From declining client/agency tenures to accelerating turnover rates to continued difficulty defining the value of PR, we have our work cut out for us. Here's a look at the current state of our industry:
  • Millennial Workforce

    • More than 70% of Millennials want to be their own boss. (source & source)

    • Millennials wants flexible workplaces. 85% want to telecommute 100% of the time, while 54% want a flex or alternative schedule. (source)

  • Unrewarding Work

    • PR firms under pay their people, and don’t align results & growth with compensation. The average PR firm only allocates 3.1% of annual revenue on bonuses. (source)

    • PR consistently ranks as one of the top 10 most stressful professions (source and source).

  • Lack of Professional Development & Talent Cultivation

    • In 2015, only 6% of clients listed understaffing & inexperience as a reason for termination; it jumped to 21% in 2016. As agencies struggle to stay competitive and meet client needs, they are sacrificing talent and sufficient skill development — and clients are starting to notice. (source)

    • The percentage of agencies who indicated that they are not providing any training to their staff almost tripled in 2016, growing from 5% to 14%. (source)

  • Lack of Tech Savvy/Tools

    • PR firms only spend 1.9% of their annual revenue on technology. (source page 11) (cross-industry average overall is 5.2% according to a survey by CIO Magazine)

  • Loss of Identity​

    • Only 27% of agency leaders believe that by 2020 the term “public relations” will adequately describe their work. (source)

  • Declining Profits

    • Annual operating profits have consistently fallen since 2011, dropping from 18.6% to 15.3%. (source)

    • Global PR industry growth slowed 5% in 2015. (source)

    • The average client-agency relationship has shrunk from 7.2 to 2.8 years while the average CMO tenure has doubled from 2 to 4 years. (source)

  • Difficulty in Proving Value

    • Clients and agencies both wholeheartedly agree that agencies struggle to prove the impact of their work through measurement, while clients feel increasing pressure to prove the ROI of agency investments. Agencies owned by holding companies feel this more acutely, with 48% selecting pricing/value as a reason for termination versus 35% of independent agencies. (source)

    • Over the past year, agencies’ approval of their agency/client relationship has fallen from 70% to 53%. “This is likely due to an increasingly competitive landscape, where clients work across multiple agencies and are feeling more and more pressure to not only produce successful marketing campaigns, but to also ‘out-innovate’ their competitors in areas that are still relatively new, like digital products and experiences, as well as marketing creativity and strategy.” (source)

Frustrated by these statistics or know of one we missed?

© 2017