Here we discuss the basic ingredients of Public Relations: Topical Issues, The backdrop - economic and social, What makes PR tick, the pain points, the problems, the positives, the negatives... almost anything under the sun related to the communication industry!

Tuesday, February 9, 2010

Public Relations vis a vis Advertising - a marketing dilemma?

The easiest thing for the marketing head of any organisation to do is to draw up an advertising budget and undertake advertising as there are tangibles in terms of advertisements that appear. Also advertising is a more evolved field so there are measurement tools which help justify the huge ad spends.

Moreover in the AV media ever since most of the channels started taking breaks at the same time, flipping of channels I presume has lessened and the stickiness to channel being viewed is more. This increases the chances of an advertisement being viewed by the viewer.

However when it comes to PR, the same organisations who are willing to spend millions on advertising, hesitate to spend a few lakhs on a communication exercise. Increasingly we find even smaller organisations spending huge amounts on celebrity association.

While I am not an expert on advertising and so would not like to comment on the efficacies of such an association, I remember talking to the marketing head of an organisation which was paying huge amounts for such an exercise and asking him the effectiveness of the exercise, his answer really left me wondering on the decision making process. He said that "more often than not, celebrity endorsement decisions are taken in drawing and bed rooms rather than the board rooms".

I am not talking about PR replacing advertising, but am advocating that marketers of all hues should look at a combination of both PR and advertising while drawing their marketing plans. While for larger organisations with established brands it is all about capturing the maximum mindspace and hence over emphasis on advertising, for smaller companies still in the process of brand building this is not true.

The fact is that advertising is a costly affair and the smaller organisations do not have the luxury of resources to spend on a failed advertising strategy. For these companies it makes more sense to rely on PR as the preferred marketing tool to build their brand. One quarter page advertisement in any leading newspaper will set back the organisation by a huge amount. On the other hand at the same or marginally higher cost, it is possible to retain the services of a good PR agency, which will constantly be working for brand building of the organisation.

In marketing at is all about the push and pull effect. Every marketer wants a 100% pull effect and constantly works towards it. For smaller organisations it is always 100% push and the PR exercise is the most cost effective way of correcting this imbalance. We have found this to be especially true for organisations looking at funding. PR exercise has the potential to provide the necessary thrust and the requisite pull to attract investments and funding. Over dependence on advertising can in fact erode the finances of organisation pretty fast.

To give you an example: There is this organisation which has a good business model, and which we had helped raise financial resources by undertaking an extensive PR campaign. This is now in deep trouble financially. The mess came about because the company burnt up huge amounts of cash in advertising while the targeted revenues were not met. The company has already raised finances twice and is going for third round of financing but the very survival of this company is at stake. Also surprisingly, in bad times the company decided to do away with PR, forgetting that PR was instrumental in getting them funding in the first place and an effective PR strategy may still have helped in their critical times.

This is not only the case with this company, but most organisations view PR as a non core activity. I think it is high time that organisations realised that Corporate Communication is not about only "spend, spend, spend" but is a critical activity.

In times of crisis, PR can actually send a strong message to all the partners of an organisation like employees, vendors & suppliers, investors and buyers. In the recent economic meltdown, most of the Indian companies cut their marketing budgets. The first to be affected in almost all cases was PR. This actually should have been the last activity to be stopped. They say that "the tough get going when the going gets tough" which is why the communication dialogue must never be stopped.

It is time that marketers and managements resolved the dilemma of Advertising vs. PR and started viewing PR as a core activity.

No comments:

Post a Comment