Benchmark survey shows strong growth in PR sector

Annabelle Warren


Industry body the Public Relations Institute of Australia (PRIA) has released its yearly snapshot of the public relations sector which reports a significant increase in industry revenue and retainers.

The annual PRIA consulting sector benchmark survey said the average monthly client retainer among the firms surveyed has grown from $7,500 last year to $10,000. The vast majority of firms reported a significant increase in revenue and client fees.

Annabelle Warren, national chairman of the PRIA registered consultancies group, said: “On the whole, PR consultancies are in build mode. There is continued change in the sector, and around 60 per cent are growing at an average rate of 18 per cent.”

Warren also noted the substantial jump in the reported average retainer which rose for the first time since 2008.

She said: “There has been a substantial jump in that retainer. It has been flat for a while through the global financial crisis but what we have seen is firms consolidating around their larger clients.”

“It highlights an increasing dependency on larger clients in many consultancies, which also brings with it some risk of exposure to concentrated revenue sources.”

The PRIA survey included 54 major consultancies nationally representing a third of the Australian PR industry.

The largest PR client sectors were IT followed by health, professional services and financial services.

According to the survey, the most growth year-on-year was in the real estate sector which grew PR spend by 20 per cent, followed by manufacturing which grew spend by 14 per cent.

The survey also reported 85 per cent of PR firms were expecting to grow in 2014.

It also showed that the industry staff churn rate is up from 17 per cent last year to around 20 per cent across consultancies of all sizes, with one of the key reasons for departures being staff wanting to work overseas.

“We have not seen a marked change in the churn rate year-on-year,” said Warren. “Rather than people leaving the industry forever, the only increased reason for leaving is that people want to go work overseas.”

Many PR agencies were also looking to hire more senior people.

“When asked about their intention to hire, most companies are looking to hire more senior level staff than junior,” said Warren. “It appears with the growth they are looking to provide for their clients with more senior level staff who can provide a broader range of advice.”

According to PRIA, most firms were hoping to grow organically with mid tier firms the most likely to look to mergers or acquisition for expansion.

“Most agencies appear to be focused on organic growth, except if they are in an agency size between $1m and $2m in revenue,” she said. “About 50 per cent of those mid-range consultancies are looking to buy, merge or sell.”

Nic Christensen

Encore issue 35This piece first appeared in EncoreDownload it now on iPad, iPhone and Android tablet devices.



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