What makes up a typical public relations budget? Start with some of the basic inputs, which cover the day-to-day activities of PR professionals that enable them to manage their clients’ campaigns. No two PR budgets are identical; every agency or team has its own way of planning its fees and time commitments, however the following are the most common expenditures.
• Printed materials
• Postage and shipping
• Memberships with professional organizations, such as the Public Relations Society of America
• Press conferences
• Reporting and analytics software
• Content authoring
• Social media campaigns
• Agency fees (if not doing PR in-house)
With shifting priorities and additional projects, budgets tend to evolve. A more recent focus on thought leadership and content marketing has increased the expenses in these areas, forcing the traditional press release to decline in its allocation of time, effort and spend.
A look at the recent evolution of PR budgets
A recent Fractl survey found that for many content publishers, generic press releases had become less important to their collaboration with PR professionals than more sophisticated content types, such as article outlines, infographics and mixed-media pieces. This preference shift emerged alongside rising publisher interest in content marketing since 2011, as measured by Google Trends.
The evolution of PR budgets is also visible in the changing mix of paid, earned, shared and owned media (i.e., the PESO model) spend. According to the 2017 Global Communications Report, earned media is expected to decline for the rest of the 2010s while the other three rise. Sixty percent of its respondents also stated that branded content and influencer marketing were the focus for the next five years.
Even as the makers of PR budgets are identifying new top priorities, financial constraints remain a major issue. More than half of both PR agencies and in-house PR teams cited a “tightening corporate budget” as a challenge to growth. “Lack of quantifiable measurement” scored similar numbers, and the two may actually be related: Incomplete use of metrics, or even lack of consensus on what metrics to track, could be leading PR professionals to sink efforts into projects that may yield a poor return on investment.
Having sufficient resources available for initiatives such as content marketing is important in modern PR. However, the costs of managing such projects can be high. What are the options for agencies and in-house teams with limited budgets?
The content crunch: How new PR priorities put pressure on budgets
Content marketing is the start-to-finish practice of producing written, visual or audio content for a target audience. The costs can be considerable, due to the vast scale of many campaigns as well as the numerous steps involved in the process. The average marketing budget devotes 29 percent of its funds to content marketing. As of early 2017, almost 40 percent of organizations also planned to boost content marketing spending in the next year.
PR budgets are being reshaped by this increased emphasis on dedicated content marketing. One reason for the shift is the decline of organic reach, which has spurred renewed interest in advertising and promotion. More than half of marketers planned to increase their Facebook, YouTube and Twitter spending in a 2017 according to Ad Age survey. The effects of those increases are evident in the growing investments in video content. Video is usually expensive to produce, with each finished minute potentially costing thousands of dollars.
The long-term increase in social media usage has been a key driver of increased content costs. Pew Research Center found that the share of U.S. adults using at least one social media platform rose from 5 percent in 2005 to 69 percent in 2016. With more of the public’s time spent on Facebook, Twitter et al., PR professionals require high-quality content that can capture and sustain the attention of specific audiences.
Not all or even the majority of PR spending is on content marketing; it is just one priority that must now be juggled among many others. Consider that 28 percent of marketing budgets go toward content marketing, according to a Content Marketing Institute survey, and that PR and marketing have already converged in important areas such as social media management and content production. The Holmes Report also once estimated that 6.5 percent of the typical marketing budget went to PR.
While large PR and marketing budgets are possible in some circumstances, not every company is a Nestle, capable of spending significant amounts each day on specific campaigns. Prioritization of projects as well as maximization of low-cost PR techniques is often necessary to reconcile the ideal requirements of PR today (e.g., expert content creation) with the reality of a tight budget.
Less is more? Opportunities with a smaller PR budget
As cost of content marketing increases, it is important to remember that other initiatives within the PR budget are becoming less of a burden, creating a potential opportunity for re-purposing the available dollars. Print and direct mail are often on the decline in many organizations, while overall PR budgets have often increased. The challenge lies in getting more value out of each dollar spent, now that PR has taken on many different tasks, including content production.
In this context, PR customers may seek to avoid the costly retainers of agencies and move projects in-house. Meanwhile, startups and SMBs may have to work within shoestring budgets even as they face pressure to ramp up content marketing and establish new business relationships. Some possible cost-saving scenarios include:
Taking a page from the operational book of lean startups, organizations may design PR campaigns that have short lifecycles and continually build on each other. This approach is in contrast to a major (and costly) all-at-once rollout that could fail in lieu of fully realized messaging.
The campaign behind the highly successful George Foreman Grill is a prime example of an early iterative approach. It was built on extensive A/B testing and adept use of the infomercial format to continually refine its message into the memorable “lean, mean, fat-reducing grilling machine” adage. This gradual, progressive campaign design allowed for smart use of PR funds, in response to extensive feedback.
The messaging app Slack also gradually built its PR momentum, albeit with even less spending. It didn’t run any campaigns, but relied mostly on word-of-mouth referrals that snowballed into a well-known brand for a familiar product.
Attending local meetings, club events and presentations provides numerous affordable opportunities to cultivate media contacts. A short press release or media pitch can also be helpful in starting or reinforcing these interactions.
While press releases have become less central to PR as a whole, they are still relatively low-cost and simple to distribute compared to other forms of content that need to be promoted on social media platforms. Experience crafting them can also help with other types of media pitches. Brevity is essential for all of these media outreach forms.
The Fractl survey we mentioned earlier revealed that publishers are inundated with PR requests, typically receiving hundreds of submissions per week. A short to-the-point document can help you stand out from the crowd and lay the groundwork for a productive business relationship.
There is plenty of low-hanging fruit that can be picked to make PR content perform better. Basic search engine optimization (SEO) is one option. SEO has become critical as PR and marketing have increasingly intersected.
Over time, changes to search engine algorithms have emphasized quality and de-emphasized keyword-stuffing. Since SEO best practices can often be implemented on a small budget, they are worth looking into to ensure articles and other media have the length, formatting and variety to consistently show up in search results.
Beyond that, there are other low-cost options such as:
• Selective signal-boosting of content that has gotten good organic results or is trending.
• Creating a press page/newsroom with plenty of resources.
• Producing podcasts, social media posts and other low-cost content types.
• Adding positive press clippings and contact info to your email signature.
• Sharing content across multiple channels, including social platforms.
Building the PR budget of tomorrow
PR budgets are complex concoctions that are always evolving. Right now, owned and paid media are gaining traction, while earned media is declining. This shift has spurred new emphasis on content creation and distribution, which is generally expensive.
The high costs of successful content marketing have the potential to outrun the budgetary constraints on both PR agencies and in-house PR teams. Accordingly, cost optimization is important going forward. It can take many forms that cut across strategy and tactics:
• Rethinking the life cycle length of a PR campaign, with the aim of shortening it to allow more space for iteration, is an approach that PR professionals can borrow from successful lean startups.
• Constantly updated media relationships are usually inexpensive to maintain while offering excellent returns. Focusing on traditional PR forms like the press release can be useful here.
• Content can be optimized through selective paid promotion of already-successful organic pieces and through the creation of press pages and the inclusion of press mentions in email signatures.
A Master’s in Strategic Public Relations from The George Washington University can help you more fully understand the challenges of modern PR budgeting as well as the best solutions. You will be exposed to the latest best practices in the industries and gain access to a wide variety of careers tracks, whether you already work in PR, communications, marketing, advertising or public affairs, or are looking to make a career pivot. Learn more by visiting the main program page today.
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