Client demands for digital, mobile, social media and online marketing services have grown markedly in recent years, yet a majority of small-to-medium sized U.S. PR agencies still don’t possess the requisite in-house capabilities to offer their clients digital services, according to a new survey of PR agency CEOs released by mergers and acquisitions shop The Stevens Group.
More than 40 percent of CEOs claim that between 10 and 25 percent of their PR firm’s overall client work is now dedicated to digital services. However, more than half —55 percent — of agencies making $4 million and less in annual net revenue said they don’t currently have the in-house capabilities needed to keep up with client demands for digital, mobile, social media and online marketing work.
The survey found that only a third of responding agencies employed more than 10 percent of their staff on a full-time basis to focus solely on digital, with one in four agencies staffing somewhere between 25 and 50 percent of their employees full-time to handle social media, digital or interactive duties.
More than a third of all agency CEOs surveyed — 32 percent — said their digital needs are currently being met by an outside pool of freelance talent from which they can draw on when the need arises. About eight percent admitted to scrambling to find talent to fill staffing gaps when existing or new client needs arise.
“For PR agency CEOs looking to acquire a PR agency to deepen their existing portfolio of digital, mobile and social media and marketing services it begs the question,” Rich Jachetti, senior partner at The Stevens Group, told O’Dwyer’s. “Most every size PR firm claims to have a full slate of digital marketing capabilities. But do they really? Based on the findings of this survey it would appear most firms with revenues of $4 million and under handle new media marketing assignments from clients mainly by outsourcing the work.”
More than 53 percent of the CEOs polled said they plan to put more time and energy into recruiting staff with relevant digital marketing skills within the next two years and doing so was cited by CEOs as their single greatest priority in remaining competitive.
A vast majority of respondents — more than 71 percent — said they were confident their agency would be current on changing digital platforms within the next two years.
Stevens Group’s survey, titled “How are PR Agency CEOs Coping with Increasing Demands for Deeper Digital Marketing and Media Capabilities?” was conducted by online survey company Survey Monkey. It polled CEOs of 800 U.S. PR agencies taken from TSG’s database. Only approximately 10 percent of CEOs queried responded to the survey, and a majority of respondents came from agencies making under $4 million in annual net revenue.