Could PR kill the stand alone digital agency?

 9th November 2016    PR Insight 
 Paarul Chand

Way back in the dark ages, circa 2013, you couldn't open a copy of ‘Brand Equity’ without looking at a story about digital agencies, their campaigns and the possibility of the big bucks they would make selling off to larger creative shops.

Now, back in the modern age,  the story has changed drastically with social media  and digital marketing no longer being the domain of digital agencies.

Is the standalone digital agency dead ?

This question may be too late, at least where the dying digital agency is concerned. Karan Bhandari vice president — consumer marketing and digital, Weber Shandwick India, says, “Given the dynamics today with growing realtime interactions where the audiences seamlessly move through information and content has pretty much made the standalone digital agency obsolete. With their old currency of impressions on paid media being under debate, alongside the backdrop of Google’s claim of “56% impressions are not viewable," combined with the ever shrinking media margin — there is an acute need to reevaluate the business and the opportunities.”

Some agencies are already doing so. Chandni Dalal, lead-digital strategy, SPAG Asia  feels, “It is too soon to say stand-alone digital agencies are dead, many stand-alone digital agencies still delivering high impact creating campaigns while some have moved on to a more integrated mix of communication. It is the evolution of communications which will decide who is the last player left standing!”

PR firms vs. Digital agencies

PR experts argue it is far easier for PR firms to acquire digital skills and talent, rather than the other way around. Yet, the conversation with clients about a PR firm handling digital has been moving not as fast as PR firms would want.

Bhandari  says that, “Clients are now warming up to the PR agency working on the digital play for the organisation. True, this might be at a slower pace than what I’d want it to be; but the conversations are encouraging. Being the custodians of content and messaging, PR agencies are intuitively aligned to not just engagement across all stake holders but also crisis advisory and management. “

Deepak Kapoor, image manager at Perfect Relations and  founder of 'The Commune', Mumbai's interactive community of advertising, media and marketing communications professionals, however does not agree that this is happening on the ground. Says Kapoor, “ At present, majority of the companies work with separate agencies for their PR and digital mandate. Their perspective circles around the fact that digital agencies are specialist in social media, whereas PR agencies are well suited for media related activities. PR firms do offer their digital services, but clients perceive it merely as a by-product. The need of the hour for PR agencies is to be positioned as an integrated communication think-tank with equally strong PR and digital services.”

Dalal agrees saying that, “It becomes imperative for PR agencies to at the minimum have an online listening capacities in house, to access any risk or adverse reactions in advance as well as plan the media strategy being mindful of the ever active digital audience. Having a digital capacity in-house opens the possibilities of PR to a much larger audience set, both online and offline. With all major media outlets being highly digitally active, digital is the next forefront for PR’s evolution, a trend which we have already started noticing in numerous campaigns.”

Big corporate spenders yet to make significant allocation to PR firms for digital 

Experts say that the big spenders on digital in India are e-commerce firms, telecom services companies and smartphone manufacturers. The big money from these categories is yet to shift from digital agencies to PR firms; while traction is being seen from Fin-tech firms and individual corporates who realise the importance of PR handling its digital personality. 

The change is happening, although slowly. 

Off the record, digital experts told PRmoment India that while 3 years ago, a PR firm’s attempts to offer digital was dismissed, in-house PR leads are now beginning to change their tune. The push is coming from these in-house leads who realise that while digital agencies are good at marketing content, it’s PR that excels at editorial led content. Increasingly, digital agencies no longer handle the content-for say a website, this is specially true for owned media properties and ORM.

The key to having PR grab the largest share of the PR pie, remains talent. Conversation with potential clients will remain superficial as long as the talent doesn't match up.

Bhandari believes that PR agencies are equal to the challenge. He says , “PR agencies are consolidating fast, scouting for top talent and adding on agile teams of transcreatives; all engaged in storytelling. Be it producing broadcast quality content, or running simulators for the top management for crisis preparedness workshop or KOL management producing engaging consumer content, this set of talent adds a new dimension, a new value add, an extended vision onto a new medium.This means the conventional PR agency model itself is undergoing a massive shift, being driven by a focused leadership exploring means to augment multi skill sets. “

While PR feels a sense of natural entitlement regarding digital content and ORM, digital agencies are also scrabbling to survive by adding PR and getting into EPR ( blogger management). Finally, the battle will come down to talent, agile consolidation and client trust.