Seventy per cent of respondents to the annual MSLGroup PR survey for 2013, on the theme ‘Public Relations in India: The Impact of the Economic Downturn and the 2014 Outlook’, said that the economic downturn was an opportunity to exhibit the strategic value that Public Relations brings to the table, with 55 per cent saying that ‘clients look at PR as an alternative to advertising’.
MSLGroup revealed findings of the survey in its report released 4 February 2014. The report is based on qualitative and qualitative surveys among 67 senior PR professionals (account directors and above) across eight Indian cities, conducted by Leadcap.
‘Clients expecting more for what they pay’
Ninety per cent of respondents said that in the downturn scenario, clients expect more services for the same fees, adding that the trend would persist in 2014.
The report also finds that while 16 per cent respondents said the downturn might be ‘the worst they had witnessed’, half the respondents felt otherwise.
In the survey, 61 per cent said the downturn has affected their agencies ‘somewhat’ or ‘not at all’. The brunt of the downturn has been borne by advertising agencies, felt 41 per cent respondents, with only 17 per cent saying the PR industry was the worst affected.
Concerns among respondents surveyed that were accentuated by the downturn were: inability to pay high salaries, investment in infrastructure and providing new services demanded by clients.
Growth expectations and client spends
When asked about the estimated growth, a fourth of respondents said their agencies would finish 2013 with 10 to 15 per cent growth, in line with the PR industry estimates of 12 per cent for that year.
Thirty per cent respondents said clients had increased (PR) budgets, with 48 per cent saying the increase was 10 to 15 per cent. On PR budget cuts, 72 per cent said the cuts did not go beyond 15 per cent.
‘Retainer fees being slashed’ will persist in 2014
Two thirds of respondents expressed apprehension for 2014, saying retainer fees will continue to be slashed. Further, 61 per cent said recovering dues and cash flow problems will continue to persist. Sixty percent respondents expressed concern over clients taking longer to appoint the agency after a pitch.
Jaideep Shergill, CEO, MSLGroup India, said, “This is a time of great churn for the industry. Ground realities – from the evolution of media to the increasing number of stakeholders to what clients want – are changing fast and it’s a challenge to keep up. Thankfully, the industry has shown the capacity and resilience required, and this is evident from the survey’s findings.”