Changing Client Demand in Germany12 years, 11 months ago
2009 was the worst year for the German PR industry in decades. With budgets for bells and whistles disappearing, qualities like craftsmanship and personal relations are becoming more important again. Ulrich Gartner believes PR agencies may be able to grow
Corporations have an increasing need for external support. The financial crisis has made communication departments downsize, while the workload remained virtually unchanged. Crisis and change management are putting even higher demands on the teams, providing a chance for agencies to step in. The demand for expert knowledge needed in growing areas like social media is an opportunity as well.
"We can’t possibly provide all the expertise in-house today," says Dr. Jörg Uhl, Head of External Relations at Procter&Gamble Germany. "It makes more sense that an agency creates niche knowledge and provides it to a number of clients, rather than each client building that knowledge internally."
Quality is back
Craftsmanship, writing and story-telling skills, solid personal relations with journalists and stakeholders – values sometimes derided as ‘old-fashioned’ are making a comeback. "In the past, agencies could get away with putting their top performers on stage during the pitch, and having interns actually do the job later on. Today, we simply can’t waste time on badly written copy or suggestions that are impossible to implement", says Martin Roth, Head of Corporate Communications at DZ Bank.
Uwe Wache, partner at agency Klenk&Hoursch, sees quality back at work in dealing with media: "Shrunken advertising budgets mean lesser editorial space. You’ll only earn some of that space if you have a good story to tell, tell it to the right person, and tell it well."
Bang for the buck
Efficiency has become an overarching requirement. Often it is not about more bang for the buck, but about concrete bang for the buck at all.
"We’d like to see more innovative ideas how to evaluate PR activities in a cost-efficient manner," says Andrea Kreuzer who manages international PR at SWISS International Air Lines. The issue, it seems, is not a lack of budgets to spend, but the need to demonstrate the business value of what is done.
"Resources are scarce everywhere, and pumping money into a sales force is more obvious to most executives than pumping it into PR. We have an even greater need to prove our value contribution," says P&G’s Jörg Uhl. Martin Roth at DZ Bank adds: "There’s no more ‘stupid money’ out there – like large retainers that were never really tracked against deliveries. Today, we focus much more on project work – and there I want ideas that clearly add value, and that will stand the test in budget discussions with the management board."
In times of uncertainty, blurring lines and stress, clients seem to hang on to agencies they truly regard as partners. "Budget cuts weren’t just simply forced on us; our clients would rather sit down and discuss how we jointly could make the best of the scenario," says Alexander Bohlinger, MD of Headspace PR.
Uwe Wache of Klenk&Hoursch observes that, during the rough year 2009, strong client relations became even stronger, and weak ones deteriorated. "The clients are facing so many simultaneous challenges that they want and need external advisors they fully trust."
This may require changes in attitude at times, explains Michael Eichel, Head of Corporate Communications at liquor maker Mast-Jaegermeister. "The social media explosion has made transparency more important than ever, and agencies quite rightfully preach this to their clients." Yet not every agency seems prepared to walk the talk. "I’d like to see that same level of transparency on the agency side when it comes, for example, to data security, people management or simply the tracking and reporting of working hours."
New roles – new opportunities
The blurring lines between disciplines like PR, social media, consumer engagement and online marketing require new approaches by clients and agencies alike. To ensure consistency, more and more corporations require different agencies to cooperate much more closely, be it across marketing disciplines, or between brand and corporate communication.
"We want our agency pool to interact closely and largely independently, to share ideas and to cooperate. There’s no such thing as a ‘not-invented-here’," says Dr. Jörg Uhl of P&G Germany.
The notion that the advertising agency – traditionally managing the largest budgets – automatically has the lead is no longer valid. "The agency that comes up with the big idea will get the lead – and the related budgets," says Uhl.
Bodo Bimboese, Managing Partner at agency Markenzeichen, and Alexander Bohlinger of Headspace confirm the opportunities for PR agencies to enter into new areas. "Many clients want to have one point of contact serving them in several areas," says Bimboese.
Bohlinger adds: "We’re taking business from web agencies in creating websites, for example. Clients realize that it’s not about programming, but about storytelling – clearly a PR competence."
Ulrich Gartner founded Gartner Communications, a strategic communications consultancy based in Frankfurt, Germany, in 2010. A veteran in international corporate communications, he previously held positions including VP Communications, Europe, at appliance maker Electrolux, and CEO, Germany, at network agency MSL Group.mail the author
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