Measuring Up

Why PR folks should love the Tea Party

Today's guest post is by Peppercommer Matt Purdue
 
The Tea Party just made our jobs a little easier. But this has nothing to do with their belief that God put coal in the ground for us to burn for fuel, so air pollution and global warming can't really be so bad.

Thanks to the throw-the-bums-out efforts of the Tea Partiers and other Republicans, we now have a divided government. The Dem control the White House and (barely) the Senate, while the GOP runs the House of Representatives.

PR professionals should be dancing in the streets today. Why? Because the stock market loves divided government, especially when the Democrats rule the White House.

According to some sharp analysis published in the Christian Science Monitor, the Dow Jones Industrial Average has historically climbed an astounding 19.5% annually when we have a Democratic president and a Republican majority in at least one house of Congress. Compare that 19.5% to a measly 6.1% annual increase when one party controls the White House and both chambers of Congress.

A soaring Dow usually means a better economy and a stronger PR industry. If companies see their market caps rise, they’re more likely to increase spending on PR and marketing. We could see budgets creep back up to where they were three years ago.

But these aren't usual times. Unemployment and underemployment rates remain very high. The residential real estate market is in a deep trough. And the financial services sector is facing Dodd-Frank, an historic load of new rules and regulations.

All of these factors could continue to drag on the stock market, despite the historical data that points to the contrary. Let's cross our fingers and hope that, at least this time, history repeats itself.

What’s in store for the future of communications?

As part of our on-going recognition of Peppercom’s 15th anniversary, my business partner, Steve, and I recently had a lively and thought provoking conversation with three premiere corporate communications leaders:  Monica Teague, Senior Manager, PR, Brand Business Teams, Whirlpool, Tom Topinka, Public Relations Leader, Genworth and Amber Harris, Manager of Digital Communications for Discovery Communications. 

I posted the first part of the podcast last week, as we focused on the existing state of our industry and what undercurrents drive our business today.

I now want to share the second part of our conversation wherein we look ahead and discuss what challenges and developments will plot our course into the future.  I hope you will enjoy listening to the conclusion of our dialogue as we discuss the digital age’s world domination and shaping of the potential of global communications.

Click on the gray bar below, to listen, and as always, I would like to hear your comments- good, bad or indifferent.

15th_Year Anniversary Podcast-Part 2

It’s a day-to-day learning proposition that we’re all still figuring out…

This is a consensus point that came out of an interesting conversation that Steve and I had with three leading  corporate communicators the other day. The conversation was actually part of a larger podcast discussion that we hosted to celebrate Peppercom’s 15 years in business.

Our three guests were asked a myriad of questions about how the state of corporate communications has changed today, what they need to do day-in and day-out to be successful and how this crazy thing called social media has turned everyone’s world upside down. The headline above refers to the latter point as they eloquently described the new challenges associated with a 24/7 blogosphere where any online comment can blow up into a real crisis at any time. Our guests were:

-    Monica Teague, Senior Manager, PR, Brand Business Teams, Whirlpool
-    Tom Topinka, Public Relations Leader, Genworth
-    Amber Harris, Manager of Digital Communications for Discovery Communications.

We recorded 30 minutes of discussion on two separate podcasts. The first contains their views on present opportunities, challenges and obstacles they face. Next week, we’ll post the second part containing their views and predictions for what lies ahead. I think you’ll find the discussion to be quite insightful.

To listen, click on the gray bar below.

15th_Year_Anniversary Podcast-Part 1

How do you measure PR success?

That’s a never ending question for my industry. Ask 100 executives and there is a chance that you might actually hear 100 different answers (well, maybe 75 would be closer to the truth).

I’ve found that too many professionals continue trying to isolate the public relations discipline (or the value it provides) from the rest of the communications/marketing mix. In this day and age, this makes little sense. I’ve also continued to watch with amazement how more often than not, the discipline (itself) is still only equated to “old time” media relations concepts…especially as it refers to measurement.

Like many others, I joined a few Linkedin industry group discussions a while back. Usually, there are too many topics covered to actually keep up on a regular basis. But, every once in a while a thread of a conversation or debate catches my eye. Here’s one professional’s take on the issue at hand How Do You Measure Your PR Success? . While he makes some valid points, I’ll refer back to the problems I just laid out to respectfully disagree with many of Drew’s assertions. 

For starters, I disagree with his theory that PR campaigns cannot be measured based on sales achieved or rate or return. I’m paraphrasing, but Drew elaborates by stating that PR is a long term investment that can increase awareness of a product/service/expertise. But, that doesn’t mean skyrocketing sales will be the result.

There’s no doubt that PR professionals need to be careful when over promising that any individual campaign/program will lead directly to sales. This is especially the case if the product/service being marketed is not really unique, or the market is already saturated with competitive look a likes, or if the company behind it has almost no visibility (which means a lack of credibility with target audiences). That said, I’ve witnessed many recent campaigns leverage the integration of very creative social media, traditional media and experiential disciplines to generate real, honest to goodness sales.

One great example from a few years back is Crocs- children’s rubber shoes that have became a huge phenomena. I remember when the company made a tremendous outreach to mommy bloggers and national media years ago. If memory serves, the specialists behind Crocs created some type of online contest to draw moms in…and it worked! At that early point in the company’s growth, it spent very little on advertising. So, public relations really helped to directly impact the bottom line, as well as create a longer term, trusted reputation with moms everywhere.

While it’s often hard to separate where public relations and other marketing disciplines begin and end these days (because of the Internet), my point rests on the fact that the digital world has created real sales opportunities for companies that leverage PR the right way, where they never existed before.

Drew also tries to provide clarity on the difference between the value of an ad and an editorial article. I agree with his premise that an article tends to be more credible, but I’m not really sure how he came to the scientific number that it’s worth 3 to 10 times more than an ad Regardless, I think this debate should be put to rest for ever. Because it simply isn’t relevant anymore.

Today, communications disciplines (and what their end products create) matter much less than making sure that target consumers are communicated with when they want and how they want it. Again, the Internet creates a real blur between disciplines and the channels we use. The value of an article versus and ad isn’t relevant anymore. Now, we should only care about how a client’s messages might resonate. If that means combining a steady blogging campaign, with hard hitting in-market events, where target media might then write about your product (because they saw it talked about in blogs and through online media buys), so be it.

The latest buzz phrases in our industry are “channel and discipline agnostic.” The premise is spot on. We need to worry less about defending public relations against advertising because we’re all treading on each other’s turf now anyways. The article, by itself, is dead (as is the ad). Reaching the consumer through messages that are indeed in motion are what matter now.   

Hiring freezes send shivers down clients’ spine

The other day, I was reading in a PR industry trade that one of the largest public advertising holding companies has finally lifted its 18 month hiring freeze. I guess either business has come back (at least a little) for this mammoth marketing services company, or it finally decided that it just can’t maintain a complete hold on bringing in new talent forever.

This definitely brought back memories (mostly negative) of my days at J. Walter Thompson. I remember that we had an “unofficial” hiring freeze for about a six month period. While, no official edict had come down from the corporate decision makers in the UK, all senior executives understood very well that any new hires had to be approved in triplicate form by the top brass, or there would be hell to pay. This reality meant that a typical hire could take a long time to be approved (in some cases four to five months). So, the effect caused many firms within the global network to either just give in and find ways to maximize current talent (as they had lost the stomach for fighting against the system), or become ultra creative to work with outside talent, but not officially hire them. This often included fudging the use of consultants/freelancers or even offering people jobs, but being very creative in how their salaries were hidden within a larger cost structure.

Of course, the only ones that really felt the collateral damage with these across the board freezes, were clients. Think about it. Let’s say there are over 200 individual marketing services companies in a typical advertising holding company. I guarantee that even in the worst of times, at least five, ten or even 20 of those companies are doing just fine because their businesses ran counter cyclical to the masses. As a businessman, I understand the need to cut costs and protect the larger entity as a whole, but the 5-10 percent of firms who still need to hire because business is coming through the door, can’t when this mandate is set. So, what happens? Clients are promised x, y and z in terms of quality and quantity of talent to service their account. And, you can bet your bottom dollar that some of that is sacrificed because as much as the agency rants and raves to higher level management sitting in their ivory towers, the resources needed, simply can’t be allocated. A secondary evil that then transpires is that very good account and creative leaders and managers within those well to do agencies start walking out the door. They are frustrated beyond belief and have had quite enough with the big agency model. Sometimes the domino effect ensues because the delicate agency balance between having really great talent to service new business and top accounts diminishes once the anger and frustration spreads.

Any way you slice it, across the board hiring freezes are just dumb policies. This whole topic is kind of ironic considering that agencies are only in business to service clients in the highest way. So, the big, public holding companies (without saying it) actually advocate doing the opposite during bad times through these poorly created mandates. 

Big, bureaucratic policies like these, which have no room for flexibility to meet the most basic client needs (and demands), represent some reasons why we started Peppercom in the first place. When times are bad, it’s understood that sometimes resources need to be let go and adding staff just can’t happen. But, most independent firms are smart and would never just implement something so inflexible as a cast in stone hiring freeze. Instead, it’s about understanding which marketing or communications areas clients need the most professional help in. Then, if necessary, these smaller agencies make trade-offs or just plain invest their own money to ensure that clients are being served they way they promised to. Profit levels are often sacrificed when this happens, but that’s understood. The public agencies can do no such thing because they are under the constant pressure of their investors.

I’m not a public holding company basher (at least, not usually). It’s just that this practice has been happening for so long and just hasn’t changed. You’d think someone at the top would get it (finally). But, I guess not.   

How “privileged” is your client/agency communication?

There’s an interesting legal trial taking place which digs deep into an important issue involving public relations agencies and their clients. For as long as I can remember, clients, agencies and lawyers have questioned whether communications between client and PR agency would be deemed privileged information (as it is between lawyer and client) when challenged in a legal setting.

This current case is an interesting one because it brings this very issue to a head. Reyes is the former CEO of Brocade Communications Systems, who was convicted and then sentenced to 21 months in prison for backdating options a decade ago during the dot com days. His sentence was then thrown out in an appeals court because it was proven that the prosecution had knowingly made false statements during closing arguments.

Now, the case is being prosecuted again. But, this time, Reyes’ former PR firm, Sitrick & Company, is on the hot seat as prosecutors have subpoenaed client files held by the firm. These documents could provide damning information which would hurt Reyes’ case. It becomes a little confusing because Reyes now has new attorneys for this second trial. These attorneys (Cooley Godward Kronish) are claiming that the PR agency client files should be protected by the attorney client privileged code because the agency worked so closely with Reyes’ former attorneys (from Skadden Arps) during the first trial. They argue that they jointly created a responsive PR strategy and executional approach to combat the negative assault by the Justice Department. The government (prosecution) counters that Sitrick performed the sort of “standard public relations work” for which there is no attorney client privilege. 

Yikes. This is a very sticky issue that certainly has no black and white answer because there isn’t a real legal precedent to follow here.

We’ve dealt with topics like this over the years. To ensure that we don’t end up swimming in subpoenas and legal costs (like the agency in this trial is,) our strategy is usually straight forward if we’re about to enter into a crisis situation. Normally, we’ll be actually retained by the attorney representing the client so that our firm will be under the same privileged and confidential arrangement as the law firm is with its client.  So, technically, the law firm is then our client.

Of course, it isn’t always this easy. Many times we’ve represented a client for years. And, crisis situations which involve legal matters just sprout up out of nowhere. In these cases, it’s hard and many times inefficient, to simply change official representation during these chaotic times. And often, no one really knows if our communications will lead to the type of scary situation that Sitrick & Company is now involved in.

Anyway, this is a good article to read. And, one that certainly has me thinking about how we can prepare better for issues like this that could easily arise.

A decade of measurement successes and failures...

Once again, Katie Paine is leading the thought leadership charge on the topic of measurement. She's asking for those in the marketing/PR field to offer up what they believe are the best and worst measurement concepts in the last decade.
 
I'm a guy who believes in measurement. So, here's my two cents on the good bad and ugly of what’s been created and discussed over the last 10 years. (in reverse order, of course):
 
The Ugly
1) Advertising equivalency is as strong as ever - In many PR camps, this is still the case. This concept which began in the stone ages (earned media publicity is compared to the advertising equivalency in space, inches and/or amount of broadcast time), will just never die. It provides zero value. Yet, it costs a lot to analyze. And in the end, marketers have a measurement report that tells them absolutely nothing about how successful their program is. Way to go, industry...
 
2)  Using technology for technology sake - I've watched one vendor after another sprout up with these "magical" offerings. In many cases, these companies have created algorithms, software architecture and lots of complex metrics formulas that are just too damn hard to understand. Sure, some can push data to you in a moment's time. Others can provide scores and analytics of vast digital and media points that could never have been retrieved before. The problem though, is that if we can't really understand what's behind the score, metric or analysis, then how do we know what's being fed to us is even correct?
 
There are too many technologies that can't be verified to provide accurate outputs or outcomes and that scares me.
 
3) The human touch - On this same note, technology has begun to replace the inefficiencies of human labor. In many ways, that's really positive. Where it took hundreds of man hours to collect and tabulate data for a particular media or digital metrics program before, now the right software formulas can do the same work in a half hour. That's amazing… except, let's not forget the value that our professional analysis and insights provide.
 
There isn't a measurement system in existence that can offer up strategic and prescriptive strategies and tactics to tackle the problems or opportunities that became apparent through computerized number crunching. We are moving too quickly into a world where human analysis is being replaced by intelligent software. That is a disaster waiting to happen as we deal with the most pressing corporate topics like reputation and sales. 
 
The Bad
1) One standard to measure all - Much like the consumer technology world is still trying to create one PDA that will do everything for the customer, our PR industry continues to search for one standard that can measure any media, event, trade show, digital program, etc. Maybe we'll find this golden standard. But, I don't understand why that "Holy Grail" is deemed so important.
 
Rather, I think what is critical is that specific metrics are tailored for each client and every campaign based on its individual needs. Might we lose something in cost and efficiency by having various standards? Yes. But, as long as the standard is accurate and clearly measures something that matters, who cares.
 
2) Information overload - We still receive far too many reports, graphs, analysis and reams of wasted paper from measurement specialists. Sorry to be so direct on this. But, I think that many companies providing these reports feel that the more data they hand over, the more value it will seem like they are providing. Very few are actually marketers or public relations professionals though. If they were, they'd also understand how little we care about quantity versus quality.
 
The Good
1) Real time metrics can lead to immediate action – It’s exciting to see that almost any issue, campaign or disaster can be monitored in real time now. This means that as data is pushed to our desk tops, we can immediately make actionable decisions to try and change opinions, push out our messages and/or contain a negative situation. Of course, this leads to an entirely new set of challenges. But, it’s great to see how linked metrics and real time campaigns are now. This will only become that much more powerful.
 
2) Better products make us more sophisticated – There’s no doubt that a number of great offerings exist out there today. I won’t start naming them, but we now have the ability to benchmark competitive programs at a very sophisticated level. Digital analytical tools allow us to figure out exactly who our programs are reaching and what impact they may be having. And, through the integration of creative graphical offerings with back end software, we can provide immensely appealing dashboards which allow clients to see their program’s achievements at a glance.

3) The industry has brought outsiders in...and that's good – Let’s face it. Marketers/PR practitioners are very good at what they do. One of these strengths isn’t the ability to provide real analytical tools and research methodologies that measure campaigns. I think that the industry has done a very good job of reaching outside the profession to bring in those who are professional researchers, statisticians, and just big thinkers. This was a must need to ensure that our offerings are accurate and dig deep into business insights. 

Overall, our industry still has a long way to go. If you have any thoughts on this topic, please fire away.

The Achilles Heel of Public Relations

Our industry group, the Public Relations Society of America, has formed a committee of high level thinkers

to solve one nagging pain point that continues to hurt our industry: develop a true industry-wide measurement standard. (PRSA Seeks To Establish Industry Wide Measurement Standards)

This is no easy task. In fact, many professionals in our industry have tackled this very challenge before with little to no consensus resulting from their efforts. More to the point, it’s safe to say that no two firms today conduct measurement that leverages the same verifiable and consistent standard.

I applaud the PRSA and especially this committee for its efforts. From what I see, their key strategy is right on target. Everything they will develop revolves around shifting the conversation away from the volume of media clips, social media activity and advertising equivalency value to outcomes that measure and show how PR drives business performance. I also love the fact that they are offering up specific economic models to do this (i.e. regression analysis and also isolating the effects of PR campaigns by isolating statistics, are two examples). No doubt, this will teach many PR practitioners that a true quantitative ROI on their campaigns can be measured and understood. This isn’t rocket science, after all.

Yes. I have a good feeling that this group (comprised of some very talented measurement professionals like Katie Paine) will provide us with a standard that the industry can be proud of.

What still concerns me (though) is that our industry is ill prepared for real metrics because of two realities that have nothing to do with creating a respectable industry standard:

1) Almost always (in my experience,) prospects talk big about wanting the agency they hire to measure a soon to be created/implemented campaign. But, once that business is actually won, it’s rare that a true metrics program is ever crafted at the onset of the relationship. Measurement isn’t that hard. But, it takes a number of meetings and some work to tailor a system/formula/process that should fit each individual client. Both client and agency have responsibility to make sure that this happens. In my experience, it’s typically the client who is so rushed (or excited) to begin the program, that measurement often just gets pushed aside.

2) Measuring true business outcomes can never actually happen unless the right mechanisms are in put in place to track and collect data and then conduct the precise type of analysis that is needed, (i.e. what sales leads data actually resulted from this campaign?). It’s not that difficult to arrange for this to transpire. But, if nothing materializes, then the end metrics result can only be the analysis of outputs (such as PR clips, and social media activity.) I simply don’t see too many companies spending time to create these valuable mechanisms. And, that’s a shame.

Kudos to this committee. But in my estimation, we’ve still got a lot of education that needs to take place.

“You’re not an artist. You solve problems.”

Those are the words Sterling Cooper’s Don Draper exclaimed to his young copy writer protégé, Peggy Olson. To anyone who isn’t a fan, I’m referring to AMC’s smash hit television series ‘Mad Men’. Draper is the lead character and creative director of this fictional early 60s ad agency. But, the meaning behind this phrase is oh so real.

Here’s a little background on it. Two episodes ago, Peggy was given the challenging assignment to create a breakthrough ad campaign that would entice the female masses to purchase a new concept— diet cola. The opening of this episode begins with Peggy and her colleagues (all men) watching a clip of Ann Margaret’s 1963 sexy performance of ‘Bye, Bye, Birdie.' While all the men are enraptured with raw sexual excitement as they watch Ann flirt shamelessly with the camera, Peggy is visibly offended at the office dynamics.

Fast forward to the next important part. Peggy is pretty much forced into trying to utilize the likeness of this famous movie scene into her creative campaign. She tells her boss (Don Draper) that this would only offend woman (showing her obvious disdain for the idea,) instead of achieving the opposite goal of appealing to calorie conscious females everywhere. As she’s about to suggest another, more cerebral, possibly less offbeat strategy, Draper interrupts her with an oldie but a goodie in the advertising world, “It will work because men want her and women want to be her.” He then reminds her of the headline above. (You’re not an artist. You solve problems.)

So, what’s my point (you may be asking)? This show is wonderful to me because it’s truly grounded in the real issues/challenges that agencies go through each and every week. It’s fascinating that the styles and specifics might have changed in 40 years, but the same annoying dilemmas remain the same.

I’ve worked at two very large ad agencies. In both cases, I’ve met many creative executives who just could not figure out that they are really supposed to be problem solvers. Instead, their prima donna, egotistical attitudes turn what should be results driven campaigns into “I need to dazzle the client with the most breathtaking creative possible.” Many times, the allure of big awards and celebrity status within the ad industry get the best of them. And, the worst part about it as that some of them are so stubborn that they just won’t back down… even if the strategy doesn’t follow a clear and concise strategy of where the campaign should be.

One clear memory I have is when a top creative at my former agency developed this hip, very stylish (almost outlandish) annual report for an insurance company client. The problem was that this insurance company was/is incredibly conservative and even dull. The senior account person in charge of the business begged the creative director to change the strategy to come across as smart and seasoned versus hip because that’s what the client wanted and (more importantly) that’s what would resonate with this company’s investors. But, the creative director would have nothing of the kind. I think his words to the account person were, “I hate this type of boring creative concept. Insurance companies need to change their images with more provocative advertising. No one wants to see this tired look anymore.”

This battle soon became a war that I had to step into to calm everyone down.  And, it was all because a creative director wanted to march to his own beat, not having a care in the world about what problems he should be solving (versus creating.)

In this case, is Draper right? Who knows… there is a lot of gray in every creative campaign. But, his simple strategy seems to make sense (at least for those times.) The key point here (though) is that Peggy completely loses her focus around what might be best for the client (vis a vis a good strategy that can solve problems.) And instead, her only thought is about personal preferences (in this case that the svelte and sexy 60s star is offending her senses.)

This show is just chock full of real situations that continue to happen in the 21st century agency world. I’ll save my next case in point (about the Madison Square Garden account) for another post later this week.

Lots of talk, but some things never change

Katie Paine is somewhat of a measurement guru in our industry. This post  (Assessing the Assessors at AMEC's Summit) from her is well written and a must read for those interested in the latest PR measurement trends. Unfortunately, it also clearly shows that our industry still doesn't "get it."

I wasn't at this conference (thankfully). But, these informal survey findings are appalling. When the question is raised to 150 public relations executives: Do you still measure the value of your media relations programs by comparing results to that of advertising value equivalencies? Amazingly, 150 people raised their hand to say yes. Ugh.

For those reading this post who aren't in the industry, it means that these executives still use an ancient, worthless means to gauge the return on this part of their public relations programs. An example would be comparing a full page positive feature article that a company obtained in Business Week, to the cost of a full page ad in that same publication. If the ad costs $75,000. Then, the article ROI is deemed to be worth that as well.

Unfortunately, I liken this to comparing apples to broccoli. Yes, they both are in the greater fruit and vegetable category. But, take that away, and there is nothing else relevant between the two. An advertisement tells the world "we are great," and is also viewed through that same commercial lens by anyone who reads it. A full page article supporting that same company, infers that a third party, high end national media publication (such as Business Week) believes the organization is doing something very right. I'm not biased against advertising. But, it's just a simple fact that the article is more credible, believable and typically provides immensely more value in building a reputation, enhancing investor opportunities or generating leads than the ad.

My real question here is: Why is this still happening?

Over the last 10 years, I've heard from no fewer than 100 clients that they hate this antiquated measurement approach. And, they want something that is more verifiable to support important programs. Yet, according to the responses at this summit, many of these same folks say that their clients continue to push them or mandate this atrocious means of measurement.

So, one of two causes is having this effect (in my mind). Either the corporate world still doesn't understand just how wrong this is (possibly because we haven't educated them enough,) or they simply don't care. It's hard to create general stereotypes for an entire segment of the industry (and I'm glad to say that most of our clients actually want real metrics), but I'll offer up my two cents.

In this bad economy, I think many just don't care about measuring accurately to understand real ROI. They might claim the opposite, but the reality is they just need some end numbers or stats that can be pushed up to the senior powers at large which show major benefits for the costs of the program. And, one thing is almost always true. When comparing PR apples to advertising broccoli, the apples almost always win. That's because all an agency has to do is churn out a large quantity of media hits to typically drive the supposed $$$ value well above what the actual cost of the program is to the company.

With jobs on the line and so much fear out there, it's hard to blame some for doing this. That said, our industry is always fighting for greater respect among the C-suite. It's hard to argue for that, when a large chunk of the industry is still stuck in the 20th Century measurement world.