For the more than 60 public relations and marketing firms in Richmond, that means it’s time to adapt, and quickly.
In part that’s because ad spending nationwide is down at least 20 percent from last year. One local firm has taken on work for free just to keep employees busy.
For most businesses, the marketing budget is often the first cost to be cut when revenue slows, and that has trounced the local marketing industry.
A handful of local firms are betting that the social networking craze is the lifeline that will pull them out of tough times.
In interviews with more than a dozen local firms, established ones say they are learning social media at the request of their clients, while the younger firms are actively pitching their social media acumen to potential clients.
There is even a social media club.
“At first businesses wanted a logo and a branding campaign,” explained Garland Taylor, a partner in TaylorWeirup Marketing, which was started in the late 1980s. “Now my clients are reading up on it and hearing it from their children. I’m feeling a certain responsibility to learn about it.”
As marketing spending in Richmond plummeted (several local firms relied heavily on work from Circuit City, LandAmerica, S&K, etc.), local firms are scrambling to find ways to connect clients and customers through social media – the platforms du jour are Facebook and Twitter.
The strategy is a gamble: It’s unclear how much businesses will pay for the services. Marketing firms generally charge between $100 and $150 an hour for social networking services. One-day seminars can cost around $350.
Still, several local companies, including CarMax and Snagajob, have a dedicated staffer who works on social media. That would suggest other companies may want to outsource that responsibility to a marketing firm.
Several business owners contacted by BizSense said they were more willing to possibly pay for a one-day seminar than outsource Facebook and Twitter, in part because they are so easy to do.
That will be the challenge for any emerging business models that rely on social networking. Still, it may be hard to sell it, considering it’s free to use.
Enter the social media expert
“Nobody is an expert,” said Bill Bergman, who runs the Richmond-based Bergman Agency. “It reminds me of those marketers back in the early ’40s, running around claiming to be experts on TV advertising when TV was brand new.”
Aaron Dotson, a principal at the firm Elevation, said most of his clients are asking about social media, but he concurred that it’s too early to become a guru. “If anyone walks into a room and tells you they are a social media expert — then walk out.”
The other risk is that too much emphasis on social networking will disrupt the established value of PR and marketing. Take PR firms, for example. One local PR professional who spoke on background said that if a PR firm sends a story out on Twitter instead of to a local news outlet, they may lose the ability to get that story in the media. In a sense, they could scoop themselves.
The rush to social networking may also put PR firms and marketing firms into more direct competition with each other, as both are actively pushing the same services, whereas previously the professional lines were more clear.
Another risk is that social media is part of the public domain and any Joe Schmo can comment on it, and those comments can be more popular than the original post. That’s been the case with blogs for a while, but pushing hard into Facebook and Twitter could invite even more attention. For a warning on this, click here to read about a PR fiasco at Domino’s.
“One of the dangers of relying too much on social media is that businesses can’t control the message,” said Holly Rodriguez, a marketer at the University of Richmond. “You can lose control of your brand very quickly.”
Added Kelley Slothwoer of Big River: “I say that if you don’t allow your employees to talk openly or you just don’t have anything interesting to say, it’s not for you.”