Value: it’s a subjective measure, but one that’s important to everything we do in business. Typically, in business, we correlate value with money spent for goods or services. Something’s expensive? Well it must be great quality! Something’s free? Great, I’ll take it, but it doesn’t matter what happens with it since it didn’t cost anything.
I like to think about it with a newspaper analogy. If you step onto the London Underground during morning rush hour, you’ll no doubt see dozens of copies of the Metro littering the carriages, yet you never see a copy of the Financial Times or The Daily Telegraph. Why? Most likely because one is free and the others are not. People do not value the free content as they do the paid (even if they read it more).
This kind of thinking is common, but not always correct. If you’re a PR agency keen to win a client over, you might over-service or provide some free project work – but what does that say about its value? If you’re in-house and take a good deal of time on some PR work due to time constraints, how likely is it that it will hurt you later, if the work is substandard?
The problem is that marketing and communications services can seem to be intangible. But this is not the case. At the end of the day, agencies and in-house PR people alike, need to each value what they do and deliver measurable campaigns against clear goals. Here is something I wrote previously on preventing PR scope creep, minimising over-servicing and how to keep everyone happy. In this piece I’d like to explore ‘worth and value’ more by giving advice about the quality vs. speed vs. value play-off, the yin and yang balance between client and agency, what value really means and why write is right.
- There’s three sides to every story
You may have heard of the business triangle before, and it’s something that continues to reign true. This triangle has three sides: speed, price and quality, but in a business transaction you can only pick two of these sides.
You want something done that’s high- quality and fast? It’s going to be expensive. You need high quality but cheap? Well, it’s going to take time. Fast and cheap? It’s probably not going to be the best quality.
This is a good one to remember as someone paying for PR services. You need to consider the repercussions of a bargain deal and whether it will cost you elsewhere. Equally, paying too high a cost is unnecessary and wastes budget that could be used for other projects. It’s a delicate balance.
- The balance of yin and yang to operate as one
Whether you’re in-house or agency, don’t take advantage of one another. Work together towards common goals. Every business deal has scope for negotiation, but pushing too much from either party can sour relationships, and one party can feel taken advantage of at the end. You need each other and you need to achieve the right balance.
From the agency side, it’s important to set the price so it correlates with the standard you can deliver in your given timeframe. Your client might have a small budget, but if you cost a project too cheaply and then you can’t deliver quality, it can damage your credibility and relationship with the client. It can also compromise your client’s reputation – personally within their organisation and externally as a brand. Do you want to be an agency that puts your client at such risk? Does this really deliver a great service? I doubt it.
From the in-house side, remember that your agency is a business with rent and salaries to pay, and is balancing a portfolio of clients, with various levels of demand and spend at any given time. If they’re performing well or exceeding expectations, ensure you make the case to pay them an appropriate budget by negotiating with the budget holders and decision makers at your business. If they keep over-servicing your account without yielding the commensurate fees, they may not be able to stick around much longer. Agencies run the risk of going bust doing this. Do you want to be the kind of client that grinds your agency into the floor? I doubt it.
- Communication is everything
It’s all very well to suggest these costing methods in the above point, but determining a price for the value desired can’t happen without a clear understanding of what’s expected between both parties. So talk to each other!
If you’re working in a business where you know the CEO won’t be interested in any PR efforts unless it’s in a broadsheet national newspaper or on a national TV station, then make sure your agency knows it. Likewise, if your marketing KPIs are based on lead generation or sales conversions, make it clear to your agency that PR efforts need to display a return on investment in this area.
Agency side, always ask your clients upfront what value means to them. It’s different for everyone. Where would your client like to be in a year’s time? What result would make them want to pop open a bottle of champagne next quarter? Find answers to these kinds of questions, and you’ll be able to plan a valuable campaign.
- Write it all down
Now you know what value means to one another, write it down in detail and reflect on it regularly. It’s not unknown for agencies and their clients to make ambitious plans at the beginning of the year, only to realise at the end of the campaign that what was agreed was not what’s been delivered.
Likewise, one party may have a change of heart on KPIs during the campaign timeframe, but if you’ve made a detailed and clear plan for objectives and results, this serves as a proof point and stops agencies under-delivering or clients expecting too much for their budget.
There has to be some room for flexibility here, but it needs to be within reason. It’s highly likely that someone at the C-level will suddenly change the business focus, or maybe the finance team will decide they don’t have the budget to fund your PR work anymore? We all need to adapt. These situations need to be dealt with as they arise, but a plan will help show what can be scaled up and down if this occurs, and ensures you’re on track otherwise.
None of us have a crystal ball, and we can’t predict what will happen in any business in the course of a year, or even a few months. However, planning and communicating what’s important to each party and reducing ambiguity will ensure you have a good chance of providing the value you set out to.
Stay on course and deliver that value so you are not like the discarded newspaper that gets left behind.