The Five Worst Ways to Save Money on PR

Yes, times are tough, and corporate budgets are under pressure to be “lean and mean.”  But being lean requires cutting fat, not muscle. And being mean is altogether unnecessary.

There are wise and unwise ways to save money on communications. Here are some of the worst ways to go about it:

Cut the most expensive programs.  If the most expensive program is also the one that provides the best return on investment, cutting it may cost the company more in the long term than you’ll save in the short term.

Cut across the board, evenly reducing all communications expenses. This is just as bad as singling out the most expensive program to cut. Each expense should be evaluated for the support it provides to communications efforts and the return-on-investment it yields.

ABC Corp. cuts the fat from the corporate communications budget.

Do everything you’ve been doing, but with cheaper people.  Layoffs of experienced older people in order to hire younger, cheaper labor is illegal – and invites age discrimination lawsuits. Besides, all other things being equal, you get what you pay for: an experienced communications professional can run circles around an inexperienced staff member and get much more accomplished.

Skip the college recruiting program for a year or two and don’t bring in any employees with newly-minted degrees. Many communications agencies did exactly this in the 2001-2002 recession, which hit the public relations industry particularly hard. The result was a labor shortage at the lowest hiring level that has moved up the ladder with time – the shortage of assistant AEs became a shortage of AEs, and then of Senior AEs, etc. Agencies fought over a smaller pool of candidates, resulting in disproportionately high salaries at each of those hiring levels. That, in turn, caused internal parity problems.  That situation was corrected by the current recession, since those higher-paid individuals became prime candidates for layoffs.

Squeeze your service partners and suppliers until they scream – they’re small companies and they have no choice but to accept what you’ll pay. Negotiation is one thing, but when you force companies to forego any profit or even accept a loss, you show a lack of regard for their well-being that will result either in losing them as service partners or ruining your relationships with them.

By inference, you can guess what I consider to be the proper way to save money on communications: evaluate each activity, and cut the activities that are the least effective – and the least cost-effective. This shouldn’t be too difficult to do if you’re measuring results against goals you’ve set, and have some data on which to base your decisions. Any necessary personnel cuts should be made the same way.

Do you have any better ideas? I’d love to hear them.

Lucy Siegel

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One Response to “The Five Worst Ways to Save Money on PR”

  1. esPResso | Recommended Link: Bad cuts to make Says:

    […] that’s not the case, be wary of what might look like easy cuts to make on paper – as this blog explains, just cutting the most expensive project or bringing in cheaper more junior staff isn’t […]

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