Is Your PR Good Enough To Withstand Performance-Based Contracts?

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Economies are unstable, budgets are tight and results are critical. These three factors contribute to the increasing demand for performance-based contracts in PR. Clients are tired of paying for services when they don’t necessarily see results – at least immediate results. They’re less willing to pay a flat rate for standard contract deals than they are to pay a minimum monthly retainer with tiered pricing systems based on performance goals.

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As one would imagine, this doesn’t make PR professionals too happy. It’s not that they want to do minimum work for maximum pay or obscure results behind industry jargon and good looking graphs (at least it’s not that for the good public relations agencies around). It’s that they know the hard work and effort they put in one month may only deliver returns a couple of months down the line.

It’s just not that simple

Jeremy Porter (Journalistics Blog) points out a few problems with performance-based or pay-per-placement contracts. These problems are glaringly obvious to PR professionals, but seem to pass clients by.

For example:

  • How do you put a value on developing media relationships?
  • What happens when PR agencies arrange for press releases to be published, only to be dropped at the last minute – as sometimes happens in print publishing where space constraints or design changes lead to articles and press releases being cut?
  • How will certain goals be valued? For example, what is a shared article worth vs. a recommendation and a link on a blog site? How are links and mentions on different blog sites valued?
  • PR has compound value. It starts slowly but as strategies begin to take effect, returns start to grow – and grow quickly.
  • Putting pressure on PR professionals to perform means that they put pressure on their contacts to deliver. Nothing sours relationships more (or more quickly) than this kind of relentlessly aggressive approach.

It’s also important to consider that public relations is a two-way street; it requires clear, regular communication to ensure that agencies are aware of clients’ news and developments, and clients need to be kept up to date on strategies’ progress.

On the other hand

To be fair, it’s not all doom and gloom for PR agencies. Provided the communication is clear, there is no doubt as to the goals that need to be achieved. Many people work best when they have something concrete to strive for, so this is rewarding for clients and professionals who relish a challenge.

Client loyalty is a given when targets are regularly met. In fact, clients may be so chuffed that they will recommend you to all of their contacts, so you get more leads. You’ll also earn a reputation for service excellence (which does no end of good to your PR).

Once the hard work at the beginning starts to deliver results, the results start to snowball, which means that higher goals can be met with less work.

It’s important that PR agencies ensure that the contract allows for emergency services, like crisis communication, which are over and above pre-determined goals.

However public relations agencies feel about it, performance-based payment systems are becoming more prevalent. To ensure that they aren’t done in, agencies need to be very clear about what their clients can reasonably expect and help them determine realistic goals. Other than that, it’s all about staying calm, knuckling down, and finding ways to improve upon tried and trusted methods.

Jemima Winslow writes for Now Learning Australia, which promotes TAFE courses in Qld, Australia, as well as other higher education opportunities throughout the country.

 

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