How indie PR agencies are surviving the pandemic

April 22, 2020
  |  by 
Oliver Budgen

We would be hard-pressed to find an organisation or individual who isn’t affected by the impacts of COVID-19. PR agencies—despite faring better than their media and creative cousins—are not exempt. Groups like WPP and Publicis are feeling the brunt of reduced client spend and are making deep cuts whether in areas of staff, salaries, or award entries. Are the independents, however, hanging on a little better?

Adrian Lee, Southeast Asia and Hong Kong managing director for Critical Path, says that his agency has experienced an uptick in work overall.

“Over the last couple of months, we’ve been assigned a number of special projects, working directly with our clients’ executive and comms leadership,” he says. “While we are grateful to currently be in a position of stability with a significant influx of work and no client attrition, we cannot totally predict what the future may hold."

In this period, Lee says that the most common request from larger clients has been for crisis management, business continuity, stakeholder and executive communications counsel, with many of them assigning additional budget during this time.

“Being an independent agency does have its advantages in the fact that we can be more agile when it comes to pivoting and making necessary organisational adjustments to adapt,” he says.

Of course, client attrition also largely depends on which sectors agencies are serving at the moment.

For Cho Pei Lin, managing director of Asia PR Werkz, it helps that her agency is not overly dependent on a small number of clients in a niche sector. “We have seen some clients pull back on retainers and projects but we are grateful that the bulk of our clients are firstly retainer-based, are multinationals or are from the public sector. So we haven’t had to do any layoffs or budget cuts yet, and we hope that we can keep up this position,” she says.

Meanwhile, Cho’s clients in hospitality and F&B have been “adversely affected” and her team has pivoted to strategy work for them. Much of this work entails positioning clients as responsible corporate players in government-led programmes.  Cho adds: “We also had many clients who were directly affected by COVID-19—even those with staff who have tested positive and have had to make public announcements and business closures. This has required us to be in crisis mode since February.”

A challenge for Cho and her team has been to adopt tech into client strategy.

“Many plans we made months ago no longer makes sense today, or simply cannot be executed. We have had very little time to turn around new comms and marketing plans. Media interviews, for example, are mostly now ‘virtual’—even the live ones with the TV and radio stations,” she says. “We are learning how to use new tech and be creative and innovative when it comes to executing marketing campaigns. All in all, we are trying to make the best of the situation.”

In tech PR, Oliver Budgen, managing director of Bud Communications, says his clients are especially relevant at a time like this, and in turn, keeping his agency afloat. “[Our clients] are typically better suited to embracing innovation and agility than other sectors, so we’ve been fortunate to not feel the same commercial impact that other independent agencies may have felt,” he says. “We’ve already seen more growth in this quarter than the last, winning several new clients in recent weeks who are developing solutions to help businesses with digital transformation.”

Budgen adds that his team is also much more “deeply involved” in clients’ businesses at this time. For instance, they might be assisting with internal and stakeholder relations for clients that might have typically only focused on media relations in the past.  

“We’ve also been supporting a number of our clients in relation to crisis comms and risk management. Rigid scopes of work have gone out the proverbial window and now it’s about thinking holistically and creatively where we can add true business value,” he says. However, he adds that many tech companies who were on the path to a fundraise have had to exercise tighter discipline on their P&Ls as the prospect of attracting capital investment is slimmer.

From a logistical point of view, Budgen says that his lean team and independent nature allows for better flexibility and agility as there are less fixed costs and overheads to manage.

“We’re based at a co-working space, so circuit breaker measures meant we are able to simply pause our membership while we work from home until normality resumes. Our entire team is billable to clients, with all our operational functions such as finance, HR and other professional services outsourced which allows us greater flexibility on overheads which are more static for larger businesses,” he says.

“Smaller leadership teams and no shareholders to answer also makes decision-making faster and more responsive. It encourages fiscal discipline and an emphasis on profitability, as independent businesses cannot ride out as many loss-making quarters as a larger network agency who can be buttressed by another profitable business unit.”

For Vuki Vujasinovic, CEO at Sling & Stone, his agency is seeing growth in certain areas like healthtech, education tech, and work platforms that support remote work. This week alone, the agency announced that it had won four new healthtech clients in the ANZ market. “We’re fortunate to have a variety of clients across many sectors, so we're insulated from the risks of carnage in any particular sector, like tourism or hospitality,” he says. “In terms of service areas, I'm seeing lots of entrepreneurs and founders beginning to pay more attention to social media and owned content, and also doubling down on internal comms. How they manage communications within their organisations is no longer a secondary consideration,” he says.

Vujasinovic has also observed that this period has “brought together” agencies, whether independent or not. He says: “Regardless of ownership, I've seen agency owners and leaders band together now like never before. I've had more calls with other agency owners in the last month than in the entire year before that. The type of camaraderie I'm seeing in the PR industry right now is something pretty special, and it helps make me even more optimistic for the future."

The contributor is Oliver Budgen, founder of Bud Communications. This article is authored by Surekha Ragavan and was first published in Campaign Asia.