Marketing Executives Report Rise in Use of Public Relations in Marketing Mix

As Budgets Rise, Marketers Look Beyond Traditional Advertising to Build and Market Their Brands

Most marketing executives report that their marketing budgets have increased over last year – and that they are spending more time exploring the ways public relations can help build and market their brands, according to the second annual PRWeek/Manning Selvage & Lee Marketing Management Survey released this week. The survey, which polled 346 CMOs, marketing VPs, marketing directors and brand managers, focuses on the value and contributions of PR in the marketing mix.

According to the survey, marketing executives said public relations is steadily gaining a larger and more strategic role in the marketing mix. When asked if they felt PR was underutilized in their current marketing mix, 54% of respondents said yes – versus 63% in last year’s survey. Additionally, a full 88% of respondents said that PR is “very” or “somewhat” involved in marketing strategy development.

Marketers also say they are looking beyond traditional advertising when developing their programs: More than half (58%) of all respondents reported spending more time identifying advertising alternatives than one year ago. When asked which alternatives they’ve explored, 63% reported looking into building buzz and word of mouth, 55% said targeting influentials and 53% said Web marketing. Respondents also said they were exploring grassroots marketing and direct to consumer activities, media relations and events sponsorship. But although these alternatives are traditionally thought of as having roots in public relations, only 12% of respondents said they would seek a PR firm to help explore these options. Thirty-six percent of respondents, on the other hand, said they would look to a consulting company for help.

Marketers also reported budget increases in 2004. More than half (53%) of all respondents reported that their budgets have increased over last year, to an average of $28.5 million. While most reported a 5% or 10% increase, another 9% said they saw increases of more than 50%. Additionally, only 23% saw a decrease in budgets. In contrast, just 28% of respondents in last year’s survey reported an increase in budgets – and 38% reported a decrease.

“With the economy on an upswing, marketing budgets are coming back – and competition for those marketing dollars is heating up,” said Mike Marino, chief strategy officer for MS&L. “But rather than continuing to rely on traditional tools, marketers are seeking more efficient strategic marketing alternatives which will help them target their consumers and meet their business needs.”

Eleanor Trickett, deputy editor and features editor of PRWeek, said these results indicate there is an opportunity for PR professionals to further educate their marketing colleagues about PR’s capabilities.

“Marketing executives have identified that there is a very great need to look beyond the 30-second TV ad in order to build their brands and reputations. But while many are looking at solutions that are firmly grounded in PR, few are engaging PR agencies at the level they should,” said Trickett. “This is a great opportunity for PR professionals to prove how they can act as strategic marketing partners far beyond the realm of media relations.”

Integration Key to Success
Integration is by no means just an industry buzz word – 66% of respondents said they have spent more time developing integrated communications than one year ago.
This figure is about equal to the results of last year’s survey, in which 61% of respondents reported spending more time on aligning their programs. But while the desire for an integrated communications strategy is clear, so is the difficulty of accomplishing it: Just 21% of respondents reported their programs are seamlessly integrated.

When asked which external partners would be best to help align communications disciplines, there was little consensus: consulting companies came first (34%), followed closely by advertising agencies (27%) and PR agencies (21%).

“The keeper of the strategy is the driver of integration, regardless of discipline,” said Marino. “With 81% of respondents reporting that PR firms can work on a strategic branding level – but only 54% saying they actually do – there is a real opportunity for the public relations industry to prove its strategic expertise. And the more PR can own strategy, the more likely it is to drive integration.”

Measuring Effectiveness
Measurement is key when determining the effectiveness of a program – and, marketers say, public relations professionals are doing it well. More than half (53%) of respondents said their public relations firms were “excellent” or “very good” when it comes to measuring the effectiveness of their performance. In contrast, 33% of respondents reported their advertising agencies as “excellent” or “very good” in terms of measurement.

“There is an increased need to measure the effectiveness of our work, and public relations firms are committed to making this a priority,” said Marino. “These results suggest that agencies are developing more effective tools to measure and market their results – and marketing executives are relying more on PR as an effective and measurable way to develop and market their brands.”

Disciplines in Marketing Mix
As in last year’s survey results, when asked to rank the importance of advertising, public relations and direct marketing against various marketing objectives, marketing executives said PR was most important for overcoming a crisis (74%), cultivating industry thought leaders (55%) and building a corporate reputation (75%). PR was also ranked most important for generating word of mouth, pre-market conditioning and building a brand’s reputation. PR and advertising ranked equally important in strategy development and message development.

Advertising lost its edge in three categories this year: acquiring customers, building awareness and promoting a new product or service. Last year, 45% of marketers said advertising was most important for acquiring customers – this year, only 24% of respondents said the same, rating direct marketing as most important (54%). Additionally, in last year’s survey advertising was billed as the most important discipline for building awareness; this year, advertising (48%) and public relations (43%) ranked equally in this area. And when promoting a new product or service, an equal number of respondents said direct marketing and advertising were most important (41% and 36%, respectively).

This year’s survey results also indicate that direct marketing is gaining on public relations and advertising in a number of areas. Nearly three times more respondents (41%) this year identified direct marketing as being equally important as PR and advertising in launching a new product or service, versus just 14% last year. For acquiring customers, 54% of respondents said direct marketing was most important. Direct marketing was also the winner for targeting niche audiences – a full 82% of respondents identified it as the most important element in this category. Direct marketing was also ranked most important for maintaining customer loyalty (44%).

About PRWeek
PRWeek is the leading business magazine covering public relations in the U.S. PRWeek launched in November 1998, and is part of a global network of four PR titles, owned by Haymarket Publishing, the largest privately-owned magazine publishing company in the U.K.

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