Why PR agencies should scrap the hourly-rate model
A project-based billing cycle means clients don’t have to pay when public relations staffers dally on assignments. One industry veteran contends that results—and efficiency—should rule.
It can be unnerving to receive an invoice from your PR agency billing you for more than the budgeted billable hours.
Why should you pay more for the agency to write a press release, simply because it took staffers 10 hours to write, edit and muster it through the approval process, when your experience says it should have taken only eight? With some agencies billing upward of $400 per hour for senior talent, the incremental hours can result in exorbitant fees—and fast.
Why should you tolerate a pricing model that allows your agency to charge you more because of its inefficiency?
Mowers and meters
If you pay someone to mow your lawn, do you care about the activity (how long it took) or the result (a mowed lawn)? Whether your service uses a riding mower or a walk-behind is their decision to make based on their own business model, not yours.
Uber does this to great effect. A few years ago, I was sitting in the back of a taxi in New York, headed from JFK Airport to Manhattan, anxiously watching my meter creep toward $50. Uber solved that problem with upfront pricing, telling you in advance exactly how much you can expect to pay for your fare.
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