August 26, 2008
Open Season
I am just back from vacation and was sent a link to Jason Calacanis’ monomaniacal riff in his subscriber based email on the shortcomings of PR people, titled, “How to Get PR for Your Startup; Fire Your PR Company.” Captain Ahab has nothing on Mr. Calacanis. Catch a few of his choicest cuts from the white whale (PR):
• Journalists hate PR people …if they say otherwise, they are lying, placating you, or just being diplomatic;
• PR people are selling you a share of their relationships with journalists and their relationships are typically on shaky ground;
• When I was a journalist I would not speak to PR people about my stories;
• PR people are an inefficiency in the system;
• Journalists are constantly getting banged by lazy, clueless PR people who fire first and don’t understand what the word “aim” means;
• You don’t need a PR firm, you don’t need an in-house PR person, and you don’t need to spend ANY money to get amazing PR
I am heartily sick of the ad hominem attacks and cheap shots taken by those who would try to draw attention to themselves. For a guy who states that “your ability to hire people, get meetings, raise money, and form partnerships will be tied to your PR footprint,” it is just amazing to learn that the only way to succeed is on your own, by holding your own conversations with media/bloggers, by organizing your own dinner salons and by being the brand.
In fact, most smart businesspeople involved in start-ups recognize what Adam Smith did in the mid 1700s, that specialization leads to better outcomes for all concerned. The reality is that PR people work hard at delivering creative story ideas that often have their basis in policy change or product advances. Most PR people have excellent relationships with reporters and bloggers based on timely delivery of accurate information and offering credible spokespeople prepared to address the issues at hand. The stereotyping of PR people is as unwarranted as ethnic profiling in law enforcement. So Jason, you make your own decisions on best use of time. Just stop the open season on PR people and recognize that smart entrepreneurs will continue to use us to deliver outstanding results that build their businesses.
Posted by Edelman at 5:21 PM | Comments (25) | TrackBack (0)
August 22, 2008
The Wisdom of Negativity
The Democratic and Republican conventions are upon us. In that context, I asked a few political experts about the wisdom of negative marketing, for candidates and for business. I had dinner on Monday night with John Quelch, Professor of Marketing at Harvard Business School. John has just completed a book titled, The Greater Good; How Good Marketing Makes for Better Democracy. He makes a strong case for “positive high ground marketing as an aid to democracy.” He contends that the recent McCain ad that compares Senator Obama to Paris Hilton is “distraction by juxtaposition, without merit in respect of informing voters on any issue.” He went on to say that any move by Obama to negative campaign ads would “contradict the high ground authentic approach established during the Democratic primaries.“ Quelch does acknowledge that negative ads can work “against new candidates who haven’t yet locked down their supporters firmly enough.” And this morning, Senator Obama is hitting back, noting that Senator McCain owns seven homes, which makes it difficult for him to understand the travails of working class Americans.
Meanwhile, Steve Grove, the director of politics for YouTube, sent me a link to his blog, www.citizentube.com, about John McCain’s sudden rise into “viral video stardom.” Grove said in a post on August 8th that the Republican candidate’s YouTube channel has “taken off,” with view counts on three attack ads on Senator Obama of between 430,000 and 1.9 million. This is a reversal of fortune, as McCain’s channel to that point had languished, with a couple of thousand views a day, compared to Obama’s “YouTube Machine that churns out 2-3 videos a day that draw tens and often hundreds of thousands of views.” But Grove challenges McCain to do even more than posting the negative ads then relying on news networks to multiply the impact. “His videos are clips pulled from TV or heavily produced web ads. He should be uploading direct-to-camera videos from the campaign trail every day…now that he has this new audience, he should seize that opportunity to connect in the genuine straight talking manner he is so well known for,” Grove contends.
What lessons can companies draw from the 2008 political wars? Quelch believes brands are ill-advised to run negative ads against competitors. “A tit for tat war of words would turn off consumers of both brands. Sales growth, not just market share is what puts money in shareholders’ pockets,” he said. The Pepsi Challenge, which gave blindfolded consumers a change to choose between two unlabeled brands, was a direct comparison that worked effectively. Similarly, GM is now running ads under the umbrella GM Truth which point out superior gas mileage and lower price points than key competitors (Chevy versus Honda). Healthcare brands with research on efficacy or side effects are touting comparative advantage. Corporate reputation can be damaged by allegations left unchallenged. But companies risk even more by casting aspersions against tormentors, whether non-governmental organizations or labor unions. It is far better to lay out your own set of facts, supported by third party experts, while creating an open forum for creative contributions from the interested publics. Even better is to acknowledge the need for some improvement, then to change company policy in a way that demonstrates progress against stated objectives.
Business is in the game for the long run, while politicians have a “winner take all mentality” which forces short term behaviors. Quelch has an interesting thesis, “Political brands are works in progress and consistency is not always their strong suit. Nor, based on past evidence, is their ability to deliver on brand promise once elected.” So counter the negative and establish your own narrative, rather than jumping into the mud with the mudslinger.
Posted by Edelman at 11:06 AM | Comments (0) | TrackBack (0)
August 14, 2008
A Decent Politician
In the past few months, it has become even more evident that public confidence in Western governments has waned to record lows, with approval ratings for leaders such as Bush, Merkel, Brown and Sarkozy hovering in the low 20s. Doug Schoen, a leading political consultant (disclosure: periodically consultants with Edelman), writes in his new book Declaring Independence LINK that “voters are becoming increasingly skeptical about government’s ability to effect positive change.” This echoes findings in the Edelman Trust Barometer, which shows trust in government plunging in the past four years in many of the 18 countries surveyed. Recent scandals in the US, including former Senator John Edwards’ affair and former Governor Eliot Spitzer’s out of state trysts with a call girl only add to the cynicism of the average voter, as those with extreme rectitude are shown to have flawed character.
That is why it has been so refreshing to meet New York Governor David Paterson, who assumed the office after Spitzer’s resignation. He is a self-effacing man, who has overcome a profound physical handicap (nearly blind in one eye, blind in the other) through force of will. He carries out his duties by relying on his aides to read documents to him, by engaging in one-on-one discussions and by building strong personal relationships. He spoke passionately about the need for direct and candid communication to constituents, telling them the hard truths about matters of public interest. He cited the rebuilding of Ground Zero as an example of this need for candor. “There is no way this project will be completed by 2011, in time for the 10th anniversary of 9/11. This is an incredibly complex construction project which must be done right. And it will need more money from government, both Federal and State, to finish the job. Decisions cannot be made that are only political in nature; can you believe that I have been advised that I am depressing the morale of construction workers on the site by saying that it will likely be 2014 before all of the construction is completed?” The Governor has also taken on the state legislature on state budget challenges and spending issues, noting the declining tax revenues because of the contraction in financial services.
This candid style is the only way forward for the business and PR community. Our approach is premised on constantly learning by listening, engaging audiences directly, building credibility through third parties such as media and bloggers, supporting it with expert commentary, and then go out to win the votes.
Posted by Edelman at 12:29 PM | Comments (0) | TrackBack (0)
August 8, 2008
Business Up North
I was interviewed on Tuesday by Amanda Lang, anchor woman for the Squeeze Play show on Business News Network in Canada. Click here to view the segment. Here is what I learned about the network in the course of my pre-interview make-up session (must admit it is fun asking journalists a few questions about their employers, even while the pancake and eye-liner is being applied):
1) CTV, the largest network in Canada, began Business News Network in 1999 to compete with CNBC. It was initially a joint venture with CNN, now completely owned by CTV. At present BNN’s ratings in Canada average about 20,000 viewers during the day and 40,000 viewers during prime time. Most of the major financial institutions will have both BNN and CNBC playing on the trading floor.
2) The web site, BNN.ca, is an important adjunct to the broadcast network, with 60,000 unique visitors a day. There is live streaming content on the site. For off premise events, the BNN team relies on its CTV partner to supply the satellite link for immediate access; for less important content, there is a 30 minute delay until the tape is returned to studio.
3) The content of BNN programming is 80% international news and 20% Canadian news. The network offers 13 hours a day of live programming and 11 hours of repeat programming.
4) Ms. Lang’s show encompasses business and politics, though the politics tends to be about taxes, trade and other business issues.
5) The Canadian economy is really the tale of two countries (with apologies to Charles Dickens). The economy is flying in Alberta, British Columbia, Newfoundland and Nova Scotia, with energy and timber prices at high levels. Meanwhile, the “old economy” industrial parts of the country, Quebec, Ontario and Manitoba are weak and teetering on recession.
6) Canadian exporters are finding the new level of the Canadian dollar to be problematic, especially in selling to the United States. Now at 95 cents to the US dollar, the exchange rate has been approaching parity with the recent drop in oil prices.
7) The Canadian Government’s financial picture is considerably healthier than the American Government’s, ready to cope with an economic slowdown if necessary. Former Prime Minister Chretien receives most of the credit for “putting the Government’s house in order by cutting our deficit in the late 90s,” Ms. Lang said.
8) Foreign capital is pouring into Canada, especially into commodities such as oil and lumber. This is reflected in the share prices of commodity companies such as Barrick Gold, which now has a market capitalization of $40 billion. Compare that to GM, which has a market capitalization of $6 billion.
Toronto seemed very prosperous and bustling with shoppers and tourists alike. The Pearson Airport upgrade, the new apartment complexes adjacent to the downtown (two bedroom condominiums selling in the over $1 million range), and the very busy Queens’ Quay shopping center all indicate an economy benefiting from the new world order of high commodity prices. But Canada uniquely has a foot in both the commodity and industrialized camps, with a sophisticated technology sector and well developed services industry. It is Edelman’s third largest market in terms of revenue; even with the rise of China and India, I would expect it to continue to be in our top five markets for the long term. I would appreciate your comments as always.
Posted by Edelman at 11:11 AM | Comments (1) | TrackBack (0)
August 1, 2008
US Media Goes Global
I had breakfast this week with Michael Elliott, who runs the four regional editions of TIME Magazine (Asia, Europe, Canada, Australia/NZ). I also had dinner last Friday with Graham Bowley, who runs the foreign desk at the New York Times. Both of these long standing pillars of mainstream media are capitalizing on the recent rise in interest outside the US in American news as told by American media. This has long been true of the UK based media, especially the BBC, Economist and Financial Times. Here are some of the most important tidbits:
1) The New York Times web site is attracting 37 million monthly unique visitors from outside of the US, almost twice as many as the 21 million from the US. The non-US circulation for Time’s print products is about ¼ of the total of 4 million.
2) The content of Time outside of the US is more skewed to business. Fifty percent of the content for each edition is generated from the US, the balance from regional bureaus. According to Elliott, “the reader is interested in issues outside of the region. He or she is a globally minded person.”
3) The Time International reader is making at least 100,000 Euros, is a frequent flyer, and speaks a second language fluently.
4) Time has folded its Time Asia and Time Europe web sites into a single global Time.com web site as of 18 months ago.
5) Both companies are exploring the expansion of the brand to encompass special dinners and conferences. Time has worked with Shell (disclosure: Edelman client) on a global series of salon dinners on the future of energy, including a recent event for 100 opinion leaders in Singapore.
6) Time has kept separate the on-line and mainstream units. The NY Times has effectively merged the operations.
7) The need for speed in posting content has led to a fundamental re-ordering of the editor’s job. Bowley told me about one of his reporters was in Berlin covering Senator Obama, moving from event to event. The reporter received a copy of the speech in advance and had written some parts of the story. The reporter called Bowley from the scene and gave his impressions. Bowley then wrote several paragraphs to provide context to the article, which was then posted to the web site. The reporter later edits the piece from the field with observations from third parties or participants.
There are several implications for PR people. Given the competitive race to post stories, we can help by providing reporters on the run advance copies of speeches or press releases so they can write some copy ahead of the event. This should be accompanied by video to provide visual supporting evidence. We can support the continued evolution of a story by posting comments on the on-line version, as well as providing access to expert commentary. We need to work with editors, not just reporters, because more of the content is being written by the editor at home office by dint of necessity. We can propose stories to regional bureaus; an example is Time’s coverage of the carbon neutral city MASDAR (an Edelman client) from the London bureau because of the editor’s comparative knowledge of the energy and environment sectors. We should also be considering partnerships with media companies as conveners on issues.
I would appreciate your comments as always.
Posted by Edelman at 9:27 AM | Comments (2) | TrackBack (0)