In 2003, HP asked Scott Peyron to work on the PR plan for HP's Distinguished Leadership in Human Rights Award, which the computer giant established in 1998. While Peyron, a
principal with Boise, ID-based PR firm Scott Peyron & Associates, was paid for most of the PR work he did on behalf of HP, he voluntarily agreed to develop a logo (on spec)
for the awards program, which HP ultimately adopted.
"In the case of HP, we felt it was in our interest to cultivate a deeper relationship," Peyron says. "And we saw the pro bono work as a measure of respect for what HP is doing
in communities as well as a hope that it would lead to stronger bonds."
For the last two years Peyron has also been doing PR spec work on behalf of the Intermountain Venture Capital Forum, an annual conference spearheaded by members of the VC
community in Boise. Most of the firms that attend the conference, however, are start-ups and don't have budgets for PR services.
But Peyron is confident that since most of these firms will eventually have a story they want to get out to the media he'll be in a prime position to land some new accounts.
"I'm not wildly eager to do spec work but there are instances when it can provide an opportunity for the business or the community," Peyron adds.
Putting the squeeze on PR firms is practically de rigueur these days, what with the increasing specter of procurement. (See PR NEWS, April 26, 2004). Spec work - "pro bono" in
more highfalutin terms, free when you strip it down - is yet another wrinkle in the increasingly complex relationship between agencies and their clients.
Indeed, wanting something for nothing in PR is a growing sentiment. With corporate America reeling from the recession, managers remain cautious about where they're putting
their marketing dollars, particularly with PR, which is viewed as the last one in (when the going is good) and the first one out (when the going gets tough). A recent PR NEWS-
sponsored survey conducted by the Counselors Academy found that a majority of corporate clients expect their PR agencies to work on spec when they are developing business
proposals.
Ned Barnett, of Las Vegas-based Barnett Marketing Communications, says that in the last four years requests for spec work have gone up between 10% and 33% among prospective
clients, mostly from the high-tech and nonprofit fields. In one instance, Barnett spent two weeks working on spec for a company "whose chairman had a buddy whose daughter owns a
PR firm," he says. The company exploited Barnett's services "just to make sure it was on the right track, but that's an egregious example of what's going on with doing spec
work."
Once bitten, twice shy, Barnett says there are three reasons why agreeing to do spec work is detrimental to both PR agencies and their clients:
- It builds a reservoir of bad faith.
- It raises the agency's overhead costs which, if a deal is reached, are ultimately passed along to the client.
- The quality for clients goes down since, if the agency agrees to work on spec, the big guns work for gratis while the lesser lights work on paid accounts.
Barnett adds that aside from adding to suspicion, spec work creates a "billing nightmare" and that "nothing good has ever come out of doing something for nothing."
Steve Rosa, president and chief strategic officer at Providence, RI-based Advertising Ventures, a full-service marcom firm, is more blunt, saying that spec work is a "cancer"
that killed profit margins throughout the advertising industry and will surely do the same for PR lest agencies demand that all of their services be paid for.
"Clients have to see value in what we do the same way they see it in attorneys and other strategic counseling," says Rosa, whose clients include the Bank of Rhode Island, CVS
Pharmacy and Hasbro. "You don't say to an attorney, 'Create a will and then maybe I'll pay for it.' It's the same thing with spec in PR."
Advertising Ventures, which doesn't do any spec work whatsoever, was named to the Inc 500 lists in 2003 and 2002, a testament to the firm's rapid growth. Within the last year,
Rosa has declined about six potential pieces of business from clients who demanded spec work at the outset. "Agencies can be vulnerable at the beginning of a relationship, so
they have to be careful when seeking new business and have to do a better job at targeting clients," he says.
Although agencies generally frown on spec work, it's equally debatable whether it's a legitimate benefit for corporate clients who tend to get the steak without the sizzle
when they ask for spec work. "Spec work is not the same thing you get when you buy-in," Rosa adds. "It's a lot like first dates. What you see isn't necessarily what you get."
Contacts: Ned Barnett, 702.696.1200; [email protected]; Scott Peyron, 208.388.3800, [email protected]; Steve Rosa, 401.453.4748; [email protected]