Go Direct

Richard Edelman – Remarks to 2018 Conference on Corporate Communication Mendoza College of Business – University of Notre Dame

October 19, 2018

I have been a student of trust for the past 20 years. We began the Edelman Trust Barometer in the wake of the Battle in Seattle, where NGOs stormed the meeting of the World Trade Organization to protest globalization. We are now in a very different time, when middle-class working people are protesting downward economic mobility prompted by automation and technology.

Over the last decade, five seminal events have hit like the waves of a tsunami, damaging people’s trust in business, government, media and civil society. They are the rise of globalization, the devastating Great Recession, fears about immigration, the threat to jobs posed by automation, and now, the plague of fake news.

This trust crisis is real, and it is playing out in many ways, from the rancorous partisanship that divides our country, to the shock of Brexit, to the expected election of a far-right-wing president in democratic Brazil. In a world where we no longer share common truths and lack rational debate, people are dominated by fears instead of reliant on facts. They make decisions that bring short-term benefit to themselves instead of long-term improvements to society.

And now the storm has reached business’s doorstep. Business is expected to fill the void left by underperforming government and lead us out of these troubled times. Nearly 85 percent of Edelman Trust Barometer respondents expect CEOs to inform debate on pressing societal issues. Nearly two-thirds want CEOs to take the lead on change instead of waiting for government to impose it. Our new Earned Brand study reports that nearly two-thirds of people— a majority across all age groups and incomes — now buy or boycott a brand based on where it stands on the societal issues they care about. More than half say that brands can do more to solve social ills than government.

These new demands mean that business must act, operating with increased accountability and transparency and deep ethical responsibility. This requires a more powerful role for the CCO—moving beyond counsel to action as Chief Change Officer. The CCO must establish the moral context for the enterprise, functioning as the conscience inside the company and its social change agent outside of it.  The CCO must help the company address, in word and deed, the issues that are pressuring people:  sustainability, inequality, populism in the West, and advanced technology’s threat to future livelihoods.

But whereas in the past the CCO could help lead the company forward by pushing the right media levers to reach the public and sway opinion, that is no longer so easily the case.

Our Trust Barometer found that mainstream media is read by under half of people in the United States and Western Europe. Globally, 29 percent of respondents told us they are reading less than they used to because keeping up with the news has become too stressful. They prefer YouTube stars and other influencers to news anchors. They want to hear only from voices that they already agree with—a personal news bubble. News is doubted simply because it comes from a source one doesn’t agree with.

Media is now the least-trusted institution in the world and has particularly low levels of trust in Western democracies. The causes are politicization, the pollution of the ecosystem with disinformation, and people’s belief that the media is biased. The majority say the media is more interested in chasing clicks, breaking news at the expense of accuracy, and supporting ideological beliefs than in serving as a credible source of information. They perceive media as an elitist entity that doesn’t speak to—or for—them.

People rely on social media—but now they no longer trust even these platforms. Trust in social media is now below 30 percent in the U.S., the UK, Germany and France. This is fallout from the fake news epidemic and the platforms’ failure to protect the privacy of data.

Compounding the problem are the mainstream media’s economic woes. Revenue for U.S. print newspapers declined from $49 billion to $18 billion over the decade 2005 to 2016. Local newspaper circulation has collapsed; the former national leader, the New York Daily News, is down from 3 million to 200,000 daily readers. This deadly combination has prompted a massive reduction in the number of U.S. newspaper reporters, down 45 percent from 2004 to 40,000 total. Three Hearst magazines are produced by one editorial staff, which rotates among the titles each week.

The same is happening in broadcast. By 2021, 45 million people will have cut the cable TV cord—that is half of the current cable audience—as they migrate to ad-free outlets like Netflix and Hulu. The average age of a network TV news viewer is 67.

People prefer to get their information directly. President Trump has a social community of 55 million people who believe that he is giving them first-person content, live and unexpurgated. His connection with his audience is personal, based on immediacy and simplicity of language. The frequency of connection—both morning and evening—is astounding. His continued attacks on mainstream media as Fake News reinforce the presumption of the truth of his message.

As the audience turns away from mainstream media, there are dangerous implications for our democracy. Our Trust Barometer showed us that 56 percent of people say that because of the media’s failings they aren’t sure which politicians to trust. At a time when truth is under attack, business must continue to support and defend the media’s role as the standard bearer for fact-gathering and dissemination. As the watchdog that questions government and business, the Fourth Estate underpins our democracy. We must continue to partner with mainstream media and encourage its high standards so that independent coverage can be preserved and expanded.

We communicators have made changes to accommodate the shorter news cycle and reduced staffing and fill in some of the gaps. We’ve updated our press releases to include video clips and GIFs. We amplify our earned campaigns with paid media. We’ve added sponsored content, brand influencers, Facebook Live broadcasts, podcasts and CEO forums to our tool box. We will continue to do all of this and more in our traditional function as partners of the media.

But these changes are not enough. To confront the reality of a diminished mainstream media, business must reconsider its approach to communications. 

Every company should become its own media company. Every organization, public and private, should have a news operation that speaks to stakeholders through its owned and social channels, and through its leaders and employees. The CCO must guide this shift. It is time to Go Direct.

Some companies are already doing this. Walmart has put journalistic storytelling at the center of all of its corporate websites, mixing company news with human interest stories. GE Reports incorporates daily news, video and social media, and presents perspectives from outside the company on industry and societal issues. The World Economic Forum is now a formidable media operation. It generates original content, but also aggregates the best thinking of a wide range of commentators from across the globe. It attracts nearly five million unique visitors to its websites and more than 150 million video views monthly.

But this is only the beginning of what is necessary. Companies must Go Direct to the end-user to Promote and Educate.

I propose a new structure for outgoing content from the communications function comprised of two equally weighted arms.

The Promote arm tells the company’s story directly. This is especially essential for companies in low-interest categories no longer covered sufficiently by mainstream media. This content will help investors to judge performance, employees to decide where to work, consumers to choose which products to buy, NGOs to hold companies accountable on supply chain.

On the other side of the house is the Educate arm. This functions with a civic mission, delving into local issues that matter to employees and the community. It works to fill the news hole left by disappearing local media outlets.

Guiding the work of both arms are four principles:

1. Accuracy — The information we provide must be factually rigorous and meet the high standards of classic journalism. We must give people sound, third-party-sourced information so that they can make the best decisions on the basis of facts, not fears. 

2. Transparency — We must be accountable for what we produce, the strategies we use and the information we share. It is not only what we do, but how we do it that should be visible to the public.

3. Open Exchange — There should be a place for running commentary by employees and customers, where they can raise concerns, share opinions on products and services, and be given solutions to problems.

4. Fairness — We must offer healthy debate around the issues, so that everyone can understand all sides of an argument.

Now for the implementation of Go Direct — how each arm works.

The Promote arm practices what we at Edelman call Collaborative Journalism. The goal is story mining, development and dissemination at the highest level of accuracy and impact.

There needs to be a team of experienced journalists who go beyond company walls to gather sources and stories. Data and insights will guide what the community wants to read. A creative team will bring the stories to life; it should be comprised of people who feel at home in the rapid-fire world of social media and are able to capture stories visually.

The Promote arm must offer online communities of interest. For United Airlines, we built United Airtime, an online portal for direct conversation between the airline and its stakeholders. This was a clearinghouse for employee or customer complaints, company plans to improve service, and a news outlet.

Yesterday in Chicago I was interviewed by the TD Ameritrade Network. This is the brokerage firm’s direct-to-consumer, “over the top” (or OTT) broadcast channel, completely company-owned and -operated.  It produces original, live news broadcasts and educational content designed to help investors make better decisions. The network averages more than 500,000 viewers per month on its web portal and on social.

Another effective way to Go Direct through the Promote arm is by activating employees. Subject matter experts should be encouraged to freely engage with their social media communities. Company thought leaders and executives should be visible and engaging. Speak to employees first, then talk to all.

The Promote arm combines strategic PR, rigorous journalism and a mutually beneficial conversation between company and community. It is the 21st-century evolution of the practices that my father Dan Edelman and other PR pioneers established.   

The Educate arm should be structured as a non-profit foundation, supported by the company but functioning independently. The local news team’s governing board should comprise a government representative, an industry leader, an NGO expert, and one or more highly qualified former journalists. The Educate unit not only generates original content, but also serves as an aggregator of important news and analysis from other sources.

I’ll give you an example of how it could work.

Young parents making the decision about where to live are often guided by school options. A company headquartered in Chicago could publish on its internal channel a fair-minded overview of all city and suburban schools. The overview would include the perspectives of other media, educators and community leaders. Employees would be invited to share their experiences or advice on the channel. The result is that employees can make a more informed choice about where to send their kids to school.

A multinational company should begin its Educate operation in its headquarters city, with honest coverage of the issues that employees need to understand, such as the effects of automation on jobs, education, and infrastructure. The model can eventually be expanded to the company’s key markets, then roll up into a global Educate hub.

The very idea of a corporation becoming an objective news source is going to be challenged. Can we set up a structure for accountability journalism, the expensive and time-consuming process of ferreting out the truth? The ultimate test of this model will be the Educate arm’s freedom to criticize the sponsor company.

A business can set up its own Educate operation with an investment of a million dollars. This affords a veteran journalist to serve as editorial director; beat reporters; a newsroom director; an analytics team to inform stories with data; and creatives to make the stories accessible. Over time, the Educate responsibility could become a collective effort, shared by a group of companies in a city that aggregate their content.

Let me be clear that Go Direct is not corporate journalism or a replacement for mainstream media. It is a necessary supplement—a way for business to help. There are other like-minded models currently in operation, including nonprofit newsrooms like ProPublica and a New York local news publication called The City, that are supported in part by company foundations.

Go Direct is a pragmatic approach to lifting the cloud of ignorance that has descended on our country. We are more broadly divided now, says Thomas Friedman of The New York Times, than we were in the 1960s over Vietnam and civil rights. A recent NewsWhip study shows that the top Facebook Pages for mainstream political content this year originated with the hyper-partisan outlets Fox News and Occupy Democrats — each has driven nearly 100 million engagements.

We need to restore civil discourse. We do this best by advancing the cause of truth, through access to quality information. The ultimate goal of Go Direct is to create an information safety net by informing employees, ensuring an educated populace. Business must lead this charge — 72 percent of Trust Barometer respondents said they trust their employer, well above government or media. This is the existential and urgent challenge for the Chief Communications Officer. There is no time to waste. Let’s get going.

Thank you.