One of the most frequently asked questions when speaking with a new client is how much does a PR agency cost? Not always an easy question to answer of course. No two agencies are the same and none are ever going to charge the same rate. Some of the top PR companies in the world will require retainers running into tens of thousands of dollars.
PR companies are notoriously secretive about their rates. Part of the reason for this may be that they want to ascertain how much the client can reasonably afford before discussing financials. It might also have something to do with the amount of work that they will be expected to perform. Bear in mind that a good PR agency will prove its value over time.
Each agency or freelancer will have a way of billing their clients that suits them. Generally, this revenue model will fall into one of three ways or a combination of methods.
Advanced Fee (Retainer)
The advanced fee is a charge that a PR agency will ask from the client in order to secure their services. This fee is usually paid upfront as a lump sum and is a type of bond between the agency and the client in lieu of future work.
As well as the retainer many PR agencies will charge their clients an hourly rate for their services. Agencies will have multiple clients at any one time and different executives will be allocated to each client. For this reason, it is more expedient to charge a client for the amount of time that their employees spend actually working on the account.
An alternative to an hourly rate is performance-based pay. This basically means that the PR company will charge the client a set rate from a pre-determined tariff of charges according to the service they provide. For example, a single press release or blog post may be charged at £100 whilst the charge for conducting a press interview may be £1000. This is a more modular method of billing a client and is slightly more transparent.
Choosing a PR agency
As with everything, there will generally be an agency or freelancer suitable to your budget or size. Frequently agencies may specialise in a particular niche, motorsport or politics for example. It definitely pays to shop around and look for someone who is affordable and has experience in your particular niche. However, PR agencies like lawyers depend on reputation and not just price.
When looking for a good PR firm take a good look at their website and social media and don’t be afraid to ask questions. Read their blog carefully. What sort of topics do they write about? Do they appear knowledgeable? What is their social media presence like? You may want to take a look at their previous client list. If this is not advertised on their website try checking out their LinkedIn profile.
Use your initial consultation to ensure that you feel comfortable with them and that your goals and theirs are aligned. Most of all though ask for their input and ideas. If they impress you with the way in which they go about their business and they buy into your company and its ethos then you could be a perfect match.
What questions should I ask during negotiations?
Before you enter into negotiations with any agency or freelancer be sure you have a firm idea regarding your budget. You need to know how much you are willing to spend and over what timeframe. Most PR agencies will insist on an initial 6-month retainer so any budgetary requirements should probably cover this amount of time. It is also a good strategy to have a clear set of goals as you will have to transmit these to the agency.
Here are some of the essential questions you will need to ask a prospective agency…
- How do they charge and how are their charges calculated? Are they happy to agree to ad-hoc work or will they insist on a minimum contract? If they only work on a retainer do they charge at a lower rate than for individual projects?
- What payment terms do they require? As a general rule, most PR firms will demand a 30-day invoice though some may ask for as little as 7 days. If hired on a retainer, agencies may ask for 50% upfront. Some may even ask for the full fee in advance so this needs to be factored into your budget.
- If they insist on a retainer what exactly will this get you in terms of services and/or time? Generally, a retainer is required merely to guarantee their services. Anything such as press releases are charged as extras at a pre-agreed rate.
- What reporting options do they offer? How will they keep in touch and how often. Do they have a set reporting structure? Most agencies are happy to be flexible and many offer daily/weekly or monthly detailed reports for their clients.
- What sort of things will be chargeable as expenses? There are always expenses! Try to be clear from the start what sort of things may be chargeable to expenses and how often these charges are likely to occur.
- How are they going to achieve your goals and what ways will they use to measure their effectiveness?
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