Before signing on the dotted line with a public relations firm, you need to be absolutely sure it is worth the money.
Hiring a public relations (PR) firm is expensive. There’s no getting around that fact. Depending on the size and scale of the campaign, you are paying someone (or a team of someones) to push your product and service to journalists to try and get your brand into the media.
There is a direct way of doing this that doesn’t involve a public relations professional – it’s called advertising and has a very transparent cost. Advertising is also expensive. Where the value in PR comes is if your agency is able to get your product covered by a media outlet that you would normally not be able to afford an advertisement in.
PR agencies do this by developing an angle to a story pitch. Usually, they will have a network of journalist contacts that they have harvested by handing out free lunches, gifts, and corporate junkets to media professionals that aren’t paid as much as they are. Journalists also don’t have to face the music if a campaign fails to gain any coverage, and they don’t have to follow up a press release they sent out with a phone call that reeks of desperation (spoiler: journalists do not like these calls), so you might say things are somewhat even.
Naturally, the better the story pitch, the more likely it is to be covered. The better PR firms out there will know the publication they are trying to get covered by intricately. They’ll have profiles on the journalists, know who is likely to respond to what type of overture, and will have worked this method successfully in the past. Due to the shrinking nature of newsrooms throughout the country, journalists are becoming increasingly receptive to press releases and story pitches from PRs, as the demand for content is constantly increasing while resources are drying up.
Unfortunately this doesn’t mean you can just dig up a journalist’s contact details off the internet, send them a press release you wrote yourself, and expect coverage. This can work, and often the journalist will appreciate the fact that it’s a genuine pitch from the business owner, but it’s like anything in business – you can probably do it yourself, but if you are willing to pay an expert to do it, they are more than likely going to be able to do it much better.
Teena Townsend, marketing manager for online store Beyond Cool took exactly that approach. Her team was bringing out a new product called a Corkcicle (which is basically a cork with a massive ice spike on the bottom of it which slides into your wine bottle to chill it from the inside) and wanted to generate a bit of media buzz around it.
“We felt that it was an unusual product, which brought a new concept to an old problem of keeping wine chilled out of the fridge,” she recalls. “The Corckcicle is a mass appeal consumer product, and as a small startup company, we don’t have the budget to spend vast sums of money on advertising and promotion.”
In Teena’s case, the company paid $10,000 to a public relations agency to work up a campaign. Because the Corckcicle was an interesting concept and had news appeal (and some hard work by the agency getting the idea out there), they were able to generate widespread coverage of the product. This included Channel 10’s Breakfast show, as well as the home and lifestyle program The Living Room. It was also picked up by several magazines, including Cosmopolitan, House & Garden, Cravings, Shop Til You Drop, Home Beautiful, Selector, and the Gold Coast Magazine. In addition to that, several local Perth radio stations (where Beyond Cool is based) covered the launch, and it was picked up by a number ofnational and regional newspapers.
“It was absolutely worth the cost. We could never afford advertisements in these magazines,” explains Teena. “This was priceless PR coverage for us in terms of creating brand awareness. Our PR report states we received between $250,000 and $350,000 worth of ‘publicity value’ received as a result of our outlay of around $10,000. Hard to measure the true value.”
Thanks to the PR campaign, and subsequent showcasing of the Corkcicle at major giftware shows, there are now over 500 retail outlets stocking the product in Australia.
“We’ve also managed to secure several of the national chains of homeware/kitchenware such as Myer, House, Matchbox, and Howard’s Storage World,” adds Teena. “Investment in PR also provided a selling point for us marketing the brand in Australia.
Something to keep in mind, though, is that the Corkcicle had novelty appeal – it was new and interesting. This is the bread and butter of journalists looking for stories as they want things that will make their audience will stop and go ‘hey, look at that’. A great story is one that leaves someone informed, entertained, and gives them something to tell their friends and family about over a meal. If you’re pitching a journalist with a generic product with no interesting features, even the most expensive PR team in the world isn’t going to get you much.
The Solar Guys
For Tessa Muldoon, marketing manager at The Solar Guys, using a public relations firm was about a very specific goal. The company has had great success providing solar panels to people in Queensland, but a major deal with the Indonesian government failed to get them even a modest nod from the major news outlets.
“We signed a multi-million-dollar deal with the Indonesian Government to provide a large solar power system. It was on four different news channels within Indonesia, and was translated into four different languages around Asia,” she says. “But there was not one publication in Australia that picked it up, so we were like ‘what are we doing wrong?’”
The Solar Guys have had a decent amount of success by using radio advertising. The ads point people towards the website and they have a good conversion rate because of that. But now Tessa is building up interest in a new product they are bringing out called My Sun Bank, which is effectively a series of batteries hooked up to your solar panels so that you can store your energy as well as selling it back to the power companies (when you have a solar installation, you usually produce more energy than you need, so you can sell the excess back into the power grid).
“What we really wanted to do is get more into the local area marketing, and not advertorials but get into real editorial,” Teena says. “Specifically where a newspaper picks up the story and goes ‘this is innovation’ and ‘this is different’ and ‘this is for people in the suburbs’.”
Teena has now signed a PR company for about the same amount of money the company was spending on a radio campaign. The aim is to drum up some interest over the next few months and ultimately land some media coverage in February of 2013.
“We received proposals and we are going through all of the paperwork now,” she adds. “It’s all very much a structured campaign about what they put up now and what gets picked up before Christmas. Because we really want to hit in February/March next year, it’s not something where you can just decide to do it at the end of January.
“They actually lay a lot of the foundation now, with company profiles and stuff that they can put out in the market. We’ve also got some case studies around Brisbane that they really want to use and it’s a broad approach, part of a six-month campaign to build up to a hit in February.”
Teena is feeling confident that the PR company will help them get covered by the local glossy magazines that are given out for free in and around Brisbane, but she is really hoping for coverage in a major Queensland newspaper.
“I would like to have a story in the Courier Mail or the Sunday Mail,” she explains. “Residentially, we only cover Southern Queensland, and our rural products are across broader Queensland, but we aren’t national.”
Something to keep in mind is that PR’s may also charge commission. There will be an agreed on fee for the period of the campaign, and then additional charges for media coverage. It’s effectively a performance-laden contract where the better the coverage, the more you pay.
PR for startups?
Vuki Vujasnovic is the founder of Click PR, and we asked him for his pointers on using a PR company.
Should startups use a PR company?
Whether or not a startup should use a PR agency really depends on what stage of growth you’re at, and what you are trying to achieve. If you’re frantically coding, trying to achieve ramen profitability, or are not yet at minimum viable product stage, you’re probably nowhere near ready to handle the influx of traffic and attention proactive PR can bring. It doesn’t mean you should ignore journalists. By all means engage with them, talk to them, build relationships, and answer any questions they might have. But you really don’t need to hire external assistance at this point in time.
A targeted PR campaign can be massively beneficial in raising investor awareness, securing a groundswell of initial users, and communicating to the broader market how you’re going to disrupt a stagnant model or industry. So if you’ve got your product out there and you are attempting to attract venture capital, or new users, then by all means begin proactive media outreach. Having the right PR team helping you means you can spend more time on your startup – whether you’re hacking or hustling – and let the experts worry about getting the word out there.
How can you find out if the PR company you are dealing with specialises in SMBs?
Simple, ask them about their previous work. PR people are very good at talking the talk – but nothing will tell you more about an agency than the clients they have represented, and the results they have achieved.
How much should it cost?
Phoebe Netto is founder of public relations firm Good Business Consulting, and we asked her for a few pointers on setting a budget for PR.
How much should a PR campaign cost?
Unless you have a one-off instant need for PR, it is much better to have a long-term approach. Regardless of your budget, you should spread your budget out over a period of months rather than having a short period of big spend.
Not only is this better for cash flow, but you will get better media results with a drip-feed approach than a quick flood of activity.
You will find that some PR agencies will not take a client on that is less than $5,000-$10,000 a month. That is a big commitment for a small-to-medium sized business. The key is finding an agency that is flexible, realistic and cares for the overall health of your business. For example, we have allowed some of our clients with small budgets to spread their activity over two month periods at a time, and have achieved great results for them.
Look for a PR agency that has a good grasp of what is needed to achieve results for your business, and is willing to put the time in to get to know you.
Make sure they are experienced in dealing with businesses of your size and with your budget limitations. Not every PR firm is skilled at getting results for small businesses or limited budgets.
Finally, find out who would actually be working on your account at the agency. You shouldn’t assume that it will be the same person who you are dealing with at the beginning of the process, and you don’t want only junior or inexperienced staff doing your PR.
How to choose a PR company?
Adam Clatworthy was a PR rep for Howorth communications until he recently returned to the UK. We asked for his advice on choosing a PR company for a small business.
What questions should an SMB owner ask a PR company before signing up with them?
It’s really important to get to know your PR agency before partnering with them. Find out what campaigns they’ve worked on and what experience they have within your industry. Find out what other clients they work with, as there may be some synergies with your own brand, and make sure there aren’t any conflicts.
How much should a PR campaign cost?
It really depends on the scale and length of the campaign that you want to launch and how much responsibility you want to hand over to your agency. A good rule of thumb is to align yourself with a PR agency that best reflects your business size. Most times, their rates will be in line with your prospective
What are some of the common mistakes you see?
One mistake we see a lot of is when businesses think they can just turn their PR off and on when they feel like it. Unfortunately it doesn’t work like that. Businesses always need to communicate effectively with their customers, employees and stakeholders. Another mistake is that some businesses aren’t completely open with their partners. It’s important to be transparent and let the agency be a part of all aspects of the business.
Case study – Accounts team
Rener Lao is the founder of online accounting solution provider AccountsTeam. He uses Good Business Consulting to handle all the PR activities for his business.
What motivated you to use a PR company?
Our primary motivation for using a PR company was our need to convey our expertise, approachability, trustworthiness and experience to potential customers. As professional accountants and business advisers, we know that our credibility and reputation are huge decision-making factors in people choosing to use our services. We also know that traditional advertising won’t convey this like PR can. We are firm believers in getting external assistance for areas that do not fall into our area of expertise so that they are done properly and efficiently.
What kind of exposure did you get from the campaign?
Our target was to reach small business owners, and the result of the coverage we received in small business publications resulted in a huge increase in web traffic, new business enquiries, and even being approached by significant businesses that wanted to partner with us.
How did you decide which PR company to go with?
We based our search on three factors: experience in the professional accounting industry and SMB sector; proven success in securing coverage across all mediums; and value for money. We only work with service providers that have the capacity to understand us and know how to communicate with SMBs.