Now that everyone in the Miami office has finally stopped talking about the grisly Miami Zombie Apocalypse, can we please focus on something that may just be of a little more importance? Like PR and marketing budgets. The depressing jobs report for May is causing a great deal of consternation on Capitol Hill and in global markets, and with so many “financial fires” burning here and across the European Union, I wonder, should our industry be worried about PR budgets drying up as they did just a few short years ago?
Let’s back up to late 2007. That’s when the “Great Recession” officially began and just six months before Lehman Brothers went up in smoke, sending stock markets around the world into a hysterical panic. Remember the photos of traders, eyes bugging and mouths agape in horror, dominating all the major front pages at that time? Over the next three years, little by little, clients started chipping away at PR budgets and agencies – small and large – were really feeling the pain.
During that same time, we had quite a number of non-profit organizations and consumer brands on our client roster. But as donors’ wallets started closing and funding dried up, many nonprofits were forced to cut their already small marketing budgets to nothing. We saw the same happen with consumer and lifestyle brands. As discretionary spending dried up, so too did the PR budgets of many small-to-mid size consumer brands.
So are we headed this way again? It’s hard to say. The glass-half-full optimist likes to think not. I do, however, think it depends very much on the types of industries that a PR agency represents. After the budget cutbacks of 2008 through 2010, our agency refined its focus and focused on B2B only a handful; of industries – underserved ones from a PR perspective. Although we still work with a handful of nonprofits, the focus of ThinkInk and our travel division TravelInk’d is technology – particularly mobile – that serves the airline, travel, payments and loyalty marketing industries. These are particularly important in keeping the wheels of global business turning. And let’s face it, tech isn’t going away.
Of course, every PR agency head needs to be judicious and keep an eye on economic trends; we have to stay nimble and ready to make quick yet responsible adjustments as necessary. I think back to 2008 and know I made the right decisions to tackle shrinking budgets and a challenged marketplace. And I’ll feel the same way in 6 months or a year’s time so ask yourself this “is my agency able to weather another economic storm?”
Here’s hoping it doesn’t come to that.