The Economics Behind Hiring a Public Relations Firm

Many companies know that public relations are an important part of business and that a good reputation is key if they are going to continue to grow and sell products or services. Many go so far as hiring a public relations (PR) firm to help them manage their reputation. Not only will a good PR firm help prospective customers see the positive side of your company, but they can produce definite economic benefits as well.

Here are three key ways that hiring a public relations firm can directly impact your bottom line. 

  1. Protection of Sales. The Internet can be a wild and dangerous place, especially when your good name is on the line. Although most customer reviews are helpful, some aim to attack your company or products.  In fact, the anonymity of the Internet means that these attacks have become quite vicious. A PR firm can protect you by increasing the number of helpful reviews while monitoring and addressing the negative ones.  Ultimately, this protects your reputation and your sales.
  1. Reduction of salary costs. A good public relations campaign requires a great deal of time, manpower, and focus. This is especially true in the information age, when more communication platforms and services are born every day. Hiring a PR firm to manage your campaigns saves you money on salaries and benefits, and frees you up to focus on doing what you do best – creating outstanding products and services for your customers.
  1. Speed to Market. A public relations firm is ready to move immediately on any press release, product release, or promotion you may have on tap. While internal PR departments may be bogged down by politicking or multiple projects, a PR firm knows exactly how and when to attack in the 24/7 world of advertising, social media, and internet exposure. This enables you to engage customers and prospects sooner and more frequently, giving you an edge in the market.

In the information age, no company can afford to ignore the public reactions to their products, services, and method of business. Hiring a PR firm is more than having someone spreading good words about you – it directly impacts your bottom line. That’s something worth investing in.

Ryan Yeoman is founder of Capterra, business software resource that helps you find and compare business software. Capterra has over 350+ software directories, from PR software to church management software. Capterra enables you to filter results based on your needs as well as view ratings and reviews submitted by your peers. If you need assistance finding the right software for your organization, you can register online for a free software consultation.

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  • David Thalberg

    Ryan – Terrific that you wrote this article. As we all know, ROI on PR is key – an especially important  need particularly with clients who have not had PR before.  And PR plays such an important role in the launch and/or continued success of the branding of a company/product/personality.

    The economics behind the hiring of and a strong relationship with a PR firm is an issue that absolutely needs to be addressed with a potential client early in the process. The client needs to state their goals; the PR agency needs to identify what methods and internal economic devices it will take to meet those goals – then there must be mutual agreement before moving forward into the campaign.

    That being said, I have some thoughts on each of the points you address:

    1: Protection of Sales – We must be diligent in what we promise to clients. It is NOT the PR agency’s role to increase positive reviews.  There have been too many unfortunate examples of “fake” or tainted testimonials and reviews posted by an unwitting PR person – or by the client directly. It IS our role to thoroughly vet positive testimonials and to possibly incorporate these testimonials into a strategic PR plan. 

    2: Reduction of Salary costs: I have found that when there is an in house PR person to work with, it eases many aspects of the PR campaign.  That person can manage shipping, be a sounding board – providing insight into the internal communications of the company, can also be your biggest supporter to the C-Suite, as they were the primary driver to hire you in the first place.  It’s not a competition with them, but rather a partnership to develop a PR campaign that meets everyone’s goals.

    3. Speed to Market. Let’s be careful there.  In a recent pitch, we shared with the client that we will NOT be pitching media for at least the first 90 days we would be working with them. This time would be used to clarify and mainstream all of their messaging – for internal and external communications.  After we explained this, the client decision-maker told me that another agency they interviewed said that they would go after media immediately on both a regional and national level, guaranteeing immediate coverage.  We responded that this was one tactic to take, but it was not a STRATEGIC method to insure long-term success for the client.  If that’s the direction they wanted to go, we flat out said that we were not the agency for them.  To us, it’s ultimately most important to have all messaging in line with goals and company philosophy, and agreed to by all key decision makers before reaching out to any media. (Of course, crisis communications may entail a different strategy, and we addressed that as well.)

  • Sara

    All three of those points are so true and vital to any company. I feel that a public relations team is something every organization, even non profits, need to have. No one ever knows when a crisis is going to arise.

    I learned something from your post, maybe because I am still in school and have not truly been out in the real world yet, but I never realized that having or hiring a public relations firm for a companies campaign could save them money. Everything you posted makes complete sense. Thank you for posting this.

  • Bikijohn

    This information is going to be great for my PR module which I’m studying for my CIM Marketing Communications diploma.   Looking at past papers, the  ‘internal vs external agency’ debate keeps popping up.
    http://myfashionslashlife.wordpress.com

  • Freshwater

    Thanks for this post Ryan. It puts the case very well!

    David Thalberg – also some good points. And I may be unfair in what I am about to say. But having had extensive experience both as a corporate customer and external supplier for PR services I did a double take at the 90-day “orientation phase” working with a company before you go out to the media on their behalf.  I heard the noisy ticking of the billing meter, lots of meetings, lots of  PR talk and chatter with the client about “strategic positioning” and the like, and repeat cycles.  

    I know what the statement ” all messaging in line with goals and company philosophy, and agreed to by all key decision makers” means, and I know it doesn’t take a competent professional 3 months on the payroll to sort that out – even if you are creating it rather than just studying what exists.
    On a separate point, what CAN  eat time and seems to be skipped over in the “speed to marketing”  comments in the main post and elsewhere is the internal approval process.  That’s the “internal politics”, and no external agency is going to vault over that one.