Educating and Recruiting New Customers: The Pay-For-Placement Public Relations Model from a CRM Perspective   by: Richard Virgilio, Managing Director, PayPerClip   The CRM model is a two-way street. You are gathering critical information about your market audience, and you are providing valuable sales-generating information about your organization to that audience. It is within this critical area of communications that the public relations practice delivers value. The public relations function helps your organization communicate “who” you are, and why you matter to your prospects. Key to this function is media coverage. Because public relations involves obtaining objective editorial coverage in targeted media, the information your market audience receives has a news factor credibility that cannot be replicated through traditional sales and marketing materials.   Historically, the drawback for organizations has been to effectively “make the case” for public relations’ value. How does a company measure, quantify – and most importantly, allocate budget – for such an intangible? Particularly when viewed through the lens of the customer relationship management practice and its focus on precision, knowledge, and return on investment, public relations has appeared to be overwhelmingly difficult to measure and manage.   Now, however, there is an emerging model of public relations available to CRM practitioners, and indeed any organization that is demanding measurable return on investment for their customer acquisition dollar.   This model is pay-for-placement public relations: a simple concept stating that the most effective way to get what you pay for is to pay only for what you get. As a client, an organization specifies in advance the message to be delivered, the target media, and the type of coverage they are willing to pay for. They pay only for the results they actually receive, at fixed and predictable prices that are keyed to the depth of coverage and the circulation or audience rating of the outlet in which the coverage appears. Much in the way that CEOs and sales and marketing professionals compensation is based on results and the meeting of pre-specified targets, the pay-for-placement PR model dictates payment only for agreed-upon results.   The traditional retainer-based value proposition, under which a PR agency sells hours, not outcomes, still works well for many clients. In particular, this model delivers a great deal of value for companies that require strategic counsel before taking their message to the media. Yet retainers are simply not an option for many businesses, whether due to company policy, budget restrictions or bad agency experiences. In many other instances, a business will benefit most from using both a retainer agency AND a pay-for-placement firm, at different times or for different business objectives.   Tips for determining if the CRM-driven "pay as you go" PR model is appropriate for your organization: Do you have your messaging established? Do you know your target markets? Do you have your overall strategy in place, or do you need extensive counsel, planning and meetings? Is publicity your primary need? Do you have some familiarity with PR? Could you use some additional short-term bandwidth to help with product launches, extended staff leaves-of-absence, etc. Do you need expertise and contacts in a particular media type such as broadcast or national business press, or in particular industry trade publications? Do company policy or finances prohibit you from committing to a monthly retainer or a contract with extended time requirements?     Pay-for-placement clients vary from large corporations to small businesses, private individuals, associations and other not-for-profit organizations. PR, marketing and advertising agencies represent a growing class of clients for pay-for-performance PR services, since this model enables them to outsource PR without financial risk while offering their clients the expertise and contacts of seasoned PR professionals.   The great advantage of the pay-for-performance model is that clients can tailor PR services to their exact needs and available budgets. But remember, pay-for-placement firms’ mandate is publicity, and only publicity. Don’t expect the proposals, plans, strategy, counseling, reports, meetings, etc. that you would pay for in a full-service firm. And don’t ever think a pay-for-placement firm will guarantee placement; they will simply promise that unless you get the stories/air time you want in the types of outlets you target, you will not pay.   The pay-for-placement option is here to stay, and it’s expanding the market for PR services (according to a survey by CoolWire). The addition of results-based pricing and pay-for-performance services can give the CRM industry the choices, results and immediate ROI feedback they really need. The pay-for-placement PR model delivers the measure of performance and expectation of results that CRM practitioners demand of themselves for their organizations or clients.