PR sector and recession: in or out?

Last week I, along with many of the other managing directors of the PRCA's PR agency members, attended the PRCA/CorpComms conference optimistically titled 'Emerging from a recession'.

However optimism was certainly not high on the agenda. Sir Martin Sorrell, CEO of WPP, delivered the key note speech which firmly stated that any hope of an upturn was not being translated into fees or orders.

However he did highlight three trends for 2010:

1. Geographical focus: although the PR/communications sector is stagnant in Western Europe, there is a 'gold rush' in Asia.
2. Online is key to any PR offering and currently accounts for 25% of the WPP business - and this growing.
3. Agencies offering consumer insights are highly regarded by clients and seen to deliver true value.

In addition, Sir Martin did share the opportunities for the PR world (and as opportunities, these can easily translate into threats if not acted upon):

• Globalisation: there is a key shift in economic power from Western Europe through to Asia, Africa and Latin America. And for those of us in Europe, coming out of recession will be slower and tougher.
• Overcapacity: the PR industry in Europe is bigger than the client need, therefore differentiation is critical.
• War on talent: the global demographics are resulting in a restriction on the supply of talent, therefore it is vital that agencies continue to incentivise, motivate and retain good staff.
• Internet: understanding and embracing Web 2.0 is vital, along with the associated understanding that it is increasingly what we know rather than who we know.
• Retail: this is a powerful force, and brands will need to maintain - even increase - promotional spending in order to main shelf space.
• Internal communications: after this period of deep recession, a focus on internal communications is now more important than ever. It is vital that a 50:50 resource focus is put on internal and external communications in order to ensure that CEOs adequately communicate strategic and structural change.
• Client centralisation: with the opportunities of globalisation and the internet, agencies will experience clients becoming more centralised.
• CSR: even in the dark days of recession, CSR continues to be vital for businesses - not as a charitable or altruistic response, but due to its fundamentals of good business practise.
• Government: as the biggest advertiser, the government is the UK's most significant client and as such represents a huge opportunity for the PR sector.

Sir Martin ended by saying: "Things are less worse, not better.... and those with a strong focus on branding and innovation will win."

As a member of the audience, I feel hopeful that our innovative focus on helping clients to integrate digital PR into their communications strategies will enable us to continue to grow through the death throws of this current recession. I also feel hopeful for our clients who have positively, even ruthlessly, responded to the opportunities that the downturn has brought.