VMA Search - State of the market survey, in association with Comres

ï Survey results reveal resilience of the PR and Communications market - 23% of Communications Directors are looking to grow their teams

ï 72% of respondents claim they had no plans of cutting headcount

ï Market downturn will not have a marked negative impact on the industry compared to the last recession

ï 60% of PR agencies have been asked for a reduction in fees

ï 48% of PR agencies report an increase in project work

ï Prediction of likely agency redundancies of up to 10%

ï CEO urges companies to keep faith in communications during the downturn


VMA, the specialist corporate communications and PR Search and Selection company, is advising businesses to maintain their commitment to communications programmes if they want to survive the market downturn.

According to VMAís CEO, Julia Meighan: ìDuring the last recession, the knee-jerk reaction of many organisations was to cut their PR and communications spend or team as the function was considered a ënice to haveí rather than a business necessity. However, businesses that do so now, do so at their peril.

ìIn fact VMA Searchís recent ëState of the Marketí survey, of Directors of Communications and PR Agency Directors and MDs, in association with ComRes, indicates that businesses do recognise the importance of PR and Communications and, as a result, are not expecting to downsize in 2009. An impressive 72% of respondents claimed they had no plans to cut headcount and a further 23% are actually planning to grow their communications teams.î

Further commenting on the market, Julia Meighan highlights that: ìIn todayís world, it is incredibly important to manage your business reputation as rumours can spread across the internet in minutes, causing financial as well as reputational damage. Successful PR and Communications professionals will be assets to their organisations, able to lead businesses through and out the other side and placing them in an ideal position to benefit once the market picks up.î

State of the market survey
VMA Search, the Executive Search arm of VMA, in association with ComRes, the leading polling and research consultancy, released the results of its ëState of the Marketí survey highlighting the resilience of the PR and Communications industry during the significant market downturn.

The results of the survey included the key finding that the role of communications is expected to be significantly stronger compared to the last downturn.

In-House Survey
Pressure from inside corporates during the downturn is significant - 64% of in-house respondents said they have felt an increase in pressure to perform from their internal clients. Nevertheless, one of the respondents commented: ìHaving a robust, measurable communications plan in place and demonstrable track record of delivering business benefits as a result of integrated communications activities has enabled me to defend the budget and limit arbitrary cuts by the Finance Director.î

54% of respondents said that they would be looking at cutting their PR budgets compared to the last financial year. One respondent claimed that ìbudgets would be tough to secure for proactive companies, but the importance of communications in such an environment is increasingly recognised by forward-looking companies.î

However, a sizeable number of respondents (82%) from within the corporate communications and agency environment predicted that the current economic downturn would be more serious than the recession in the early 90s, with 68% of them reporting that the UK economy will take one to two years to improve.

Alex Cole, Global Corporate Affairs Director at Cadbury, commented: ìTeams who have fully grasped the need to find the business case for communications, rather than communications for communicationsí sake, will thriveî. She goes on to say, ìTodayís communications professional needs to think and act like an operator as much as a functional specialist.î

One of the respondents however stressed: ìNever has the value of communications currency been so high. With reputation critical, Boards are recognising how important it is to have excellent communications functions in place – unlike the 90s, when communications functions were seen as a ënice to haveí.î

Another remarked: ìIf we learned one thing from the last recession, itís that organisations that retain a strong voice and profile during a recession tend to come out of it stronger than those that donít.î

PR Agency survey
Agencies have seen a significant increase in the amount of work relating to change management issues – 36% of agencies reported that they have been asked for an increase in focus on advisory services to CEOs and Boards on managing communications through change.

Half of Communications Directors reported that they will be looking to cut their agency spend but over 48% of agencies reported that they have increased their levels of project work substantially. In addition, 44% of agencies reported that they are looking to increase their number of clients and, in particular, 56% of financial PR agencies have reported that their clients have requested an increase in effort doing more for the same amount of fee.

A highlight of this survey was the further-strengthened role of agencies during the market turmoil. 92% of agencies reported that their clients now view them as more important, or as important, as six months ago.

The economic malaise, however, has forced agencies to think both in the short term as well as the long term. One of the responses reflects the views of many who managed to steer through the last downturn: ìThere will be winners and losers out of all of this and the winners need to position themselves to come out better on the other sideî. However, one strong representation suggests: ìServices have to change – agencies need to be more flexible, cut the fat, senior people need to be seen to be adding value and transparency with billing.î

Julia Meighan, CEO of VMA continued: ìThe outcome of the survey is not surprising, given that PR and Communications professionals are now firmly established at a senior level, be it as part of the Board or Executive team, influencing and making decisions rather than tactically delivering messages after the fact. Business leaders understand the importance that communications now has and how a strategic programme can positively affect a businessí bottom line.

ìThe market downturn will actually provide some opportunities as well and we have clients who recognise that there will be bargains out there. In certain areas there will be redundancies and, as a result, some very attractive candidates will enter the market. In this climate they are likely to be more practical about their salary expectations with a greater emphasis on the role, career progression and stability of the organisation. Companies that are able to snap up these talented people will retain a strong voice and profile during the recession, with an expectation that they will emerge stronger and fitter than those that do not.î

VMA Search Survey – The changing role of todayís Corporate Communications Director

VMA Search also recently carried out an industry survey on the changing role and remuneration prospects of todayís Corporate Communications Director, in association with CorpComms Magazine. The results of this were also significant. If you wish to download a copy, please go to www.vmasearch.co.uk or email mail@vmasearch.co.uk or contact VMA Search on 020 7436 4243.