PMMAO 2008 / REVIEW 2007 / PUBLIC RELATIONS : Polishing profiles for the better

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The Pitch-Madison Media Advertising Outlook 2008 is an attempt to look at how the different media platforms gained or lost in their tussle for the share of advertisers money. Apart from media spending, a considerable amount of the total ad budget also goes to other significant platforms like public relations. To try and understand the positions, progress and prospects of the PR industry, Pitch spoke to the leading lights in the industry fraternity to get an overall picture and how the industry is shaping up in terms of acquisition of clients, its growth etc.

As an industry, PR is relatively a younger concept compared to its other counterparts. But the popularity of PR as a marketing tool has seen an upsurge in the past decade or so, chronicling a visible success story. The keen interest shown by MNC PR firms in the domestic agencies and hiking of their stakes in the existing joint ventures amply speak of this. While Genesis became Genesis-Burson Masteller after the latter bought out the former, Hanmer and Partners Communications is on the block of its foreign partner MS&L for an imminent takeover. The PR industry, which is presently pegged at above Rs 300-crore by different estimates, has seen a lot of forward movement in terms of new services and offering innovative solutions to clients. Again, various estimates put the industry growth rate between 15 and 20 percent, thanks to its fast evolving role in the business of corporate image building.

It is all happening due to many factors like the overall economic growth and the resultant upsurge in corporate confidence and profitability and hence their marketing as well as brand-building spends. The ongoing economic boom has also see a lot of MNCs joining the India growth story. As the largest PR agency Perfect Relations consulting partner Dilip Cherian shares, “global interest in India’s growth story is at an all-time high and companies and governments from around the world are looking for strategic support for an effective market entry.”

Genesis-Burson Masteller principal and founder Prema Sagar too feels the same. “Public relations is becoming far more holistic today. We are seeing the industry transcending from being viewed as a simple bridge to the media to a trusted advisor on corporate reputation.” Sagar further adds that this recognition of the need for credibility within a growing decibel in communication makes PR the preferred alternative medium to spearhead synchronised and integrated communication.

Shedding more light on this buoyancy, Madison PR chief executive Veena Gidwani says, “the overall growth of the economy is resulting in sprouting of many new ventures, launch of new brands and expansion of existing businesses. The entry of many global organisations into our market through joint ventures and tie-ups is also widening the scope for PR agencies.” Integral PR chief executive Sharif Rangnekar also believes that MNCs’ increased interest in India as a whole is pushing the growth graph of the PR industry vertically. “There are a number of MNCs that require hand-holding as India’s diversity is at times too complex for them to understand. This is where PR consultants step in to help draw a connection between our socio-economic environment and the positioning of a foreign entity,” he says.

Innovations Galore
The industry has also a seen a broadening of horizons in terms of services that they provide. As PR Pundit director Archana Jain elaborates, “till a few years back, PR professionals were more of ‘technicians’ who were concerned with the job of communication. Their new role calls for a being strategist who can think business.” Perfect Relations’ Cherian also underlines this factor when he shares that his firms are now increasingly looking at providing a holistic communications package that includes BTL, spokesperson training, PR 2.0 among others. Practice areas like corporate social responsibility and public affairs have become an integral part of his agencies’ service portfolio.

Another interesting development is that PR agencies are changing their profile today. As Hanmer & Partners’ managing  director Sunil Gautam says, “agencies are expected to deliver a host of services other than just pushing media releases and remaining as clip-vending machines.” He puts the changing picture further in place when he says the focus on media relations will always remain, but PR agencies have now started giving value-added services in terms of a host of non-PR activities like events and non-advertisement-related promotions.’ Sagar of Genesis echoes similar sentiments when she says the PR industry is moving up the value chain. And this can be seen in the way agencies are catering to the integrated communication needs of their clients and are not just confined to managing and delivering media mileage.

Coming to a rather ticklish issue—the performance of individual players, in the backdrop of non-availability of any audited data as an industry—most players claim high growth rates coupled with a bullish outlook for the future. As Madison’s Gidwani shares, her agency has been maintaining an high 50 percent growth year-on-year for the past three years. Integral’s Rangnekar also claims that the past year was good for the agency as he was able to book a growth rate higher than what the industry average. Hanmer’s Gautam also notes that his agency managed to gain impressive numbers in terms of growth in the year gone by. Talking about the growth figures, Ipan’s Vivek Sengupta has this to offer, “we have done very well in 2007, and was in line with our creditable performance in the previous two years.”

The industry saw a whole set of new trends coming in as the concept of PR itself having changed or rather broadened, thanks to a greater realisation of the need for better corporate communication. As PR Pundit’s Jain expresses, “we have witnessed a further rise in the trend of specialisation within PR. The role of a specialist today encompasses issues of management, public affairs, investor relations, employee communication and event management.”

Seconding this, Ipan’s Sengupta says, “most agencies and their clients seem to think that PR begins and ends with media relations!  However, we encourage our clients to look beyond media relations.” He further adds, “as a result of this, our clients are increasingly opting for a mix of media and non-media activities. And that is going to be the trend, for soon there will be a saturation of the media, from a perspective of corporate communications.” According to Hanmer’s Gautam, “corporate reputation and corporate communications have emerged as the areas of specialisation which offer the best growth prospects over lobbying or public affairs.”

Another change that Jain brings up is value overtaking the numbers. Today these agencies do not need to show the numbers anymore and now the focus has shifted to creating and showcasing value, she points out. Another important shift is that now PR services are being used by both small and big corporate alike. Apart from all these, internal communication and crisis management have also emerged as key focus areas during the year.

Upbeat Outlook
Looking ahead, the industry seems bullish, riding on the innovation wave and broadening profile. With a large number of global PR firms getting entrenched in the country, the public relation industry has started witnessing more internationally-benchmarked practices. Amid all the buoyancy, there are some talks of consolidations taking place in the industry which reached the point of thinking in terms of offering differentiated services and practices. As Hanmer’s Gautam says, “public relations agenies have an enormous opportunity to lead the next generation of marketing and communication activities around the world as well as in the country, and integrated communications through opportune ATL and BTL, events and public relations would become a necessity.”

Another growth area that Gautam foresees is ‘digital’, as he bets big on it to turning as a catalyst for the communications industry. Sharing a similar sentiment about the change, Sagar of  Genesis opines, “the year 2008 is going to be the year when digital communication comes into the centre-stage. Mass communication media will have to share the dais with online conversations as more and more people turn to the web for information and opinion.”

Looking forward, Rangnekar of Integral PR feels confident about the future when he says, “growth is a certainty and the market is bound to expand. Small and mid-sized companies are aspiring to be bigger. They will wish for a corporate profile. At the same time, infrastructure is another emerging sector as such. The needs would differ from typical brand and marketing communications that has largely dominated the business of PR over the past few years. So what we could see not just over the new year but for many years to come is a growing mix of clients for the PR industry.”

Perfect Relations’ Cherian perfectly puts it, holding that domestic agencies have a bigger and better scope with the rush of multinationals and domestic leaders going to the foreign shores. “PR agencies have a bigger scope in terms of decoding India today than many other,” he sums up.

With a booming economy, the mood is upbeat and most of the industry leaders are talking about a brighter tomorrow. However, some see some dark clouds on the horizon on account of shortage of staff and the feared slowdown in the domestic economy which has been sizzling for quite some time now. On the whole industry leaders look buoyant about the future and promise that PR as an industry holds out.

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Neeta Nair

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