The Hidden Costs of Hiring PR Agency in 2021

7 mins read

PR Costs 2021. What makes collaboration with a PR agency work is no different from what makes any great partnership work: The mutual understanding has to be there, they have to really “get” what you’re trying to do, and just because they’re able to prove past success in past relationships doesn’t mean they’re necessarily right for you, and of course, it’d fit your budget.

Hidden PR Costs #1. Involving Inexperienced Stuff

An agency has sold itself to a client (through the name of its owner, or through a tender), and the project was handed over to an accountant – a journalism student who has little experience in PR.

At a market rate of $12,000 a month, which is pretty typical, they serve you with about 20 hours per week, total, of two junior employees, who they pay anywhere from $50,000 to $100,000 a year.

Because many PR agencies suffer from the lack of experts and high turnover of staff. But, unfortunately, the client pays for such “troubles”

Hidden Costs #2. Blurry Price for Services

The representative of the PR agency doesn’t tell you the exact price of the service and tries to find out your budget. It is much easier to add additional value to the price of publications, writing the press releases, and so on under the total cost.

Hidden Costs #3. Distributing the Content

The next level of overpayment for PR services is the usage of the Press Release distribution agencies. For writing and sending your articles and press releases to lists of journalists they hold for a fee. Fees can cost differently, depending on the number of journalists you need to reach. Writing each press release professionally can cost between £50 and £200 or more per press release. Also, distributing the content PR agencies request money for time, spent on outreach, additional time for approval, a salary of a PR manager, etc. Whereas publications can be done much faster and cheaper with the PRNEWS.IO service. With our service, you can create and distribute brand content to the relevant publication. Whether you’re looking for a way to send press releases or articles to credible media outlets, PRNews.io will get you covered. 

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Hidden Costs #4. Incorrect KPIs

Your overpayment is hidden in the incorrect metrics. PR agencies often say “we have published 30 articles”, but they do not give you (or you don’t ask) a list of publications, how much traffic, conversions, and purchases they brought you, etc.

Most PR companies choose to charge executers, which are mostly a fixed monthly or quarterly fee charged for a contractual agreement of a minimum of 6 months. Most of the time is paid in advance.

It ensures clients of a certain level of services during the contractual time and the basis of determining the time to put into a client’s PR is a simple calculation: hourly rates multiplied with the estimated time taken to execute the agreed services.

Sometimes, the working hours for a brand will be higher than promised, but it balances off with times when there is less to do around the account. And in total, it ensures some stability to the PR firm which can serve now for long-term goals and can cover day-to-day activities. But it doesn’t guarantee stable results for the client. So consider the agreement, based on the achievement of KPIs and you’ll be able to control your expenses or stop the contract. This method is called payment-by-results.

It usually consists of a basic fee plus a success fee. The latest is charged for certainly gained media coverage through the PR efforts, also known as pay-per-placement. This is the option most appealing to clients that are skeptical of PR and are all into proven ROIs.

Hidden Costs #5. Inappropriate Services

Many PR agencies offer many services, like strategic planning, project management, and execution. It will provide employees like an account director, account manager, account planner, project manager, creative director, art director, copywriter, copy editor. Each comes with a salary at a different level and their time spent on your work or campaign will be estimated and paid. The client will pay those expenses plus a multiple added on to cover a roughly 20% profit margin and overheads. If your agreement is for one year, this cost is divided by 12 to provide what is called your retainer fee per month. In addition, a full-time person doesn’t actually yield 160 hours a month. After you subtract vacations, sick days, and unproductive time, you end up with about 120 hours a month.

But your project might be on the starting stage when you need minimal services. And you don’t need to pay for the full services. This is paid irrespective of coverage achieved, though professional companies will give clients results. This is not usually an option for SMEs and startups.

The Bottom Line 

I hope these points helped to clarify things for you. Now you have a choice of what to choose or create a hybrid PR strategy when you outsource the tasks to PRnews service or PR agencies. I’m generalizing and no one knows your business better than you do. That’s why the decision is yours.

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Nastya Zelenovskaya

Content marketing manager at PRNEWS.IO.

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