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October 26, 2007

Both Sides Now

When Judy Collins wrote her famous ballad, “Both Sides Now”, I’m certain she did not envisage my borrowing her song title for a blog post. But her two-sided view of clouds helped me reflect on two interesting meetings with start-up ventures in the media arena this week. I appeared as a guest on the Fox Business Channel’s Happy Hour segment at 5 pm with Cody Willard and Rebecca Gomez. I also met with Dick Tofel, general manager of the ProPublica web site which will launch early next year. The contrast between these concepts could not be more stark.

The Fox show is staged at the Bull and Bear Bar at the Waldorf Astoria Hotel in New York City. As the bar’s patrons imbibe, Cody and Rebecca discuss the day’s events in business. The hook for my appearance was a video by Disney featuring average Americans. It welcomes foreign visitors to the USA as they wait in the interminable lines at the airport to clear customs. I opined about the use of real people, citing the credibility of a “person like you” from the Edelman Trust Barometer 2007. I also discussed the new relevance of peer to peer conversations in marketing PR campaigns for brands such as Dove and Halo3.

Cody, a former hedge fund manager, expresses specific opinions about companies and their stock prices. Rebecca is more oriented to lifestyle trends, new product launches and the intersection of entertainment and business. Both of them are incredibly animated and dedicated to the proposition that business can be fun. The show seems targeted to the demographic that owns stocks but is not really conversant in the intricacies of the market. After my interview, there was a short segment for two guests, myself and a local handbag designer, answering four short subject questions, such as “Can a running machine linked to a trader’s desk be successful Christmas gift on Wall Street?”

Meanwhile, ProPublica, a non-profit investigative news operation funded by the Sandler Foundation, Atlantic Philanthropies, the MacArthur Foundation and the JEHT Foundation, is going in exactly the opposite direction. ProPublica will not accept any advertising. Tofel told me that the venture will have 24 full time reporters. Stories developed by the staff will be given to other media outlets for distribution. For example, if there were an article on improper campaign financing in the US elections, the New York Times or Washington Post might be given the first opportunity to use the story, with a ProPublica tag. Tofel noted that ProPublica will initially be a print oriented enterprise, though a TV aspect could be developed later. The operating budget is$10 million a year for multiple years, so that Paul Steiger, the managing editor (formerly of the Wall Street Journal) can attract the right talent.

So here we witness the morphing of mainstream media. The segmentation of the business continues, with end user flight from general purpose to specific utility, from single source to multiple windows into news. The role of public relations is to adapt our stories to suit the outlet; we will have to increasingly incorporate a media planning model, to start with audience profile, then work to develop the communications plan. I would appreciate your views.

To view the Fox video, please click here.

Posted by Edelman at 2:32 PM

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Posted by: Bruce MacLellan at November 1, 2007 2:41 PM

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October 19, 2007

The Big Ask

Earlier this week, I organized a fund-raiser for Mark Warner, former Governor of Virginia and Democratic candidate for US Senate. The following evening, I went to dinner at the home of Douglas Schoen, founder of Penn Schoen Berland the political polling firm, in honor of Kevin Sheekey, political advisor to Mayor Michael Bloomberg. At both events, there was a pointed discussion of, in Warner’s terms, “The Big Ask,” the willingness of Americans to make a major sacrifice in the short run that provides hope for a better life over the long term. This approach stands in sharp contrast to the usual incremental approach in politics, the “small ask” on a specific issue which elicits the predictable negative response from voters.

Warner believes that the American people are ready to address major issues, such as energy, health care, immigration and trade. He believes the framework of the conversation must change, from pain-free to shared responsibility. “Even if taxes must go up or Medicare is means-tested, that might be acceptable if there is a model that can be shown to work in the long term,” he said. His experience as Governor of Virginia, when he raised taxes to pay down a substantial budget deficit, gives him the precedent for such a comprehensive reform agenda.

Schoen provided further insight from recent polls around the United States. “The American people sense that the present twin deficits in the Federal budget and trade are unsustainable. They see the looming funding crisis in Social Security and Medicare. They are worried about the growing gulf between ‘haves’ and ‘have nots’. They want a solution to the Iraq war. They are demanding an end to partisanship. They want a vision that may have real short term costs but offers clear and demonstrable benefits.”

In a subsequent discussion, Schoen and I agreed that there are real lessons here for the corporate sector. You must begin by reaching out to all stakeholders to develop a plan, to ask for their ideas and to explain your rationale for the program. All parties, from employees to white collar executives, must share in the sacrifice (note recent GM-United Auto Workers deal on health care coverage). The CEO should share the communications burden, informing his employees of the specifics of the plan, so that the horizontal (peer to peer) and vertical (top down) communications are synchronized. Local communities affected by the change or NGOs asked to endorse the plan must be solicited so that they can add their voices in support. Using this model of “the Big Ask”, public relations is helping to secure real change, providing context, supporting data and continuing updates on progress toward the goal. As always, I would appreciate your comments.

Posted by Edelman at 2:04 PM

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Posted by: Bill Sledzik at October 21, 2007 11:19 PM

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Posted by: Richard Edelman at October 24, 2007 1:39 PM

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October 11, 2007

Be It, Don’t Buy It

Peter Kim and Josh Bernoff hosted me this morning in Chicago at their annual Forrester Consumer Forum. They asked me to speak about corporate image and brand building in the age of social technologies.

My central thesis is that corporations can’t buy reputation or brand loyalty any more. These are earned through performance over the long-term. The dispersion of media; people’s continuous partial attention from a surfeit of daily impressions; and the lack of trust in traditional institutions and leaders are all driving this evolution.

In this changed environment, I believe that PR can adapt as well as, if not faster, than any other communications discipline. PR should stand for Public Relationships, a transparent effort to advocate our client’s position, supported by depth of content, while offering an open place for dialogue and comment. Our aim is to educate when possible, build bridges when necessary, and respect the new market-based conversations always. We should start at the end point--to dream about where we would like our client to be—and then create a dialogue-based communications program to get them there.

We should encourage our clients (disclosure: all companies mentioned in this paragraph are Edelman clients) to take on issues that are central to society’s good, from environment (GE’s Eco-imagination) to living wage (Starbuck’s fair-trade coffee) to female self-image (Dove’s Real Beauty). We can offer bloggers—enthusiast category leaders-- with access to plans and products in beta, and in return, provide clients with invaluable feedback and counsel (Halo 3). We can create communities (Lower Manhattan.info) and establish platforms for employees (Morgan Stanley) because they are among the most credible sources of information about a company. We can facilitate important links between civil society and companies (Chiquita and Rainforest Alliance).

The pyramid of influence, the classic C. Wright Mills description of the power elite where information moves one way from pinnacle to the mass audience below, has been eclipsed. The new reality for communications is the sphere of cross reference, in which information moves unpredictably among equal stakeholders. Conversations now occur spontaneously, in peer-to-peer discussion, with individuals creating their own webs of trust including people like themselves. Our task in PR must be to facilitate and contribute to the discussion in both the controlled vertical axis reaching traditional audiences such as investors, regulators and mainstream media, and on the horizontal axis to inform employees, passionate consumers, NGOs and communities.

Tom Friedman wrote a column in the New York Times on June 27, 2007 called, “The Whole World is Watching,” that “In this transparent world, how you live your life and conduct your business matters more than ever…Companies that get their ‘hows’ wrong won’t be able to clean up their mess by taking a couple of reporters to lunch…But this also creates opportunities…’how’ you keep your promises … build trust…collaborate…lead…that is where companies can now really differentiate themselves.”

PR is simply a reflection of reality, well presented perhaps but based on fact and behavior. My late colleague, Michael Deaver, said that the organizing principle for PR is “Know Who You Are.” Effective communications should evolve, from controlled messaging towards conversational collaboration. We need to acknowledge the dialectic between control and credibility, encouraging our clients to embrace this new construct without fear and with alacrity. By aspiring to big ideas and helping to change the reality not simply the perception, we move along the continuum from Talk to Action.

Here is the link to my presentation.

UPDATED: What attendees are saying:

http://pop-pr.blogspot.com/2007/10/forrester-forum-corporate-image-in-age.html

http://uwehook.blogspot.com/2007/10/future-of-pr.html

Posted by Edelman at 1:17 PM

Comments

Posted by: Josh Bernoff at October 11, 2007 6:52 PM

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Posted by: Scott Bauman at October 17, 2007 10:38 AM

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Posted by: Amanda Mooney at October 19, 2007 1:39 AM

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Posted by: Richard Edelman at November 2, 2007 1:51 PM

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October 3, 2007

Mayor Mike’s Manifesto

Michael Bloomberg is an American political phenomenon, a billionaire who has successfully transitioned from entrepreneur to public service as Mayor of New York City. He is rumored to be a candidate for President of the United States. He has made a virtue of his lack of artifice and his impatience for results. He speaks plainly, using facts as his basis of communication, instead of lofty visions or soaring platitudes. He has learned to include in his repertoire stories of real people, such as Sal the sole man who came to New York City as an immigrant from Italy and repairs shoes a few blocks from City Hall, whose son has become a successful car dealer and grandson is now a baseball star at Princeton. He has recruited brilliantly from the private sector, giving real authority to his subordinates to make change in a city where every move is second-guessed by stakeholders large and small.

Mayor Bloomberg, aka Mayor Mike, made a few important points that are as relevant to business as to government yesterday in his Keynote Address at the Economist’s Conference on The Future of New York City as the World’s Business Hub.

1) A Mayor (or any leader) cannot be short term focused nor obsessed with photo opportunities. One has to be as excited about completing a new water tunnel for the City as about glamorous new buildings in Lower Manhattan. Infrastructure upgrades cannot wait; his Administration put more money into the water tunnel project than the five previous mayors combined.

2) New York City is in a competitive battle with London, Paris, Tokyo and now new centers such as Dubai, Shanghai and Mumbai for corporate headquarters and for top talent. For skilled professionals, after economic opportunity, the quality of life matters most, including culture, environment, education, parks, safety, and cosmopolitan feel. Availability of information in digital format (such as our client LowerManhattan.info) is critical to these people.

3) One must instill a commitment to customer service in government. NY City has a test program called SCOUT which enables city employees to notice a pothole or detached sign, register it on line and in a transparent way for the community initiate a due date for repair. “If the public is not demanding good service, then government won’t bother. People have to scream and government has to be held accountable," the Mayor said.

4) Government fails to allocate resources properly because there is a tendency to devote more money to programs that are unsuccessful, in an attempt to turn the failures around. You must learn to redirect resources to initiatives that are going well.

5) You have to ride out initial criticism of bold program initiatives. The smoking ban in offices and restaurants tied to a ban on trans-fats in retail establishments has led to a life expectancy in New York City that is higher than the average in the USA for the first time since World War II. Now Paris is banning smoking in restaurants as of February (imagine that)!

6) New York City’s population is expected to grow by a million to 9 million in the next thirty to fifty years. At the same time, the US overall population is expected to grow from the present 300 million to 425 million, due to immigration and relatively high birth rates. This is unique among industrialized nations. The question is how to accommodate the new inhabitants without strangling the city. He suggested further investment in mass transit, immediate passage of congestion charging and even experimentation with a rental bicycle system akin to Paris.

7) Be explicit on trade-offs. Since the terrorist attack in the Tube system in London on 7/7/05, the police in that city have installed security cameras in every subway car and bus. The residents of that city recognize that personal freedoms may be abridged but are very supportive of this new technology because their personal safety is enhanced. Bloomberg spoke about the education reform in New York City where teachers have gotten 43% raises over the last five years but turnover has declined from 12,000 resigning annually (control of 80,000) to 5,000 per year.

None of this is to suggest that New York City should be seen as the de facto capital of the world nor that its present prosperity will last forever. What is clear is that PR focusing on candid, clear communications and relationship building has made a difference in this Administration, presenting the leader as a hard-working, pragmatic character who has applied management principles to the business of running a city. He has been able to make tough political choices, such as a real estate tax hike just after the Internet bubble burst and the 9/11 tragedy, because he convinced his constituents that there is a virtuous circle of maintaining quality in city services in order to maintain quality of life, thereby retaining corporations and the urban professional class. I would appreciate your views as always.

Posted by Edelman at 6:15 PM

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Posted by: Diego de Rivas at October 8, 2007 2:19 PM

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