Technology Sector Dominates PR Spend in 2013

2013 was an interesting year for the public relations industry.  Two of the world’s four largest multinational PR and advertising companies – Omnicom and Publicis – merged to become Publicis Omnicom Groupe, and a bit closer to home, another of the big-hitters  – WPP – acquired a majority stake in local digital agency, Cerebra.

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Then there was the clear push for diversification among agencies across the world, a trend driven by an evolving marketplace, and rapidly changing client demands. The role of the PR practitioner continued to expand in complex ways, as digital platforms continued to become all-pervasive. All this has left us in an interesting place, where agencies, both locally and globally, big and small, are looking at executing new, exciting strategies, to adapt to what has become a very interesting environment.

However, one of my favourite results of the year – and it’s one which we have felt notably – was that the technology sector became the world’s largest PR spender, overtaking consumer products. I find this trend interesting, but not all surprising.  The consumer products market is still the bigger feeder of the advertising industry, with the likes of Procter & Gamble, Coca Cola, and McDonalds spending huge amounts. But if those behemoths are the biggest spenders on advertising, then why are tech companies dominating PR spend?

At the very heart of this question, lies the difference between advertising and PR. In my view, good PR picks up where bad advertising stops working. If you’re familiar with Seth Godin’s books or talks, then you’ll have a good idea of what I mean by “bad advertising”, and specifically, why advertising is not as effective as it used to be. Put briefly; as audiences become more informed and critical, they become less receptive to advertiser messaging.  This is the critical point where PR can be a lot more effective than advertising, and by PR, I mean the entire gamut of public relations activities, from media engagement, to influencer outreach, social media campaigns, community management, and other more dynamic communication platforms that brands can use to influence purchasing decision.

So with this in mind, why are tech companies spending more than consumer product companies on PR, and vice versa on advertising? Because they should be. Because, their audience is typically more critical and informed than, say, the average person Coca Cola targets.  Tech companies need to shape perception by A) releasing great products, and B) getting key influencers to endorse them publicly, whether it be the head gadget reviewer at Techradar, a renowned blogger, or even just someone with a large Twitter following who is perceived as credible and knowledge. This is where PR works better than advertising, and this space has a more prolific ability to stimulate purchasing intent than traditional advertising, at least in the tech space.

The fact that tech companies are spending more on PR than any other sector is promising, not only for our industry, but also for the tech market. It reflects that these companies understand their audience, and they properly understand the various marketing tools at their disposal.

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