While PR programs have grown more complex and expensive, all too
often agency searches are based on referrals alone or clients'
personal experience with certain individuals or firms.
In the advertising industry, use of professional third-party
organizations to conduct formal agency searches is a common practice,
especially on larger accounts. In public relations, use of
consultants to conduct searches still is the exception.
Nonetheless, as PR programs become more sophisticated, and as the
number of experienced PR firms has exploded in the past 10 years, the
reasons to consider a formal search process have grown more
compelling. Tendencies to restrict agency searches geographically
also have diminished as technology effectively shortens distances
between clients and their firms.
"There is greater talent out there than ever before," said New
York executive and agency search consultant Dennis Spring. "That is
all the more reason that clients really should do their due diligence"
when selecting an agency. "Looking in a directory and talking to
friends is far from due diligence," he said.
Advantages of Search Firms
For larger PR programs, in the $100,000 range and up, it often
makes sense to retain a third-party organization to drive the search
process. In addition to being able to devote the appropriate amount
of time and focus to the search, third-party search organizations--
typically PR executive search firms--are able to bring to bear
experience with particular firms and individuals. (PR NEWS published
its listing of such firms in its April 29 issue.) They also typically
have extensive experience with conducting search processes, performing
reference checks, crafting Requests for Proposals (RFPs), and
evaluating agency presentations.
One of the big advantages of third-party search organizations is
their intimate knowledge of a large number of PR firms, and the
individuals in those firms who might work on a client's account.
Search firms, such as New York-based PR management consulting firm
Arnold & Truitt maintain databases on firms, their areas of expertise,
and professional experience of staff.
Finding the Right Individuals
A major change in agency searches today is a focus not only on
finding the right agency, but also finding the right people within
agencies. "You're searching for the correct teams within firms to do
your business," said Spring.
Echoed Larry Marshall of Marshall Consultants, a PR executive
recruiting and agency search firm, "We are finding that the brand name
of a firm is meaning less and less. More important is who is the
individual that you will be developing relationships with" on the
account team.
The importance of selecting the individuals that will relate well
with a client cannot be overemphasized, said Boston-based search
consultant Byron Reimus. "I always say forget about the PR program
budget" when evaluating the commitment an organization makes to hiring
and working with a PR firm. "Look at the time invested in
relationships--not just in their understanding of your business--but
the amount of time they interact with you and the organization."
In assessing the importance of relationships, consider the costs
and disruptions associated with ending an agency relationship, Reimus
advised.
Billing Patterns Vary
More often than not, the fee for an agency search is paid by the
corporate client. Some agency search firms bill a flat fee, others
bill by using a percentage of the budget for the agency's program. A
typical percentage in this case is 10 percent of a PR program budget,
said Marhall.
Some search firms, such as Arnold & Truitt, bill strictly by the
hour.
In some cases, firms will pay a "finder's fee" to search
consultants, said Marshall. In these cases, to avoid the appearance
of bias, search firms advise their clients that one or more of the
agencies which have made it onto the short list have such a policy.
While the finder's fee may appear to relieve clients of paying
for the search process, Marshall said that agencies often will add
this fee into their bills for the new client, and advise the
prospective client of this up front.
(Spring, 212/473-0013; Arnold & Truitt, 212/725-0000; Marshall,
212/628-4800; Byron Reimus, 617/451-0216)