Retreat from Advertising across Media Deepens as Business Pivots to PR Investment
A continuing pivot by business to building, reorganizing or expanding their public relations and media relations is expected to result in a minimum overall growth of 8.3% over the next seven years by dollars invested to nearly $16B according to marketresearchintellect.com.
Myriad issues are contributing to the resurgence of PR as executives return to more traditional, less costly, and less disruptive methods of brand promotion including:
· Escalating advertising and marketing costs coupled with diminishing returns on investment and frustration with questionable performance metrics.
· Artificial Intelligence (AI) generating growing concerns about the drain on capital, its realistic efficacy for segments of operations that demand customized human touch and critical thinking, creativity, response, and management.
· The emergence of troubling limitations of AI in quality, accuracy, and copyright infringements.
· Intensified sensitivity for brand protection and greater control of messaging.
· Volatile and worrisome economic uncertainty affecting future budgets and business strategies favoring a greater return for less expenditure.
“Demand for Public Relations solutions is particularly driven by industries focusing on reducing operational costs, improving performance, and adhering to environmental regulations,” Marketresearchintellect.com reported. “With a growing emphasis on sustainability and innovation, the Public Relations market is set to experience steady growth, offering numerous opportunities for both established and emerging players.”
The burn of capital AI requires from businesses is curtailing investment in other areas of operations that need attention and the real-world environmental costs of AI along with the fear of a prohibitive expensive AI infrastructure in the future is influencing the rise of PR as a safe alternative. The analysts at marketresearchintellect.com surmise:
“This growth is largely attributed to the rapid pace of technological developments, the increasing need for energy-efficient and Eco-friendly solutions, and expanding industrial usage across various sectors.”
Ironically, the same AI technology, for those organizations balancing spending on it or minimizing its cost through affordable third-party solutions are gaining even greater value from their PR investment as AI’s use as a support tool for public relations and media relations is increasing efficiencies.
The research firm’s report, “Global Public Relations Market Expansion Forecast: Key Insights into Market Growth,” shares that one industry expected to benefit the most from PR investment is automotive. Considering the overwhelming amount of resources the industry dedicates to marketing and advertising for its brand promotion, the conclusion is easy to understand.
The marketing and advertising dip that began in the first quarter this year is acutely seen in the recent serious decrease in automotive marketing on television. According to iSpot, national television spending by the industry was down nearly 24% in April year-over-year ($160M from $210M) and the overwhelming majority of that spend went to sports-related programming (71%). Of particular note in iSpot’s report, no American automaker made the top five in advertising spend.
An additional piece of data reinforcing the decline of advertising and marketing this year is a recent Nielsen survey that reports that despite legacy media’s fall as a top destination for ad dollars, younger marketing channels, including streaming, digital, and social will mostly experience decline as well:
· Social Media -4%
· Video: Online or Mobile -2%
· Display: Online or Mobile +1%
· Search: -3%
· Email: -3%
· Podcasts: -2%
· Streaming Audio: flat
“As marketers plan to reduce ad spend this year, many will continue to increase investments in digital channels, but at lower rates," Nielsen concluded.
Nielsen also reinforced the message that a global downturn in advertising is real and substantial by projecting the total overall advertising spend across all channels with 51% of American and 54% of foreign marketers confirming cuts.
The bad news for legacy media was also confirmed by research from BigChalk which reported that Linear TV underperforms for advertisers when it comes to return on investment. Even though it remains an effective channel for brand building, the firm says the source for the dissatisfaction is the cost per consumer reached. Big Chalk estimates that the average terrestrial TV cost per thousand viewers (CPM) is nearly $44 and the most expensive of all media channels. Compare that to the costs of younger channels according to the firm:
· Digital Display: $2.29
· Social Media: $2.38
· Streaming Audio: $3.22
A different kind of cost is also contributing to the movement of higher investment in public relations: the increase risk of damaged brand identity by way of digital advertising where brand safety is a concern. A new study from Advertiser Perceptions asked marketers to provide their top three reasons that resulted in reduced media advertising. 41% responded that brand safety or incompatibility was the driver while 38% said they had concerns either about the media outlet their ads were placed with or the content that outlet produced. Of note, the same survey reported that 41% also said the money spent on advertising did not produce the results expected of their spend.
Matias Rodsevich, CEO of PR Lab recently wrote, “PR is all about reputation, it cultivates great relationships between a brand and its stakeholders like journalists, investors or influencers. PR focuses on reputation management, crisis communication, and long-term brand positioning. It increases credibility and trust in the long run, but often takes time to show results.”
What has been increasingly clear as this year progresses is that more and more executives are placing higher value on pr because brand reputation, relationship building across multiple audiences, and long-term brand positioning backed by consistent messaging that is better managed, safe, and controlled is paramount and things advertising cannot deliver.
Rodsevich adds, “PR is a long-term game, because its initiatives create credibility and trust over time.” This truism has been painfully lost or diminished in recent years with the promise of faster brand strength via numerous digital channels and technology. But the promise has had a dangerous and often costly result that only sustained, long-term public relations can rebuild as it by nature is much deeper in messaging, motive, and meaning with target audiences than advertising can be for brands.
“PR builds credibility, while marketing expands reach,” Rodsevich says. Credibility, it can be argued, is something precious a lot of brands forgot about in recent years and needs to be brought back into the strategy and this is important not only on consumer-facing side of business.
KPMG states in a recent mergers and acquisition report that organizations prioritizing corporate communications including pr are 13% more likely to close a deal. The inference is that the brand, organization, and messaging are more familiar and ‘safer’ to engage. PR creates more substance that marketing can develop when after all, the ‘sell’ is first, everything else secondary.
Edelman takes this a step further by reporting 59% of consumers are more likely to purchase when they trust a brand and 67% are more likely to stay loyal. PR and media relations provide an organization a much deeper approach, and results, think of it as a surround strategy, that boosts a brand by safely communicating and promoting its messages, including value propositions, to audiences on a more personal approach with a variety of methods and with much greater control.
One of the best investments an organization can make is in Public Relations and the smartest groups understand its value is enhanced in tough times. Forbes Councils Member and BPM-PR CEO Monique Tatum says, “When the economy gets shaky, many brands panic. Budgets get slashed, campaigns are paused and, often, the PR and marketing departments are the first to go. It’s understandable, but it’s also one of the most damaging decisions a business can make, especially if you’re playing in the big leagues or want to get there.”
She adds, “Luxury brands, leading direct-to-consumer (DTC) powerhouses, household names and Fortune 500 giants don’t make that mistake. Not because they’re reckless with spending, but because they understand that cutting visibility during market uncertainty is more costly than investing in it. These brands know PR isn’t just about press—it’s about power. It’s about permanence. And in times like these, the brands that stay loud are the ones that win in the long run.”
Tatum compares advertising and public relations by emphasizing the fleeting nature of marketing as opposed to longer-lasting (and meaning) pr:
“While pay-per-click ads vanish the second you stop funding them, public relations is like a snowball. Every piece of earned media adds to your momentum. It compounds and keeps you visible across search, social and conversation. But if you pause? That snowball slowly starts to thaw. Your visibility cools. Your momentum fades. And the brand equity you’ve spent months or years stacking begins to slip away. The press you earn now becomes the growth engine that propels you later. When the market recovers—and it will—brands that stayed visible won’t be playing catch-up. They’ll be scaling.”
Public Relations can be as comprehensive as an organization needs. It can include wide-ranging external communications that encompasses community relations, government relations, investor and partner communications, events, sponsorships, and internal communications in addition to executive communications.
Media relations does not have to be limited as well. Besides the traditional earned media method, which today does better in building credibility and relationships with strategic media than a purely commercial strategy, an organization has greater potential today to become a trusted and reliable source of content that is both beneficial to the media outlet and business.
Earned media, shared media, and owned media can all be a part of a media relations program. All can be posted on an organization’s website, repurposed for various audiences, and create a deeper, more strategic, and legitimate presence online.
Considering today’s economic climate of growing instability, inflation, consumer stress, and advertising fatigue, establishing and executing a public relations and media program is the long-term, budget-friendly solution to steer the ship through these stormy waters.
As the retreat from advertising continues, the second half of 2025 will be an interesting period to observe just how deeply this decrease in marketing will go and how far pr will ascend to give organizations the brand communications they seek in today’s marketplace.