Encouraging signs abound for technology markets - all of which play into PR services - including a four-year high for the technology-laden NASDAQ, the voter initiative
in California to pump $3 billion in stem-cell research as well as constant research and development in biotechnology.
Against this encouraging backdrop is a study conducted earlier this year by Gartner2 (a unit of Gartner Inc.) that showed small business marketers (SMB) are shifting a
growing amount of their marketing budgets to PR at the expense of events and sponsorships, print advertising, catalogs and sales support material.
According to the study, small business marketers increased their PR budgets 36% in 2004 compared with 2003 (see below) while events and other sponsorships fell 77%, print
advertising decreased 66% and catalogs dropped 44%.
Does this garner a new gravy train for the PR field, especially among the nimble, more scrappy PR executives? Don't hold your breath.
"Tech spending is still tight," says Mark Coker, president of Los Gatos, Calif.-based Dovetail Public Relations, which predominately represents start-up tech firms.
"During the salad days it was not uncommon for VC firms to mandate that start-ups spend $20,000 to $30,000 per shot on PR. Those days are gone. Client expectations are just as
high but budgets are lower." Nevertheless, Coker admits that many of his clients initially devote marketing dollars to PR "and not necessarily advertising."
But while PR was culpable for much of the noise during the boom-and-bust of the 1990s, the current climate demands an emphasis on true performance. "Companies need to be more
focused on results and the pressure is on PR to do more with less." Coker adds. "I think we need to go back to the 80/20 rule and in pitching, companies have to take a rifle
rather than a shotgun approach."
With overall technology growth starting to mirror GNP, Coker stressed that PR pros now have to be up on all the different subsets of technology, for both software and hardware.
"You can't treat eWeek the same way you do Computer Reseller News and you can't treat PC Magazine the same you would PC World. You need to understand
the client's business strategy, what the company needs to achieve in the marketplace and how to get there. Is it a direct sales strategy or some other channel? All of that impacts
how you're going to run the PR program. And if you waste the money [the client] will pull the plug." (See sidebar.)
But that works both ways, considering how many PR pros got burned during the boom-and-bust. Sabrina Horn, founder and president of San Francisco-based Horn Group, which
also focuses on start-up tech companies, says that although she's had a "substantial" increase in the number of RFPs among start-up tech firms she's turned down several similar
pieces of business.
"Companies want to engage PR firms but PR needs real numbers to use," she says. "It's much more different than what happened with the bubble. Now, you need to show that the
company has a solid business plan, good management team and real customers...There's an aversion to the herd mentality."
For PR pros both internally and on the agency side, Horn says there are three elements to selling technology clients to the media and consumers:
- Getting companies out there in a focused yet somewhat limited fashion; reaching the top, half-dozen decision-makers in your particular market
- Positioning strategic counsel; self-promotional CEOs don't cut it anymore and PR execs have to be extra-careful about bosses tooting their own [tech] horns
- Enhancing Web sites to communicate to people other than technology reporters; integrating different messages online
Indeed, as the Web increases its presence with consumers, small tech firms trying to get their names out will need the imprimatur of larger, more mainstream news sources.
Brian Chernicky, PR manager for Aplus.Net, a San Diego-based Web-hosting and design firm, beliefs that in the near future - if it's not happening already -search engine
ratings will place a good amount of "weight" on companies that are referred to in articles from traditional, trusted news sources.
"You see some of this indirectly happening on Google right now," he says. "If your company has a recent news headline, you will show up first [for certain search terms],
above the other results, in the 'Google News' preview. Really, it is necessary for small businesses to have a good ongoing PR effort, and that's uncontroversial."
The point of many small businesses being on the Web, he adds, is to compete with the major players. "With a professional looking Web site and enough marketing to drive traffic
to the site, they can compete with some big fish."
What PR Can Deliver Online to Small Businesses
Among Internet-related activities this year, e-mail newsletters have been the most popular among small businesses, followed by search engine marketing, with banners/buttons and
sponsorhips a distant third and fourth. Specifically, the increases in 2004 compared with 2003 were:
| E-mail Newsletters: | +24% |
| Search engine marketing: | +19% |
| Sponsorships: | +9% |
| Banners/buttons: | +6% |
| Source: Gartner2, 2004. | |