H&K/PRWeek Corporate Survey 2011


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The Hill & Knowlton/PRWeek annual Corporate Survey was released on October 1. For this year’s report, more than 290 US corporate communications professionals completed an online survey examining the latest trends and shifts in the corporate communications function.

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H&K/PRWeek Corporate Survey 2011

  1. 1. Corporate Survey 2011Centralized efforts are among the prevailing trends thatepitomize the changing face of in-house communications
  2. 2. Streamlined operation32/prweekus.com/October 2011
  3. 3. As information travels faster,reducing response lead times, thepervading ambition among thoseleading corporate communicationsis to flatten and centralize their teams.The 2011 PRWeek/Hill & KnowltonCorporate Survey examines this andother trends. Rose Gordon reportsT wo years ago, Southwest Airlines began a pro- cess that would streamline its communications Heightened profile department in terms of reporting structure and Does the corporate communications function have a “seat atjob function. Where previously there were three sepa- the table” at the earliest stages of discussions on matters thatrate communications units – employee communications, will eventually require internal or external comms?PR, and emerging media – there is now just one: commu-nications and strategic outreach. VP Linda Rutherford,who reports to SVP of culture and communicationsGinger Hardage, leads the 90-person department, cen-tralized at the airline’s Dallas headquarters excepting itslocally embedded community affairs and grassroots teams. The new communications department dedicates teams 52% 42%to particular functions, such as community programs,multimedia, and external relations. But now each of thoseteams reports to a single director who all report into 6%Rutherford. Instead of having a PR employee who justtalks to the news media or writes for the employee mag-azine, Rutherford says, “Now I’ve got a group of people Yes, all the time Yes, sometimes Nothat can do many things.” Base: 293Turning less into moreA reduction in staff set the reorganization in motionwhen four people on Southwest’s communications team THe survey sampleaccepted an early retirement program. The changeprompted the need to reassess the team dynamic, says Title: Of the corporate communicators polled, 45% are at theRutherford. Sensing a movement in the PR industry director/manager level, 35% at VP level or abovetoward breaking up silos within communications depart-ments – and within companies as a whole – as well as a reporting lines: 54% are the most senior PR representativedesire to “take on more work with less talent,” she moved in their company; 25% report directly to the most senior personto consolidate the teams and create a next-generation com-munications staff trained in cross-function competency. Company focus: An average of 41.2% are b-to-c focused; 56.7% are b-to-b focused “It was a better use of our resources,” Rutherfordexplains. “We can now do more with the same talent. Company revenue: 40% of respondents work at companiesWe really did create project managers.” with revenues exceeding $500 million, with 34% of those at This is the revolution taking place among many organizations with revenues of $1.5 billion or morecorporate communications departments now: a flat-tening and centralizing of teams. Communications budget: 38% have a PR/communications “You’re seeing more and more consolidation of responsibi- budget of $1 million or morelities under one or two people instead of half a dozen,” says October 2011/prweekus.com/33
  4. 4. This all leads to corporate communicators’ top pain stress factors points, unchanged from 2010, as found in the 2011 PRWeek/ What three challenges cause you the greatest stress in your job? Hill & Knowlton Corporate Survey: budget constraints (52%); keeping up with social media innovation (48%); and Budget managing internal silos/departmental divisions (43%). “With social media, everyone has a microphone,” says constraints 52% Paul Hartwick, SVP of communications for JPMorgan Chase Card Services. “As soon as your organization takes any action whatsoever, you’re subject to anyone being able Keeping up with social to comment on it, so it’s really important that the com- media innovation 48% munications team is involved in decisions, planning, and Managing internal silos/ understanding what actions – good, bad, or otherwise – can be taken so we can be prepared to respond if needed.” departmental divisions 43% “The speed with which information moves is my major Base: 293 stress,” adds Rutherford. C-suite taking notice Dan Bartlett, US president and CEO of Hill & Knowlton. The C-suite, though, has become much more tuned in to “If you look at the typical Fortune 500, internal communi- the potential lightening-speed reputation takedowns that cations reports to HR; IR to the CFO; public affairs, PR, can happen on social media and elsewhere as a rumor can media goes up through corporate communications; and now spread from tweet to blog to CNN in an hour. Events then there’s government relations. So you have five different of the last few years where once venerable brands were senior people, all with public facing responsibilities. I can’t torn down amid a global financial crisis have made CEOs tell you how siloed and non-communicative they are.” all the more aware of the frailty of their reputations, The effect of consolidation is multi-fold: it increases which has sped corporate communications’ climb up to the PR function’s ability to move at the same rapid speed the corner office’s ear. The survey, which polled nearly with which information now flows, including stamping 300 corporate communicators, found 89% say they are out and responding to the quick crisis brushfires that emerge under pressure to act as the guardian of their company’s and peter out on Twitter, Facebook, and blogs sometimes reputation, while 55% say their C-suite has paid more all within a few hours. It allows teams to do more with less, attention to corporate reputation issues in the last year. as Rutherford points out; and, if everything works as prom- Additionally, 94% of respondents say corporate com- ised, it can create a more consistent corporate message. munications has a seat at the table at the earliest stages for “I find CEOs are demanding more strategic com- discussions on matters that will eventually require inter- munications,” adds Bartlett. “Because of the change in nal or external communications, according to the survey. communications, every constituency is hearing all your Moreover, 60% of the top communications pros at organ- messages. You used to be able to have discreet commu- izations report into the CEO, chairman, or president. nications. Employees hear what you’re saying to inves- Ellen Gonda, SVP of global corporate communications tors. This calls for a lot more coordination internally. It’s at Hilton Worldwide, is a member of the company’s a much more strategic conversation.” executive board and reports directly to CEO Christopher Nassetta. One of her early mentors in PR counseled her to always be positioned closely to the CEO if she wanted to be an effective communicator. “It’s been a guiding force,” she says. “It allows you to have a seat at the table when planning is going on and to provide strategic input as plans are being developed.” Hartwick, who reports into both the CCO and the con- sumer practices group head, counters, “Ultimately it does not matter who you report up to, as long as the function is respected and you have a voice with senior management and the right resources to do your job. You have to be a busi- nessperson first who has expertise in communications.” “Your working relationship and access is much more im- portant than who you report to on paper,” adds Andy Katell, a 30-year industry veteran who leads communications as SVP at GE Energy Financial Services, GE’s energy in- vesting arm. “If you’re respected, people will invite you into discussions and when you need access, you’ll get it.” Not only are corporate communications professionals learning to react to this new communications dynamic, but they are also being charged with taking on new respon- sibilities related to digital media. While respondents listedSouthwest formed a collaborative team, made up of leaders from marketing, media relations, crisis/issues management, and executivecomms, and the culture group, to coordinate its 40th anniversary promotions communications as the top three functions they are most34/prweekus.com/October 2011
  5. 5. anatomy of Feeling the pressurethe corporate Say they arecommunicator under pressure 89% to act as the “guardian” of % their company’s reputation Say their C-suite has paid more 55%Of the most senior global PR/public affairs attention topeople report to CEO/chairman/president reputation man- agement in theIn companies with less than $500m last 12 monthsin revenues that number rises to71% (vs. 64% in 2010) staffingIn companies with more than $500min revenues that number falls to 62%45% (vs. 42% in 2010) 34%$ 4% Budget constraints and Expected no Expect an Expect a an unstable economy are change in increase decrease the #1 and #4 reasons their in-house for job stress, respectively. corp. comms staffing levels37 Saw an increase in their % PR budget in 2011, for this year compared to last year measurement16% Saw a decrease 69% Share PR metrics reports with the C-suiteNo. 1 reason for an expected increase in 2011:pr more of a priority for company 60% 54% Are judged based on media coverage performance47% Saw no change 53% Deploy in-house team to prepare regular monitoring/clip reports In 201247 Of those at companies with revenues less % than $500m expect an increase in their PR budget for 2012 marcomms alignment Of those at companies with revenues of38% 3% Do not consider more than $500m expect an increase in Say yes it is an alignment a priority their PR budget issue, but they are making progress on alignment 35%Digital 49% Are satisfied infogrApHiC deSign by CHriSTopHer SilvA with the level of27% 54% 13% alignmentSay corporate comms Do not use any type of Say alignment is a big issuespearheads the company’s agency to develop their because they are not satisfiedsocial media vision digital strategy with the level of alignment October 2011/prweekus.com/35
  6. 6. likely to be responsible for, they also added duties in the social media adviser to assist the corporate communica- areas of social networks and applications (47%), blogger tions group, though Gonda declined to name the firm. relations (30%), online tracking (20%), search marketing “Because we are a private company, we haven’t done as (15%), and digital creative/website development (15%). much here, but we’re starting to be more engaged,” she adds. Rutherford’s communications team leads all of the en- “We recognize social media’s growing importance. You can’t gagement and conversation elements around social media miss out on what’s being discussed, so we take it seriously.” at Southwest, including flight sales on Twitter. They don’t Following Blackstone Group’s 2007 acquisition of Hilton execute ad buys, but they do create Facebook campaigns Hotels Corp., the company repositioned with a new corpo- and even source code their Twitter flight promotions, so rate name and logo in 2009 as Hilton Worldwide. It also they can note sales the PR team brought in. moved headquarters from Beverly Hills, CA, to the decidedly “If you book a flight through that, the tweet gets the non-Hollywood city of McLean, VA. In late 2008 it credit,” she says. “We report that back to marketing.” hired Gonda. All these changes coincided with a company- Additionally, the airline has a Social Media Council, wide mandate to switch from a geographic to a functional which has a co-leadership team among marketing and com- reporting line, including in the communications depart- munications. Rutherford’s structure reflects the leading ment, in order to create more cohesion among the team. trend in social media, according to the survey. “It improved our efficacy of communicators because we could take the message and share it amongst ourselves, Leading the social media charge rather than having disparate messages,” Gonda explains. Twenty-seven percent of survey respondents say corpo- “The benefit of having all the communicators together is rate communications is spearheading the organization’s we can share experience – we can train together.” social media vision and strategy. Another 24% say it is a Many in the financial sector have been slower to adapt blended team made up of leaders from a variety of func- to social media marketing, in part due to regulatory con- tions, such as HR, marketing, and communications, while cerns. Katell’s GE division has its own Twitter feed, though another 22% say marketing leads it. it is infrequently updated. More often, though, it is pop- Gonda has a newly hired director of social media on ulating the corporate YouTube page with videos of her corporate communications team, but the individual executives at events for thought-leadership purposes. Hilton Worldwide brands, such as the Hilton Garden Inn “We are a b-to-b business in a niche industry, so if we and DoubleTree, also handle social media at the brand do use social media, we’re not going to use it for broad level. In addition, the corporate team recently enlisted a communications to a broad external audience,” he says.Digital additionsComms departments, much like other marketing arms, continue to grapple with society’s move toward digital living. As therelationship builders and storytellers within organizations, communications teams are finding they have a unique role to play.What responsibilities have you or your team taken on in the last two yearsthat were not previously part of the PR/communications function? agency selection 47 % Social networks 30 Blogger % 20 Online % 15 Search % 15 % Digital creative/ SOCIAL NETWORK & APPS and applications relations tracking marketing Website devel. 60 59% Base: 293 40leading the visionWho is spearheading your social media vision and strategy? 20 14% 10%27% Corporate communications 7% C-suite 7% 4% 4% 1%24% Blended team selected from specific functions 6% Blended team of those interested in social and other select functions 0 Not PR Social Digital/ Ad Other Analytics/22% Marketing 6% No one is spearheading it using an agency media interact. agency research agency agency agency firm8% Blended team interested in social media regardless of function Base: 279 Base: 275 DIGITAL STRATEGY ONLINE/SOCIAL MEDIA TRACKING BLOGGER RELATIONS (developing overarching approach to engaging audiences through online or mobile apps) 62% 60 60 60 54% 50% 40 40 40 24% 20 17% 20 18% 20 10% 12% 8% 6% 8% 6% 5% 3% 2% 2% 4% 3% 3% 2% 1% 0 0 0 Not Digital/ PR Social Ad Other Analytics/ Not PR Analytics/ Social Digital/ Other Ad Not PR Social Ad Other Digital/ Analytics/ using an interact. agency media agency research using an agency research media interact. agency using an agency media agency interact. research agency agency agency firm agency firm agency agency agency agency agency firm Base: 275 Base: 275 Base: 27536/prweekus.com/October 2011
  7. 7. Katell is considering allocating a slight uptick in his crease. While economic factors were the main motivatorbudget to an agency to help with its digital strategy and for a budget decrease, an increased budget was primarilyexecution, including a website revamp. due to PR’s rising priority at the company. Social media’s rise has also led to the need for better “Despite the economic uncertainty we’re facing, PRcoordination between marketing and communications, will fare better in budget pressures because the CEOs areas well as a sometimes contentious fight over who will get seeing the strategic value of managing their corporationthe budget and staff to support the function. in a more proactive way,” says H&K’s Bartlett. Credit card companies are probably equally known for Katell says he experienced a slighttheir voluminous marketing as they are for crisis and budget increase proportional to thereputation issues. Chase’s Hartwick says his 12-person rest of the businesses. He expectsPR team is “joined at the hip” with his brand and ad peers. to be flat or slightly up next year. “We really try to be integrated in everything we do,” he In order for corporate commu-notes. “We’ve started to form cross-functional teams that nications to convince the C-suite itwork directly with our GMs on our products.” needs more budget, it has to demon- The teams recently collaborated on a promotion around strate value – a perennial quandaryits Blueprint offering, which provides cardholders new for PR, which is a more imprecise artbudgeting functionality by allowing them to select certain form than, say, a Super Bowl ad.types of balances on their cards to pay off before others. As Rutherford says, “A lot ofThe brand and ad teams came up with a print campaign tar- times the success of our efforts isgeting lifestyle magazines, particularly bridal and parenting. based on what does not happen,” The company partnered with Brides on a survey about such as in a crisis averted.wedding budgeting. The PR team managed the relationship “Of all the things I do, it’s thewith the magazine, contributing to the survey development least in my control and the leastand reader panel, as well as a follow-up interview with its measurable,” says Brad Matson,executives regarding the results on outlets such as Fox News. CMO of Bluefly, an e-commerce “The brand, advertising, and communications teamsneed to be a united front when we’re talking about com-munications with our business leaders,” says Hartwick. “A loT of TimeS THe SuCCeSS“We create integrated plans and we have all the agenciestogether. We’ve done that for a couple years.” of our efforTS iS bASed on wHAT At Southwest, a senior leadership team was also formed doeS noT HAppen“to create and coordinate the airline’s 40th anniversary pro- linda rutherford, Southwest Airlinesmotions going on this year. It was made up of a leader frommarketing, communications, and the culture group. “They worked together to decide the themes, activities, fashion site. With a small marketing and PR departmentthe operation budget, and the ways we would engage that includes a four-person social media team, hedifferent stakeholders,” explains Rutherford. relies heavily on his agency roster, which includes Yet 48% of the respondents say alignment between People’s Revolution for fashion press and ICR formarketing and communications is an issue. Upon further financial and business media. Matson sets goals forbreakdown of these numbers, there is an upward trend of the teams, such as two major media placements eachalignment issues in corporations with revenues exceeding year outside of their regular impressions programs.$500 million where additional layers often impede pro-gress. Of the total base, though, 35% say while it is an issue,it “is not a big issue because we are making progress.”The importance of versatilityCorporate communications has always been a smallerfunction in terms of people resource and budget in com-parison to marketing. In order to grow, it has added newcapabilities, including looking to bolster digital expertise. “I firmly believe in being versatile as a communicator,”says Katell. “These are those that can do it all – write well,handle a crisis, and handle marketing communications withalmost a sales mentality. I also do employee communica-tions, so it’s important to have those skills and obviouslyall the digital skills. A well-rounded candidate is whatcompanies will increasingly want because they’re leaner.They want people who can move around.” In continued economic turbulence, though, budget con-straints and an unstable economy were cited as the top andnumber four reasons for job stress, according to surveyrespondents. Forty-seven percent expect no change in their Chase Card Services’ PR and ad teams worked closely together on promotingbudget this year, 16% expect a decrease, and 37% an in- Blueprint, including coming together on the lifestyle-themed print campaign October 2011/prweekus.com/37
  8. 8. measurementPR is a notoriously difficult discipline to measure. This sometimes put comms at a disadvantage as the C-suite lavishedattention on its more demonstrable marketing brethren. It also led to the development of the much debated ad-equivalencyvalue. Corporate communicators say their best defense is reliance on a multitude of tools, rather than a single one.systems check accountabilityMost popular ways to measure Less popular With whom do you share the PR measurementPR effectiveness reports/metric?�53 In-house team prepares regular % monitoring/clip reports � 18 Clipping agency prepares regular % monitoring/clip reports 71% PR/communications department 69% C-suite 61% Marketing department�52 In-house team conducts analytics % of website � 15 Research firm conducts % survey/polling 25% Board 23% Sales department Base: 248�49 In-house team conducts social media % analysis (i.e. online community, blog, Facebook, Twitter analysis) � 15 Web agency or Web analytics firm % conducts analytics of website Budget What percentage of your PR budget in FY 2011 is dedicated to measurement?�41 In-house team conducts media % analysis (quantifies and analyzes clip content) � 14 PR agency conducts social media % analysis (i.e. online community, blog, Facebook, Twitter analysis)� PR agency prepares regular � Research firm/media analytics 5.2% 6.2%33 12 % agency conducts media analysis % monitoring/clip reports Average Average (quantifies/analyzes clip content)�21 PR agency conducts media analysis % (quantifies/analyzes clip content) � 11 Media or Web analytics firm % conducts social media analysis (i.e. online community, blog, Facebook) Companies with less than $500 million in revenues vs. 5.9% in 2010 Corporate Survey Companies with more than $500 million in revenues vs. 6.7% in 2010 Corporate Survey Base: 270 Base: 270 Base: 191 Communications has employed various measure- to determine the success or failure of a communications ment models such as ad equivalency, which attempts to activity or campaign. Instead we look at a wide variety of compare PR earned media to paid media values. Of them,” says Katell. “The one that’s the most quantitative is the communications executives interviewed for this business leads that we generate through communications article none praise ad equivalency, but they did say it has a activities. My philosophy is to be extremely commercial- place among their arsenal of metrics oriented in our communications. I am much more interested and analysis. Media analysis dash- in helping us make money and be profitable than almost boards and social media analysis any other goal one could think of in communications.” tools are also commonplace among those interviewed. Sharing intelligence The most commonly deployed tools Communications is sharing that knowledge – whether it to measure PR effectiveness are reg- is media sentiment, an angry blog post, or a social media ular media monitoring and clip fire put out – with its peers in organizations, which may reports prepared by the in-house help to build its profile further in front of the C-suite. Sev- teams (53%); website analytics enty-one percent of corporate communicators share the PR (52%); social media analysis by the analysis and metrics with others in communications, while in-house team (49%); media analysis 69% share it with the C-suite, and 61% with marketing. by the in-house team (41%); regular “It’s almost thinking of yourself as an intelligence officer, monitoring/clip reports prepared by rather than as measurement that proves our ROI,” says the PR firm (33%); and PR agency- Hartwick. “Clearly you have to show you’re spending the conducted media analysis (21%). PR dollars you receive wisely, but if you can help executives “My own approach is not to even act on that intelligence, it will make a big difference.” l try to rely on just one single metric The PRWeek/Hill & Knowlton Corporate Survey was con- ducted by PRWeek and CA walker. e-mail notification“pr will fAre beTTer in budgeT was sent to about 18,000 corporate communications pro-preSSureS beCAuSe THe CeoS Are fessionals with 293 completing the survey online between may 18 and June 13, 2011. results were not weighted andSeeing THe STrATegiC vAlue“ are statistically tested at a confidence level of 90%. This article offers only a summary of findings. A premium version of the dan bartlett, Hill & Knowlton survey is available for purchase at prweekus.com.38/prweekus.com/October 2011