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| Dustin Siggins |
Hourly billing has been the norm for public relations agencies for generations. Not only do clients often ask for it, but it also creates predictability for the agency’s finances when it’s hiring staff and thinking through compensation packages.
But in a profession built on outcomes, creativity and great storytelling, hourly billing rewards time spent instead of results delivered. Consider the junior staffer who gets paid more to take a day writing a piece of content versus a seasoned pro who gets it done in three hours. Consider that lightbulb moments in the shower are rewarded less than bad ideas developed in all-day brainstorming sessions. Consider that employees who write several bad pitches that go nowhere are paid more than the person who creates a single great, coverage-landing pitch that required only one e-mail.
Success in PR has never been about how long something takes. It’s about what works. Misaligned incentives punish high performers, waste time and breed distrust on both sides of the relationship.
If your PR firm still charges by the hour, you might be losing money—and your best people — without realizing it.
Creating conflict instead of cohesion
Under an hourly model, slower employees are worth more and your most valuable team members—the ones who are fast, sharp and experienced—end up making less. That’s not just unfair; it’s bad business. It disincentivizes quality and speed while teaching your team to prioritize the clock over creative results. Team members are taught not on what matters most— serving clients—but to create artificial deadlines in their minds and on their calendars.
Time-based billing also ties up resources documenting hours logged and tasks accomplished to reassure clients that every dollar was spent well. But the best clients know how public relations works: outcome focused with a margin of error for the fact that it’s earned media, not paid advertising or a company-owned platform. Spending time justifying every meeting and e-mail creates unnecessary stress and creates conflict with clients who will nickel-and-dime you into timesheet hell.
Hourly models also incentivize dishonest behavior. How many times will an employee, their manager, his boss and the finance department be tempted to round favorably to each person in that chain? The low-level employee is happy to make a few extra bucks, but the executive is going to look at that askance because it eats into what the client is charged and the agency’s profit. And the client is going to notice and wonder what happened. If it happens twice, they’ll ask. Third time? They might be gone.
The result: What should be a strategic partnership devolves into administrative nitpicking and trust gets replaced by math fights and bad company culture.
“The best relationships are the ones where the value comes from a strong understanding of what needs to be done, how we’re going to do it, who needs to be involved and the cost analysis last,” said Mark Devito, Managing Director of Brand Strategy for SKDK. “Then, it’s a matter of doing all you can to make the work amazing.”
“Hourly billing kills all of that,” said Devito.
Aligning incentives with outcomes
Instead of spending billable time tracking the clock, agencies that use value-based pay models automatically put everyone on the same page. Clients know what they’re paying for, and agencies are free to focus on results instead of the stopwatch.
At Proven Media Solutions, we’ve adopted this model across the board. Writers are paid by the project, and clients are charged per engagement. Our Good Faith Pledge lays out expectations and deliverables from the start, eliminating confusion. Whether something takes three hours or thirty, the standard is clear: make it great and deliver it on time.
“The hours-based structure protects the vendor from ever having to be a skilled communicator or to improve client services,” said brand strategist and Backroom CEO Kara Redman. “Many technical founders start companies because they’re exceptional at their craft, not because they’re great at business or relationships,” Redman continued. “They aren’t great at being proactive on projects or managing expectations, so they think in hours instead of outcomes and overbill on change orders.”
The value-based pricing model does create some risk for the agency. We recently had an editor ghost us after promising to place an op-ed; we’re now stuck spending time sending it elsewhere. On the other hand, the same client was quite happy when a single pitch resulted in three outlets wanting op-eds tailored to their audiences. (And we were happy to send only one pitch instead of a dozen.)
Firms also need to watch for scope creep with a value-based model, and not every creative project fits neatly into a box. But incentive-based structures solve far more problems than they create. They reward efficiency, foster innovation and most importantly, reflect the actual value PR brings to the table.
Clients can budget with confidence, and agencies can reward their best people based on quality and performance. Team culture improves because people are encouraged to work smarter, not just longer.
PR isn’t a timecard business
Public relations isn’t factory work, nor is it billed in six-minute increments. It’s about influence, insight and impact. You don’t pay an airline by the hour flown or a doctor by the minute spent in surgery—the value is in the result, not the effort.
“You will get more work, have better client relationships and drive more change for everyone by having the right people focusing on doing the best work you can,” said DeVito.
As an industry, we can provide better service to clients—and a better work culture—if we evolve past legacy billing models that stifle performance and slow down progress. Hourly pay probably served a purpose once, but it’s become a crutch. Faster work shouldn’t lead to smaller paychecks, and smarter strategies shouldn’t be harder to price.
It’s time to stop measuring time and start rewarding value.
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Dustin Siggins is a former Capitol Hill journalist and Founder of the public affairs and PR firm Proven Media Solutions.
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