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December 23, 2004
More Insight into Future of Media and Evolving Role of PR
Edelman held its end of year executive leadership meeting last week in New York City. We were fortunate to have three outstanding outside speakers who are experts on the evolution of the media business. They include Phil Revzin, who runs all of Dow Jones properties outside of the US, Jonathan Klein, recently named president of CNN in the USA, and Michael Wolf, who is the senior partner at McKinsey in charge of the media and entertainment practice. I will relate key comments by each of the speakers, and then provide my own views at the end of this entry.
Revzin: The Wall Street Journal will launch in India in early 2005 in cooperation with the leading Indian newspaper. It plans a China edition in the next year. These national editions are meant to serve both American executives working abroad and the local business community. The Journal no longer has national news editors--they have given way to a global news editor. The Wall Street Journal believes its remit to be everything related to the life of a business person, from their investments to their life at the office to the best resorts and restaurants. The Wall Street Journal on line product is very successful even as a paid subscription, with unique attributes such as query to journalist and bookmarking. He believes that blogs are not a real threat to mainstream media and that the quality of media remains excellent despite the pressure to publish more quickly. He suggests that PR folks can be very helpful to journalists by introducing them to the next level of executives below the CEO, so that strong relationships can be forged before accession to the top job. He noted the importance of educating beat reporters over time on a company and industry, and underlined the importance of PR folks having personal connections to reporters, with relationships built on trust and transparency.
Klein: Broadcast has become too regularized and has caused the audience to tune out. Networks are too accustomed to going to press conferences and regurgitating the content, just covering the headlines. He wants CNN to cut through the background clutter, to make the news easier to watch and then understand. "We must constantly refresh our approach to get our message through. We have to focus on a few topics, such as terrorism and security," he said. He noted the increasing localization of broadcast, with CNN Europe having a different look and feel than CNN US. He wants to focus on high interest topics such as music news (interestingly movie news not so compelling). He wants to win viewers back from specialized cable networks such as the History Channel and Court TV. He noted his recent experience at Feedroom, with the power of broadband now allowing companies to turn their own web sites into media outlets to reach investors, employees and other stakeholders.
Wolf: Consumers are watching less news, especially traditional news broadcasts, than ever before. In fact, more are now getting their news from late night talk shows or comedy shows. Consumers are taking their news "cafeteria style" by taking small bits of knowledge from many sources. People are looking for individual stories and are not relying on a single news brand to deliver the information. Tabloids are a very fast growing and influential news source, with heavy reliance on celebrity gossip and sex. Another fast growing medium is suburban newspapers, which are more thoroughly read than urban daily papers because they offer more local news and relevant advertising. Advertisers are seriously concerned about the efficacy of their spending in traditional advertising, particularly on new product launches. They are scared about blogs because they are an uncontrolled medium. They are unable to reach key growth audiences with traditional media, including affluent Hispanics, gays/lesbians, upscale businesspeople. Product placement is not a fad, it is here to stay. The new film Aviator has Leonardo de Caprio as businessman Howard Hughes, sporting his Keds sneakers, part of a cost effective promotion. Key to this is not offset of production costs but ability of the brand to fit into the show, as younger viewers particularly dislike excessive promotion. The content must have a "subversive look" to be most effective, a self directed and not corporate controlled approach on a company web site as one example. Companies should make their web sites a place for consumer experience and destination for fun plus product information, such as Pepsi.com. Marketers must be aware of opportunities on the smaller screens of PC and cell phone, beyond television, particularly for young consumers.
What are the implications for PR people as we enter 2005?
1) We need to expand our horizons to include a broader set of delivery options for our messages. We should go direct to end user of information via cell phones, PCs etc.
2) We should recognize the importance of media vehicles such as mass circulation tabloids and suburban newspapers, plus the comedy and late night shows.
3) We can help our clients create compelling content for distribution on their own web sites.
4) We should persuade our clients not to fear blogs but to participate in this wonderful democratic world of communication.
5) We have a great opportunity to take market share from advertising agencies by offering credible, interactive and entertaining programming.
Have a wonderful holiday season. See you on the other side.
Posted by Edelman at 8:50 AM
Comments
I don't wish to rain upon your parade but I read last week that a survey reported at the recent international Public Relations Association conference in Dubai indicated that PR was, in the eyes of the public, the least trusted of all communication media (for want of a better word) with a trust rating of 4%.
That's no doubt a result of bad practice, but it does indicate the size of the mountain that has to be climbed.
Posted by: john dodds at December 24, 2004 11:47 AM
John,
The PR industry has to improve its own image and its own reality, no doubt about that. We also need to confront stigmatization of our industry. An example I came across this morning An article in the Russian Journal blasting PR spinners for saying bad things about President Putin contending that PR firms were making Putin out to be anti capitalist and were causing problems for Russia This is so bizarre as to be amusing.
I intend to write to the publication to ask for a correction.
Posted by: Richard Edelman at January 3, 2005 4:07 PM
When a PR profissional - and a vice -president of one of the top ten !- says in a interview that he was surprise that people are more interested in stories closer to their lives.... give me a break...What you could expect readers will think of PR people?
Posted by: andrea vieira at January 29, 2005 6:26 PM
"We also need to confront stigmatization of our industry."
I think we have to do everything to avoidstigmatization!
Posted by: Sharlott at August 1, 2005 4:09 AM
Sharlott,
We will break out of stereotypes like "flak" only by concerted effort to improve our image and our reality. Meaning that we are as good as our product. Good example is PR work behind the Dove Real Beauty campaign--we have given it substance and personality at same time. Thanks for writing.
Richard
Posted by: Richard Edelman at August 1, 2005 9:27 AM
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December 21, 2004
Living in Color
In the late 90s,, Washington Post columnist Michael Schrage wrote an article on technology PR people. He described them as "sitting astride the nodes of influence in technology." He said that all parts of the technology food chain, from venture capitalists to investment bankers to customers to technology analysts to investors were linked by the magical hand of public relations. It was a rare acknowledgement of the central role of PR in connecting to the world of multiple stakeholders.
That wonderful period of innocence is past, as the tech bubble imploded and the interconnections of banker and analyst are legally proscribed. But the importance of the PR person in the global knowledge economy should not be one of the relics of that bygone age. In fact, we are central actors in a world lacking trust based on perceived ethical violations by institutions ranging from government to media to business to baseball players using steroids.
Here are a few reasons why we are entitled to a seat at the management table. We are uniquely positioned to understand the uncontrollable world of blogs, the ultimate immediate feedback mechanism. We are in touch with dissonant voices such as non-governmental organizations. We can balance the needs of global marketing and local culture. We value the input of employees as partners in building great companies. We have a different mindset, in which relationships and listening are more important than selling and marketing. In short, we are the soft power advocates (to use a phrase invented by Prof. Joseph Nye at Harvard), who believe in attraction and persuasion rather than the hard power attributes of force and compulsion.
For PR people to really earn this place at the table, we have to "Live in Color." What I mean by this phrase is that we have a responsibility to live in the real world, to observe and report back to our colleagues so that they can offer the best advice. We should each commit to working with a philanthropic organization so that we are exposed to a variety of viewpoints while giving something back to society. We should be taking advantage of a wide range of cultural offerings, from film to theater to art to dance. We should volunteer for political campaigns. We must recognize that there is a responsibility to have continuing education in our field that is dependent on getting out of the office, beyond the small world of billable hours, into a big world of imagination and social contribution.
That is why Edelman will take a dramatic step on January 1, 2005. Our firm will contribute $250,000 of time to the Global Business Coalition on HIV/AIDS ( http://www.gbcaids.com ), to help fight this global scourge by persuading business that it is in their economic interest to safeguard their employees and protect their consumers. Our 41 offices around the world will work with GBC member companies to tell stories of innovative cause-related marketing, of voluntary testing of employees and their families and cooperation with government to alert them to outbreaks. We are proud to have our 1,800 people mobilized in this fight. We will continue to volunteer on a local market basis in hundreds of acts of Living in Color, but our alliance with the GBC will bring us together to combat ignorance and promote safer behavior. I encourage others in our business to make similar partnerships with important global causes.
I am off to Hershey, Pennsylvania with my children for a little bit of Living in Color and a great deal of consumption of chocolate. I wish all of you and yours a wonderful holiday season. Thanks for taking the time to read my blog.
Richard
Posted by Edelman at 12:40 PM
Comments
What a fantastic idea! Here's wishing you every success with your campaign.
Posted by: Piaras Kelly at December 21, 2004 2:07 PM
In combating HIV/Aids, strongly affected countries are obliged to reinvigorate health-related state apparatuses, revamp public health financing systems and effectively engage the civil society to promote better health outcomes. These problems can be further complicated as the involvement of multiple actors with different priorities could politicize and/or limit the effectiveness of anti-Aids programs. For example, ideological differences among constituencies within a donor country, if left unchecked, may place divergent demands on host governments and their international partners.
It´s great that Edelman is engaging worldwide in the Global Business Coalition on HIV/Aids. It´s even better if 3rd world countries, suffering the most from the disease, might profit from the rich North.
The intriguing question, however, is to me how the above mentioned political issues can be negotiated while trying to effectively deal with this sensitive topic? What polictical sensivities have to be regarded? What would a worldwide strategy look like? This would be a fascinating case study.
Posted by: Gudrun Herrmann at January 2, 2005 7:54 PM
Gudrun,
We hope that the positive stories on business involvement with the HIV AIDS issue will push government to be more open on disease incidence and prevention. It will create a positive cycle in which government is benefited and not criticized for transparency.
Posted by: Richard Edelman at January 4, 2005 5:54 PM
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December 13, 2004
My guide to running the family business
I am now in my 27th year at my family company. I have particularly enjoyed building the business in close partnership with my father, who founded the firm in 1952. My brother and sister both work at Edelman, while my mother maintains a very keen interest in the progress of the enterprise. My brother in law and one of my cousins are also employed by Edelman, along with 1,800 others around the world. I want to tell you how I came to work at Edelman and to offer some advice for those who are heirs to a family business, considering their career options.
I was exposed to the family business from the earliest stage of my life. My parents hosted an annual party for Chicago media, with three hundred reporters mobbing our residence. Dinners at home often included clients or spokespeople. My most memorable dinners were with popcorn king Orville Redenbacher and former Miss America Phyllis George (what self respecting 12 year old wouldn't enjoy that). The most humorous dinner was with a woman nicknamed Miss Manners, our spokesperson for Ore Ida frozen fries, who taught President Nixon's daughters how to improve their table etiquette. As I pushed my peas onto my fork with my knife (and other tricks I don't choose to reveal for fear my kids might read this blog), Miss Manners sat quietly and finished her dinner by complimenting the Edelman children, much to the consternation of my mother.
As I was graduating from business school in 1978, I was convinced that I wanted a career in product management. I was on the verge of accepting a job as assistant product manager at Playtex (fantasy job for 23 year old guy). My father called and said that he had received an offer to buy Edelman from the advertising agency DDB (now part of Omnicom). He told me that he was not ready to sell, that he wanted me to come to the firm and that I could do something else in a year if I was not happy. So I turned down Playtex and accepted a job for $25,000 a year at Edelman, beginning after Labor Day. My long planned six week vacation around Europe with my then girlfriend beckoned. Exactly a week before graduation, my father called to tell me that Edelman had won the Continental Grain account, that I understood commodity futures, and that I had to report for work in Chicago the following Monday. I had just learned my first lesson about family business-business first, unless it is a family matter, which should take priority. Leisure is not an option if you are taking the business seriously.
I have learned a few other lessons along the way about family business. I was sent to New York as part of a grand plan to learn about the firm. I was very fortunate to have a non-family mentor, Dick Aurelio, a former journalist and deputy mayor of New York City. He ripped apart my copy, showed me the value of networking with opinion leaders, and took me along as he worked on the Nestle infant formula boycott, Hooker Chemical's environmental disaster at Love Canal and Pan Am's acquisition of National Airlines. You need a role model and teacher who brings no emotional baggage to the process.
Dick left for a job at Time Warner and my father made two consecutive bad choices as successor. In desperation, he turned to me, age 26, to be interim manager until he could find somebody else. There were only about a dozen of us, including the indomitable Jody Quinn, so I guess he figured there was not much to lose. In any case, a bunch of twenty "somethings" built a business that today ranks as the second largest in New York City. The third lesson for family business, then, is to give a family member a chance to sink or swim with his or her own unit.
My career progressed to the point that I was named chief executive officer in 1997. In the last seven years, we have substantially increased the size of the company, but we also had to endure an unprecedented reversal of fortune as the tech bubble popped in 2001, followed by the disaster of September 11. I had to make some tough decisions, including a reduction in our employee force and closure of some offices as the business ebbed in 2001-2. I did this in close consultation with my senior team but acted only after persuading my family, most notably my father, that this was the right strategy to pursue. The fourth lesson is that you may have the title of CEO, but you have the responsibility as head of a family enterprise to act collectively.
My last lesson is that family business owners have a choice to make: either lead from the front, or hire a professional manager and let that person get on with it. If you are willing to make the personal sacrifices, if you can act as a role model, if you can inspire confidence in those around you, by all means go for it. If you feel in the least ambivalent, or if you prefer a less hassled lifestyle, make the family the investor and not the operator. Either model can work well, but decide on one or the other, because lack of clarity leads to disaster.
I conclude with a thought about my father, who founded the company. My relationship with him as a teen was not easy. I remember clearly coming home with a 770 (out of 800) on my American History achievement test. His comment, "I thought you were perfect in American history, what did you get wrong?" I have come to understand him from working together for 27 years. He hardly celebrates his victories and mourns his defeats. He is a man committed to his company, to excellence, to outstanding service to his clients and to family. He drives a seven year old car and wears suits from Brooks Brothers. He gives generously to charity and serves on several non profit boards. He is truly the blacksmith in Longfellow's immortal poem, "His brow is wet with honest sweat, He earns whate'er he can, And looks the whole world in the face, For he owes not any man. Onward through life he goes; Each morning sees some task begin, Each evening sees it close. Something attempted, something done, Has earned a night's repose."
Richard
Posted by Edelman at 9:06 AM
Comments
Great post that talks about running a PR firm, and the issues that running a family business bring to the quotient.
The family business back in Michigan went through some of the same issues you brought up, but on a much smaller scale.
If you ever are looking to adopt a son, I'm open to a new family.
Posted by: Jeremy at December 21, 2004 3:56 PM
Dear Richard,
I read your post with pleasure and actually emailed that poem to my father. We too have a family business and now at 27, 5 years since I started, I'm finally learning what it really means to run a business, a family one. So reading what your wrote was yet another helpful piece of information.
It was also an eye opener. It was good to see the human side of the business. We hired Edelman for our PR needs several months ago, primarily working with your London Office. It's been quite a ride :) I'm looking forward to 2005.
Thank you.
Lana Romanov
Pose Tech Corporation
Posted by: Lana Romanov at December 22, 2004 12:08 PM
I happended to view Edelman website, and to know the history of the company. I totally agree with your comments regarding to the relationship and communicatoin as quoted: “I am convinced the future of business is not about selling. It is about building and sustaining relationships with multiple stakeholders through dialogue, credible sources and relevant experiences”; “We measure the depth of impression and strength of stakeholder relationships, not just the advertising criteria of message frequency and recall.”
I am touched by your comment, and I totally agree with the points. Organization is a complex system, which has open, non-linear, self-organizing, and co-evolution relationships among agents. Managing an organization is to manage the linkage of relationships, both internally and externally. To match external variety with internal variety gives organizations the chance to improvise, to prepare for the uncertainty of the future. Both internal and external varieties are created when organizations rely on reliable, more and different communication linkages. Under this circumstance, organizations can develop the capacity to make the shift from knowing the world to make sense of the world, from forecasting the future to preparing the organization to meet unknowable future, and controlling the system to unleashing the system’s potential.
Edelman is a unique public relation company, to help clients to manage the internal & external relationships. I am inspired to communicate with you about some ideas of relationship management, after looking at the website of Edelman, and hope you agree with me. Additionally, I hope you are not surprised by this spam-looking email. J
Like the song says, I wish you a Merry Christmas, I wish you a Merry Christmas, and Happy New Year! J
Aili Zhang
MBA04
McCombs School of Business
Posted by: Aili Zhang at December 23, 2004 9:01 AM
...a terrific narrative...honest, straightforward, insightful.....typical of you, based on what I know...more such sharing from time to time would be well received, I'm sure.....cheers....
Posted by: Bill at December 29, 2004 3:19 PM
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December 6, 2004
Impressionists, Blogging and North Carolina...
This is the time of year when people in the PR field are madly pitching business, hoping to retain their current clients and to win new ones. One of the side benefits of this manic period is that you get a quick snapshot of the U.S. across industry and geography. Here are a few impressions from the past week.
Chicago--I brought my family to visit my parents for Thanksgiving, certainly my favorite holiday. We walked to The Millennium Park, located in the center of the downtown district. It is a triumph for all involved, particularly Mayor Richard Daley, in transforming a former railroad yard into a true gathering place. The Frank Gehry designed open air home for the symphony, the dramatic always changing forty foot high stack of clear bricks reflecting images of Chicagoans, and the giant smooth bean, are incredibly impressive. I was also lucky enough to get a guided tour of the Art Institute led by the energetic Laura Muller. She told us that the amazing collection of Impressionist art is the result of a enterprising French art dealer, who, when faced with rejection at home, brought a sampling of Renoirs, Lautrecs and Cezannes across the ocean to New York and met with the newly wealthy industrialists from Chicago, who bought quality in quantity.
New York--I went to Professor Red Burns' Media Lab at New York University. Professor Burns is combining art, technology and entertainment with imagination in her curriculum. Her students build devices that incorporate elements of all four of these fields. As she strolls through her "campus" on Lower Broadway, Professor Burns shows you one item that looks like an old TV set--she bangs it on the side and a new photo show begins--she smacks it again and you are onto a new theme. You walk past a camera slowly and you see a nearly full side view projected on screen, but if you walk quickly, you are merely a thin line. She is into a world beyond McLuhan. Later in the week, I went to the opening of the Alvin Ailey Dance Theater season. Judith Jamison, artistic director and grande dame of the company, had the audience in hysterics with ribald comments about the honorary chairman of the evening, Derek Jeter (he's so fine...if I were twenty years old again..oh my). Both the new (Love Stories) and the old (Revelations) were wonderful melanges of pastel colored outfits, upbeat music (some hip hop, some Earth Wind and Fire) and athleticism. I also had a meeting with Tim O'Reilly, owner of O'Reilly Media, publisher of Dan Gillmor's recent book on blogging. O'Reilly believes that business can coexist with the blogworld, it just has to move beyond its usual mindset of our company and our products to figure out relevance to the general discourse and to engage in conversations not one way selling propositions. Companies must show they can contribute to conversations and find out where the discussions are happening. Companies may be better served by empowering one of their mid-level executives (Scoble at Microsoft) rather than relying on the CEO--there is more credibility and speed. Blogs are just one aspect of social networking, along with news groups and mailing lists. The biggest challenge for companies is not the technology, it is understanding the culture. Tim's point is that that not every company or CEO should blog. A quick point here from me--this is the great channel for companies because blogs are immediate, credible and dialogue-based -- basic tenets of PR and the reason why we work with our clients to engage influencers online.
North Carolina--I now better understand the phenomenon of exurbia. I was in the Charlotte area, actually about 40 miles outside of the city. The major retailers like Starbucks, Subway, Lowe's are all here. The service is first Driver has not implemented the class, the outlets clean and the product mix remarkable. There is significant tract housing development, but the homes are two generations past Levittown, with sizeable footprints and significant amenities. The exurbs are reinforcing the economic vitality of center city assets such as the metropolitan airport, sports teams and cultural attractions. There is a different symbiosis evolving.
So this was an amazing week. Hope some of this is useful.
Richard
Posted by Edelman at 9:27 AM
Comments
I really enjoy your blog. You are right on about PR and blogging. You made me realize in this and your ethics blog that internal change acceleration work is just internal PR and you have to engage in two way conversations.
Posted by: Marion Vermazen at December 8, 2004 8:48 PM
One thing I admire about Sun is Scott McNealy's willingness to speak out to all audiences He is a real leader. By the way, he was my roommate in freshman year at Harvard in 1972. Small world, right?
Posted by: Richard Edelman at December 9, 2004 10:58 AM
Although weblogs (blogs) are currently used only by a small number of online consumers, they?ve received a great deal of corporate attention because their readers and writers are highly influential. Two points to take into consideration when trying to introduce blogs as PR tools:
- Companies planning to open their own blog should feel comfortable to have close, two-way relationships with their stakeholders.
- Blogs are part of a subculture and draw the intellectual clientele as they are an instrument of open debate. Can a company ever achieve this open debate w/out loosing credibility or restraining the debate?
A third point would tie in with your recent posts on ethics in PR. Would companies be comfortable with an instrument where they immediately would be held accountable for any errors and/or might become victims of slander?
Posted by: Gudrun Herrmann at December 9, 2004 11:12 PM
Gudrun,
Thanks for your posting. I do believe companies are getting the message...that the very fact of blogging, the immediacy and the dialogue...is key to credibility. Much better in some cases than a press release or prepared speech by CEO.
Posted by: Richard Edelman at December 13, 2004 11:35 AM
You roomed with McNealy? That is pretty cool. Can you get me onto the Sun sailboat?
I liked your viewpoints on the NY, Chicago and NC markets. I'd love to get your opinion on the Arizona market, and if you ever make inroads here, or even look at the landscape. Phoenix's an odd oasis, 300 miles from any other metropolitan center (or 100 miles from Tucson), and seems to be more tourism and real estate oriented.
Posted by: Jeremy Pepper at December 13, 2004 7:57 PM
Mr. Edelman, you have proven to be "up close and personal" when you replied to my email recently, me being a complete unknown entity.
I asked you why you blog, and your answer was pithy, idiosyncratic, and enlightening. You also gave me permission to use your quote in a book.
This is what corporate communications with target audiences is all about: whether it's a blog, wiki, web site, press release, brochure, etc.
Being candid, personable, gracious, good-hearted, eager to help others succeed in what they're doing.
No wonder you're the world's largest independent PR firm. Your site is now blogrolled on two of my blogs.
Keep up the great role modeling.
Posted by: Steven Streight aka Vaspers the Grate at February 3, 2005 2:59 AM