The new client dance is a tale as old as agency life.
The first call with a prospective client begins. With a bow, we introduce ourselves. First, a round of banter to build rapport. The music starts and we begin in earnest. The client takes the lead, describing what they’re looking for, their news pipeline, the contours of their executive bench, their business goals. The PR firm takes a spin in front, explaining why they’re different, how they work, relevant case studies. We get into a groove, start building a natural back and forth, and lay the foundation for what could be the beginning of a beautiful friendship.
I’ve been in this dance dozens of times, on both sides of the conversation, and I’ve been guilty of one of the most pervasive problems to be found in this two-step, avoiding the most important topic of them all: budget.
Discussing budget at the start is essential to right-size a PR program. If the retainer is too high, clients will be annoyed at the cost, feeling the waste of outsized meetings and calls. It’s only a matter of time before the people who pay the bills start objecting. Too little retainer and clients aren’t happy by the work product and results and in some cases create a hostile environment by demanding work the agency can’t complete at those budget levels.
But with a budget matched to need, amazing things can happen.
So why do we avoid talking budget? Ancient taboos about discussing money sneak in. Some clients genuinely don’t know their range or want to feel out the market–and some agencies believe they can cast a spell that will be so hypnotizing it renders the budget an afterthought. Either way, bringing up budget in your first conversation can save months chasing a deal that will never close–and can also confirm the right partner for the long-term.
The budget tango can take many forms. Here are a few common scenarios paired with insight on how to get going on the dance floor:
- The client announces their budget range. Ideal! If it’s in the agency’s wheelhouse, keep talking. If it’s not, the agency can map out how it bills and why, which sometimes expands the range. If it’s not a fit, agencies are always happy to provide thoughtful referrals.
- The client asks for a budget range. This one can require some fancy footwork on the agency side as they try to hit the right amount (big enough to get the job done well, small enough to not scare off a potential client). I think of this one as education, and PR firms can help here with clarity around how they work, including contract minimums (time and retainer), hourly rates and team structure. One caveat: if a company asks for a range, seriously consider the entire range, not just the lowest number. PR agencies are providing a service here and listening to the reasons behind the range will only help in your communications journey.
- Nobody mentions budget. Quite common! The key here is to get off the sidelines and just say it. On the agency side, I ask if companies have a sense of budget. Most are relieved I’ve brought this up, as it speeds their search for the right partner. Some turn this question back to the agency and ask for a recommended budget tailored to their needs–in which case, see above.
- The client insists the agency will get exposure working for less than market value—or even for free. Most PR firms will give a little on budget if they truly love what a client is doing and if it’s good for the agency. There’s real value in working on a story our staff is passionate about. But working cheap for experience is called an internship–and no proven PR firm will embrace steep discounts.
- The client brings up alternative models, like paying based on outcome: media hits, speaking placements, award wins, etc. Much of marketing is data-driven–put money into Google or Facebook, and companies typically get a predictable number of leads. Successful PR has far less of a direct line between dollars and returns, requiring a magical-seeming intersection of relationships, creativity, timing and (it’s true) luck.
Strategic plans take time and thought, as do award submissions, analyst prep and all the myriad little things. Some stories are simply better than others. (Give me a $300M funding round and we can get you Bloomberg, but a small product update is a battle to win trade coverage.) I’ve never seen the math where an PR pro gets paid fairly for media hits that honestly factors in the strategy, hustle, news value and good fortune behind them. Instead, we try to reset the conversation around the retainer—the time-tested, money-for-time arrangement—while reiterating how an agency’s goal is to make clients insanely happy, and if that doesn’t happen we can always end the dance. But it can be hard to reset expectations on this structure, and agencies should be willing to walk away.
The right agency is an invaluable dance partner for years to come. With 2021 around the corner and a new year of budget conversations to come, make it a resolution to dig into the budget on the first call. It’s a vital step to align expectations so companies and agencies can avoid stepping on toes and dance the night away.
An ounce of prevention
Budget is central to a PR program. Simply put, budget equals time and expertise dedicated to advancing a company’s mission. Assembling the right team to create genuinely interesting stories that merit media coverage in a time of unprecedented news events (and ongoing media shrinkage) requires far more expertise than many appreciate at first blush–and experts don’t work cheap.
Successfully managing social media (often tossed into an RFP as an afterthought or a “quick” add-on) can also be a gargantuan undertaking, requiring hours each day of social listening, ideating, approval-seeking and execution. It often exceeds client expectations on time and expense.
Get ahead of disagreements farther down the road by having the tough conversations upfront.
Matt Stewart is an executive vice president with Method Communications.