A couple of weeks ago I read in PR Week that a high profile hi-tech PR agency was offering the first month’s PR free to new clients. As all PR practitioners know, the amount of effort that goes into new business is immense. Not only that, once an account is won, it is quite likely that you'll over service in the first few months to kick-start the campaign. For long enough PR has been the poor relation in the marketing mix, surely this just fuels the charging debate - I feel it certainly devalues the service, can you ever imagine a creative agency creating anything for free?! 

Those companies who realise the value of public relations naturally use PR, if their account is out to tender, then as an agency, you need to know why. Is there a new marketing director who wants to make changes; has the incumbent agency become complacent; are they overcharging for the work they do; are they just doing a half-hearted job and if so why? It may be that the client's just not satisfied; no matter how much focused coverage their agency is achieving.

Before inviting agencies to tender for your business, take the time to develop a comprehensive PR brief. Know what the PR campaign has to achieve, set out the objectives you need to be achieved and be honest about your budgets. All too often we are asked to pitch for business and the company can offer no formalised brief and no details of the size of budget.  You wouldn’t go and buy a new car without knowing whether you wanted a people carrier or a sporty little number and you would certainly know how much you can spend, so why is buying PR any different?  Producing a concise, but thorough, brief ensures a company reaps the benefits of the effort they have sown.  An agency is then able to respond intelligently and creatively and most importantly, within the financial parameters they have been given.  There is nothing more frustrating for an agency than to produce a proposal with hundreds (or at least tens) of ground-breaking ideas only to be told by the potential client that instead of the 7,000 per month retainer being suggested, they only have 2,000.

Think about what you're looking for in an agency.  PR is inevitably the domain of the marketing department, but when developing your brief check out the requirements other colleagues may have of PR, particularly the sales team.   At the end of the day PR is not about column inches and self-congratulation, it’s about establishing a persona for the company that brings in the sales leads. This reality is unfortunately often overlooked. It’s also worth doing some investigation outside the company. We all know PR is about the media, so why not talk to them? Speak to the leading titles in your sector- trade, vertical and online titles - and find out which PR companies they recommend.  I can guarantee this approach will lead to some interesting conversations and journalists will be only too happy to tell you which agencies understand your markets.

Companies should also be wary of the charge out rates: unfortunately all too often agencies seem to charge what they feel fits. This simply skews the whole charge out rate mechanism for companies like ourselves who use the tried and tested and recommended formula - charge out rates should be 3.5 times the cost of the consultant to the agency. It is ridiculous how much some agencies charge, but then you could say if clients are willing to pay it then, what’s wrong with making money. Over the years I have interviewed hundreds of PR executives but one that stays top of my mind was an account executive who had only 6 months experience and was being charged out at a staggering 485 per day!

Overcharging enjoyed its heyday during the dot com boom, but now that the markets bombed and the technology industry is in a state of flux, agencies are slashing their fees to retain their clients. To me this simply means that they were grossly overcharging in the first instance. Unfortunately, agencies who play by rules whatever the economic climate suffer, as we, for instance, would have difficulty cutting our fees simply because we never overcharged in the first place.

Make sure there are no hidden charges.  Prior to signing contracts make sure that you know how your chosen agency charges for disbursements.  A handling charge on third-party invoices is the norm, but all the hidden extras can add up how do they charge for telephone, Internet connection, stationery, etc? It may sound rather petty, but a full understanding of these issues at the outset can rule out the need for unpleasant conversations at a later stage in the relationship.  Also, if you have a set budget for disbursements, ask the consultancy to build into the contract a ceiling for such costs, e.g., a statement confirming disbursements will not exceed 1000 per month without prior approval from the client.

I would suggest any company looking to take on a PR agency keeps the tender list to as few agencies as possible.  After you have drawn up your list of selected agencies (which maybe seven or eight), ask them to undertake a credentials presentation at their offices.  This will give you the chance to see first hand their company in action (is the place buzzing? Do the people exude creativity? Are the phones constantly ringing? Is there a good atmosphere - keep an eye out for the sweat shops!), as well as listen to the corporate presentation.  By undertaking this exercise you should be able to halve the list and go forward with the three or four remaining agencies. The benefit of going this route is that you have invested a relatively small amount of time in checking out all the players, but are guaranteed that those you are taking forward gel in some way with your company’s philosophies, people and methods of working.  The flip side of this is the agencies also know their presentation will be a serious contender to win the business.

Watch out for the beauty parade. Clients take heed. Ensure that when the agency comes into pitch to you that the PR consultants doing the mainstay of the presentation are the people who will be working on your account. Make sure they can answer the probing questions without the new business director jumping in with all the answers every five seconds. Having established that the pitching team in front of you would be your designated account team - think about whether you actually like them. PR is a people's business and it's important you get on with your team. Considering that our subconscious rules our conscious mind, it's tricky because it means we've already made a decision about someone as soon as they walk in the room, but your first impressions need to be taken on board.  Without doubt, PR is down to personal chemistry and if your account manager grates with you every time they call, you have to wonder if they have the same effect on a journalist, and if so, how does this affect the amount of coverage they are achieving on your behalf.

Going forward, you have selected your agency and contracts are being drawn up. Any agency worth its salt should include a six monthly review in the programme. If they don’t, ask for one.  Also make sure you have a getting started meeting at which time objectives can be set, which then become the benchmark on which to assess the campaign at the six monthly review.  So many agencies talk about it, but insist your PR company becomes a satellite to your marketing department, the interface should be seamless successful PR campaigns are not those generated by two organisations who only communicate at the monthly status meeting.

 And finally a PR company can only be as good as the information they are given to promote.  Keep your agency in the loop when it comes to news and business developments, confidentiality is not a problem as agencies will happily sign an NDA (Non Disclosure Agreement), invite representatives from the PR team to your marketing away days, don’t grumble when they’re always on the phone (when they’re not constantly calling is the time to complain) and remember they should be fun to have working as part of your team!

Louise Stewart-Muir is the Managing Director of Stewart-Muir Communications www.stewartmuir.com

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