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Study: Most small PR agencies outsource digital/social account work

by | Aug 23, 2017 | Public Relations

Fifty-five percent of U.S. PR agencies doing $4 million and under a year in net revenues claim they don’t have the requisite in-house capabilities to keep up with client demands for digital, mobile, social media and online marketing services, according to a new survey of agency CEOs from mergers and acquisitions consultancy The Stevens Group.

And yet 70 percent of respondents answered “yes” when asked if they are confident their agency will be current on continually changing digital platforms in the next two years.

More than a third of all agency CEOs surveyed indicate their digital needs are being met by utilizing outside resources—and 30 percent said they seldom if ever need additional resources beyond their existing in-house staff and their network of freelance digital service providers.

“PR agencies in the $4M-and-under revenue range apparently are not keeping up with internal staffing requirements needed to provide clients with end-to-end digital services,” said Rich Jachetti, senior partner at The Stevens Group, in a news release. “A much larger percentage of firms in the small-to-medium size range are depending on outside contractors to meet client demands. They haven’t as yet committed to building internal staffs that are capable of fulfilling clients’ ever-expanding digital marketing needs.”

Most small PR agencies outsource digital/social account work

“Most firms claim to have a full suite of digital marketing capabilities,” Jachetti added. “But the central question is which firms are actually staffed with full time, or even part time employees, to handle new media marketing assignments, and which firms are mainly outsourcing the work?”

The survey found that only a third of the agencies responding employed more than 10 percent of its staff on a full-time basis to focus solely on digital—yet 53 percent of the CEOs said they intend to put more time and energy in the next year into recruiting staff with relevant overall digital marketing skills and experience.

“Apparently, the smaller size firms still either don’t have the resources, or the sense of urgency needed to beef up for the inexorable and inevitable transition from legacy to digital and social media,” Jachetti said.

Surprisingly, Jachetti added, less than 50 percent of the CEOs surveyed said only one third of their overall work for clients included digital services.

“The question remains,” Jachetti said, “are PR agencies sitting on the fence to see which way the digital wind is blowing? Or to what extent will agencies that are used to the tried and true traditional scope of PR work venture more aggressively into areas that they’re not as confident in or knowledgeable about?”

The survey was sent to 800 agency CEOs, with more than 10 percent of CEOs responding. It was unclear how many agencies were represented in each of the revenue classes represented.

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Richard Carufel
Richard Carufel is editor of Bulldog Reporter and the Daily ’Dog, one of the web’s leading sources of PR and marketing communications news and opinions. He has been reporting on the PR and communications industry for over 12 years, and has interviewed hundreds of journalists and PR industry leaders. Reach him at richardc@bulldogreporter.com; @BulldogReporter

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