PR activities are becoming more diverse due to media fragmentation
Melbourne, Australia (PRWEB) February 03, 2013
The economic downturn did not affect the Public Relations Services industry as severely as traditional advertising. According to IBISWorld Industry analyst Craig Shulman, ‘while marketing budgets tend to be one of the first items targeted in cost-cutting efforts, public relations (PR) services are often seen as more focused and therefore better value for money than media advertising’. As a result, spending on PR tends to be less volatile and holds up slightly better when budgets are cut. Additionally, some aspects of PR, such as communication with stakeholders, can be crucial in a downturn to allay fears and manage crises. This, along with a longer term trend towards more below-the-line marketing methods, is expected to result in industry revenue growing at a stronger rate than that of the Advertising Services industry.
In 2012-13, industry revenue is forecast to grow by 5.4% to reach $443.1 million. Over the past five years, annualised growth is estimated at 2.2%. PR activities are becoming more diverse due to media fragmentation, with new media opening up a broader range of communication channels to reach target audiences. ‘The internet in particular has presented marketers with the opportunity to target specific audiences’, says Shulman. The ease with which marketers can contribute to content, such as websites and social media, has resulted in an increase in the use of online PR activities. Over the next five years, the picture looks better and revenue forecast to grow. Increasing communication about environmental issues, including the carbon footprints of clients and their carbon reduction strategies and offsets, is expected to be a major new area of work for the industry.
The Public Relations Services industry has a low level of market share concentration. Historically the industry had been highly fragmented, with a large number of small agencies, often operating as partnerships and family companies. Rapid consolidation began in the 1990s as major global advertising firms began aggressively acquiring complementary marketing and communications businesses including PR firms. Many of the larger PR firms operating in Australia were part of international firms that were swallowed up by the likes of advertising giants WPP, Omnicom and Interpublic. Consolidation has also occurred among Australian-owned firms, with a key example being major Australian advertising conglomerate Enero Group. Originally named Photon, it was established in 2000 as a group of three companies and has rapidly acquired firms across the full spectrum of marketing and communications specialties in Australia and offshore, and is now among the top 20 largest communications companies globally. Despite the consolidation, industry concentration remains low as a large number of small, independent PR firms continue to operate in the industry.
For more information, visit IBISWorld’s Public Relations Services report in Australia industry page.
Follow IBISWorld on Twitter: http://twitter.com/#!/ibisworldau
IBISWorld industry Report Key Topics
Public relations agencies manage the communications between an organisation and its publics in order to promote favourable relationships and portray a desired image. This includes communication with the general public as well as employees, investors, customers, analysts and other stakeholders. In contrast to advertising, PR campaigns aim for exposure through public interest and news items rather than paid advertisements in order to give their message third-party legitimacy.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.