IBISWorld has reported that paid advertisements are losing out to communication campaigns. The $1.9 billion Adverting Services industry is struggling to match the agility and ability of public relations providers to engage consumers within a changing media landscape.
The emergence of digital and new media, including web-enabled mobile phones, faster and cheaper internet, iPods and podcasts, pay-TV, new free-to-air channels and social networking websites such as Twitter, YouTube and Facebook has fragmented consumers viewing habits. Marketers are increasingly turning to public relations for more subtle methods to ensure their message reaches the target audience. To do this, public relations techniques are incorporating communications into media content that consumers choose to view and interact with. In particular, social media such as blogs, discussion forums, video sharing and social networking sites are a key avenue for public relations communications.
The mushrooming of this new media and its use to target specific audiences is taking its toll on mass media paid advertising in TV, newspapers, magazines and billboards. While paid online display advertising has increased strongly, many popular websites and social networks such as YouTube and Facebook have limited advertising so as not to turn away visitors. Additionally, the fear of viruses and spyware has caused consumers to be sceptical of online advertisements.
Public relations revenue has also been more resilient than advertising revenue during the recent dip in the economy’s fortunes. While marketing budgets tend to be one of the first items targeted in cost-cutting efforts, public relations services are often seen as more focused and therefore better value for money than media advertising. Additionally, some aspects of public relations such as communications with stakeholders can become more important during a downturn.
As a result, public relations revenue is expected to fall in percentage terms by less than half that of advertising revenue over the two years to June 2010. Over the next five years, advertising services in Australia are expected to grow by an average of 3.0% a year. Public relations services, which currently generate less than a quarter the amount of revenue of advertising services will grow by an average of 3.4%.
Advertising agencies are not retreating in the face of this fall from favour. Rather, they are doing what they do best: reinventing themselves. They are acquiring public relations agencies, market research firms, digital advertising agencies and web developers to become diversified marketing communications companies. The line between public relations and advertising is blurring.
Sydney Public Relations Agency, CP Communications provides specialist media, traditional and online PR strategies that get amazing results. Contact us today. For more great tips visit our website www.cpcommunications.com.au.
