Friday, 1 February 2008

Specialist vs. Generalist PR, Independent vs. Global Network Player, Consolidation Imminent for the Indian PR Industry!

This post seeks to address the genesis of PR Firms in India, their move towards specialization, and then back towards a generalist positioning. It further seeks to explore the interrelationship between global and organic Indian outfits and motives for their speedy polymerization. Finally it seeks to draw parallels in trends between the state of the Global PR business and a growing similarity in the Indian PR Industry.

Most Indian PR Firms first cracked on the scene somewhere between the late 1980s and early 1990s, which I really see as the time when Public Relations consulting evolved somewhat from cult led spin-doctors to consulting organizations. I employ the caveat, somewhat, because even today many if not most continue to have a similar architecture, with a single personality or two providing the thought leadership, most of the others never really making it beyond middle or senior management, till they either decided to start their own little PR Firm! Those were the days of IPAN, Good Relations, and Genesis (Now Genesis BM ) to name a few, as they were very few. Some of these are still around, some with international affiliations and some with name changes after being acquired but do they remain the gorilla on the hill? I think not!

Here again, while we are on the topic of genesis, it is important to separate the also-rans from the connoisseurs. Disregarding honorable exceptions on both ends, on a general cliché, stand-alone PR Firms, grew organically, built scale and proliferated, while the PR’ divisions and the PR’ arms, mostly of advertising networks or agencies took a step forward and two backward, mostly playing a game of snakes and ladders. Evolution does strange things and many organizations that were once infallible are today extinct or alive in a dysfunctional sort of way, impossible if not hard to imagine back then.

Specializations are a factor of consolidation and pretty much follow the need for differentiation and domain expertise. At different points of time in the evolution of the PR story in India, tangents have proliferated in the form of Technology PR, Financial PR, Corporate Affairs, CSR, University PR, ‘this & that’ PR, etc. Have these always been deliberate attempts or single projects turning into templates that gave the financial logic of a practice or a critical mass that justified a specialist structure? There have been so many instances that have polled for or against the trend so the truth is somewhere in the middle.

The question in my mind really is what works best in the long-term, a generalist approach, or the specialist path? While I have had the good fortune to work for both specialists like Text 100 and 2020 Media, I have also witnessed their forays into the non-tech arena, the former through a proxy agency called Vox PR and the latter directly, when generalists started to eat their lunch. The smaller reasons for this were various including client business conflict, retainer pricing, and sometimes plain ego clashes. The positioning conundrum clearly follows the way of the market shift. The shift has not been smooth, some may call them works in progress, others a fear of losing what they already have in existing clients due to an apparent positioning preference as opposed to other client portfolios that they desire.

There are of course international specialist PR brands that have come in and opened their doors for business to get a piece of the action like APCO, Lewis PR, but for every specialist, there are an equal number of generalists rushing in with names like Fleishman Hillard, Brodeur, Manning Selvage & Lee and scores of others.

Interestingly one space that has stayed relatively virgin is the Financial PR marketplace with a few like Adfactors PR which have stayed ahead of the game and hedged their bets in other specializations while clearly holding on to a very lucrative Financial PR (read IPOs) pie. Others in the game include names like Concept PR, Pressman PR and the Financial PR practices in some of the larger generalists but with a low critical mass as a part of their revenue base. This remains one of the most lucrative spaces in Indian PR and already there are overtures from many international PR firms that work the Financial PR or Investor Relations space for a piece of the action. I know that they are biting at the hooves and I’d just love any M&A gossip there!

While specialists and generalists keep moving towards each other in shenanigans that defy logic, in the final analysis with a few exceptions, most home grown specialist outfits may or may not last long. Large global mandates will force an ongoing consolidation as the Indian PR Industry becomes pregnant with the FII money and the burgeoning weight of its booming middle class marketplace.

The Holmes Report makes for great reading for those interested in delving deeper into the holding patterns, revenues, market statistics and other insights into the global PR business. It is interesting to note that globally a majority of PR firms are controlled by 4 holding companies or networks: Omnicom, WPP, Interpublic, and Publicis.

Either which way the Indian PR Industry cookie crumbles, the traditional approach of developing a specialization to carve the melon will increasingly become harder as entry barriers to opening up or sustaining organic PR shops will get way higher than they used to be for the last decade or two. PR Firms that have shown amazing organic growth in the comparative short term like a Vaishnavi will become rarer. Independent firms of course remain more than capable of competing with network players for clients, both network clients or restricted to geographic location.

The Indian PR Industry soon promises to map the global PR Industry, and while a consolidation is imminent, all that is open to debate is the when and at what valuation. While isolated accounts may remain in silos but clearly the end of cult and personality led PR is around the corner. In all this mayhem, the largest benefactor is not a single entity; the entrepreneurs have their happy exits, the employees-growth, while slowly but surely the fight is hotting up for the Indian PR market pie and it’s time for the big guns to battle! These remain exciting times and all this can only mean more professionalism and better prospects for the Indian PR Industry: The King is dead, long live the King!

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