Clients of major U.S. public relations firms are generally highly satisfied with the performance of those firms. The vast majority would rehire their firm, and recommend it to a friend or colleague, according to a survey conducted in the first quarter of 2006 by The Holmes Group.
But the survey also found cause for concern: while firms scored extremely high marks on questions related to client service and the quality of staff, they scored considerably lower on questions about measurement and evaluation and—more surprisingly—creativity.
To some extent, the results echoed those of a similar survey conducted by The Holmes Group in 2004 and 2005 in partnership with the consulting firm Kelly & Lugbauer, although direct comparisons are difficult because of changes in the wording of some questions and the use in this year’s survey of a 1 to 10 scale rather than the 1 to 7 scale used in previous years.
More than 800 clients from about 30 public relations firms—including 10 of the top 15—responded to the survey, which was conducted online. Individual agency results are treated as proprietary and are designed to provide actionable comparative data on customer satisfaction to participating firms.
But the survey found extremely high levels of satisfaction with existing agencies. For example, when asked whether they would recommend their existing agency to a friend or colleague, 41 percent answered with the highest possible score (10) and another 25 percent indicated strong agreement (9), while only 6 percent have a mark of five or lower.
Similarly, when asked whether they would be happy to rehire their current agency, 42 percent responded with a 10 out of 10 and 25 percent with a 9 out of 10, and just 5 percent responded with a score of 5 of lower. The average score was 8.66.
“Generally speaking, PR firms have happy clients,” says Paul Holmes, editor of The Holmes Report. “The levels of satisfaction are surprisingly high, although the fact that many agencies continue to complain about client turnover suggests that anything short of a 10 out of 10 is cause for concern. Client satisfaction is not enough; agencies need to aim for client delight.”
Clients were particularly happy with the level of service they received. Some of the highest scores came in response to questions about service, including whether key personnel are accessible (8.98), whether agencies respond quickly to requests (8.69), whether the agency hits deadline (8.66), and whether the agency listens well (8.62).
Firms also scored high marks on questions related to their people, such as whether they provide clients with access to counseling beyond the account team (8.62), whether clients are happy with the leadership of the account team (8.61) and the overall quality of the account team (8.52). There was slightly more concern about the stability of the account team (8.30).
Even better news for agencies is that the quality of people and the quality of client service ranked first and third respectively when clients were asked which factors were most important in evaluating the performance of the agency. Execution and attention to detail ranked second, and is perhaps the major cause for concern in the survey, since most agencies scored only average marks.
On questions such as whether their firm pays attention to detail (8.15), whether it executes in an efficient and cost-effective manner (8.09) and whether it produces good quality writing (8.02), firms scored adequate but unspectacular grades from clients. And when clients were asked whether their firms identified and quickly changed program elements that were not working they gave their agencies one of the lowest marks in the survey (8.02).
“Responses to the survey seem to suggest that agencies are getting the little things right,” says Holmes. “On the basics of client service and execution, agencies are scoring high marks, and these things seem to be the ‘price of admission’ for many clients. But once that price has been paid, there’s still a lot agencies need to do right to hang on to the account.”
Agency scores related to creativity and measurement and evaluation are also cause for concern, even though clients ranked these factors eighth and ninth respectively in terms of the criteria they use to assess agency performance—rankings that are likely to raise some eyebrows among agency leaders.
Clients felt that agencies were doing an adequate job of providing strong media results (8.04) but were considerably less satisfied with their agencies’ ability to create measurable programs (7.75), show strong business results (7.49) and demonstrate ROI (7.38)—the latter being the lowest score for any question in the survey.
Similarly, clients were somewhat disappointed in the quality of creative thinking (7.84), the quality of creative product (7.81), the willingness of agencies to take creative risks (7.71) and the ability of agencies to deliver innovative, non-traditional ideas (7.41).
“The scores for creativity are particularly worrying,” says Holmes. “Clients don’t rate it as the most critical element in a relationship, but over time the inability to come up with innovative ideas can clearly cause a client-agency relationship to feel stale, and prompt clients to look elsewhere. Concerns over creativity may also lead to clients looking elsewhere for branding ideas that ought to be coming from their PR agencies.”
The survey also discovered differences in the level of satisfaction across industry sectors and practice areas.
Clients from the public sector (9.21) and the not-for-profit world (9.08) gave their agencies the highest marks when asked about their overall satisfaction. When it comes to the private sector, professional services clients are the most satisfied (8.72) followed by those from the technology (8.40) and financial services (8.38) industries. The least satisfied clients came from the consumer (8.27) and healthcare (8.28) industries.
As for practice areas, those using their agency for crisis communications reported the highest level of overall satisfaction (8.67—although the sample size was relatively small), followed by those seeking marketing support (8.41). The least satisfied were those using PR firms for financial communications (7.50—although again the sample size was relatively small) and for corporate image (8.20). Public affairs clients (8.30) were in the middle of the pack.
Even more satisfied, overall, were companies that used their agencies for all of the above (8.95). “It’s hard to know which is cause and which is effect,” says Holmes. “Do clients that are more satisfied give their firms a wider range of responsibilities, or do relationships that are broader and deeper produce higher satisfaction? In all probability, it’s a combination of the two.”
Clients with revenues of less than $500 million were the most satisfied overall (8.72), and midsize clients—those with revenues between $1 billion and $10 billion—were generally more satisfied (8.47) than clients with revenues of $10 billion to $25 billion (8.21) or the largest clients, with revenues in excess of $25 billion (8.26).
But clients with larger budgets were typically more satisfied than those spending a smaller amount. Those with budgets in excess of $10 million were most satisfied (8.94), followed by those spending between $5 million and $10 million (8.75). But clients with budgets of less than $100,000 were more satisfied (8.62) than those with moderate budgets of between $500,000 and $1 million (8.31).
Finally, clients who have been with their agencies for five years or more expressed the highest level of satisfaction (8.63) followed by those who have three to five years of tenure (8.49) and those in the first year of a new agency relationship (8.42) suggesting that the critical phase of a client-agency relationship is in the second and third years (8.36).
Things Agencies Do Well….
1. Key personnel on my account are always accessible 8.98
2. My agency collaborates well with our in-house team 8.78
3. My agency responds quickly to our requests 8.72
4. My agency hits deadlines 8.66
5. My agency provides access to senior counselors beyond the account team 8.62
6. My agency listens well 8.62
7. I am pleased with the leadership of my account team 8.61
8. I am pleased with the overall quality of my account team 8.52
9. My agency collaborates well with other marketing disciplines/agencies 8.52
10. My agency makes me look good to my senior management 8.45
…. Areas Where There is Room for Improvement
1. My agency proivides strong evidence of ROI 7.38
2. My agency delivers innovative, non-traditional pr ideas 7.41
3. My agency is able to show strong business results 7.49
4. My agency is willing to take risks 7.71
5. My agency identifies program elements that are not working and makes changes 7.75
6. My agency creates programs that are measurable 7.75
7. My agency delivers high-quality creative product 7.81
8. My agency delivers high-quality creative thinking 7.84
9. My agency monitors the competitive environment and is alert to changes 7.89
10. My agency brings me ideas rather than simply waiting for instruction 7.92
Which Factors are Most Important in Evaluating Agency Performance
1. The quality of people on my account team 9.32
2. Execution and attention to detail 9.18
3. Client service activities such as accessibility and responsiveness 9.08
4. A good partner that collaborates well with my team and other disciplines 8.98
5. Knowledge of and insight into our target audience, media, competitors, etc. 8.87
6. Initiative: anticipating problems and bringing me new ideas 8.70
7. Financial stewardship, budget and billing 8.56
8. Creativity 8.54
9. Effective measurement and evaluation 8.53