Market Research: Revenues and prices of Czech PR Agencies increased in 2021

Market Research: Revenues and prices of Czech PR Agencies increased in 2021

Asociace public relations (Association of Public Relations Agencies – APRA) has conducted research into the Czech PR market. The results of the research show that 2021 was turbulent for Czech agencies and that there are many challenges ahead for them in the following year.

While revenues grew for 69 percent of agencies, more than half (53%) also reported an increase in costs of at least ten percent. Optimism for the next year is becoming  tempered by  increasing costs.

“Thanks to the market dynamics and to the fact that, unlike in 2020, there was no lockdown during the pandemic, last year was better than the preceding one for three quarters of agencies. However, the vast majority of agencies already saw a substantial increase in  costs last year. This year, staff costs are the highest in history, which means that margins are at an all-time low. If the agencies do not increase their prices for services, they will not be able to invest,” reminds Petr Lesenský, owner of the agency and member of the Executive Board of APRA.

Concerns about staff retention will result in more expensive services

Upward pressure on wages will be enormous in the immediate future due to the rising rate of  inflation . Wages for senior management positions increased on average by ten per cent in 2021. In contrast, wages for lower positions stagnated. The high inflation rate will not be the only source of pressure on the PR agencies to increase their prices for services. Without the price increase, the agencies will not be able to afford to retain their top employees.

Even the research data confirms the concerns about employees. Retention of key employees will rank among the greatest challenges for the PR agencies in the immediate future. No less than 63% of agencies stated that retention of such employees was absolutely crucial for them. More than half of agencies (53%) will focus their attention on recruitment of senior people (53%).

Research gains importance, media relations are on the rise

Agencies expect that the greatest volume of contracts will be obtained in three areas, namely financial markets and financial services (17%), technologies and IT (15%) and industry and energetics (12%). In addition, PR agencies still have a growing interest in contracts relating to sustainability. Media relations have the greatest potential among the PR areas. In 2020, only 38 percent of agencies reported this segment in terms of growth, compared with 63 percent in 2021.