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The Trouble with Pay for Placement

Written by: Anthony Mora

Article Overview: With Pay for Placement chances are you won’t have a campaign focused on delivering your message, or building your brand, but one focused on grabbing as much quick media as possible.

The Trouble with Pay for Placement

Pay for Placement
By Anthony Mora
Copyright© Anthony Mora 2008

There are firms that charge per placement. In other words, you do not pay for the media until they place a story. This sounds awfully attractive, but in my experience, it is not the way to launch an effective brand-building campaign. Look at it from the perspective of the media relations firm. If they are only going to get paid for the media they place you in, chances are they are going to try what they consider will be their easiest placements. If those magazines or TV programs pass, what is the company's incentive to take time, do some grunt work and launch an effective campaign? There is actually very little incentive. Chances are what they will do is move on to another client and hope that they can land him or her some quick placements in order to pay their bills. And so the process goes. It sounds attractive, but in actuality it's a horrible PR business model. You may end up with placements, but most will be reactive. Chances are you won’t have a campaign focused on delivering your message, but one focused on grabbing as much quick media as possible.

What you want in a media relations firm is a company that is actively working for you when things are tough, when there are no hits coming your way. You want a firm that is mining the stories, calling the media, pitching new ideas, making sure that eventually there will be big hits. A company that is paid based solely on their placements simply cannot afford to take the time to build and nurture a client. You may get some hits, but you won't get a campaign.

Many such firms base their fees on the ad rates of the particular media they are placing. In other words, if they were to place you in a local paper, they would base your fee on what a same-size ad would run and charge you a percentage of the ad rate. I have seen the percentage vary from 20% to 50%. If you are dealing with small, local media, this could be affordable, but once you move up the media ladder, you'll find that the costs rapidly become prohibitive. Strange as this sounds, one of the reasons I refuse to work on a per-placement basis, is precisely because I feel we will be too successful. It sounds great to the client at first
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he or she doesn’t have to pay unless there’s a placement. But score one good placement and suddenly their looking at the reality of paying a pretty hefty bill. Many never built the payment into their budget, because it didn’t seem real to them

One client in the fashion industry tried and tried to convince me to work with him on a pay-per-placement basis. I refused. Eventually he agreed to the retainer fee and signed with my company. The second story we placed for him was a three-page article in Vogue. If I would have agreed to the fee structure he had suggested, he would have, based on Vogue's ad rates, owed us over a years worth of retainer fees for that one story alone - and I would probably still be trying to collect my payment.

For Further Information Visit:
Anthonymora.com

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Article Tags: actuality, anthony mora, business model, grunt work, local media, magazines, media relations firm, perspective, placements, pr business, tv programs



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