Wednesday, March 12, 2008

Indian PR industry to double to $ 6 billion by 2010: ASSOCHAM

Industry body Associated Chambers of Commerce and Industry of India (ASSOCHAM) says that the PR industry is likely to double its size to over $6 billion by 2010, from the current $3 billion, as companies rely increasingly on PR professionals to enhance their brand image in order to maximise benefits of the current economic boom for increased sales and higher turnover volumes.

The above findings have been arrived at by a random survey carried out by ASSOCHAM on ''Attrition Vs. PR & its future prospects'', in which views of over 400 PR professionals were elicited. It highlights that as a result of growing opportunities costs in PR industry, attrition has become a core concern, reports domainb.

Releasing its findings, ASSOCHAM President Venugopal Dhoot, himself a lead consumer durables player, said that over 90 per cent of PR professionals at the entry level, with enthusiasm and a passion for hard work, are moving on in search of greener pastures within the industry in less than a year's time.

Dhoot, whose Videocon group spends roughly Rs30 billion in brand building initiatives, pointed out that the ASSOCHAM survey confirms the trend that a large number of corporates are opting to rope in PR professional for increasing sales turnovers, as one of finest marketing strategies.

The survey reveals over 75 per cent of the respondents said that pressures apart, PR activities demand a diversification of intellect.

A majority of PR professionals said that the economic boom has resulted in immense competition in brand building, as result of which PR agencies are in great demand, and are quoting market driven prices for their services. It also says that takers are available at these prices as well.

Since the demand for PR professionals is rising, so are opportunities for relationship industries. This is cited as a major reason for the growth rate of around 22-25 per cent in last couple of years, which has now risen to 32 per cent. According to ASSOCHAM, the growth rates would be sustained. Quoting findings of the survey, Dhoot said that by 2010 the PR industry would grow to more than $6 billion.

According to estimates by ASSOCHAM, the Indian PR industry comprises 1200-1500 agencies, with manpower strength of between 30,000 and 40,000. In terms of vertical markets, healthcare has been identified as one of the fastest-growing sector. However, the public sector, the environment, and corporate social responsibility (CSR) are also emerging as growth areas for PR.

The overriding concern of the industry is a serious shortage of skills. ASSOCHAM says that almost all agencies are hiring, displaying a trend that is itself indicative of growth. It says that some are even looking outside the PR industry to bring in new skills.

Although there are many thousands of small agencies and individual consultants serving highly localised markets, larger agencies are forging partnerships across the globe to meet demand from clients who themselves are increasing their global reach.

The ASSOCHAM study says that over 100 agencies, including large ones with 10-15 branches pan India such as Adfactors PR, Perfect Relations, Genesis and Vaishnavi, or medium-size ones with 4-5 branches and smaller city-specific PR agencies, who function as affiliates of global PR companies. Additionally, ASSOCHAM says industry specific agencies such as Text100, 20:20 and Imprimis who cater to specific needs of the IT and healthcare companies.

PR is being used as a supplement to advertising, as part of an integrated and effective communications strategy, primarily because at times advertising does not suffice in communicating the exact message. PR services not only help in communicating the message, but can also help in generating a response.

ASSOCHAM says that with the scorching pace of growth, agencies are facing an acute shortage of trained manpower, which is reflected in the 30-35 per cent hike in top-level salaries that the sector has witnessed over the last one year. Compounding the problem are attrition rates touching 30-40 per cent.