Wednesday, April 20, 2011
How Can Public Relations (PR) Make You Money and Increase Sales?
High quality vintage bicycles like the British-made Pashley (pictured right) are making a big comeback.
A story in my local newspaper highlighted the impact of PR on bicycle sales for a local bicycle shop owner.
Public Relations or PR is largely misunderstood as a marketing tool.
Public relations has a key part to play in the marketing mix because the reputation of a brand, service, person or organisation affects marketing.
Effective PR thus can have a significant impact on a company's competitiveness and overall market position.
PR is about reputation with the aim of influencing opinion and behaviour in a positive way so that consumers and potential customers buy more of your products and services.
Based on a front page story in the local newspaper of a student riding a red Pashley the local bicycle shop owner said in the three days since the article he had sold six of these bikes.
Given that each bicycle sells for between A$1350 and A$1650 each that is a great return on investment for a zero marketing outlay.
The article didn't cost the shop owner a cent and returned him nearly a thousand dollars in extra sales.
The owner was quoted in a follow-up interview saying the buyers all said it was because of the article.
One customer even arrived in a taxi and rode her new bike home not even asking or checking about the price.
Imagine if your customers were making purchasing decisions like this.
Another study published by the Institute For Public Relations refers to the case study of a beverage brand that measured the impact of PR versus other forms of marketing.
The data showed that every dollar spent on TV advertising delivered $1.10 in sales.
Trade advertising delivered a return of roughly $2.20 for every dollar spent.
But PR delivered an incredible $8.00 for every $1.00 invested - the best results of any form of marketing tested.
In fact, 4 per cent of all incremental sales were attributed to PR.
For a fast moving consumer good like a beverage this represented tens of millions of dollars.
PR is the only marketing tactic that impacts all other forms of marketing in a positive way.
That is why I call PR a **marketing accelerant**.
When media coverage about a product, brand, organisation or person is positive and prominent, every other form of marketing has been shown to be more effective, thus creating a beneficial accelerating effect across all marketing efforts.
Add to this that PR usually costs far less to achieve than paid advertising and that editorial based publicity has a much greater readership impact than traditional advertising and you can see why PR has one of the best marketing return on investments (MROI).
Unfortunately business owners and accountants tend to look inwards when budgeting for marketing.
They might have a formula something like 3 per cent of sales or not more than 5 per cent of overheads and rarely see PR as the external investment that it is.
Another client of mine has made his business more profitable and pleasurable by using PR and public speaking to increase his visibility and credibility as well as share his passion for what he does.
He has also increased his fees considerably by positioning himself at the premium end of the market and as the "go to expert and authority" in his field of business.
Another client of mine working in the real estate industry was marketing a multi-million dollar property.
Using PR, he was able to get a whopping return of $100 for every $1 spent on marketing.
So as high end bicycle manufacturer Pashley knows, a high profile reputation enhances your ability to charge premium prices, regardless of the economy.
If you want to accelerate your marketing efforts with a customised PR campaign, please make contact.