communications manager Karl Nielson. ’Our customers are at the

rebellious end of the youth market, so everything we do is tied in to

youth sponsorships and promotions.’

The five-strong in-house communications team includes both a fashion and

a music promotions executive. These two devote much of their energies to

supporting bands, festivals and student fashion shows. For the past

three years, Dr Martens has sponsored a New Band Stage at the Phoenix

and Reading festivals, where the likes of the band Kula Shaker have

started on their road to fame. In addition, last month Dr Martens signed

a three-year shirt sponsorship deal with West Ham football club. But the

company is also keen to strengthen community ties between its Shepton

Mallet factory and the local Glastonbury festival.

Last year, AirWair created a wall of fame from limited edition

Glastonbury boots, signed by musicians ranging from Sting to The

Prodigy. Later this year, it plans to auction these in aid of homeless

charity Shelter.


Avon Cosmetics has been ringing British housewives’ doorbells selling

its products direct, since 1959. At the end of last year, the company

realised the need to address its old-fashioned image to maximise


To broaden its appeal and implement a more cohesive communications

strategy, the company expanded and refocused its corporate PR


Since January 1998, the seven-strong team, led by Kim Fernihough, who

arrived from Boots, has established its reputation both with the media

and internally. ’We have had to work hard to change some of the

perceptions within the company about what we should be doing,’ says

Fernihough. For example, she cites the company’s six-year support of the

charity Breakthrough Breast Cancer. In the past, Avon raised huge sums

of money for the charity, but never received any credit. In March,

Fernihough persuaded her superiors to invest funds and change this

relationship to sponsorship of the Fashion Targets Breast Cancer

campaign. As a result, Avon has received huge publicity and been able to

arrange tie-ins with top models and fashion designers, such as Alexander


Other projects scheduled for this year, include the Beauty without

Boundaries campaign. Timed to support the September launch of Avon’s new

Women of Earth fragrance, the company has commissioned a range of

photographs by female photographers of women going about their daily

tasks. The images will be shown in the departure lounges of Edinburgh

and Birmingham International airports. Fernihough says: ’This year, we

dipped our toes in the water to find out what works best. Next year, we

will tailor what we have learnt and take a longer term approach.’


In the UK, Bass Brewers handles brands including Grolsch, Caffrey’s

Irish Ale and Carling. Its eight-strong communications department, based

in Burton-on-Trent, covers external and internal communications as well

as business-to-business campaigns. Glasgow-based communications manager

Scott Wilson looks after the Tennants equity. Bass Brewers works with

Paragon Golin/Harris on its staff newspaper Bass Brewers News and with

agencies including Infocom on its technology-driven communications.

Last month the company faced a crisis when eight million cans and

bottles - about half its Birmingham plant’s weekly output - had to be

recalled because of possible contamination. Bass’ sophisticated intranet

service, Brewnet, proved invaluable as employees were able to follow

events as they happened on the internal news service.

Communal PCs for shift workers in the company’s eight breweries means

that all staff are up to speed on internal matters. But communications

director Philip Malpass says: ’You solve one problem and create


Now we have to address the issue of encouraging face-to-face team

briefings.’ To boost staff morale, in January 1999, about 80 per cent of

employees will attend a national one-day conference at Birmingham’s



Cap Gemini is Europe’s largest computer services and business

consultancy which aims to help companies solve business problems or gain

a competitive advantage through use of IT. Its UK press office, based in

London, is run by PR manager Michelle Perkins, who has a press office

assistant and reports to external communications manager Denise Colgan.

The press office takes most of the incoming calls, while prime agency

Banner PR and a number of smaller regional agencies do most of the

proactive PR. Many of the corporate messages, such as group results and

announcements about acquisitions and alliances, come out of the company

headquarters in Paris.

There are a number of key messages that the press office is responsible

for communicating. These include - Cap Gemini helps companies use IT to

run their business better, it understands technology and is a good


’We are (only as good as) our people and we need to make sure we recruit

and retain the best. We work hand-in-hand with human resources to

promote the company to current and potential employees,’ explains

Perkins. She adds that London-based hi-tech agency Banner is responsible

for regionalising messages to the 80 per cent of employees who work

outside of the capital.


Group corporate affairs director Chris Hopson is in charge of a team of

45 staff based in four cities: Manchester, London, Leeds and


The geographical spread reflects the group’s ownership of four ITV

franchise holders: Granada, LWT and Yorkshire Television and Tees

Television. Following last year’s acquisition of the latter, Hopson has

restructured his team, creating head of media relations posts for both

the north and south of England, filled by Sallie Ryle and Zoe McIntyre

respectively. Last year also saw the arrival of corporate affairs

manager Virginia Lee from regulatory body the ITC.

There are no retained agencies as Hopson believes he has all the

expertise he needs in-house for both programme and corporate PR. The

success of the Free Deirdre campaign, after a plot-line in which

Coronation Street character Deirdre Barlow was wrongly arrested, lends

credence to Hopson’s view. There was coverage on News at Ten and a

widely reported mention during Prime Minister’s Question Time in the


Hopson and his team also had to handle communications linked to the

redundancies of 120 staff in the wake of the Yorkshire-Tyne Tees

acquisition. In addition, there have also been licence discussions with

the ITC and a Government relations programme ahead of a broadcasting

green paper.


’A lot of my effort here is directed towards exhibitions, which is the

most effective way for us to get publicity,’ says Imperial War Museum

keeper of museum services Christopher Dowling. Undeniably Dowling and

his team have maximised publicity opportunities out of recent

exhibitions staged by the Lambeth museum in London.

Last year’s Forties Fashion and the New Look show was shrewdly marketed

to catch the public’s imagination, driving income admission up from

pounds 719,000 in 1996 to pounds 944,000 in 1997. Ballerina Darcey

Bussell was persuaded to model some of the clothes appearing in the show

in a photoshoot for You magazine. She also wrote an introduction to the

book accompanying the exhibition and attended the launch party, which

saw a good media turn out complemented by celebrities, such as ’It Girl’

Tamara Beckwith. Bussell also appeared in the poster for the exhibition,

photographed by Lord Snowden.

Christian Dior sponsored the show.

This year, the big exhibition is Landmines, the April opening of which

was attended by Foreign Secretary Robin Cook. ’We are always looking for

opportunities and we like to persuade people to launch TV documentaries

or books here because it gives us a great deal of publicity and brings

useful contacts into the museum,’ says Dowling. He adds that, where

appropriate, the museum is prepared to consider creating exhibitions

linked to book or film projects in the hope of achieving mutual

cross-publicity benefits.

On the corporate front, the live issue is the proposal to build a

northern branch of the museum in Manchester.


Over past months, media attention at Manchester Airport has moved away

from environmental protests at a second runway, to focus on the more

positive aspects of the operation. The airport has handled its share of

incidents, not least the media circus when former au pair Louise

Woodward, convicted of manslaughter in the US arrived back in the UK.

But the dramatic growth in passenger numbers and air services, a

recently opened British Airways terminal and a new 40-site retail

complex, mean the 12-strong PR team has focused much of its efforts on

promoting the airport and Manchester to the world.

According to Sally Sykes, head of press and PR, the in-house PR

operation sits firmly under the umbrella of corporate affairs, with her

director reporting straight to the chief executive. Currently, the team

covers five main areas: political relations; media relations; event

management; arts sponsorship, and internal communications. On the

political front, the pace of Government policy has meant a busy year.

The team has provided information for parliamentary reports on

regulatory issues and last month’s white paper on integrated public


This year pounds 560,000 of the PR budget went to arts sponsorship. As

principal sponsor of the Halle Orchestra, this month, Manchester Airport

is flying the musicians out to Austria for the Salzburg festival.

Likewise in December, the company is sponsoring the opening season of

Manchester’s newly restored Royal Exchange Theatre. ’To attract more

customers to Manchester, it’s in our interests to promote the culture of

the region,’ says Sykes.


Cirencester-based Mitsubishi Motors has an in-house team of four, headed

by press and public affairs manager David Miles, who has been in the job

for 15 years. Occasionally freelance journalists are used to produce

copy for ’dealer-type stories’, but otherwise work is not


’PR agencies don’t have a very high reputation in the motor industry,’

says Miles. ’You have to work with and believe in the product so you

know it top to bottom. Motor journalists are incredibly professional so

you really have to know your stuff.’

Much of the communications focus over the past year has been on the GDI

engine, which is the result of almost 30 years of research and


The engine is more powerful than its predecessors but at the same time

is more eco-friendly, cutting emissions by 20 per cent and reducing fuel

consumption by a similar amount. Journalists have been able to test

drive GDI-powered cars both in the UK and on overseas trips. In May,

Mitsubishi exhibited at the Greener Car Show, held in Chester, which was

attended by deputy prime minister John Prescott who was speaking on

environmental issues as part of UK’s presidency of the EU.

Major activities this year include the sponsorship of the Badminton

Horse Trials, at which Miles and his team run a media centre for 600

journalists, plus a fully computerised results service. Another annual

fixture on the calendar is the British International Motor Show in

Birmingham. On the eve of press day, Mitsubishi hosts a dinner to which

160 motoring journalists are invited.

There is also publicity linked to motor sport. Current World Rally

Champion, Finland’s Tommi Makinen, drives a Mitsubishi.


The Museum and Galleries Commission (MGC) exists to safeguard and

promote the UK’s 2,500 museums and galleries. Its key role is to provide

expert and impartial advice and to raise standards.

The four-strong public affairs team is quite new and covers general

information, media relations, parliamentary liaison and


Headed by Julie Taylor, the department is allocated its own budget and

reports directly to MGC director, Timothy Mason.

Major projects over the past year have included creating a new corporate

image and organising a conference on the issue of museum charges. Taylor

says: ’The conference generated huge media coverage and kick-started

lobbying of the Government by other bodies, such as the National Arts

Collection Fund.’

Since December 1996, the organisation has also run a designation scheme,

which focuses attention on outstanding collections based in non-national

museums. In June, culture secretary Chris Smith announced the second

round of successful applicants to the programme and in July, backed the

scheme with funds of pounds 15 million.

The public affairs team is also working on the MGC Conservation Awards,

which is sponsored by the Jerwood Foundation. The awards will be held at

the Foreign and Commonwealth Office in December. Previous winners have

included National Museums and Galleries on Merseyside, which runs a

conservation centre which is open to the public.

By the beginning of next year, Taylor expects the MGC web site to be up

and running. Initially offering information and advice, in the longer

term it will include catalogued details of collections around the


’This will be a wonderful tool,’ says Taylor. ’The information we hold

here is second to none, so this will be of use to curators, academics

and the general public.’


Under the directorship of corporate affairs chief Philip Dewhurst,

Railtrack has 27 headquarters staff and a further 12 in the regions. The

company, which owns the railway network infrastructure, also uses three

consultancies: Brunswick for financial communications, The Rowland

Company for corporate hospitality and event support and Bell Pottinger

for public affairs consultancy work.

’I’m a great believer that consultants should advise, rather then be the

spokesmen for a company or their public face at Westminster,’ says

Railtrack head of public affairs Simon Miller.

Recent public affairs tasks have involved dealing with the Rail

Regulator in the run-up to the 2001 review of access charges (from which

Railtrack derives the largest chunk of its revenue) and providing the

Government with input for its white paper on integrated public


Positive news coverage this year has included Railtrack ’steaming to the

rescue’, as the Sunday Times put it, of the Channel Tunnel rail


Railtrack struck a financial deal with consortium London and Continental

and the Government, guaranteeing that phase one of the project would be

built. ’It’s a valuable precedent as it shows how Railtrack and the

Government can work together to solve public policy problems,’ says


As ever, rail safety concerns manifested themselves in a number of

stories, the most damaging of which was last year’s Southall rail crash

in which seven passengers died and 160 were injured. Working in shifts,

the press office fielded 5,000 calls in four days. There has also been

Health and Safety Executive criticism of some construction and

maintenance work and the standard of some of the track.

But, on the whole, it has been a comfortable year for Railtrack, which

has seen its share price rocket since its privatisation in 1996.


The last quarter of 1997 was described as ’pretty grim’ for Safeway by

communications director Kevin Hawkins. In September, the food retailer’s

talks with supermarket rival Asda about the possibility of a merger were

prematurely leaked to the press. On the heels of this came a series of

profit warnings, and the abrupt departure of trading director George

Charters, earlier this year.

However, initiatives such as the relaunch of its customer loyalty card

and internal restructuring seem to have eased some of Safeway’s troubles

for the near future.

Previously reporting directly to chief executive Colin Smith, Hawkins’

operation now sits under the umbrella of Roger Partington’s customer

development division. Most of the team of 25 have been recruited over

the past three years and subdivide into five units, covering public

affairs, consumer PR, wines PR, corporate and internal


While there is still some media speculation about Safeway running out of

steam, its public relations machine has kept the communication channels

open. For two years running, a leading survey of journalists has placed

the company as the premier retail chain for press relations. Hawkins

says: ’You have to keep talking. It’s all very well being open with the

media when things are going well, but you can’t batten down the hatches

and retreat to Fortress Safeway during those times when things aren’t so


Along with the other three big supermarket groups, Safeway’s PR team

faces further challenges over issues such as the safety of genetically

modified organisms (GMOs). ’The level of public interest in the food

industry means the pace is fast and furious’, says Hawkins. ’But we have

people with energy and experience, who are able to think on their



Siemen’s, the largest electronics group in Germany, is currently

battling against the effects of the Asian crisis, as witnessed by the

recently announced winding down of its semi-conductor plant on Tyneside.

In the recent past the group’s medical equipment division has also

suffered financial losses, but now seems to have turned the corner.

’For a while, Siemen’s healthcare sector was perceived as

under-performing and at risk of being sold off,’ says John Stoddart, UK

marketing manager of Siemen’s Medical Engineering (SME) and Siemen’s

Healthcare Services (SHS). ’We were criticised for being rather

unapproachable and so we have made a conscious effort to reposition

ourselves as solutions providers, rather than the purveyors of white


With an in-house PR team of two, the one-year-old SHS business is

handled by Countrywide Porter Novelli, while Basingstoke-based agency,

De Facto works with SME on an ad hoc basis. Currently, the engineering

division is trying to raise awareness among health professionals of the

dangers of X-ray overdosing. As levels from its own products are

comparatively low, the company wants to reinforce its image as a

responsible manufacturer.

In addition, since the beginning of the year the PR team has worked on

the launch of a new magnetic resonance product. Costing around pounds

700,000 per unit, the productalready has 50 per cent of the UK market


SHS however, has been dealing with the set back of withdrawing a major

product. In June, the company decided not to go ahead with a new patient

administration system it was working on with the Government.

Unfortunately, some customers expected to upgrade from an earlier

version and had already invested financially. With an ex-employee among

the journalists asking questions, Stoddart says: ’We had to be totally

honest and provide some very difficult answers. But I think we handled

the situation well.’


The Kingfisher-owned health and beauty retail chain has an in-house team

of six, headed by public relations manager Catherine Emanuel and

internal communications manager Theresa Wright, who both report to head

of marketing Paul Geddes. A decision was taken not to replace part-time

head of communications Tanya Hughes, who left the company in March at

the end of a one-year contract.

Superdrug now has over 700 stores nationwide and is expanding the number

of outlets which contain pharmacies - currently 140. In line with this,

a key communications task has been to drive home the message that the

company’s healthcare business is as important as its cosmetics


An example of this was the publicity which was generated for Superdrug’s

launch of the first ever over-the-counter osteoporosis risk assessment


With input from its long-standing PR agency Lexis, the in-house team put

together the Solait Suncare Amnesty for Superdrug’s 43-product suncare

range Solait, which was repackaged this year. Consumers were offered a

pounds 3 reduction on Solait if they traded in old suncream products.

The campaign runs until the end of the month, when the team will begin

evaluating its impact, both media- and sales-wise.

One of the most successful techniques for generating media coverage has

been to ’come up with new product ideas,’ says Emanuel. There are three

examples of this. First, Virgin Radio, The Big Breakfast, three national

newspapers and a slew of magazines all covered the launch of World Cup

condoms: prophylactics in England’s home kit colours. There was also the

invention of the UK’s first nipple protection stick for sunbathers - the

Solait Nipstick - supported by survey findings which showed that ’older

women are more likely to throw their tops and caution to the wind’. The

Nipstick also won won substantial coverage for the company.

October will see the launch of a third PR-devised product, a breastcare

bath oil, which has been created because experts say the best way for

women to examine their breasts for lumps is in the bath. The product is

part of Superdrug’s cause-related marketing project, working alongside

Breast Cancer Care. It will be launched during Breast Cancer Awareness



Swallow Hotels’ in-house public relations department was set up in

October 1996 when Kish Wilkinson was appointed as its PR manager. Part

of the Vaux Group, which includes a brewery and a chain of pubs, Swallow

operates 36 hotels around the UK.

The two-person PR department handles corporate PR nationally, while

financial PR is handled by the parent company. ’Our aim is to gain

maximum exposure for Swallow nationally and establish it as one of the

biggest hotel chains,’ says Wilkinson.

The department undertakes public relations initiatives for business and

leisure programmes. Recent work has included the launch of a leisure

breaks brochure, and the launch of the new annual tariffs, featuring

room rates that include breakfast. This year has been a busy one for

Swallow with the acquisition of the three-property Manor Hotels group,

and the opening of major new hotels in Huntingdon and Liverpool. For the

opening in Liverpool, the in-house department has been working with

local PR agency Stopforth Bright Anderson. ’We don’t tend to use

external agencies, but the hotel in Liverpool is part of a major

redevelopment of the city centre which the PR agency had been involved

in for some time,’ explains Wilkinson.

Another major part of Wilkinson’s remit is to train hotel staff to

handle local PR. ’I’ve been going out and telling the hotels what public

relations can achieve, which has raised the profile of PR in the

company,’ she says. ’When we purchased Manor Hotels earlier this year,

it was important to project a good image in the local media to help with

staff morale and to ensure guests and suppliers didn’t feel as if they

were losing anything.’

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