More than seven-in-ten people believe companies spend too much for advertising and marketing, up 10 points from last year, according to Edelmanís "goodpurpose" study released Oct. 21. Thatís hardly good news for PR firms desperately hoping clients are finally ready to open their wallets.
A PR exec recently told me that 2009 will be his firm's first unprofitable year in its nearly 20-year history. Staffers have been cut, salaries chopped and expenses pruned. Remaining employees are running ragged, serving "tiny," but time-consuming accounts.
"We are not drinking Bud Lites out of paper bags, but things have been tough," joked the exec. Business picked up in September and the hope is the firm can ring up a five percent profit margin going into next year.
That's a fraction of what the firm is used to earning. The champagne will remain corked.
Edelman's surveyed consumers want companies to divert advertising and marketing dollars to good causes. Happy days for corporate social responsibility.
Respondents may want corporations to help pick up the slack as Edelman found that 70 percent of consumers say the global recession has limited their ability to give to charity. A third of the 6,000 people polled in ten countries gave less money than last year. It's worse in the U.S., where more than half (51 percent) have cut back on financial contributions to good causes.
Volunteering is on the rise, which may be because unemployed or under-employed people have a lot of free time on their hands.
Edelman expects firms and their brands will benefit from backing good causes. A warning sign: 68 percent of respondents feel that it is "becoming more unacceptable not to make efforts to show concerns for the environment and live a healthy lifestyle."
Despite the global recession, the survey shows that people are willing to support firms that are doing good even if their products are a little more expensive than competitors. The question: is a boom in CSR enough to lift the PR business out of the doldrums?
No, it will take more than CSR to make PR people feel good about their business again.