October 8th, 2012 / 12:38 am
[The following draft is a rough translation into English from the article above which appeared in Bisnis Indonesia]
The public relations industry is a relatively new line of business which is seeing swift growth, especially in the Asia-Pacific region as most multinational companies are partnering with PR firms in building their communication to the mass media as well as to the public. Bisnis Indonesia had an opportunity to meet with President and CEO of Burson-Marsteller Asia-Pacific Bob Pickard to gain some insights on the PR industry’s competition in the region.
How do you see the development of the PR industry in Asia-Pacific?
We see that there is a tremendous growth of the PR industry in Asia-Pacific. We recognize that there are three things that were traditionally imported from West to East. The first is money invested in communications campaigns, the second is ideas, and the third is talent. But now Asia-Pacific exports all three of these things – here we have the money, the diverse ideas and a lot of human resources. There are many Asia-based multinational companies that have developed into big global players, and it creates a major market for the PR industry in Asia.
How much does a company usually spends for communication strategy?
Many companies in Asia-Pacific spend $1 million or more every year for public relations programs, covering the entire region. For instance, if a company which is headquartered in one country has branches in some other countries, such a budget would covers PR activities for all the markets. However, there are also companies which would spend $250,000 per year for their regional PR activities.
What is the strategy usually used by a PR company in order to reach their markets?
Currently, we are seeing a change in the communication model. Previously, the number of media outlets was so limited that every company tried to tell their story only through mainstream media. But now, social media is growing. It really helps PR companies deliver the clients’ message to the public.
Furthermore, communications built between companies and their stakeholders is no longer a one-way street, but more of a two way conversation. In the social media sphere, people can easily share any input with companies. In this context, every PR firm has to listen to what the clients need, understand the target audiences that they want to reach and also incorporate input from media before they can create effective strategies.
Do you think competition in the PR industry is tight enough?
There are hundreds of PR companies these days and some of them are located in Indonesia. This surely creates competition among the firms, especially in terms of the budget levels proposed to the clients. There are relatively small PR companies which would normally compete on price, while there are also PR firms that play at the higher level and compete on quality. Such firms provide premium thinking such as building a corporate reputation, handling CSR activities and they also become commercial consultants for the clients. Competition in the PR industry is not excessive. There is still a lot of room to develop. The PR industry is at a relatively early stage of development, unlike advertising which is already a more mature business.
With respect to price competition, does this pose a significant threat to big PR companies?
Not at all, in fact it provides opportunities for PR companies to be established and to thrive. The presence of new [Asian] PR firms provides new ideas that the more established PR firms should learn from.
Does each PR firm need to have special skills?
It is ideal for a PR firm to have the capability to meet the clients’ needs in all sectors. Nevertheless, PR firms need to build deep experience and knowledge by domain. In our experience, we don’t just cater to one sector or a single industry, but we do try to extend expertise across geography and practice (that includes building our networks with governments). This is crucial to build reputation and trust in a PR firm.
What needs to be done by a PR firm in order to grow?
Try to see how it was 20 years ago, before social media arrived on the scene. Brands from companies could only become worldwide because they were published in traditional media. The change has been very rapid. Currently, rising Asian companies are becoming top global brands because they utilize social media platforms. PR firms cannot escape from this evolution and they have to use social media as a strategy to drive clients’ communications. One day, there might be an Indonesian company which builds a truly international brand on a social media platform.
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