Tag Archive for: what are some PR strategies

How Much Should Hypergrowth PR Budgets Be?

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By definition, hypergrowth companies are outliers. Hypergrowth is defined by a compound annual growth rate (CAGR) of 40%. Companies grow that fast by pouring on the gas and reinvesting every dollar back into the company – usually, in the earliest stages, the reinvestment is heavily based on product and talent. Slack is a great example of this; it had a $1.1 billion valuation before ever hiring a CMO. When marketing and PR become a priority, and that’s when the question of how much hypergrowth companies should spend on PR starts to circle, and it’s difficult because hypergrowth companies can’t use baselines of slow-moving Fortune 500 companies or even those in the pre-IPO stage.

PR and Marketing Spends: Rules of Thumb

You know that adage, “Dress like the job you want?” Hypergrowth companies need to spend on the valuation they want. In 2023, because many companies invested heavily (marketing budgets went up 13% on average) in branding and marketing during the pandemic, VC-backed business valuations rose considerably in the wake of the pandemic, 68.5% in some verticals. Marketing and PR investments are just that: investments. Wouldn’t you spend $5 million to make a billion?

We are thoroughly out of the pandemic and are now managing uncertainty. But for ambitious companies, this presents a true opportunity. Especially if you’re looking to creep into market share, according to Christine Moorman, at Duke University’s Fuqua School of Business:

“Companies tend to cut back on marketing in periods of economic uncertainty,” said Christine Moorman, the T. Austin Finch, Sr. Professor of Business Administration at Duke University’s Fuqua School of Business. “This general tendency should be tempered with an understanding of the cost of reaching consumers and what competitors are doing. Inflation may be a chance to leap ahead if others pull back.”

Average Companies Have Average Spends

The 2023 CMO Report reflects this changed environment:

-The average marketing budget was 10.6% of the overall budget and 9.2% of revenues.

-For companies with $10-$15 million in revenue, the average spend was 15.5% of revenues.

-For companies under $10 million in revenue, the average spend was 19% of revenues.

-For startups, the average marketing spend was 11% of revenue.

So the question is – are you average? If you’re in hypergrowth, you are decidedly NOT average. Hypergrowth companies aren’t average and are often in dogfights for additional funding or customer acquisition against better-funded competitors. So, there’s no question that hypergrowth companies need a hypergrowth PR budget that reflects their ambitions. It’s unreasonable to think you can stagnate your budget but grow revenues aggressively.

 

Hypergrowth: What’s PR Worth To YOU?

Unlike other initiatives, it has cross-functional importance. This is important because, in a moment, we’ll discuss how hypergrowth companies can make their marketing and PR budgets go further.

Before we do, a note about marketing spend distribution: most companies lump PR into their marketing budgets, and all companies face the dilemma of marketing budget balance. Again, this takes some introspection into your goals, audience, and competition. But one thing about PR is that it has a very long shelf life. Whether you do a publicity stunt, a Super Bowl ad, or a social media post, the impression is seconds long, and then it’s gone. But PR tends to have a very long shelf life. We’ve seen clients continue to get traffic to their sites for years after posting a piece of content. In addition, it’s still the most trusted form of marketing. According to the Edelman Trust Barometer, 65% of consumers trust earned media more than any other form of marketing. PR is an investment like buying a house, whereas marketing is like renting.

Ask yourself, “How will we use and activate PR?” 

Will PR help you secure top talent?
Will PR help you secure capital?
Will PR give potential customers confidence in the company?
Will PR support low customer acquisition (CAC) and high word of mouth?
Will PR increase loyalty and reduce churn?
Will PR support culture and purpose?

PR is cross-functional, so it stands to reason that PR’s budget should be cross-functional as well. If you’re using PR as a recruitment tool, then-candidate marketing or internal comms could help increase the budget. Product development and PR can collaborate on low CAC, so there’s an opportunity to mix those budgets as well.

Be sure that your overall marketing budget matches your ambitions. If you’re growing at 40% CAGR, your budget should match, and remember that today’s marketing and PR investments are tomorrow’s returns. You may need to increase your marketing and PR budget by more than 40% to achieve 40% CAGR; once you’re on that track, perhaps you pull it back to match your growth, and once you’re publicly traded, your budgets may more closely match the average CMO projection.

What Should the Hypergrowth PR Budget Include?

Your hypergrowth PR budget scope should reflect your priorities for your business and how you will use and activate PR. Typically, when I speak to hypergrowth companies, I immediately assess whether the following PR tactics will work for them:

Thought Leadership
Word of Mouth Activations or Stunts
Media Relations 
Corporate Awards Programs 

Plus, any company investing in its reputation should do crisis PR planning.

That’s not to say these are the only PR tactics that will work for a hypergrowth company, but these are the immediate things that come to mind. Different hypergrowth strategies will dictate how each of these will be executed.

If you’d like some specific examples of budgets across a variety of ranges that worked for hypergrowth companies we’ve worked for, we can share what we’ve seen work throughout our executive-level experiences, contact us, we’d be happy to talk about effective strategies based on your goal.

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Public Relations Strategy in 2024: Navigating the Landscape

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In today’s world, what is the role of public relations, and how should you create a public relations strategy? Many people think of PR purely in terms of articles placed (earned media), when in fact, PR strategy is a cross-functional objective that enhances business goals through reputation management.

How Does PR Support Business Goals?

PR is not a strategy – PR supports a business’ over-reaching goals. It’s completely possible for a company to be successful without PR, but it’s near impossible for a company to become a household name without PR. So whether your objective is raising capital, recruiting better talent, quickening the sales process, or preparing for your pre-IPO, a proper PR strategy is a critical partner in success.

How PR Supports Business Goals

  • Build credibility or trust.
  • Reputation management.
  • Brand/company awareness.
  • Harnessing media to support business goals.
  • Incorporating digital media in a brand and business-relevant manner

What is a Public Relations (PR) Strategy?

A public relations strategy answers the following questions:

  • What is the desired outcome of a positive company image with stakeholders?
  • Who are the stakeholders and target audience?
  • What company key messages resonate most successfully with the target audience?
  • What trends can the brand utilize to improve its image with stakeholders?
  • What research is relevant to stakeholders?
  • What content are the stakeholders consuming?
  • What activities are the stakeholders attending/participating?
  • What is the existing media coverage on relevant topics and key messages?
  • What assets does the company have to support PR initiatives, or what needs to be developed?
  • What PR initiatives are competitors utilizing, and how can the company differentiate?
  • What KPIs will be tracked to measure the effectiveness of the PR strategy?

Ultimately, a PR strategy provides the roadmap for the PR campaigns. It will incorporate data, messaging, and brand research to develop a positive public opinion of an organization, brand, product, or person for a specific business goal. PR strategies are often cross-functional and stakeholder-dependent. For example, you may have an overarching PR strategy for the brand with the goal of attracting financing, but within that strategy is PR for consumers and even an internal communications plan for employees.

In the above example, you would expect the CEO, CFO, and/or board members to be actively engaged in investor relations, a CMO, product manager, or marketing manager to be involved in consumer PR, and HR to be involved with an internal communications plan.

We believe in crafting PR strategies that align with our clients’ overall goals and values. This includes identifying key messages, choosing appropriate communication channels, and engaging with the media and the public in a way that enhances reputation.

Our approach emphasizes proactive communication to showcase the positive aspects of our clients, address potential issues, and foster strong relationships with the media. We leverage various platforms, such as social media, press releases, and events, to create a consistent and compelling narrative that resonates with the audience.

An effective PR strategy is about responding to crises and building trust and credibility over time. By staying attuned to industry trends, monitoring public sentiment, and adapting our strategies accordingly, an effective PR strategy will ensure companies maintain a favorable image in the eyes of their stakeholders.

How to Develop a Good Public Relations Strategy in 2024?

In order to create an excellent PR strategy, there will be considerable research, internally and externally, including audience analysis, media trends, and competitive analysis. A public relations strategy can take anywhere between 4 weeks to 4 months to create, depending on the ambition of the goal and how complicated the strategy will be.

A good public relations strategy aligns with the goals and the company brand and incorporates hard data and insights. There are different expectations of a PR campaign vs. an ad campaign; transparency and authenticity are expected in PR, as is an understanding of how to communicate with the media.  Communicating with the media is different than direct communication with your target audiences. Journalists have different expectations and requirements to satisfy before a story will be published, and journalists don’t see themselves as marketers – the role of PR is to bridge the gap between the journalist’s needs and the company’s. At its best, it’s symbiotic, but the any PR strategy will go awry when it doesn’t meet the needs of the journalist.

Understanding your metrics and KPIs is essential as well. Experienced PR professionals know how to analyze goals and ensure they match the plan and vice versa. For example, if the ambition is to be a household name, then the media budget – earned, paid, owned – needs to match that ambition. We’re fans of saying all things are possible, but the lower the budget, the longer it takes.

A solid PR strategy also needs to have a firm grip on the trends and tools that can support or derail a strategy. The media landscape is constantly evolving, and it’s important that any PR strategy take into account the entirety of the media and analyze which of these items presents opportunities and which presents threats. Further, there are hundreds of thousands of PR crises a year, and in the volatile and dynamic post-pandemic landscape, companies who don’t plan for a crisis are creating a very expensive scenario for themselves. Crisis like cyberattacks put hundreds, if not thousands of startups and mid-size businesses every year.

Ten steps to a modern public relations strategy

  • Consider your 6, 12, 24, and 48-month goals, and review the budget you have allocated to ensure your budget matches your goals.
  • Determine KPI and metrics baselines.
  • Research your target audiences using social media conversation, data, and stakeholder surveys.
  • Research media cycles and trends to identify media opportunities throughout the year.
  • Determine what key messages will work most effectively with your target audience.
  • Determine what gaps exist in the marketplace communication.
  • Identify three types of content and channels that will support your strategy.
  • Determine what PR platforms will support your strategy.
  • Identify relevant metrics and quarterly KPIs to track.
  • Develop or update the crisis communications plan.

What Will a Good PR Strategy Do for You?

Your PR strategy is like a finger print – there really isn’t one quite like it. Others may have the same business goal in mind, but the path to getting there should reflect your company’s distinct voice and brand. The goal of a public relations strategy isn’t to set everything in concrete but rather to provide a deep understanding of the goals, audience, and measurements so if changes are made; they are done so specifically to adjust within the necessary parameters. For example, if your goal is to attract investors, it’s important to consider what investors want to know and how to articulate that into PR campaigns; it will look very different than a campaign targeted towards consumers. Consider these parameters so your entire process from content to outreach is consistent.

A good PR strategy should include:

  • Identify proven key messages that are effective to the target audience and reflect the brand.
  • Identify baselines of metrics and growth goals that align with budget and timeframe.
  • Identify what PR objectives will be most effective for the target audience and the brand’s desired outcome.
  • Develop corresponding PR campaigns.
  • Identifying corresponding content opportunities.
  • Identify potential brand crises and create a crisis communication plan.

Digital PR Strategy

Is a digital PR strategy different from a PR strategy? No. Today’s PR strategies should incorporate digital platforms, content, and communication channels. A PR strategy that doesn’t incorporate at least some of these considerations isn’t incorporating modern PR principles. Avaans Media was originally founded as a digital communication agency, so our roots are firmly planted in the earliest days of social media. Today, digital media is a vibrant arm of public relations, as are content and earned media online. Digital perspectives should be included in your PR strategy as an integral part rather than a separate aspect. There may be other elements of your overall digital plan (pay-per-click for example), but your PR should be firmly integrated with the rest of your digital programming. And, of course, all these elements should work together to deliver trackable improvements toward your business goal.

A good PR strategy should incorporate at least three digital PR components

  • Organic search audit.
  • Keyword analysis and opportunities.
  • Social media audience audit and opportunities.
  • Social media brand audit and opportunities.
  • Brand mentions across platforms and forums audit and recommendations.
  • Owned content or native content development.

 

The importance of a strategic PR in 2024 approach in supporting business objectives cannot be overstated. Beyond its traditional role as a reputation management tool, PR has evolved into a dynamic and integral part of overall business strategy. From building credibility and trust to driving brand awareness and fostering stakeholder relationships, PR plays a multifaceted role in shaping the success of a business.

Companies that recognize the strategic significance of PR are better positioned to navigate challenges, seize opportunities, and cultivate a positive and enduring presence in the market. As businesses continue to face unprecedented levels of scrutiny and competition, a from startup to IPO, well-executed PR strategy remains a linchpin for sustained growth and success. For PR expertise, contact Tara Coomans and her team at Avaans Media, who are PR experts for ambitious companies.

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