Agency of record. It’s a phrase to warm the heart of any PR professional. It tends to evoke a long-term, retainer relationship with a largeish account. But there’s evidence that the agency of record (AOR) may be heading the way of the traditional media tour. Gone.
According to the latest study conducted by the USC Annenberg Strategic Communication and Public Relations Center, clients are spending more on PR. Good news! But only 15 percent of the 600+ senior communicators surveyed say they have an agency of record; a decade ago, by contrast, more than half reported an AOR relationship.
Bad news? Perhaps. But why the shift? The report attributes it to the need for more specialized and more regional expertise. That’s undoubtedly true, but I’d also factor in the economy. Even if you’re spending more on PR projects, cost allocation and management is simpler when you have the flexibility of shorter contracts. Most importantly, it’s easier to calculate the ROI based on a discrete assignment.
And ROI, or more precisely, impact, is where PR is going. Thanks to the rise of social media, the industry’s maturation, and the sophistication of measurement tools, we can quantify the results from a given campaign with increasing precision. In fact, the Annenberg study showed that PR spending is up largely due to greater investment in evaluation.
The death of the AOR sounds scary, but here’s what it really means for PR firms.
More opportunity. This is particularly true for smaller or specialty firms. Presumably this heralds more respect for what we do, and the increased specialization of PR and communications overall.
Regard for PR as a strategic business tool. The study backs this up as well, showing that a corporate PR officer is increasingly likely to report to the “C-suite.”
Greater quality consciousness and focus on PR impact. Though agencies may deride project assignments as forcing us to “always run for reelection,” that tend to be more goal-oriented and more closely tied to business objectives. That’s a good thing.
Besides, that cozy, long-term AOR relationship was never really so secure. Let it go. We’re well positioned to prove the value that PR brings to the table. And that’s the good news.