The Difference Between 2007 and 2010 in PR/Ad Agency Battle for Social Media

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.

What now?
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.

Advertisements

7 thoughts on “The Difference Between 2007 and 2010 in PR/Ad Agency Battle for Social Media

  1. This is a really interesting take on who should be doing social media. Coming from a PR background myself I agree that PR is the way to go. They’ve always been the ones who are about creating and maintaining relationships for a company and I think they should continue.
    That’s not to say however that marketing and advertising can’t get in on the act with certain campaigns and whatnot, but I feel that PR is best suited for the every day interactions and engagement.

    Cheers,

    Sheldon, community manager for Sysomos

  2. I hear ya, I really do. But I think it is impossible to say one way or the other. It depends on the ultimate goal of the project.

    I don’t recommend that client companies outsource day to day admin (in a few instances this might make sense, but generally no). So if you follow my logic…and the only thing companies need to outsource is social media campaign construction, then you disprove your point. “marketing and advertising [can] get in on the act with certain campaigns and whatnot” In my opinion, ad agencies should be doing social media.

    But then again, what’s an ad agency and what’s a PR agency? The lines blur.

    That being said, I hear what you’re saying. But isn’t it pretty easy for agencies to rebuild their billing structure for social media services? So a PR agency can provide ad agency services while an ad agency provides PR agency services? Are the two still mutually exclusive?

  3. Thanks for the comment Liz. I agree, if a company can do most of the heavy lifting in house, it’s better for them in the long run. We even train employees on how to do that. Yes, the lines are blurring and will continue to blur which I personally think is wonderful. We shouldn’t get hung up on tools and tactics. Rebuilding the billing structure isn’t that hard but rebuilding the compensation of ad agency execs who are used to the big bonuses from large media buys might be a little more difficult.

  4. “rebuilding the compensation of ad agency execs who are used to the big bonuses from large media buys might be a little more difficult”

    Ha ha! Agreed!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s