What’s the Optimal Public Relations Budget?
Have you figured out what your optimal public relations (PR) budget is for 2019? Chances are, you may still be grappling with it or may be wondering if you have set aside the right amount. Heck, you may not even have a PR budget and are not sure whether you should have one.
Identifying the right amount to invest in public relations isn’t always easy. Consider this figure pertaining to marketing, which includes public relations. According to an article by Pattie Simone in Entrepreneur, companies should invest at least 10 percent of their gross annual income in marketing as “a general rule of thumb.” So if your company made $5 million in revenue last year, you’d be investing $500,000 into marketing. There are several variables to this figure—and I explain them in my earlier blog, “What’s the optimal marketing budget?”
So what’s PR really going to cost me?
Many companies just want a budget figure—not a number derived as a percentage of revenues. As an agency, we give them benchmarks based on what we have seen in our almost 20 years of experience performing public relations for the mortgage industry.
We find that the average 1 to 50 person company is investing anywhere from $3,500 to $7,500 per month in public relations—whether they work with our agency or use another resource. Companies in the 50 to 200-person range tend to have monthly budgets around $5,000-$10,000+, and larger ones range from $8,000 to $30,000 and more. However, we have seen large companies with small budgets, and small companies with large budgets, ready to make a big splash.
Add to that, every company has varying public relations needs. Some purely want to get a lot of positive press exposure, whereas others want speaking engagements at conferences, they want to be nominated for awards, they want social media, and they want blogs, articles and white papers written and published on their behalf, too.
It’s important to note that a public relations budget can be kept consistent from year to year to ensure steady growth, or it can be increased to maximize growth. That is, if a public relations campaign boosts web traffic, improves a company’s visibility and fuels sales, it’s smart to increase the budget until the benefits start to plateau.
In-house or outsourced?
Many companies believe they can do PR in-house. Of all marketing functions, I believe PR is the hardest one to do in-house. While it would take a whole blog to explain why this is the case, a key consideration is that a big part of public relations is proactively reaching the press and getting them to write about your company, your people, or your product or service.
As an agency, we have the immense advantage of having staff dedicated exclusively to communicating daily with reporters. Plus, when our staff members reach a reporter, they are not always promoting the same company. Instead, they give the reporter ideas on what to write about and offer sources based on the reporter’s response. If you have an inside public relations person pitching the same company all of the time, reporters soon tire of speaking to that person, knowing they will recommend their company as a source regardless of the angle of the story.
In my decades of experience in public relations, I have witnessed that once companies get exposed to the power of proactive public relations, they become lifelong believers. Public relations, after all, is the tide that lifts all boats—making sales and marketing efforts far more effective.
How much should your company invest in public relations? The question is less about how much to spend, but more about how much you would like your company to grow.
If you have not allocated budget toward a public relations strategy, this is the time to start. Even a conservative budget is better than no budget—and once you start seeing the impact on your business, it will be easy to justify growing the amount. You have a lot to gain by exploring this tried and true strategy rather than conserving funds and risking a far slower growth curve. And it’s good to know that you can use a public relations agency like ours that lets you start conservatively, and allows you to grow the budget as your sales increase.
If you need help getting started with public relations, or simply have questions about how it all works, we’d be happy to help. Just reach us at Info@StrategicVantage.com or call 305 971-6239.