10 Expert Insights for the Optimal (and Most Effective) PR Budget in 2024 The age-old question "How much should a company spend on PR?" echoes through boardrooms, with organizations seeking a magic formula for budget allocation. Here are 10 things you need to consider.
By Alexander Storozhuk Edited by Kara McIntyre
Opinions expressed by Entrepreneur contributors are their own.
As companies vie for attention in a crowded marketplace, a well-executed public relations (PR) strategy can be the key to building brand awareness, enhancing credibility and fostering positive relationships with stakeholders. The age-old question "How much should a company spend on PR?" echoes through boardrooms, with organizations seeking a magic formula for budget allocation.
However, determining the optimal budget for PR efforts remains a complex decision, influenced by various factors. In this article, we delve into the considerations that businesses should weigh when allocating resources for PR, backed by tips for securing your budget and steps to ensure your spending is strategic and effective.
Related: Mastering Public Relations — A Comprehensive Guide to Boosting Your Brand's Reputation
Considerations for PR budget planning
1. Holistic approach
Framing your budget necessitates a holistic approach, encompassing content, search engine optimization (SEO), social media and influencer marketing. A survey conducted by Gartner stated that 82% of chief marketing officers (CMO) reprioritized investments in digital channels in 2023, showing that recent shifts in the PR landscape underline the importance of adaptation to new trends.
2. Alignment with business goals
The PR budget should align with the overall business goals and objectives. For instance, a company aiming to launch a new product or enter a new market may need a more substantial PR investment compared to a business focused on maintaining its current market position.
3. Industry norms and benchmarks
For effective PR budget planning, companies must be aware of industry standards, with spending typically ranging between 7% to 12% of revenue. However, recent trends indicate a slight reduction in marketing budgets across most industries. Gartner's 2023 CMO Survey reveals a decrease in marketing budgets from 11% of company revenue in 2020 to 9.1% in 2023, reflecting the changing landscape as brands seek cost-saving measures. Notably, self-service models, marketplaces and technology-driven services are gaining prominence in this evolving scenario.
Related: How Employee Advocacy Can Help You Overcome the Challenges of Limited PR Budgets
4. Content marketing on top of ROI
When considering investments in content, understanding its direct impact on business revenue becomes imperative. According to a survey by Search Engine Journal, 49% of marketers claimed that search engines like Google are the digital marketing channel that brings the highest return on investment (ROI).
Moreover, content marketing ROI goes beyond mere numbers, incorporating both quantitative and qualitative results. Lead generation, customer loyalty and brand awareness should be factored into the calculation, offering a comprehensive perspective on the effectiveness of content efforts.
Understanding the components of PR budget
1. Have a multi-channel presence
Ensuring a comprehensive multi-channel presence is pivotal for expanding audience reach and engagement. PR specialists, alongside the marketing team, share the responsibility of staying tuned to dynamic social media platforms that drive engagement and build credibility. A study by Adobe emphasizes the effectiveness of a strong multi-channel strategy, revealing a significant 10% year-over-year (YoY) growth for companies compared to a 2.8% growth with a less integrated approach.
Looking ahead to 2024, Twitter and LinkedIn remain essential platforms for PR professionals, extensively used by media professionals seeking pitches or sources. Simultaneously, maintaining an active blog on your website contributes to enhanced SEO and establishes the brand as a thought leader in the industry. Podcasts, now more than just a trend, position companies as authoritative voices in their sectors. The convenience of on-the-go podcast consumption enhances accessibility, and the versatile format allows for extracting key segments, extending impact across various channels like Instagram Reels and TikTok, amplifying reach and resonance.
2. Embrace influencer marketing
With a changing media landscape characterized by a decline in traditional journalism and a surge in influencers, integrating influencer strategies into your brand approach is crucial for successful PR outcomes. Influencers bring authenticity to brand endorsements, as their followers often perceive them as trustworthy individuals.
Partnering with influencers ensures adaptability to emerging trends and aligns with budget-conscious goals. A survey by Influencer Marketing Hub reveals a noteworthy ROI, with businesses earning an average of $5.20 for every $1 invested in influencer marketing.
Related: 10 Influencer Marketing Trends to Keep Your Eye On
3. Forge strategic partnerships
Building meaningful partnerships is set to be a top priority in 2024. Directing resources toward this goal enables PR campaigns to significantly broaden reach and engagement. The costs involved cover a range of expenses, including networking events, booths, invitations, PR packages, meet-ups, collaborative projects, travel expenses and more.
4. Harness the power of AI
As more PR tools integrate artificial intelligence (AI) features, it's mandatory to embrace it to boost your daily workflow. Whether it's streamlining the process of refining pitch strategies or analyzing complex data for insights into the performance of PR campaigns, the integration of artificial intelligence can elevate the engagement and effectiveness of any PR campaign. A 2023 study by PRovoke Media shows that 86% of communication professionals around the world between the ages of 35 to 44 believe that AI has a positive impact on their work.
5. Leverage ESG and CSR initiatives
Companies that effectively communicate their initiatives in Environmental, Social and Governance (ESG) and Corporate Social Responsibility (CSR) often experience an enhancement in their reputation.
Examples of initiatives:
- Sustainable practices: Reduce carbon emissions and minimize waste.
- Foster diverse and inclusive workplaces.
- Community engagement and social responsibility: Engage with communities through volunteering and address community needs through supporting education, healthcare or other social causes.
Moreover, ESG and CSR-focused companies are increasingly attractive to investors. According to a report by McKinsey, sustainable investments are growing 2.5 times faster than traditional investments, indicating a shift in investor preferences toward ESG-conscious businesses.
Related: ESG For Entrepreneurs: A Path to Business Success
6. Apply media monitoring and social listening
Expand your focus beyond press releases by investing in PR analytics tools for comprehensive campaign tracking. Metrics like media mentions, social media engagement and sentiment analysis offer valuable insights into the effectiveness of your PR initiatives.
Robust monitoring tools are crucial for assessing campaign performance and a proactive shield against potential crises. In today's digital age, where news and information spread rapidly, a delayed reaction can significantly worsen a crisis. Effective monitoring tools empower organizations to address issues promptly, develop a crisis communication plan, take control of the narrative and minimize potential reputational damage.
Conclusion
In the past, measuring PR impact has been a challenging task, but with recent technological advancements, the process has become more manageable. Starting this process early can streamline measurement and help companies position themselves for more significant budget allocations.
When businesses allocate resources effectively, adapt to emerging trends and practice responsible communication, they increase their brand's visibility and make significant contributions to the ever-changing narrative of corporate communication. The journey towards effective PR spending is as important as the destination, representing a commitment to communication excellence in a constantly evolving realm.
