The Value of Independence: The 5 Myths of Giant PR Firms
By John J. Seng, Founder and CEO, Spectrum; and Louise Pollock, Founder and President, Pollock Communications
In the spirit of Independence Day, we recently found ourselves reflecting on what independence means, but from our perspectives as PR agency owners.
Fifteen plus years ago, we each took leaps of faith, leaving the halls of PR conglomerate employers and starting our own niche public relations firms, Spectrum Science Communications and Pollock Communications. Now as top health/science and food communications agencies, we are proud of what we’ve built over the years, and can’t help but list a number of misconceptions we’ve observed within the PR world about working with small-to-midsized independent firms versus bigger corporations.
Quite often, it seems, larger agencies are viewed as more capable, in a sense, due to their sheer size. So we both wonder: Does massive really matter?
Below we bring to light persistent myths that circulate among our fellow PR agency professionals, some on the client side – including procurement folks, so let’s set the record straight:
5 Myths Of Giant PR firms:
1. Myth: You need a large PR firm to conduct large-scale national or global campaigns. Smaller, independent brands don’t have the bandwidth to execute large programs, and therefore, should only take on smaller projects.
Fact: Many independent firms quite often do some very heavy lifting. We are proud of our practices and place the highest emphasis on client relations. Independent agencies provide the same amount of support, if not more, to maximize our clients’ campaigns to their fullest potential. Plus, we work well with our clients’ other communications partners, and our own independent global networks such as GLOBALHealthPR. If small isn’t right-sized, then why do the larger firms create so-called conflict shops or pseudo-boutique firms?
2. Myth: Only large firms can bring leading expertise into play. By virtue of sheer size, the bigger agencies offer more established connections with the media and third parties.
Fact: Independent agencies understand the complex dynamics of good relationships. We build connections with the people who can impact our clients’ businesses based on what they think or say. People at larger agencies, often heavily overworked, may not have the time to build rich, in-depth connections. One of our stronger suits as independent firms: We find the time because we own greater, local control of our time. Plus, firms such as Spectrum and Pollock that specialize exclusively in health care and food unquestionably offer world class expertise not always found at mixed-interest firms.
3. Myth: With large companies, there’s safety in numbers. Working with bigger firms seems like the more secure choice.
Fact: Size doesn’t necessarily mean quality. Or stability. Or the continuity of your account team. While you may feel confident in selecting a big agency, you won’t necessarily get the attention from its leadership and enjoy the depth of talent you get by working with an independent agency. Our clients remain our first priority, and we consistently provide the creativity, capabilities and results our national and global scale clients need. We are solid, stable businesses that offer high staff retention rates.
4. Myth: Large firms are better-equipped to understand and execute in important, developing, new media sectors.
Fact: Many independent firms already do it all, because we have to. We ensure our employees are well rounded in every facet of public relations. We breed communicators with multiple specialties. While bigger agencies may create smaller, specialty sectors, independent PR agencies encourage and nurture diversity in the communications skills of our people. We develop a combination of the best tools, including social media, advocacy, media relations and everything in between. When we don’t own the best expertise internally, we don’t hesitate to partner with other, best-in-class independent resources. We are not beholden to entrenched, specialty departments or sister companies that are hungry for additional billings.
5. Myth: Large firms provide the best value or economies of scale. It stands to reason you should expect better value by working with a larger firm. Right?
Fact: Scale doesn’t really apply in professional services. Not in law, not really in accounting, and certainly not in PR. The public relations profession is neither a commodity nor a retail business such as Costco. (If you can get Costco quality and prices from our larger competitors, go for it.)
If there were an app that commoditized PR services, it would have been built by now. PR is still and always will be a creative, human resource-driven business.
Based on hourly rates alone, smaller independents are typically a greater value in nearly every single category. (2011 PR agency firm industry data indicate that firms billing in excess of $25 million annually reported higher staff billing rates for every job title from account executive on up to CEO, as compared to firms with less revenue.) Free from the board of directors-driven, ROI-focused mindset of a large firm, we smaller independents own the flexibility to invest in staff dedicated to client service and delivery.
Finally, you may have noticed that many large agencies create smaller, arms-length affiliates to compete directly with the small to mid-sized firm. Why? Because of the perception that smaller is more creative or innovative? Or, maybe imitation really is the sincerest form of flattery after all, and that size does matter.
As independent PR agency owners, we are proud of our respective reputations for high quality service and reach that we’ve built since our respective foundings.
On this Independence Day, we’re also celebrating our business independence and the benefits it brings, from working with the people we enjoy and better serving our clients. We happily remain true to these declarations.
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Louise Pollock started Pollock Communications in 1991 in order to provide clients with top level strategic counsel and advice. Her company has developed award-winning strategic marketing campaigns for some of the world’s most iconic companies in the healthcare, health & wellness, nutrition and food arenas. Louise has implemented communication campaigns on a national and global scale. And has helped start-up companies reach national distribution through the creative use of public relations tactics. Louise values her independence.
John J. Seng, founder and CEO of Spectrum, is a seasoned public relations professional, having worked for three PR firms owned by holding companies since 1979. Celebrating its 15th anniversary this year, Spectrum ranks among the top three health care-only independent PR firms in the United States and is the leading health care-only PR office in Washington, DC. John co-founded GLOBALHealthPR in 2001, the world’s only health-only partnership of independent public relations firms.
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Great blog, guys. Here’s another myth big agencies perpetuate: They’re staffed with the best and brightest minds in the industry. Fact: They’ll present those minds at a new business pitch in order to land the business but, once the actual work begins, those hired guns will be gone with the wind. The ongoing bait-and-switch practices of big agencies helps ensure lots of frustrated former cclients turn to smaller, indepedent firms for REAL people who provide REAL value.
An excellent and timely blog. As indpendence agencies working with some of the largest corporations in America, we’re confronting these myths every time we walk into a pitch. Unless we are dealing with marketing people who really know the realities of the agency world.
I also have come to believe that the last thing in the world people working at big corporations should be holding onto right now is the myth that there is safefy in numbers and that size somehow equals security. Just ask the hundreds of thousands of people who worked at big corporations who have been “downsized” what they think about that.
I believe that the procurement driven mindset that virtually guaranteed the large conglomerate PR agencies business regardless of whether or not they were the best quality-wise is finally starting to wane. Independent PR agencies, especially the good ones in every industry sector, should be on every major corporations list when looking for a PR firm to partner with. We offer things that the giant PR firms can’t.
An excellent and timely blog. As independent agencies working with some of the largest corporations in America, we’re confronting these myths every time we walk into a pitch. Unless we are dealing with marketing people who really know the realities of the agency world.
I also have come to believe that the last thing in the world people working at big corporations should be holding onto right now is the myth that there is safefy in numbers and that size somehow equals security. Just ask the hundreds of thousands of people who worked at big corporations who have been “downsized” what they think about that.
I believe that the procurement driven mindset that virtually guaranteed the large conglomerate PR agencies business regardless of whether or not they were the best quality-wise is finally starting to wane. Independent PR agencies, especially the good ones in every industry sector, should be on every major corporation’s list when looking for a PR firm to partner with. We offer things that the giant PR firms can’t.
Surely “big agencies”must offer some benefits to clients besides the “I hired the biggie so don’t blame me” syndrome.
And while this column borders on self-promotion, these true “myths” have endured for decades.
As to the so-called advantage of hiring a multinational, many-officed agency – each office protects its own P&L, so a client should not expect their “home” office to effectively delegate the work, and don’t expect a local office to give such a one-off project is best shot.
Hi, Len:
Thanks for your comments. PR people given to self-promotion? What’s next, negative political advertising?
Hope all’s well. John
What a thoughtful piece. Thank you both for offering this insightful look into our profession. As a very small firm myself celebrating 17 years in business, I am a true generalist who may come as close to having “seen it all” as is possible. Yet the new twists on so many familiar subject areas makes the work a joy. I am thankful for my many public sector clients and their related private sector clients who rely on smaller firms to communicate complex public policy. The word-of-mouth reputation one earns among these very visible agencies, combined with their need for publicly-justifiable billing rates, long ago led many government clients to understand that we boutique professionals are the best value for those scarce and publicly-disclosed dollars.
Thanks, Marty!
I have to completely and violently agree with Steven Cody. The latest thing that really annoys me is the whole garbage about their employees “traditional PR” backgrounds. What a bunch of positioning fodder. If you are a practitioner and use the AP Style for releases, and can afford to use the latest technology for analytics, then you are practicing both traditional and non-traditional. In tech talk “traditional” means old and out of touch. Clients from the Fortune 500-and beyond-have yet to actually discover that they are not getting the service they pay for and deserve from some of these agencies. Like this wonderful blog, analytics and list building tools such as Vocus and Cision, are part of the new, non-traditional world of business and not that big agency positioning hype. Q2PR (my firm), has been competing with players like Edelman Worldwide for $10,000 jobs in the past two or three years, something that would be rediculous and unheard in prior times. Then again, these guys can afford to say to a large city film festival for instance, “Keep your (inadequate) $10,000 budget. We will take the job on pro bono.” Then they can actually train their staff and have them cut their proverbial teeth on jobs like that. Is that a good value for the client? I say “hell no.”
In years past, large agencies would outsource their work to my firm because we actually know what we are doing, not just training at it or “cutting our teeth.” Hopefully, the really good ones will continue to do so.
I recently saw a blurb on how a large agency alum would be running the Hispanic outreach for a large stock car racing association, and I have to tell you , I feel somewhat sorry for them and wish them both (client and PR counselor) the very best. Does the biggest necessarily mean the best? Again, I say “Hell no.” Is experience no longer a factor in this industry? I have wonder when I read news like that. This is a great article thanks for sharing and publishing it.
JM de Jesus, MBA
President
Quadrant Two PR
Just to bring a bit of balance to this discussion, I worked for a large (the world’s largest, at the time) PR agency, as well as some small ones. I learned much of what I used for the rest of my career at the large firm. I learned it from some of the leading people in the agency business. And I used that experience to teach the business to younger workers at the small firms. A PR agency is a business based on experience. If you don’t have someone with experience running the accounts and teaching the new people, you’re not going to do very well.
At the large agency, I had the option of calling on my colleagues at other offices around the country and buying some of their time to quickly educate me about an industry I had not worked in before, to provide some background as I started work for a new client in that industry. Of course, I could also add them as a temporary member of my account team and have them do actual work on the account. We billed the client at their normal billing rate and there was no mark-up in our office for the “outside” service.
For a week each year, a hundred or so people fairly new to the agency from all over the world were shipped off to a training facility and put through a series of exercises designed to win an account. This was interspersed with problem-solving sessions involving actual problems the agency had encountered with clients. The sessions lasted all day long, there were assignments given each night (again, involving actual situations with clients), and lights out by 11 pm. At the end of the week we made our presentations to the people running the world’s largest agency, as well as several deans from leading business schools. Their critiques of our presentations as a group and as individuals made a lasting impression. I don’t think many small agencies do anything like that.
Presentations to get new business did involve the top people in our office … but the account person(s) who were actually going to service the account were a key part of the presentation and introduced as such to the prospective client. And the top people did remain in touch with the client on a fairly regular basis.
There are probably some big agencies that could be described by your myths. But the ones I’m familiar with, including the one I worked for, were the ideal places for someone new to the business to start out and grow.
I have to violently disagree with Jose who violently disagreed with Steve Cody.
In our Big Agency, we’d bring in the Big Guns (we called them “The Suits”) from New York City, who would dazzle the prospect with their particular expertise and professional presentations. After we got the business, the suits would never be seen again.
Instead, the account would be turned over to an AE and an account supervisor.
It is possible to work with a Big Agency without breaking the bank. Here are some tips:
1. NEVER let the agency visit you for a meeting. Meet at their office. Otherwise you’ll be hit with outrageous time and travel expenses.
2. Get fixed prices for everything. If you let them bill you on an hourly rate, they will pad the bill outrageously.
3. Do some of the work yourself–especially secretarial-type tasks, such as collecting media kits, updating mailing lists, putting together an editorial opportunity book, etc. You don’t want to pay $152 per hour for something you can do yourself.
4. Keep the agency centered on whatever it is they do best–media relations, writing press releases, etc. Don’t let them wander off into a dreamland that you’ll get billed for.
5. Remember that the motto of a Big Agency is: What’s good for the agency is good for the client (they say the opposite, of course). In other words, when they suggest focus groups, doing research, having a meeting, doing a competitive analysis, having a media tour, holding a press conference and so on, it COULD be because they make a fortune doing so. Or it could be the right thing to do. With a Big Agency, you never know.
As my boss used to tell me, “That client has our money in his pocket and it’s your job to get it.”
Words to live by. And to watch out for.
Mr. Merritt,
If you review my comment closely I am in agreement with Mr. Cody. For the record, As a former Account Supervisor, I also hear a loud ring of truth in a your comments and thank you for the insight. I think many agencies large and small bring amazing results. The way this article read to me is that the little guys can bring values that equal, sometimes complement and even outperform the larger agencies in certain assignment areas.
Again thanks for the rare and first hand insights.
JM de Jesus
Quadrant Two PR
In my business, at least (high tech), the woods are full of one-man (one person?) PR agencies. These typically are ex-editors and engineers who know more about their particular industry than most vendors do. These editor/PR people bring product knowledge, industry expertise, and vast experience in preparing materials that will be published.
When a client asks them to write a press release about a new veeblefetzer, they don’t have to explain it–like with most English-major AEs at big agencies, who don’t have the foggiest idea, require a sit-down meeting, and write a release that has to be rewritten by the client 3 or 4 times. And, geez, don’t ask them to write a tech article!
NO big agency can compete with a one-man shop when it comes to industry expertise. The Big Agency will charge 5X as much and take forever to do something a one-man shop can do overnight.
The one-man shops, though, typically don’t have any experience in issue management, crisis communications, and “floppy hat” PR, such as dealing with local TV and newspapers, shooting grip-and-grins, and promoting the client in non-product, non-technical efforts.
So there is a place for big agencies. Just don’t expect to find any industry experts there.
JM: You’re right. You did “violently agree.” I had it backwards.