In 2007 I wrote about an AdAge article that focused on the battle for social media client budgets between ad agencies and PR firms. At the time, the popular momentum, or at least AdAge’s view was that advertising agencies were better prepared to capture this opportunity. Ad agencies have definitely had some high profile wins blending social media and traditional advertising, with Wieden + Kennedy being at the forefront with their work for Old Spice.
Despite the success of the recent Old Spice campaign, in 2010 Ad Age is singing a different tune with an article headlined, “Social Media Helping Public Relations Sector Thrive.” I think PR is going to continue to grow into advertising spends with social media for a few reasons.
Different Types of Time
PR agencies for the most part are structured to make money and bill clients based on billing for the time their employees spend working on projects for clients.
Most ad agencies are structured to make money based on buying time on media. This allows ad agencies to generate much higher revenue in general than PR agencies of the same relative size.
The thing with social media is that there aren’t huge ad buys. Sure, there are some. There is integration with print ads, and television and radio campaigns. There are also online ad buys, but these don’t have the dollar amounts or margins associated with them that broadcast buys do.
Social media is about people putting in time to interact with other people. That’s what PR agencies do. They used to just do it with reporters, now they do it with everyone.
Campaigns vs Engagement
Most advertising programs are built around campaigns that have a specific beginning and an end. Some social media activities are structured as campaigns with a beginning and an end, but more often they are about long-term customer and public engagement. This isn’t something that ends.
Ad agencies and PR firms are becoming more adept at creating products to sell or to demonstrate their chops. This may be social media monitoring tools or widgets to distribute information, but they are all things to sell to try and add value to clients and allow them to be more of a one stop shop. This move to development on both sides is going to continue, but I’m going to keep my bet on the PR agencies, at least the smart ones to continue to pull ahead.