Magazine article Marketing

IPR Goes for Pay by Results

Magazine article Marketing

IPR Goes for Pay by Results

Article excerpt

IPR goes for pay by results

The Institute of Public Relations (IPR) has voted to change its code of ethics to allow payment by results, a radical move likely to lead to the use of more quantitative measurements to gauge the effectiveness of PR.

The change will apply to that section of agencies' fee income - about about a fifth of the total for larger consultancies - which is based on special projects such as new product launches. The remaining 80%, which comes from retainer fees, would not be affected.

The IPR decision follows repeated complaints by marketers that PR lacks the skills in measuring effectiveness that other marketing services professions possess, such as advertising, direct marketing and sales promotion.

But even within the area of special projects, some agencies argue that payment should not in fact be based entirely on result. PR is only one element in the marketing mix, and should not be penalised for mistakes perhaps made in other areas, they argue.

PR agencies are employed as consultants to give advice as well as supply a service, says Janet Salvoni, the client services director at Paragon Communications.

Payment by results has been a hot issue at the IPR for the past year. …

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