PR: When is it best to go out of house?

Budget is not the only issue when deciding if external PR is required, writes Mary Cowlett.

For organisations of a certain size, deciding who is the most appropriate person to handle a particular piece of PR work is a perennial challenge.

The problem for marketers is that internal and external PR teams each possess attributes that work for and against them, so picking the right team for the right job is vital.

The most reliable sounding board for making such a decision is likely to be the in-house PR team itself. But the pivotal question is who is the best person for the job?

Cable and satellite TV operator Nickelodeon has an in-house PR team of three, which typically handles the day-to-day reactive communications around its three channels and matters close to its brand values.

Most recently, this has included the positioning of a new co-produced series of Thomas The Tank Engine on its pre-school channel Nick Jr with the parenting and kids media.

"That was easy for an in-house person to deal with because they know Nick Jr's brand values inside out and are immersed in that channel every day of the week," says Nickelodeon PR manager Nick Southall.

Communications challenge

This July, however, Nickelodeon launched a new channel called Nicktoons TV, showing well-established Nickelodeon cartoons such as Rugrats, Hey Arnold! and The Wild Thornberrys, which presented the PR team with a major communications challenge. "The new channel had no new programming, so we had no story for the press," says Southall.

To solve this dilemma, the TV operator turned to specialist consumer agency Frank PR, which came up with the idea of promoting the channel via a competition to find the Nicktoons TV family. Backed by a regional tour of 10 UK cities and with a prize to become the inspiration for a series of one-minute animations to be aired on Nicktoons TV next February, this generated great media coverage.

"The agency was able to come in with fresh ideas and essentially had the time and creativity to be able to brainstorm around the problem," adds Southall.

But if creativity is often the driving force for turning to hired help, so are some of the specialist skills agencies can provide, such as online PR, grassroots viral marketing and maximising sponsorships. This summer, youth specialist agency Cake helped bottled water brand Evian leverage its sponsorship of Kylie's 2002 Fever Tour. To bring to life Evian's 'Live Young' brand philosophy, this involved handing out 200,000 limited edition Kylie/Evian bottles after each gig from the back of a 45ft branded lorry.

In addition, the agency generated a host of media coverage for the tour, including an eight-page interview with the pop princess in Marie Claire.

Importing specialist PR support may also be a good way of shaking up the internal culture of an organisation. "One of the big advantages of using an external agency is that it can and should break the 'yes' cycle," says Suzy Frith, chairman of PR firm Citigate Technology.

This is particularly true in the IT sector, where organisations can get swept away by the bits and bites that make their products work and pursue an ill-conceived media agenda, based on one person's hunch. "Within a strong corporate environment, no one likes to disagree or be the bearer of bad news," says Frith. "But it is easier for an agency to stand up to people and say, for example, that it's no use talking about products to the Financial Times, that it's only interested in the issues surrounding the products and the business implications of future technology trends."

Carbon copies

This is a view echoed by Gerry Hopkinson, director of corporate and consumer PR specialist Band & Brown. With experience on both sides of the agency/client fence, including a five-year stint at Mastercard, he says that in-house PR people have a broad remit that can encompass everything from internal relations to regulatory and legal issues. But he adds: "There is a tendency in-house to hire people who are a carbon copy of you. This may make you feel comfortable, but there can be overlaps and such people probably won't give you any new insights or tell you the stuff you need to hear, such as how the rest of the world sees your business."

Indeed, one of the many advantages of hiring an agency that is one step removed from the daily business of managing a brand or product is its impartiality and honesty.

"An agency can be politics-free, challenge the status quo and accept no sacred cows," says Richard Medley, director of PR firm Countrywide Porter Novelli, which works with clients ranging from Diageo to the Jim Henson Company.

In addition to the consultancy aspects of hiring external help, there are also timing issues. For example, management consultancy Deloitte (soon to be Braxton) outsources all of its media relations. "We've done studies over the years and it makes more sense to keep our PR out of house," says global marketing director Mike Nethercott.

This is driven in part by a skills requirement, in that Deloitte's internal marketing people lack the in-depth content knowledge necessary to support the firm's recent move into the wireless space.

But as with all business issues, the number one criteria is cost. While the current economic climate means many firms balk at adding to their head count, Nethercott's organisation calculates that, in terms of hard dollar value, the expense of adding PR salaries, training, education and management outweigh the advantages of having an internal team that is solely immersed in its business.

But budgetary and timing issues swing both ways. For some senior managers, the idea of splashing out several hundred thousand pounds on external PR help is unsupportable.

"Brutally, it comes down to budget. The value you can extract from an agency comes from confidence, which is something that doesn't happen overnight," says Jeannine Nolan, acting head of communications for AstraZeneca, which works with a raft of UK PR firms including Burson-Marsteller, Chandler Chicco Agency, Munro & Forster and Cohn & Wolfe.

Managers next to leaders

The pharmaceutical firm is currently reorganising its internal marketing resources to establish a more integrated way of working, with brand communications managers sitting alongside brand leaders. But Nolan acknowledges that this re-jig will not negate the advantages of putting some PR work out to agencies that have the specialist skills in creativity, copy-writing and production.

Likewise Wyeth Pharmaceuticals, which has an eight-strong internal PR team in the UK, uses a mix of in-house resources and specialist pharmaceutical PR firms such as Red Door Communications. Corporate affairs director Gill Markham believes some areas of brand PR sit better with the corporate PR team than an external agency.

"We work across eight major therapy areas, including depression, women's health and transplantation of organs, so obviously our brand managers have a lot of knowledge about their products," she says. "Because we're working with them all the time, we pick up on the nuances and are able to change things quickly on a need basis."

The internal PR team also handles all communications for which speed and corporate ownership are of the essence, such as issues and crises.

Likewise, the in-house team manages all relationships with third parties, such as patient groups. "If these activities are farmed out to an agency, the agency takes the relationship with it when a particular project comes to an end," says Markham.

But if external PR agencies sell themselves on their creativity, impartiality and breadth of sector knowledge, whereas internal PR teams pride themselves on their familiarity with the business and proximity to people in the know, how are the two forces to work together?

After all, it's one thing to write a brief, organise a pitch and appoint an agency, quite another to ensure that timelines, approval processes and brand strategy are met.

In most organisations, the relationship is most successfully managed by the in-house PR team, which typically acts as the interface between an external agency and the marketing department. Markham says her team goes so far as to train up brand personnel so that they understand how to get the best out of external agencies.

For the past two years, the Post Office has sharpened up its use of PR agencies and taken the decision process for who should handle brand PR work out of marketing and into its corporate communications planning.

This has solved the dislocation between the corporate press office and marketing, but it has also ensured that perceptions of the Post Office's products and services are in line with the organisation's handling of sensitive issues around employment and company performance.

"With our heavy corporate agenda it is impossible to separate marcoms and company news - each has the potential to contaminate or support the other," says Post Office external relations director Paul Budd.

Extension of in-house team

Maxine Taylor, director of corporate affairs at Lilly UK, thinks it is important to view agency people as an extension of the in-house team and to establish clear points of contact.

"That's in addition to clarity in briefing, open dialogue and the fact that we are prepared for and respect the agencies that answer us back over problems or issues," she says.

Similarly, consultants are aware that they can only deliver the goods if in-house PR teams act as their advocates. "With all the talk about integrated marketing, any initiative needs to have client pull as well as agency push so we can ensure our activities are in tune with those of direct marketing and advertising," says Countrywide's Medley.

And although much is made of the service relationship between clients and agencies, it's worth remembering that partnerships are a two-way street.

Whereas in-house personnel always have the right to sack the hired help, if the relationship goes sour it may well be the agency that decides to walk away first.

TOP FIVE UK PR AGENCIES

Rank Agency Income 2001 (pounds )

1 Weber Shandwick Worldwide 41,282,000

2 Incepta Group (Citigate) 35,260,000

3 Bell Pottinger Communications 28,933,000

4 Hill & Knowlton PR 28,857,000

5 Countrywide Porter Novelli 20,646,000

Source: Marketing league tables.

ABBEY NATIONAL USES RESEARCH TO MAKE NEWS

Since 1999, Abbey National has run a branding exercise to convince its core target market - working families - that it understands the everyday pressures of customers' lives.

With the in-house PR team primarily occupied by the day-to-day business of reactive media relations, issues management and product PR, most of this work has been outsourced to Band & Brown Communications.

"We needed a PR campaign that would support our advertising and marketing message - 'Because life's complicated enough' - and we simply didn't have the internal resources to create newsworthy stories," says Abbey National head of media relations Christina Mills.

The other decisive factor in the bank choosing external PR support was the recognition that Abbey National needed a strong creative input, one that would generate a media agenda outside the personal finance pages.

In the first year of the campaign, this resulted in a high-profile 'news' presence for the bank, driven by a landmark piece of research commissioned from The Future Foundation.

This study identified six key themes: positive parenting; life's irritations; independence; fatherhood; pester power; and androgyny. These were drip-fed to the social affairs and news media at intervals of roughly six weeks.

Over the past 12 months, Band & Brown has refined the campaign's focus to forge a more obvious financial link. Further research from The Future Foundation has enabled Abbey National to explore topics such as the cost of children, work, time, home, holidays, family relationships and health with the media.

At a time when the entire banking sector has been under fire, this strategy has helped Abbey National present a positive face to the media.

But much of the campaign's success rests with the in-house PR function, which acts as a bridge between its marketing departments and Band & Brown.

"The media relations team secured the necessary internal sponsorship for what we're doing," says Band & Brown director Paul Lucas.

COMET SECURES COVERAGE FOR 'BACK TO SCHOOL' CAMPAIGN

Electrical retailer Comet has worked with its retained agency, Windsor-based EHPR, for nine years. Much of the success of this partnership can be traced to its flexibility, openness and honesty, says the company.

"There's an absolute imperative on both sides to build up our relationship. So, outside status reports and the like, we develop a PR plan for the year and have face-to-face meetings every couple of weeks," says Comet environment and public affairs manager Scott Keiller.

In addition, neither party is too precious about the concept of creativity and owning the big idea, and the relationship is also fairly flexible in terms of its division of labour.

In April, Comet launched a mobile phone recycling scheme, offering the public a convenient and environmentally responsible means for disposing of old and unwanted mobile phones while raising funds for the charity Macmillan Cancer Relief.

The bulk of PR activity around this initiative was handled in-house, with EHPR simply producing a press release.

This summer, however, the roles were reversed when the electrical retailer ran a 'Back to School' marketing campaign in conjunction with NCH Action for Children, aimed at increasing footfall and awareness of its range of PCs.

With a central theme of internet safety, this programme involved a series of radio interviews and competitions, an online and POS fact sheet, plus a major sell-in to the media of the findings from a nationwide survey of parents' attitudes to the internet.

"EHPR helped us with everything, from the creative and writing the leaflet to the NCH contact and getting our spokespeople out there," says Keiller.

As a result, the campaign secured 28 radio interviews and more than 25 targeted pieces of editorial coverage in titles such as The Independent, The Sun, Family Circle, Ideal Home and Eve.

In addition, comet.co.uk chalked up 1200 requests for the fact sheet that linked PC usage by age group to the national curriculum.

TOP TIPS

- The in-house PR team is often best placed to deal with sensitive and crisis issues.

- The in-house PR team may give a faster response.

- No matter what you've asked an external PR agency to do, all spokespeople should be internal.

- The in-house PR team is best placed to act as the go-between with an external agency.

- An external agency will provide an objective perspective of your core market and competitor activity.

- An external agency can inject creativity or manage an entire project when time, resources and ideas are at a premium.

- An external agency needs a clear brief, outlining business objectives, budget, timelines, background information and reporting processes.

- If you've asked an external agency for advice, be prepared to take it.

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