Will regional PR agencies be game-changers in the years to come?

Despite incurring losses in crores every month, the regional PR industry is optimistic about emerging stronger from the crisis

e4m by Nafisa Shaheen
Updated: May 21, 2020 3:31 PM
PR

The plummeting corporate budget allocation on public relation industry has been a cause of chaos since the commencement of the lockdown. With the national PR agencies bearing the brunt, regional PR agencies have also started to feel the heat. Sources reveal that the overall loss in the regional PR space till the lockdown lasts could be pegged at Rs 10 crores. With large players losing Rs 30 lakh - Rs 35 lakh a month while medium and small players losing around Rs 8 lakh to 10 lakh. There are about five agencies in first range while around 15 in the later range.  All put together, the losses could amount to Rs 4 Cr to Rs 5 Cr a month. This is a big dent as it is a huge amount as service fee alone. It has hit hard on people like regional PR stringers who were solely living on such assignments for and by regional PR only.

India is a land of diverse cultures and languages where mother tongue changes in every 3 kilometres and people have varied preferences and tastes, the need for regional PR eventually expands. There has been a considerable rise in the need for public relations for local brands and regional media. Regional PR agencies are being considered as serious competitors in the race by national PR agencies. These are tough times for the national PR agencies, but for the regional agencies, the situation is tougher. We interacted with some of the key players in the different regions of the country to know their experiences in tiding over such unprecedented times.

On being asked about the challenges being faced by the agencies, Shailesh Goyal- Director, Simulations Public Affairs Management Services Pvt Ltd., Ahmedabad replied, “A few clients have temporarily paused our services and revenues have fallen.” He added, “However, we are lucky that most of our clients have been extremely supportive and have appreciated our work and results we have got even during the lockdown.”

Richy D Alexander -CEO & Founder, Davidson PR & Communications, Kochi chimed in: “The biggest challenge is the financial crisis during this period. One of the many reasons for this is the client taking a step back with the PR activities. Many have either paused PR until the situation gets better or have slowed down and are restricting themselves to minimum PR activities. This situation has resulted in an all-new challenge of convincing the client to contribute for an article/feature as many of them would want to lay low for the fear of negative perception or not enough reach during this period.” He further added, “In the media front as the number of pages are reduced and with journalists working from home it is challenging to achieve press coverage as before.”

While Shishir Somani, CEO- Archer Communication, Indore pointed out towards other equally important challenges being faced. He said, “Before the present crisis, it was complex to even imagine the option of working from remote places/ home. Now especially, when organizing a press conference, meeting in person is out of the question, thus work from home is feasible. As per as sharing routine press release, notes, statements etc. are concerned, it hardly took any time for the team to adjust. In small towns, people prefer meeting over talking telephonically or via video conference, but they were also fine.”

Managing the finances has been a major cause of worry among all businesses, not sparing the regional PR agencies too. Asking about reduction in cash flow from clients and how is the financial stress being managed, Davidson said, “There is an overdue of 30-40 per cent since February 2020 from many of our clients. We are in a situation where we cannot push the client too much for the payment nor can stay idle with the financial crisis upon us.”  He added, “So far, we were able to manage the overhead expense which is a result of our financial discipline.”

Goyal pointed out on expanding the basket of services offered by adding skills in related domains. He said, “We started offering bundled services in content, design, and digital services for SMEs and It has started showing encouraging results with smaller but more invoices. Besides, we have also re-negotiated the fee for a short-term for a couple of clients, but with the commitment that the compensation will be revised upwards as soon as things get better. Everybody understands and has been extending cooperation.”

“We are trying to manage financial stress by reducing discretionary expenses, rationalizing the team’s compensation given the revenue projections and restricted use of infrastructure and perks,” added Goyal.

Somani threw light on the free fall of clients in the initial 10 days of the first phase of lockdown and clients taking a break of a couple of months. He added, “The teams have been asked to focus on recovering the long over dues. Secondly, we have deferred some of the expenses especially the variables of the team members. There have been no salary cuts in the month of March and April.”

Amid the gloomy environment, there has always been a sense of positivity which has kept the show going. The centrality of the public relations industry will be more relevant in the future. The industry will grow manifold since brands will relay in PR largely for brand recall. Regional Public Relations Consultancies have been playing a crucial role in the industry for over two decades now and will certainly prove its worth in the times to come. 

Experts believe that regional agencies will prove to be game-changers in the times to come.

Shailesh Goyal supported the new thrust of “Vocal for Local” by the government. He affirmed,” There will be an enhanced role of regional PR firms, given the fact they have a better understanding of the ground situation in their respective geographies and can provide deeper insights into localizing the outreach strategy. I believe that going ahead, even the larger communication firms will seek a collaborative role with regional PR firms in preparing blueprints of communication strategies and plans multinationals, private, and government organizations.”

Richy Davidson too spoke on similar lines. He acknowledged the fact by stating, “With movement from place to place being restricted, brands will be giving more focus to regional PR as it is going to be the major source of income at least for the time being.” He advised regional PR agencies to step up their spot in the industry, evolve with the crisis and come up with innovative PR strategies. He added,” During this period, it is essential to look beyond revenue and pitch newsworthy articles for your prospective clients. The sole objective must be in creating engaging stories rather than mere promotion”.

Shishir Somani had contradictory views. He said, “I doubt if the regional agencies would be able to change the game. Given the dependability on the traditional media, where the ad revenue is stressed, substantial job cuts, pages getting reduced, editions getting closed, the traditional regional PR firms will have a tough time. In fact, I see job cuts and or shrinking salaries for the next six months to a year. “

Concluding on a positive note, he added, “ In spite of huge uncertainties, the revitalization of the regional PR firms will be very rapid as compared to the larger corporations.”

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