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Three quarters of Hong Kong PR firms admit to price cutting to win clients this year

Top reasons give for leaving a PR agency

Reasons given for leaving a PR agency

Just under three quarters of PR firms in Hong Kong have admitted to cutting their prices to win new clients this year, the results of a survey by the Council of Public Relations Firms of Hong Kong have shown.

Seventy-three per cent of firms tried lowering their prices, according to the study of 35 of the CPRFHK’s members, conducted in July this year.

This suggests that PR firms are finding it increasingly difficult to articulate their value propositions, the study’s authors suggest.

However, most firms are reporting an increase in the fees they generate from their clients this year, although that rate of increase has slowed compared to 2013.

According to the study, 53 per cent of PR firms said that their annual fees had increased this year, compared to 79 per cent in 2013.

Demand for digital and social media services is the big driver of growth, the study suggests.

The number of clients using PR agency for digital comms rose from 23 per cent to 44 per cent.

Using PR agencies for social media marketing was up too, with engaging bloggers and influencers making up 85 per cent of the services used, up from 62 per cent last year.

On staff churn, agencies said that family or personal reasons were the most common motive for staff to leave.

Next was a desire to gain more exposure to different clients. Unlike last year, an increased salary and a better title were less common reasons given.

Rachel Catanach, chairwoman of CPRFHK and senior partner, SVP and MD at FleishmanHillard Hong Kong, said that the survey showed that digital was top of mind for clients using PR and suggested that the industry partner with local universities to develop young talent entering the industry.

She said: “This year’s benchmark survey indicates that 2014/15 will be another strong year for the public relations industry. While this is good news, to be successful in the long term, PR firms must embrace the enormous integrated communications opportunity. The survey has showed us that digital communications, social media and blogger engagements are very much top of mind for clients, and we must compete head to head with our digital counterparts to remain relevant.”

Catanach added: “To meet this challenge, we need to focus on nurturing the right talent, perhaps partnering with local universities to ensure they are preparing their graduates with the strategic and critical thinking skills we need. We will also need to continue to invest in our people. As traditional and digital marketing skills merge into one discipline, we need to make certain our employees are ready. Finally, we need to educate our clients on the value of an integrated communications approach, creating a win-win solution for all.”

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