How to manage a PR budget cut without bringing your communications effort to its knees

How to manage a PR budget cut without bringing your communications effort to its knees

Mark Mellor

Mark Mellor

If only quantitative easing applied to marketing budgets. How many of us wouldn’t love to inject resources and energy into innovative, new campaigns? Instead, the more likely scenario is one of creative austerity, as PR and marketing departments the world over struggle to do even more with less and less.

Having worked in PR for nearly 30 years, I’ve met plenty of marketing and communications directors who, when the budget axe fell, were completely unprepared and forced to take drastic measures that hurt more than they helped.

Today, cuts hardly come as a surprise, although the fallout from slash-and-burn tactics still manage to leave some budget-holders befuddled. Of course, there will be negative impacts.  We’re all in favour of greater focus and more efficient working, but when cuts are really deep, most people are ill-prepared to make the right trade-offs.

If you’ve recently stared the budget axe in the face and lived to tell about it, you might find the following insights helpful for preserving what’s important and setting yourself up for sustainable success.

It’s not a solo effort – When faced with budget cuts, don’t shoulder the entire burden of deciding what activity to cut, and how much, entirely on your own. I’ve had situations where clients slashed their budgets and my first instinct would always be to gather the team, discuss the situation and brainstorm the best possible outcomes. This collaborative process made it easier to come back with informed recommendations that the client hadn’t considered, and often we were able to reach a comfortable compromise. Talk to your teams, internal and external – give them a heads up and reasonable time to suggest ideas, and consider these with an open mind.

Get it on paper – At Firefly, we’re big fans of scope of work documents. They’re different from PR plans in that they cover the full extent of PR activity that we actually perform for our clients. “Scope creep” will be familiar to in-house and agency PRs and we recommend curtailing it as early as possible. After all, you have to wonder: if an activity wasn’t in the original plan or your list of priorities, was it really that strategic or important to begin with? Insist that your agency keeps detailed scope of work documents to be able to assess (quickly) which activities are suffering from bloat.

Be prepared to flex and negotiate your way through tough times. Being nimble and having an open mind can generate some surprising, beneficial outcomes, as you start to think laterally about how to tackle the challenge of cuts. For example: can you consolidate similar or complementary services with one vendor (e.g., a bundled approach like home broadband, landline and mobile)? Can the agency look into the current PR team configuration and whether adjustments can lead to savings? Can you, as the PR or marketing client, provide more in the way of ready-made content that doesn’t require too much retro-fitting to help the team fast-track to implementation? The list goes on...

Socialise the new plans, because whatever happens will inevitably impact other people, and having them on board from the beginning will help the changes settle in faster.

Set expectations – all too frequently agencies are keen to please and often at any cost to themselves. This shouldn’t be the case and clients, in-house teams and agencies should all be clear and transparent about what a budget level or cut means in real terms. For example, a cut from £10,000 to £5,000 per month is not a 50% cut in proactive PR effort; it’s far greater when you consider that the same underlying measurement and reporting has to continue (unless that element of activity is also cut – not recommended!). It can also mean headcount, or adjustment of the senior/junior balance of the team. We live in the real world and have seen agencies fill their teams with interns and fresh graduates (secretly or overtly) just to meet procurement demands, but does the actual client truly expect director or account director-level advice at half the price? No one benefits from this kind of situation. Everyone should aim for a win-win relationship. Having the right expectations is crucial.

Review your cost base – When times are tight and you want to cut and minimise your costs there are two approaches:

Firstly, if some part of your comms plan is simply not working well or the ROI is not clear enough and spend is called into question, extreme measures may be the solution.  In the same way that amputation might be the only way to save a patient, stopping an underperforming costly activity might just save the day.

On the other hand, you can save by reviewing your costs, too.  This is the easiest, quickest and most effective way to get in control of your cost base. Spend 20 minutes to review every cost – make a full list – then against each item or line ask yourself these questions…

1. Can we do without it altogether?

2. Can we cut or trim, i.e. how much of this do we really need (e.g. cut out trips and settle for Skype calls)?

3. Am I getting a good deal, or am I paying too much? What is the market norm now?

4. Can I share the cost with another department/business or another client, or get this done another way?

You could be surprised by how much you can save.

 

 

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Discussion

  1. Wise words. Scope creep is a big offender – tons of unnecessary stuff with no apparent end and little bearing on the health of the brand or product. Sometimes people do a lot of things and don’t really understand why they are so busy.

    That’s enough from me…

  2. Excellent, practical stuff. 

    Every downturn you hope more brands will learn the lessons of acting for the medium to long-term. And every time I see another analyst forecast for healthy growth in revenue within a particular sector over the next three years, I wonder how vendors are planning to maximise their take (‘You haven’t heard from us for a while, but we actually have a great product we’d like to introduce you to… ‘?).

    One area that some companies might look at is is how to target the influencers that really matter: ie those that genuinely have authority over the right audience. Influence isn’t spread evenly amongst analysts, journalists and so on. Understanding where it’s concentrated is an important first step towards knowing where (finite) resources should be focused.

    Now, a real problem would be how to sort out the centre of United’s midfield…

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