Diana Marszalek 25 Oct 2022 // 11:28AM GMT
WASHINGTON, DC — Facing a very precarious future, PR industry leaders say it’s incumbent on independent agencies to build out the infrastructure — and adopt the mindset — that will enable them to adjust to global challenges.
“We are not an industry that embraces change,” said rbb Communications president & partner Lisa Ross, adding that rigidity took its toll during Covid.
“I always knew it, but we saw it. A lot of the firms that were slow to adapt to flexibility, remote working, are not with us,” she said.
Ross’s comments were part of a panel discussion on future-proofing agencies Monday at PRovokeGlobal in Washington. Adfactors PR CEO Rezani Aziz and SPRG chairman Richard Tsang also participated in the PROI-sponsored conversation.
The conversation built on a recent PROI survey of 60 agency leaders in 35-plus countries looking at agency confidence considering potential financial and geopolitical threats to business.
Some 51% of respondents said they are expecting double-digit growth this year, with many of those predicting growth of more than 20% for 2022 and a few even saying they are looking at growth of more than 30% this year.
A majority of agencies also see opportunities in more profitable business models and growth of the whole communications industry. Firms are investing most aggressively in digital capabilities, followed by integrated marketing, social media campaigns and corporate reputation management, the study found.
Nonetheless, inflation and profit margins are by far respondents’ biggest concerns, with economic downturn and client budgets and constraints because of staff shortages in second and third place.
Despite representing three different regions (rbb is in Miami, Adfactors in India and SPRG in Hong Kong), and three different Covid experiences, speakers agreed that, to ensure their survival over the next five or so years, agencies need to invest in the tools, capabilities and talent that will enable them to keep pace with changing conditions and client needs.
For Ross, that includes diversifying clients, engaging employees, building out capabilities like digital and measurement and paying attention to the nuts and bolts that keep businesses afloat — staying on top of accounts receivable and cutting expenses and the like — all of which helped the firm survive the Covid pandemic.
“Being able to roll with the punches was key to us,” Ross said.
Aziz, too, said the pandemic taught Adfactors the value of being able to unexpectedly switch gears. As clients’ needs changed, Adfactors built out its advisory capabilities, enabling new services — and revenue streams. The firm also increased its digital tools, like social listening, and became increasingly client centric.
“There was opportunity in all the chaos,” Aziz said. “The opportunity that we felt was in counsel and in understanding the clients’ situations and trying to find solutions.”
That experience, Aziz said, laid the groundwork for Adfactors being in a better position to meet future challenges. Her advice: “Adapt, adapt, adapt to changing client needs.”
Tsang, meantime, stressed the value of retaining talent and the role employees play in overcoming challenges — including financial. Rather than cut staff, Tsang said he sees expanding teams’ expertise to include the range of advisory services as key to future-proofing an agency, as doing so draws new and different kinds of business.
He also encourages agencies to assess the kinds of clients they serve, and the roles they play in maintaining firms’ long-term success. SPRG, for instance, learned the value of having a roster heavy with local clients during Covid, when the pandemic made serving clients at a distance more difficult.
Ross also encouraged independents to create, and regularly assess, a five-year plan and actively assessing progress against it. “We check ourselves and make sure we are accountable. It keeps us thinking about the future and keeps us changing,” she said.
“It’s important to look at change as an opportunity, not something you’re forced to do,” she said. “Those who embrace it tend to stay ahead of the curve.”