Gloom versus Boom in Indian PR

One of the cardinal rules of PR is this: "Never become the story"

But thanks to a raging fight between the Hanmer MSL, the flagship brand in the MSL Group's Indian portfolio of communication agencies, and the PRCAI, the umbrella body that represents all PR agencies in India, it's a little too late for that.

"They've violated the spirit of business. Some of our member companies have received legal views that what they've done is defamatory," says Sharif Rangnekar, the head of PRCAI and of Integral PR, one of the still independent PR agencies with some critical mass.

But Jaideep Shergill, Hanmer MSL's CEO, says he is surprised with PRCAI's questions. "We did it because nobody else was doing it, and because we wanted to educate everyone in the industry. We didn't do it for ourselves."

The bone of contention, if I can call it that, is this - "Understanding the Public Relations Industry in India: Challenges, Opportunities and 2012 Outlook" (PDF).

The 24-page report was brought out by Hanmer MSL in early January upon which it was promptly picked up and reported by The Holmes Report which wrote:

Reports of this nature are usually blighted by a heightened sense of caution, with firms afraid of offending clients or discussing their peers (to say nothing of Sarbanes-Oxley concerns). That this study shows so much less of this restraint should probably be welcomed.

The report's unnamed authors first went on to pour some (refreshing, I might add) cold water on the prospects for PR in India. The ills cited - an over reliance on "media relations", extremely low fees, inability to attract or retain talent and lack of emphasis on training - were by no means new.

In fact I had written about them exactly a year back in the magazine, with the hope that the entry of numerous foreign agencies might cause the situation to change.

In many ways, that environment remains but change has begun to happen. A wave of international firms is sweeping over India’s shores. They see the potential to take the business of public relations to a more professional, systematic and pro-active level. They are trying to shake up a smug Indian industry used to treating PR as a minor cost centre focussed on managing a few journalists; and help it prepare for a more assertive and connected consumer base. In the process, PR is becoming a more strategic but expensive affair for companies.

All of these issues are well known about agencies and clients, so no surprises there in the report.

Maybe the report's authors got carried away with all the candour - often a very scarce commodity in PR - because they then went on to deflate the size of the industry down from the $6 billion that an Assocham study had estimated and the PRCAI too had quoted in its May 2011 report titled "Public Relations Practice - Ground Realities" to $140 million.

Now we all know that industry estimates are notoriously unreliable and must hence always be viewed with some margin for error. But according to Hanmer MSL the margin was 96.7 percent!

Hence, there’s a vast gap between what the market says and what independent surveys claim. There’s more supporting evidence. Many independent surveys say the size of the Indian advertising industry is Rs 10,000-12,000 crore ($2.2-2.5 billion). This begs the question, how can the PR industry, which is much smaller, clock Rs 27,000 crore?

By now the authors must have been on a roll, because they decided to go for the jugular - individual financials for most of the large firms.

These are the top five and their estimated revenue, according to it:

1. Adfactors, $13 million
2. MSL Group India(Hanmer MSL and 20:20 MSL), $11 million
3. Concept PR, $7 million
4. Genesis Burson-Marsteller, $6 million
5. Corporate Voice Weber Shandwick and Edelman India, both $5.5 million

Now that set the cat among the PR pigeons!

Rangnekar first dashed off an angry letter to the MSL Group CEO Olivier Fleurot, asking for the estimates of agency revenue to be "retracted".

Firstly, he says, "the figures are, according to our members, inaccurate and quite far off from the reality", including those of his own firm, Integral PR ($3 million).

Secondly, Rangnekar says Hanmer MSL's revenue estimates had no legitimacy because it was an interested party itself.

Lastly he says Hanmer MSL made no effort to validate its estimates by either contacting the PR agencies themselves, or even by viewing mandatory declarations filed by the agencies with the Registrar of Companies.

When I ask Shergill about these points, he says, "Estimates are estimates. We collated these from company websites, research reports, industry people and newspaper articles. We don't expect the information to be accurate, nor are we claiming that they are."

That sounds surprisingly shoddy, for an agency that highlights the following as an "opportunity" in the same report:

Transparency and reliability
PR measurement should be transparent. For media measurement, mention clearly the source along with analysis methodology.
For surveys, make clear the methodology (sample, margin of error, geography, etc), the questions (wording and order) and statistical methodology (how specific metrics are calculated)

Physician, Heal Thyself?

While I admire Hanmer MSL's honestly in laying out the industry's challenges in plainspeak, unfortunately it compromised the integrity of the report by not being diligent and transparent enough about all of its contents.

From the same report:

Most experts agree that the PR industry has a PR problem. Many stakeholders, including media and businesses, think of the industry as one large spin doctor.

[...]

Many of the industry’s problems are  self-inflicted. If clients don’t understand the value of PR, the industry is clearly not telling the story well enough.

It's ironic that a report that sought to address issues like these ends up repeating the same mistakes.

And my advice to PRCAI which is still waiting to hear back from the MSL Group's CEO on its demand for the revenue figures to be "retracted" is another cardinal rule of PR: "Once information is public, it can never be retracted."

I'd view this as an opportunity for PRCAI to bring out its own impartial, transparent and level-headed analysis of why and how the Indian PR industry needs to get its act together.

The thoughts and opinions shared here are of the author.