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Deal Radar 2009: Publicity Guaranteed

Posted on Wednesday, Jul 8th 2009

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.

Recommended Readings:
Deal Radar 2009: Enquisite
Online Advertising
Deal Radar 2009: Critical Media

This segment is a part in the series : Deal Radar 2009


. Jimmy Beans Wool
. EnerNOC
. GreenRoad
. AdvancedMD
. DecisionView
. EnergyWare
. Sungevity
. eMeter
. WaveMark
. Edutainment Resources, Inc.
. IntraLinks
. The Rubicon Project
. CollegeNET
. Central Desktop
. SnapMyLife
. Talend
. Adayana
. Vontoo
. OrecX
. CrossLoop
. Service-now.com
. Plain Black
. Shipwire
. Collaborative Software Initiative
. Open-Xchange
. Extentech
. Chaupaati
. Zoosk
. Mytopia
. Social Gaming Network
. Zynga
. MindTouch
. MuleSource
. Medsphere
. Greenplum
. VeraLight
. Dealer.com
. Kaltura
. Triveris
. Spiceworks
. SpineMatrix
. Nokeena
. Webtide
. Jivox
. xTuple
. Tangle.com
. Outspark
. concrete5
. Infinia
. UserVoice
. Vindicia
. Sonoa Systems
. SpotMixer
. SodaHead
. EnterpriseDB
. Enquisite
. Coverity
. Hydro Green Energy
. Zannel
. SoloHealth
. CAST
. Marin Software
. InQuickER
. HealthEdge
. Hippo
. Tabula Digita
. checkMD
. GlobalSubmit
. BOKU
. Awarepoint
. KidZui
. AnyWare Group
. Critical Media
. Colosa
. Convio
. Life
. Publicity Guaranteed
. SharesPost
. Aravo
. RadarFind
. Offerpal
. Confidela
. FTRANS
. HSA Global
. Skyline Solar
. Grab Networks
. Meteor Solutions
. Ancestry.com
. EQAL
. Simply Hired
. ClearCount Medical Solutions
. iControl
. Outright.com
. Rocket Fuel
. AirPatrol
. Lakshya Institute
. Elements Akademia
. InXpo
. Viralheat
. ChalkPad Technologies
. socialDeck
. IngBoo
. DubMeNow
. OrangeSoda
. NomaDesk
. SMS GupShup
. Reply!com
. Cellufun
. PSS Systems
. uTest, Massachusetts
. Kalypso
. Yola
. eXo
. Hydra
. AppSense
. Extrabux
. Shoplet.com
. Bazaarvoice
. Clearwell Systems
. Barracuda Networks
. Eloqua
. Sheet Music Plus
. Nimsoft
. LiveOffice
. Jigsaw Data
. SugarCRM
. Trustwave
. Surgient
. AppRiver
. Proofpoint
. Apptio
. Silverpop
. InfoSoft Global
. Cnergyis
. LogLogic
. PGP Corporation
. Avidian Technologies
. Force10 Networks
. SnapLogic
. Alert Logic
. MAIA Intelligence
. Orangescape
. Wirkle
. Clearpath

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[…] Deal Radar 2009: Publicity Guaranteed | Sramana Mitra upon Strategy […]

Yahoo Adsense Offers an Alternative - Best Paying Affiliate Programs Wednesday, July 8, 2009 at 12:35 PM PT

Sramana,

Let me start by saying that I like your approach to Deal Radar but there’s nothing innovative about Publicity Guaranteed (aside from the fact that founder is on a first name basis with the CIA and KGB).

It’s inaccurate to say “Publicity Guaranteed was the first agency to charge its clients only for the results delivered, without any long-term contracts.”

This concept has been around for some time.

While I don’t know if he was the first, Dick Grove and his firm Ink Inc at http://www.inkincpr.com/ is one of the more visible PR companies with this business model.

While the pay-for-play model will appeal to a few companies it doesn’t address how the PR effort enhances the perception of the company in the eyes of the target audiences. Heck, to borrow from the advertising world it doesn’t even address aided and unaided awareness.

Lou Hoffman Wednesday, July 8, 2009 at 4:27 PM PT

“Publicity Guaranteed was the first agency to charge its clients only for the results delivered, without any long-term contracts.”

That statement is false.

I can’t speak to the rest of Konanykhin’s claims, but I can assure you that at least a dozen other PR firms have been offering pay-for-performance publicity services without contracts for much longer than Publicity Guaranteed has been in existence.

I started a pay-for-performance publicity firm in 1993 and I wasn’t even the first to do so at that time, although most of my predecessors no longer exist. [One of my earliest competitors had been in business since the early 1980’s, and only went out of business in 2001, in part due to the fallout of the bubble.] Dick Grove’s INK has been around since at least the mid-90’s, and the perfectly named PayPerClip even predated Publicity Guaranteed by a few years. There are, of course, many others, but these are the ones that spring to mind.

My firm is still actively performing pay-for-performance publicity services, and we specialize in helping early-stage startups. We have broadened our service scope to include PPC Management and SEO services on a pay-for-performance basis. We also have a consulting division that does branding and marketing strategy work for startups on a “flexible fee” basis (services rendered for deferred compensation, stock options, barter, etc.)

Outstanding small companies with promising futures should not be constrained by small marketing budgets. (And, it may just be me, but I also don’t think you should trust a PR flack to tell your company’s story if they can’t even tell their own story truthfully.)

David Wednesday, July 8, 2009 at 5:27 PM PT

There are also several independents in the US and Europe that offer a version of pay for performance. They still charge for writing news releases and articles, but they get paid for each meeting they set up and then again if that meeting results in a story. But like all versions, there is no strategic involvement. It’s just a numbers game and that is so 1999.

Lou Covey Wednesday, July 8, 2009 at 10:59 PM PT

All, Keep the information coming. I’d like to hear more from you all on pay-for-performance PR. I have always paid a fair bit to my agencies … Sramana

Sramana Mitra Thursday, July 9, 2009 at 7:24 AM PT