Elaborate Reviews Vex PR Firms

Procurement, Consultants and Marketers New to the Discipline Muddle Process

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NEW YORK (AdAge.com) -- Early in 2007, Bill Imada, chairman of midsize PR agency IW Group, inquired about a potential new-business opportunity with a major pharmaceutical marketer he'd heard about. Before he was even told what the project was, his agency and the five rivals chasing the business met the marketer's procurement team and had to soak up back-office nitty-gritty such as how to bid, file estimates and submit proposals using the marketer's software programs.

The half-dozen firms all made the company's preferred list and will be able to fill out the request for proposals -- that is, if the marketer ever gets around to issuing one. You see, it's about a year later, and Mr. Imada has seen neither hide nor hair of an RFP.

Chalk it up to an emerging trend that's seen the competition for PR business -- which once simply involved a pitch and a decision -- become weighed down with process and, of course, cost.

Tough sell
While many PR agencies benefit from marketers wanting to shift their ad dollars from traditional advertising to other disciplines, a large number also have had to deal with an increasingly frustrating review process. Whether it's the procurement department, third-party search consultants, marketers using PR for the first time or brands just wanting to be sure they're spending money wisely, agencies are being asked to invest a lot of money and manpower into putting together new-business pitches.

Doug Spong, president of Carmichael Lynch Spong, said the process has changed because of a number of factors, including the economy. He said the attention PR continues to get as an effective alternative to advertising brings to the lot potential buyers who spend a lot of time kicking tires but don't always sign on the dotted line.

"It's good that marketers are looking at PR as a way to make their limited dollars stretch further, but it's a double-edged sword," Mr. Spong said. "They're acting like it's an ad-agency search and as if PR firms are $400 million-billings ad agencies with 15 people in research and planning, a 50-person creative department and 12 people in broadcast production. Most PR firms aren't staffed like that."

These days, a review can start with a search consultancy asking the agency to fill out a large dossier that includes things such as the history of the agency and where each potential team member lives. Or it can go something like this: A company issues an RFP and tells the agency what the budget is. If it moves forward after the opening pitch, the agency meets with the purchasing/procurement division, which can inform the agency that the budget number was only a parameter. Next, procurement, which likely knows little about marketing or PR, may ask the agency how it plans to spend the money and tell the agency it likely could do things in a cheaper way.

These process-heavy reviews are more likely to be seen in regulated industries such as pharmaceuticals, as well as the government, automotive and telecommunications sectors.

'Overwhelming' details
"They have questionnaires of 50 or 60 questions -- and not just about who your clients are or what they spend," Mr. Spong said. "They want a list of clients you've lost over the past five years and how big each of those clients was. ... That level of detail can be overwhelming for some small to midsize shops."

Dan Orsborn, senior partner-PR practice leader at Select Resources International, said his search firm has seen the process give some smaller agencies pause. "I have had some firms decide not to participate or drop during the process, but most stick with it," he said via e-mail.

Kathy Cripps, president of the Council of PR Firms, said member agencies have told her that procurement's involvement has increased but that agencies don't object to procurement or search consultants taking part in the review process. Rather, it's the requests for irrelevant information and "unrealistic time constraints" that anger them.

"Sometimes the consultants make it a process that can be more challenging than it should be," Ms. Cripps said. "There are still unenlightened search consultants and procurement agents that could actually end up hurting their client organization. Agencies want to do great work and not spend unrealistic amounts of time on very short deadlines on some of these searches."
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