PR Spending Forecast: Are We Set for a Big Decade?

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Businesswoman Holding MoneyA Financial Times article from Friday, March 26 (online subscriber edition here; free PDF version here), noted that global advertising spending is set to rise 4 percent in 2011, as the advertising, PR and marketing industries start to see a surge in client confidence, revenues and overall re-emergence of the world’s economies. What I found particularly interesting was the note in the third paragraph of the article which explains that even with a strong overall global ad spending growth, the total 2011 global ad spending will still below 2006 levels, which is right about the time the US and UK—which are the world’s top spender on advertising, marketing and PR budgets—saw a drastic uptick in overall corporate market and stock values.

But Carat (Aegis Group’s media agency) warned the predicted growth was against weak comparators. After last year’s 9 per cent collapse in marketing budgets, total spending in 2010 will remain below 2006’s levels.

The article goes on to point out that 2011 online ad spending—the only sector that saw ANY growth in the wretched ad year of 2009—will see the strongest growth at 10.1 percent, not surprisingly.

All of this statistical excitement got me thinking: Is PR poised to grow as much as advertising appears to be in the coming years? Or, are we still at a pre-recession state where companies view PR, rightly or wrongly (I’d argue wrongly) as something that is dispensable when the revenue going gets tough? I’d like to think the recession and its ongoing revenue difficulties for many companies has shown that earned media (PR) is a far better value than paid media (advertising), so long as it is done in conjunction with a strategic and well-planned marketing plan, one that, ideally, would incorporate a heavy and strategic use of PR and communications, mixed in with on-point and on-message marketing and advertising used where necessary and where the company/marketer knows the user wants to view and is receptive to viewing said advertising.

So, for the many PR prognosticators out there, where do you think PR spending will stack up in 2011 and beyond? Are we set to see a dramatic uptick in total earned media spending, or will the coming years continue to be a tough time to get clients on board with communications outreach and an paying for an effective and strategic PR/communications strategy?

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  • jeffespo

    Keith – interesting piece. Not sure what the future holds in the cards, but would love it if there was an increased focus on PR, but I don't think it is going to happen.

    Since PR is not measurable in the way that online banner or TV ads are, companies don't see the craft as sexy. So expect to see more dancing babies and similar ads.

    The point that they miss is that PR helps build the brand while those “sexy” ads merely augment the sentiment to incite impulse buys. Hopefully for all of our sake our clients or employers are led by folks who are starting to see the need for a better brand, especially in these tough times.

  • keithtrivitt

    Jeff – Thanks for chiming in about this. I definitely agree with you that even though total global ad spending is predicted to rise in 2011, much of that is probably becuase advertisers and marketers – whether rightly or wrongly – assume that with an uptick in the economy and more consumer spending, consumers will be more receptive to indulging in impulse buys and “shiny-object syndrome” than they were during the recession.

    Granted, that is certainly not all that advertising is good for, as it does have its many merits, but like you, I truly believe that the overall benefits of PR and branding to companies is a long-term value and product affiliation directly with the brand and its attributes, which is often difficult to measure, whereas with advertising, my belief is it's more of a short-term liking or feeling of need to purchase or loosely be associated with that product, which can be more easily measured by short-term sales, TV ads, banner ads, click-throughs, etc.

  • jeffespo

    Keith – there's a lot of value in advertising. My beef with it in general is that when an ad goes south or is relied on too much, there becomes the “What do we do now?” mindset as it was putting the eggs in one basket with the butcher and chicken.

    Thinking of Camel on this one.

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