TechMarcom, Inc.
http://www.techmarcom.com

Marcom strategies for today’s uncertain economy

Companies can’t operate as though a gold mine existed in the budget. Jon Boroshok investigates strategies for marketing communications and PR in the uncertain economy and gives tips on how to select the best shop.

Jon Boroshok¹
With over 15 years’ experience, Jon Boroshok is a veteran of high-tech and internet marketing communications. He is the President of TechMarcom, Inc., a Westford, Mass. public relations firm specializing in value-based marketing communications for technology companies. He is also an adjunct instructor of marketing communications and public relations courses at Emerson College in Boston. An accomplished strategist and writer, he has written articles and columns that have appeared in the Boston Globe, ZDNet, eCommerce Times, Mass High Tech, PRWeek and more.

AT THE MIDPOINT of 2003, it's surprising how many companies are still paying the price for following bad counsel and strategic planning during the tech gold rush. Entrepreneurs and venture capitalists vaguely understood that a strong marketing communications (marcom) and public relations campaign is needed to create awareness, build brands, and drive sales, but too many were ignorant when it came to deciding how to select the right agency or PR resource to maximize the return in investment.
   A start-up or early-stage company that has a competitive edge but a thin PR budget can communicate effectively if their agency is innovative, resourceful, tech savvy, and not wasteful.
   Unfortunately, many companies and investors weren't quite sure how to select such an agency. Using a rationale that paralleled the old adage, ‘Nobody ever got fired for picking IBM,’ companies were often advised by VCs and investors to retain a large, “brand name” PR agency with a posh downtown address. They often wound up paying for the name of a CEO who didn't work directly on their account, and typically hadn't contacted a reporter about a client in years. Many of these larger agencies were simply “friends” of the VCs, with referral and finder's fees—and possible conflicts of interest—being the rule rather than the exception.
   Back in the irrational environment of 1999–2000, the large agencies found new ways to hype, oversell and overvalue their services. They pushed bloated, expensive retainer packages stressing their brand names rather than results, expertise, or efficiencies. Investors were dazzled by big names rather than value, and clients wound up footing the bill for the training of very junior practitioners.
   In this post-Iraq war, quasi-recession–pseudo-recovery economy of 2003, truly competitive companies have begun looking “outside the box” for better value from PR and other marcom agencies and service providers. They are also questioning why the agency that commanded a $20,000 retainer 18 months ago is suddenly offering the same services at fire sale prices. Are the agencies using less experienced staff now, or were their rates over-inflated then? All too often, staffers performing the actual account work tend to be young and inexperienced, because that's where the agency's profit margin is based.
   Clients can now get more for less by eliminating many traditional agency inefficiencies such as downtown offices with expensive views, rigid 12-month retainers, the marking up out-of-pocket expenses and outside vendors, and under-qualified junior agency staff.
   Economically astute companies have started outsourcing marketing communications to battle-tested veterans who can pick up the slack and provide services on a smaller, flexible scale, often on a project-basis. Experienced marcom professionals bring core competencies that enable them to do a better job in less time, thereby reducing costs and maximizing results. These smaller (boutique) agencies, virtual PR teams, and individual practitioners are a growing alternative for companies of all sizes, particularly those with monthly marcom budgets of less than $6,000. Like their clients, these outsourcers have to work smarter, faster, and cheaper.
   Is retaining the services of a large agency really a prudent investment, particularly in industries like tech and the life sciences, where every marketing communications decision can affect millions of dollars?
   Working on a project basis often clashes with the business model of a large agency. There are many overhead costs that must be passed along to the client, and large agencies need steady retainers to make sure financial goals and obligations are met.
   Alternative marcom providers find ways to efficiently service smaller clients and produce results. For many clients, outsourced and project-based marketing communications has an economic rationale even in a strong economy. It makes sense to find a marcom outsource that will work on a project basis, or adapt to a flexible, needs-based budget that allows clients to pay for services on an "as-used" basis. It allows companies to do more short-term activities without a large commitment. If a project proves successful, it can lead to longer-term relationships. Projects are a great “test drive” for both the agency and the client—a way to see if they enjoy working together.

Advice for companies looking for a public relations or marcom resource