?If I was down to my last dollar, I'd spend it on publicrelations.?

-- Bill Gates

As unlikely as it is that Bill Gates would ever be down tohis last million dollars, let alone a single George Washington, the factremains that it's a powerful endorsement of the power of PR.

Still, when the economy is tight and corporations yank hardto get their belts down to that last notch, PR is usually one of the first fewitems on the budget that's frozen or cut completely. To bean counters, it's aneasy choice.  Because it's impossible totrack the impact of PR in strict accounting terms they consider it difficult toquantify PR expenditures. To the numbers guys, if something fails to leave afootprint on the spreadsheet, it is expendable.

However, the usual result of a cut in PR is an?inexplicable? drop in sales and sales leads which can make a companypractically invisible to consumers and business-to-business customers alike.Add to that the fact that the print and broadcast coverage almost always comeswith an online media counterpart repurposing their stories, PR delivers thedouble-whammy of free press AND search engine fodder.  So, when you cut the PR budget along with theadvertising budget, it's like tossing the baby, the bathwater and the bathtub.   

Even in lean times, public relations still provides thehighest value and greater return on investment than any other marketing tactic,including promotions and advertising. To increase that value, there are anumber of ?performance-based? PR agencies that mitigate the risk of theirclients and only get paid when they deliver solid placements. Retainer-basedfirms operate on the principle of making their ?best efforts? to get yourcompany press. With these firms, you're paying more for their time than forpress. With performance-based agencies, you actually pay only for press, notfor intangibles like time and effort. They deliver for you, or they don't getpaid.

Part of the issue facing corporations is the lack of understandingof the difference between PR and advertising. If the soul of advertising isrepetition ? which generally cost into the tens of thousands to run aneffective campaign ? the heart of PR is that clients will likely pay one-tenthor less of the cost of an advertising campaign.

Further, the PR delivers a larger punch because it focuseson the placement of articles and broadcast spots in free media. Moreover,these placements carry the third-party verification factor of being in the newssections (not advertising) of the outlets in which they appear. This means thatreaders and viewers respect the placements more than advertising because theycarry the tacit credibility of the outlets that carry them. In other words, ifthe editors of these outlets deem the company or client worthy of newscoverage, then there must be something special about them.

Gates was one of the few software geniuses of his era whoalso understood the differences between advertising and public relations, andwas able to maximize both to his company's favor. But with performance-based PRagencies, companies don't need a Gates-sized bankroll to capitalize on thepower of PR. In fact, they can start with about $3,500 for a standard nationalradio campaign.

At the end of the day, companies can't survive the leantimes without a steady stream of customers coming to their doorsteps, and PRcan deliver them without busting the bank.