Today’s Deal Radar looks at a company that seems to be attempting to change the direction of an industry that has been notoriously difficult to measure. Publicity Guaranteed allows companies seeking publicity to pay for results as they go along, rather than having to pay a retainer or for billable hours. The company has introduced a performance-based model to public relations, a model which has so far been popular in online marketing.
Publicity Guaranteed was founded in early 2005 by Alex Konanykhin. The founder’s personal story sounds like one out of a Hollywood movie. In the early 1990s, Konanykhin claims to have controlled the largest commercial bank in post-Communist Russia. By his mid-20s, he had built a $300 million empire of banking and real estate ventures and was one of the wealthiest people in Russia. On his way to Hungary, he was kidnapped and soon after he had the KGB, FBI, US Justice Department and CIA on the lookout for him. Overnight he lost his businesses, had to escape and was granted asylum in New York City after several years of trials. Since 1997 Mr. Konanykhin has been operating KMGi, which handles projects for many major corporations and produces webmercials.
New York City-based Publicity Guaranteed is a private company fully financed by Konanykhin. The company was created in an attempt to follow in the steps of Google’s resounding success. At the beginning of the decade, Google made the pay-for-performance business model the new standard of online advertising, making it one of the most valuable companies on the planet. Other prominent media companies which relied on a pay-for-impressions, no-results-guaranteed model faded into the fringes of online business. Publicity Guaranteed is trying to bring a similar change to the public relations industry. Soon after its launch, the program became popular with its clients who wanted a cost-effective approach to publicity, in which they paid for results rather than efforts.
Publicity Guaranteed was the first agency to charge its clients only for the results delivered, without any long-term contracts. Publicity Guaranteed’s model of “Guaranteed results – fast and inexpensively”, is more suited to small and medium-sized companies. The exact size of the available market is not known since no studies have been carried out on the subject.
Publicity Guaranteed has all its rates listed on its website. The company does not charge clients for placements in small publications. Its fees range from $385 for publications with a circulation of 10,000-50,000 like The Cincinnati Post or Daily Record to $2,850 for major publications like The Wall Street Journal, The New York Times and USA Today. Magazine rates range from $385 to $2,400 based on circulation. The company has served over 400 clients since its inception, but it was unwilling to divulge any financial data.
Publicity Guaranteed gained early traction through online advertising on large internet sites like Google. Clients include RaiseCapital, Dahn Yoga, Absolute Poker, Book Publicity and Magic Elf, among others.
The management team has been the same since the company’s inception. Konanykhin, the CEO, plans to operate Publicity Gauranteed as a private company for the foreseeable future, and for this reason no exit strategies have been developed.
What I find interesting in the company’s core thesis is the identification of a need for pay-for-performance services. Earlier, we looked at Enquisite, a company trying to do the same in organic SEO. However, we managed to extract very little data out of the company on how they do what they do, so if there are any users of the service out there who would like to share your experience with the company, I would appreciate it.
Overall, an intriguing premise for building a company.
This segment is a part in the series : Deal Radar 2009