My work is my credibility: the importance and value of pitch fees for marginalised/underestimated businesses

Since the Black Lives Matter uprising the spotlight is increasingly turning to the marginalised and underestimated . Over the past five years there has been a noteworthy surge in the presence of female and black entrepreneurs, bringing fresh perspectives and innovative ideas to the forefront.

As the PR space becomes more crowded with pitches, RFQs, and proposals, the need for a subtle yet transformative shift has emerged - the reintroduction of pitch fees. This practice, once standard but often overlooked, is now gaining momentum as a crucial step towards addressing persistent inequalities. Let’s look at the facts of why this is important for female and black led PR agencies who’re often considered underestimated/marginalised.

The average PR agency spends upwards of  £11,000 in internal agency time on a pitch. In some instances agencies can spend an additional £5000 to £25,000 on out of pocket expenses for conducting research and producing creative materials for the pitch.

PR agencies do an average of 27 new business pitches annually. That’s an estimated cost of. £432,000 to £972,000. For an underestimated PR agency this can be a substantial cost, taken in consideration agency win rates and contract values there’s a increased possibility that pitching for new business without a pitch fee can result in agencies going out of business. 

Considering the cost implication introducing a pitch fee seems like a great way to level the playing field for such agencies. Pitch fees provide an opportunity for underestimated agencies who may not have access to extensive resources to showcase their capabilities on par with more established/privileged counterparts. But does the introduction of a pitch fee become the solution to bridge the gap and foster fair competition?

Pitch fees can signify the recognition of the value & creativity underestimated agencies bring to table while acknowledging the financial and human resource costs they incur to do this. By attaching a fee to the pitch process, prospect clients show that they understand and appreciate the unique perspectives, creativity, and expertise that may have been previously undervalued.

It’s also a good indicator or gauge on how serious a prospect client is in making a decision and provides some protection for the IP within a pitch. If a client isn’t willing to pay a pitch fee this can be a good litmus test in willingness to commit or how they value the engagement. Paying a pitch fee also gives some ownership to the strategies outlined within a pitch. For any agency, especially an underestimated one nothing is more defeatist than seeing hours of time and money spent to produce a pitch where you’ve not been successful, only to see substantially similar strains of your pitch being executed by said client later on. 

The use of pitch fees align with a broader initiative as a start to address historical disparities. Marginalised communities have long faced systemic challenges that can be blockers to their progress in the business world. Pitch fees can be a tangible effort to create a more inclusive space for female and black entrepreneurs.

As the PR landscape undergoes a transformation with an increasing and visible presence of diverse and creative voices from female and black entrepreneurs the use of pitch fees is a step in the right direction but not enough.  If we truly want to make it equitable for female and black entrepreneurs shouldn’t we consider a standard banding for pitch fees based on a percentage that’s weighted more for underestimated agencies mapped to the potential value of the business if won in the pitch? 

Would it not be more equitable for an underestimated agency to have a higher percentage value for a pitch fee than one of its more established counterparts?

Can we not look at grouping in categories where smaller to mid size agencies (based on size & revenue) are allowed to have a higher pitch fee than a larger agency?  That would be a strategic move that does more than the “bare minimum” surface level platitude; and one that really addresses inequalities, recognises inherent value and fosters a more inclusive business environment for female and black entrepreneurs in the PR space. This would truly be a step towards creating a landscape where female and black entrepreneurs have an equal opportunity to thrive and contribute in an equitable way in the PR space.

Commissioned by FP Comms.

Written and produced by Kevin Leonce - - Please connect with Kevin for relevant commissions