You may have heard the word “recession” mentioned a few times recently, and there’s no question that PR budgets are being squeezed, whether you work client-side or agency-side. Tom Watson, professor of PR at Bournemouth University says that in an economic downturn, the balance in the client-consultancy relationship moves towards the client. For those working in-house, he says it shifts towards the financial managers. But whichever side of the fence you are, it is important not to panic. Watson says: “In both situations, it is easy to run ahead like a headless chicken doing lots of little tasks and appearing busy. But, to manage expectations, you must became more strategic and less frenetically tactical. If times are hard, meet with clients or managers and decide which actions are really necessary and will give the best contribution to strategy. Aim to create value rather than buzz.”

Client side

Talking from a client perspective, Simon Wakeman, head of communications and marketing at Medway Council, says that when budgets are tight, it’s important to focus on the positive, and at Medway this means concentrating on effectiveness – “ensuring our money works as hard as possible towards delivering the outcomes that matter.”

As well as leading to more effective work, another benefit of smaller budgets is that they can spark more creative solutions. Wakeman says: “Organisations may look at new channels for delivering their communications and think more laterally about partners who they could work with. For the public sector that means thinking about other public-sector partners, national government and the voluntary sector – working together to create integrated campaigns for our audiences.”

Agency side

Discussing the challenges agencies face as money get tighter, Pete Jacob, new business and enterprise director, EMEA at PR firm Weber Shandwick, also likes to focus on the positive, saying that agencies can turn pressure on budgets into an advantage: “It’s up to the agency to think creatively. A retainer is no longer the final budget. In many cases it’s there to cover off the ‘bread and butter’ activity. Agencies have to wise up, compete against other marcomms agencies, work harder to identify new opportunities, bring new ideas and tap into other areas of the client’s business – marketing, sponsorship and training being just three examples.”

Jacob believes that clients are better advised to spend £30K in three projects across the year, than spread it thinly over a 12-month retainer. He adds that internationally, the value of a creative and efficient hub function, backed up with the latest digital tools, can also dramatically reduce inefficiencies in areas like reporting.

However, it is a mistake, in Jacob’s view, to take gambles: “I can think of several examples in the last 12 months where agencies have clearly taken a loss on a client in order to win the business. The impact is often unmotivated staff, unhappy clients and, in the long run, an unsuccessful business.”

“If you can’t make the budget work or if the client has unrealistic expectations, then do the unbelievable and follow TV show Grange Hill’s Zammo’s example – ‘just say no’.”

Case studies

A client and an agency describe working within tight budgets

Emma Sheppard, Head of PR at St John Ambulance, details a campaign achieved on a “shoestring”:

“Being a charity, we are used to a limited budget for PR, and having to think creatively and make the most of existing resource. For our Life Lost campaign, we wanted the public to realise first aid is the difference between a life lost and a life saved. We knew we needed a strong statistic to get this message across so we pictured the ideal headlines and worked with our in-house medical team to realise them by determining that up to 150,000 people die each year through a lack of first aid.

“The budget went on a survey assessing attitudes towards first aid, media house tours and case study expenses, but the PR element of the campaign was achieved on a shoestring thanks to careful planning and a talented team of individuals. Good PR isn’t necessarily costly, but when money is short, it means you have to be extremely focused in what you want, use your strengths, and allow more time to get there.”

Caroline Kinsey, chairman at PR agency Cirkle, explains how the agency has adapted to financial pressures:

“Our experience this year has seen clients holding or increasing budgets, but wanting greater emphasis on ROI and/or evaluation. A greater commercial understanding, a stronger financial literacy and a more refined marketing approach have got to be adopted by PR professionals if they want to be treated as ‘trusted advisers’ by their clients.

“In addition, we’re finding that we are dealing with more procurement departments than ever before, with PR budgets coming under closer scrutiny. Having said that, the scaremongering procurement departments of old have been replaced with a new, fresher breed. Recent experience shows that so long as you work collaboratively and treat them in the same way as client brand managers and CMOs, sharing best practice and, importantly, campaign evaluations to prove effective return on investment, much can be gained.”