Pay-for-Performance PR...why, what, and how...or how not

One truth is not so self-evident…all PR firms are not created equal. This certainly goes for those of us in the profession dedicated to the proposition that charging by the hour might be appropriate for a hot masseuse, but probably not for public relations…and absolutely not for media relations. It seems the economic disaster of the last three months has once again turned attention within our profession toward something “unique,” something “new,” something almost “revolutionary”…pay-for-performance PR. Once more, a compensation model that has been practiced successfully by myself and a few others for almost two decades is being trotted out of the shadows into the bright sunlight by our own trade media as either the “answer” to reduced marketing budgets at best…or as a viable test at worst for companies willing to experiment. How To Get Good PR Without the Big Retainers

I recognize this happens every few years when the traditional big hourly retainer PR firms and their clients begin to feel the economic squeeze of constricting budgets, or heaven forbid, a pang of guilt. Ok…the guilt thing is way overrated.

And with this renewed focus on pay-for-performance PR, comes the usual confusion as to what it is, who does it, and most importantly how do you go about selecting a firm should you decide it’s your path. Here are some thoughts from those two decades…

Pay-for-performance PR goes by many names….”pay-for-results,” ”incentive-based compensation,” “contingency-based,” and the most unglamorous, “pay-for-play”…but all are intended to describe PR firms that utilize a compensation system where the majority of their charges are based upon successful media placements or completion of actual designated services, i.e., speaking engagement, etc….and not by hourly fees or large retainers based on such fees. Some may offer some combination of hourly fees and/or retainers depending on the PR services being requested. However almost always the media outreach portion is performance based. One of the most common misunderstandings about pay-for-performance PR is that it is some how “cheaper” than under a traditional compensation model. Not necessarily. Over the long run of several months or years, a client may pay close to the same number of dollars, but the difference will be that each one of them will be attributable to a specific tangible result…not wasted effort.

And in spite of the old-fashioned basic fairness of this compensation structure, only a few PR firms practice it on a regular basis…and only a very few have practiced it successfully over a long period of time for all of their clients. Some large traditional PR firms have experimented with “pay-for-performance” for short periods or have tried to pass off the hourly/retainer model under its guise but seldom with any long-term success. The most common reason for failure lies in the fact that it is the antithesis of an ingrained compensation culture based on charging for the abstract “consulting” and “effort” rather than for a tangible something.

So, if there is only a small percentage of PR firms practicing legitimate pay-for-performance PR, how do you know which will best serve your needs as a client. Here are several pointers…

• Do a search for “Pay-for-Performance PR” on the Internet and review their web sites. Then contact the principle of the firm directly, discuss your particular PR needs, and their experience with similar challenges. 

• Do not hire a PR firm strictly online no matter what inducements may be offered. You can’t go “cheap” by filling out detailed PR or media needs online and expect any real level of successful service. Successful PR placements are the result of a collaborative process between the client and the agency…not a questionnaire. 

• If still interested, ask for a detailed written statement of the PR firm’s compensation structure and how their fees are determined. It is fair and appropriate to discuss budget and estimated potential charges at this point, but understand that under pay-for-performance compensation, the good news is that budget ceilings may not always be achieved. 

• Be leery of bundled pricing. Ask to see what’s in the “bundle” and that you’re paying for what meets your needs, not the agency’s.

• Make sure that compensation is based on real “performance” based on the successful publication, broadcast, or posting of your story…not just the “setting up of an interview opportunity at a specified date and time.” Make your agency deliver the actual placement…along with its invoice.

• And always make sure you’re willing to work with the agency as a team whichever PR firm you select…i.e., check the chemistry, not just their experience. As mentioned previously, successful PR is a collaborative process based on trust, responsiveness, and teamwork. And oh…patience.
  

Embargos, exclusives, and suck-ups, oh my ...

Once in the land of blogs nestled in the valley of silicon lived a large man, Sir Arrington of TechCrunch, with a small pen that grew to believe through haze of smoke and the magnification of many mirrors that his pen was mightier and more powerful than all the inhabitants of the valley…and indeed of all those that came to visit his words posted along the great highway. That with a single keystroke of his instrument, he had the power to create immense wealth or almost instant demise. Those that lived within the boundaries of this great highway, which seemed to both begin and end at times in the valley of silicon, catered to and feared this man’s pen and its perceived power. They sent personal emissaries to bid for the man’s even slightest attention and brief acknowledgement…begging for his positive notice in return for knowledge that he alone would receive.

But alas, one day in a fit of pique and after a multitude of emissary encroachments upon his personal lair, all promising special knowledge in return for his favors, the great man bellowed from his mountaintop, “ENOUGH! No More!” “I have all the knowledge I need or could ever use. I am tired from sycophants clawing at my feet, promising special knowledge in return for me holding my great and powerful pen even a second longer than I must.” Death to the Embargo

And the emissaries grew frightened. Even though there were other pens in the valley of silicon and elsewhere along the great highway, none were perceived to produce such wealth or harm as that held by Sir Arrington. As emissaries and devoted sycophants to their masters whose lives depended upon the bounties grown along the great highway; and whose riches depended upon having these bounties acknowledged through the written word, they knew not what to do?

In a great vision however, it came to them on how to please both their masters as well as the great Sir Arrington…do what we have always done…only more so. Self-flagellation to begin….acknowledge the error of their ways and the wisdom of the great man for bringing it forth. Beg for forgiveness and promise to ferret out the severe offenders and offer them as sacrifices. And of course, charge mightily by the hour… TechCrunch Kills The Embargo, But PR Holds the Smoking Gun



And a great peace fell across the land of blogs and a sigh was heard across the valley of silicon.

To be, or not to be…a flack. That is the question.

One of the sad side effects of this current recession is that traditional media in both print and broadcast are cutting editorial staffs in record numbers creating an influx of highly qualified and trained journalists on the street. Last week many of these journalists were reporting on the growing unemployment numbers and now they’ve joined them. Some are shifting their talents online…some are finding income as freelance writers, and some are dropping out entirely in hopes of finding more secure professions. But many, heaven forbid, are debating whether to join what they have always jokingly called, ‘the dark side’…public relations. A field, in their minds, infested by those who simply don’t get it…”flacks.” As expressed by Rob Walker, a New York Times columnist in his recent blogpost PR Corner:Tragedy as hook

And others… B.L. Ochman's blogpost

I for one, welcome these dispossessed journalists not as the elitists they might have once been, but as brothers and sisters that frankly we in the established PR world, need as much as they need jobs. The very thing that Walker complains about is the very thing that good journalists bring to PR…an inside understanding and empathy of what makes the media work…what makes a story compelling and why…and most importantly, how to persuade the media gatekeepers to listen. Or as we say around INK, “to make our client’s story the most interesting one that an editor will hear that day.”

That is not to say that all journalists have the skill or temperament that transfer well to pitching stories as opposed to writing them. Many will fail because of a lack of this skill set and because they simply cannot adjust to the creative demands and pressures of client expectations. In general however, good journalists, those I describe as good news people with an instinct for news, are extremely valuable and welcome.

But what of this question of name calling…i.e., flack. Is it really necessary and is it really so bad? According to Merriam-Webster, maybe not. Flack “One who provides publicity: as in press agent: an agent employed to establish and maintain good public relations through publicity.”

Doesn’t sound quite so ominous put that way, does it?

Peter Himler, a respected long–time pro in the PR profession actually titles his blog post, The Flack. Personally I am not a big fan of this tag, but it is what it is. By sharing best practices and exposing ethical lapses, it is my hope that "the flack" will follow "the hack" into semantic oblivion.”

Those remaining reporters and news directors that complain the most about PR people being “flacks” and not worthy of their time or even email acceptability, had best be cautious and perhaps a bit more respectful. That pitch which you just rejected out-of-hand might well be coming from a former colleague that used to reside in that empty cube next door.