India set for PR boom

01 February 2011

NEW DELHI: The public relations sector is set to experience rapid revenue growth in India, as brand owners adopt new methods to engage consumers.

The Associated Chambers of Commerce and Industry of India surveyed 500 executives regarding their attitudes and expectations.

It suggested the category is expanding by 32% annually, measured against the acceleration of between 22% and 25% witnessed during the last few years.

Revenues are thus forecast to rise from $6bn (€4.4bn; £3.7bn) today to $10.6bn at the close of 2012.

"Corporates are relying more on PR professionals to hike their brand image, to take maximum benefits of [the] current economic boom for increased sales and turnover volumes," the study said.

The healthcare sector has delivered a particularly strong uptick in demand, while environmental issues and corporate social responsibility are playing an increasingly important role.

It is estimated there are now somewhere in the range of 1,000 and 2,000 public relations agencies active in India, employing at least 30,000 people, with 90% of staff occupying "entry-level" roles.

The biggest networks include Perfect Relations, Genesis PR, and Vaishnavi, running a minimum of ten offices apiece.

Global players like Weber Shandwick and Ogilvy Public Relations have also established local units, and Fleishman Hillard has an affiliation with domestic operator Lexicon.

Specialist agencies are already emerging, such as Text100 and 2020 serving IT clients, Imprimis offering expertise for healthcare companies and Adfactors prioritising financial firms.

A majority of interviewees agreed the intense competition among marketers to connect with consumers in different ways means PR shops are quoting "market-driven prices" for their services.

The average fees commanded by agencies generally start at 250,000 rupees ($5,450) and peak at around 1m rupees.

Employee churn is a further primary characteristic of the discipline, partly because of the constant necessity to hire fresh staff, but also demonstrating a broader "skills shortage".

"The overriding concern of the industry is the skills shortage. Almost all agencies are hiring, a trend that is itself indicative of growth, and some are looking outside the PR industry to bring in new skills," the report said.

Another matter to be addressed is the "leadership crisis" resulting from the comparative youth of the Indian public relations segment.

"There are very few veterans and worthy leaders in top management positions," ASSOCHAM stated.

"This presents a crisis of leadership in smaller firms, which makes people move onto larger and more reputable companies."

An equally sizeable obstacle to be overcome is a widespread "lack of understanding" that can be seen in the marketplace.

"It may come as a surprise but most people still have a very vague notion of PR," ASSOCHAM concluded.

Data sourced from ASSOCHAM; additional content by Warc staff