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Integrating PR: How integrated marketing communications can save public relations, and how you can help

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Sheffield University Management School is a triple-accredited business school with a world-class reputation for high quality teaching, ground-breaking research and cutting-edge thinking. Part of Britain's elite Russell Group of research-driven universities, it runs one of the few MBA programmes to involve a compulsory semester-long course on Integrated Marketing Communications. This 2006 presentation was given to MBA students at the school to outline the opportunities for public relations, the obstacles preventing PR from meeting its potential, and the solutions for both PR as a function, and for MBAs looking to move up in the industry.

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Integrating PR: How integrated marketing communications can save public relations, and how you can help

  1. 1. Integrating PR How IMC can save public relations And how you can help Duncan Chapple dc@duncanchapple.com
  2. 2. Agenda Agenda, Self-introduction, Overview
  3. 3. Agenda • Introduction • The opportunity for PR • The obstacles facing PR • Solutions • How to sell yourself as part of the solution
  4. 4. My background: MSc. Business Analysis, and then…
  5. 5. In a nutshell • Opportunity exists to use PR to grow business value through building brand equity • But PR managers deliver high- volume, low-strategy and barely profitable commoditised PR • PR can improve measurably • You can make a major difference • Focus on brand & business outcomes • Make PR a profit centre, not a net cost • Need a vision of what to create
  6. 6. I saw the angel in the marble and carved until I set him free. Michelangelo
  7. 7. The opportunity The opportunity exists to use PR to grow business value through building brand equity
  8. 8. “If I had one last marketing dollar I’d spend it on Public Relations.” • Bill Gates’ famous endorsement – Achieving editorial coverage is often • More powerful – Seems independent • Uniquely credible – Growing scepticism of consumers • More economical than advertising – Fraction of the cost • Also rooted in the crisis in advertising
  9. 9. Where to begin?
  10. 10. US Firms’ Marketing Spend • Overall spend over $1 trillion – Since 2005… • $40 bn fall in advertising/d irect marketing • $40 bn rise in public and analyst relations • Broadly reflective of global trends Source: Blackfriars Marketing Index (Blackfriars Inc.)
  11. 11. The end of advertising’s dominance Sergio Zyman: former CMO of Coca Cola; founder of Zyman Institute at Emory University
  12. 12. Gates made systematic • Advertising is brand maintenance. PR is brand building. • How many advertising messages is the average person exposed to during an average day? ... guesses ranging up to five thousand per day. ...we tend to tune advertising messages out. • The goal of traditional advertising is not to make product famous. The goal of traditional advertising is to make the advertising famous. Al Ries: co-author of crucial works on positioning
  13. 13. More good news? Is PR easier? • Global decline of journalism is deeply underestimated – The media are industrialized and under deep commercial pressures • Journalists unable to generate stories • Aspirational role models of journalists are columnists not investigators • Limits on press/broadcasting freedom – Advertising pressures grow internationally – Scores of journalists killed every year – Most news stories result from PR
  14. 14. Summing up the opportunity • PR is benefiting from a crisis in the credibility of advertising • PR can drive business value • PR can drive brand equity
  15. 15. Gauging the obstacle: Quick quiz How often does ‘public relations’ appear in the indexes of these leading MBA marketing textbooks?
  16. 16. Obstacles Most PR managers deliver high-volume, low-strategy and barely profitable commoditised PR
  17. 17. Life in the PR industry
  18. 18. 40,000 people; 3.8% profit • Around one-third of the Top 1000 UK PR agencies have been gradually increasing their levels of debt – Debt is eroding profits throughout the industry • Around a quarter of companies are loss making. – 208 companies are overtrading and selling at a loss • £1.1 billion profit is lost every year • 44 companies are 'ripe' for acquisition – 92 companies enjoyed over 20% growth • 50 companies are aggressively attacking the market share of others Sources: PRSA; Plimsoll Portfolio Analysis www.plimsoll.co.uk/mark etreports.aspx? market=pr_consultants
  19. 19. Journalists’ requests condemn PR • “A press release is not a pitch. An e-mail is a pitch, and I assume it’s exclusive.” • “Know whom to pitch to.” • “Get back to us quickly with honest responses and be accessible. Don’t give a story away to our competition without telling us.” • “Not being able to accept criticism, should negatives arise in stories [is mistaken]” • “Don’t pepper the newsroom” • “Shun repetition and overwriting” • “Eschew executive speak and corporate clichés” Source: Jan Thomas, Thomas Hunt & Associates Public Relations
  20. 20. “PR consultants are perpetrators of catastrophic errors” -- McCusker PR consultants themselves are increasingly being 'outed' as the perpetrators of the catastrophic errors of judgment and ethics that create or catalyze PR disasters. Just recently we had a UK PR guru having to pay six-figure damages against a former Tory MP for slander, while one of the USA's leading PR agencies, Ketchum, was embroiled in a 'cash for comment' scandal, which revealed that they'd paid a media 'shill' $250,000 to talk up a government-led education initiative. Bafflingly - for supposed PR specialists - Ketchum flatly denied any impropriety, yet eventually admitted the error of their payola ways when intrusive media attention refused to go away. Even a quick Internet sniff around the world's top 10 PR firms suggests that around half of them have been variously linked to supposed PR disasters; one firm manufactured evidence to support America's need to get involved in Gulf War 1, while another created and bankrolled a fake 'grassroots' lobby group to try to influence US government decision making. If it's true that 50%-plus of the world's top PR companies have been linked to shady PR practice, there's unfortunately little deterrent to dissuade errant practitioners from straying from the straight and narrow. Little, except negative media coverage, that is.
  21. 21. Burson-Marsteller tobaccodocuments.org/ pm/2028375325- 5344.html
  22. 22. A fascinating insight into ethics
  23. 23. O'Dwyer's PR Report : “PR Ethics codes are worthless” “These codes are not worth the paper they're written on. “They only leave the associations open to charges of gross hypocrisy. They give the false impression that the association is somehow concerned about and is enforcing behavioral guidelines and is following such guidelines itself…. “Our experience is that both the Council of Public Relations Firms and Public Relations Society of America and their members could practically commit murder and it would still not violate their codes.”
  24. 24. Mindset: can’t measure real value The Financial Times book on financial PR, the highest priced segment, gives an overview of the mindset. • “So how do managements determine what financial public relations is doing for them? The simple answer is, they can’t. Financial public relations is, in the end, an imprecise and unscientific activity. Its payoff is very difficult to separate from dozens of other influential factors”
  25. 25. Less tangible substitutes?
  26. 26. Goal: sell journalists on benefits? “Understanding effective uses of Public Relations is what makes SOHO’s PR campaigns successful. It is not the goal of public relations to "sell" editors on your product. It is the goal to provide them with news and features that will interest their readers. How will your product change the marketplace? Who has used it effectively? Who will most benefit from it? When will it be widely available? Who will use it and how will it benefit that person's business or life? Providing answers to these questions in a well written article is part of effective uses of Public Relations.”
  27. 27. Without goals, conflicting measures • Advertising equivalent value – Accounts for the relative market values of media space and time • prfirms.org/docs/pr_measurement2002.pdf – Used by one third of the industry – Ignores favour, brand and value • Unfavourable mention on TV ‘better’ than favourable mention in target media
  28. 28. Without goals, conflicting tasks • Awareness rather than perception – $1 bn firm has growth in negative media coverage. Produces higher awareness: PR is rewarded. – $8 bn firm focuses on key media. Increased favourability, but only in the target audience: PR punished. • Hopelessly off-brand ‘find & fill’ – Cult of personality – Trivial, off brand messages – Children, charity, celebrity
  29. 29. Wilkinson Sword Quattro
  30. 30. Is this streaker the real McCoy?
  31. 31. The Cloning Scenta
  32. 32. Kellogg’s Winders
  33. 33. The only thing worse than being talked about is not to be talked about at all
  34. 34. PR needs a rudder: Brand gobrandengineering.com
  35. 35. Even business schools confuse attributes for brand https://upload.mcgill.ca/ mba3/mba3-brand- attributes.jpg
  36. 36. Solutions PR can use brand to improve measurably
  37. 37. Integration rests on consistency
  38. 38. Consistency needs strong branding • Hard to get people on board to agree on operationalising a brand • Research maps coherent brands – Brand has been corrupted into design – Tight, unique, shared, understood • Subordinate PR to brand – Messaging  What are we? – Customers  Which can we own? – Positioning  How do we conquer?
  39. 39. PR should focus on brand attributes zibs.com/GuidetoBranding.pdf
  40. 40. Could your manager understand?
  41. 41. Only a little easier…
  42. 42. Case study: Tie to outcomes • Connect in PR to product launches, telesales and prospect seminars – Excellent RoI – Hardly anyone takes approaches like this
  43. 43. Selling yourself into PR You can make a major difference •Focus on brand & business outcomes •Make PR a profit centre, not a net cost •Need a vision of what to create
  44. 44. 1] MBAs turnaround agencies • Since agencies struggle to produce value, they are pressured on price • Furthermore, they fail to price for normal profitability • Price elasticity is normal, yet agencies typically harmonise price points – In the UK, there is an informal cartel – Fees are similar, thus price does not signal quality reliably
  45. 45. 2] MBAs link PR functions up • Bring the brand to life – Align the brand with its customers – Understand customers – Measure perceptions in the target audience not overall awareness • Support marketing campaigns – Align targets to the marketing plan • Focus campaigns on single attributes • Then prioritise secondary attributes • Use PR to support push-pull tactics
  46. 46. 3] MBAs coach PRs into context • PRs are focussed on volume – ‘Cold Turkey’ manners self-esteem – Senior PR managers often can’t show they get the business, the brand or the respect of the board • Fetish of “Reach x Impact” • MBAs focus on goals not tactics – Get the team to stop digging a hole – Understand business & marketing needs – Have a tactic-neutral approach – Can push the brand, not just attibutes
  47. 47. In a nutshell • Opportunity exists to use PR to grow business value through building brand equity • But PR managers deliver high- volume, low-strategy and barely profitable commoditised PR • PR can improve measurably • You can make a major difference • Focus on brand & business outcomes • Make PR a profit centre, not a net cost • Need a vision of what to create
  48. 48. Questions? Contact details Duncan Chapple dc@duncanchapple.com 020 7993 8655

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