We have enjoyed publishing here on Reason Enough over the past few years. While this blog is no longer active, we are leaving the archive up, in case you find something helpful to you from our prior writing. In the meantime, we invite you to visit Peppercom's other blogs: RepMan, The Stand Up Executive, PepperDigital, About You, and PRiscope.

Too much has already been written and said about BP CEO Tony Hayward’s numerous PR gaffes since the explosion of the Deepwater Horizon rig in the Gulf of Mexico on April 20. But far be it from me not to pile on. These are actual quotes from Hayward: 

"I think the environmental impact of this disaster is likely to have been very, very modest.”

“The Gulf of Mexico is a very big ocean. The amount of volume of oil and dispersant we are putting into it is tiny in relation to the total water volume.”

“I would like my life back.”

While media wonks have been decrying Hayward’s lack of sensitivity for weeks, I think they’re missing the bottom line. The real news here is that no one who really matters cares how obtuse or insouciant Hayward appears to be. In other words, despite all his public relations blunders, he still has his job.

That’s the real disaster for those of us in the PR industry. While Hayward is vilified by commentators, bloggers and the general public, those behind the scenes don’t seem to care about how blithe he appears to the media. On the contrary. On a conference call last week, Hayward called his support from BP’s board “extraordinary.” Meanwhile, Jason Kinney, an oil industry analyst at ING, was widely quoted after the conference call. "This was a rational, level headed, confident delivery," he noted. "There's still a lot of speculation and unknowns, but ultimately BP is committed to rectifying the issue and regaining its reputation in the long run."  

So the question remains: Do the people who sign Hayward’s checks—the board and his bankers—really care about how poorly his public image appears? Do they connect his public relations bungles with the 42% drop in BP’s share price since the explosion? At this point, apparently not. And that—not howlers like Hayward’s--is the PR industry’s real problem.

Posted by Milos Sugovic

It’s no secret: A clear company vision, efficient allocation of marketing dollars, and the use of digital media to support sales will accelerate the return on a marketing or PR initiative. Yet only 12% of surveyed firms are adept at all three. 

Peppercom conducted a survey of 104 c-suite executives at small- and mid-size firms. The findings reveal that companies across various sectors do not have their act together. Almost half (48%) of the firms have no clear digital media strategy, absolutely no idea where and how their marketing dollars are being spent, and no agreement over the company vision at the executive level. As our findings show, the know-nothing approach comes with a high price tag of missed market opportunities, limited exposure to the target audiences, and foregone sales.

Crystallize your digital radar

But what’s more telling are the specifics of the two groups: those that do digital right and those that don’t. Of the former group, 60% report having exposure to relevant audiences which is translating into sales, while 95% of the latter group believe exposure and sales have not increased as a result of digital media initiatives.  

A wasteful tide lifts no boats

Budgets may be tight, but spending doesn’t seem to be. Less than half (46%) of corporate executives know how and where marketing dollars are being allocated and how consumers are responding. This poor allocation of resources is invariably correlated with a lack of adaptability and market agility, and translates into missed market opportunities and the potential for growth.

As a matter of fact, companies that know where and how marketing dollars are channeled use resources efficiently and can quickly reposition according to growth potential. That is why 63% of this efficient group report their company’s core competencies are being resourcefully used, while 67% are ready to take advantage of market opportunities and 85% are prepared to respond to shifts in the business climate. However, where marketing outlays are an untraceable and unplanned process, core competencies are not efficiently utilized (64%) and, as a result, very few are prepared to respond to business climate shifts (44%), let alone take advantage of market opportunities (25%).

The trickledown of a company vision

At the end of the day, a company without coherent leadership is like a ship without a captain. Our findings confirm that internal consensus among senior management regarding a common company vision has a direct and positive effect on internal and external communications. Where senior managers have a clear direction, employees and strategic partners can not only describe, but subscribe to the company value proposition. To survive in today’s economic climate, senior management, employees and strategic partners need to work off of the same compass; else they will be lost at sea. 

In companies where senior managers agree on the company vision, 53% report that a majority of their employees can describe the unique value proposition, while 65% report having external strategic partners that know and share the company vision. More alarming, however, is the finding that when senior managers are split, 88% have employees that cannot describe the value proposition, while an astounding 96% believe that external strategic partners don’t know, let alone share, the company vision. 

There are no barriers to entry

The results are clear: A company vision, an efficient allocation of marketing dollars, and a clear digital strategy will not necessarily result in a competitive advantage, but falling short will guarantee a competitive disadvantage.  Only one out of 10 firms gets all of it right, and that means there’s plenty of room for more.

About the Survey

Peppercom’s Business Intelligence Group conducted a detailed statistical analysis of a 2009, 10-question survey taken by 104 c-suite executives at small to medium sized firms. The study was administered to uncover the gaps in company vision, allocation of marketing dollars, and the use of digital media at firms most sensitive to the current economic climate. 

What a difference six years makes. In the summer of 2004, Greece was preparing to host the Olympic Games. By many accounts, the games were a great success. But now, less than a decade later, Greece stands on the brink of economic collapse. I wonder if the Greeks would like to have back the 7 billion Euros they spent to stage the games.

Alex Monro at Risk.net writes the best analysis I’ve seen yet of the Greek crisis, and what it could mean for the world economy. 

As Jerry Seinfeld might opine, “So, what’s with Greece?” Essentially, most of Europe owes money to itself. Many countries are indebted to each other. Greece has taken on more debt than most, and can’t keep up its debt payments. The NY Times has an excellent graphic illustrating this tragic co-dependency.

For some time now, the Greeks have been asking their European Union partners to help them out. The International Monetary Fund and various EU nations recently approved a long-term bailout plan designed to prevent Greece from defaulting on its debts. Yes, Greece is using its MasterCard to pay off its Visa bill, but there’s little choice. A default by the Greeks would throw the entire EU into economic turmoil.

The problem is: Who’s next? Italy’s total public debt is 116 percent of its annual gross domestic product—and climbing, the nation announced today. Ireland’s current deficit is 12 percent of its GDP. And just when you thought the UK was safe comes news that Great Britain’s balance sheet may be in the worst shape of all.

(Note the difference between debt and deficit. A government deficit [or surplus] is the difference between what the government spends or borrows and what it takes in. Right now, the difference between what the Irish government borrows [high] and what it takes in [low] is equivalent to 14 percent of the value of all the good and services produced in Ireland in a year. Ireland is living like a subprime mortgage holder whose home is worth less than what he paid for it, yet who’s using his American Express card to finance a kitchen makeover. On the other hand, government debt is essentially the aggregation of a government’s deficits over time, plus what a government owes to everyone who buys government bonds and securities.)

Any way you slice it, these are dark days for Europe. This is what is causing so much consternation and volatility in global financial markets.

Your client comes to you with a great new project: launch a huge PR campaign around their new line of trucker hats. This is a five-figure deal, and sounds like great fun. There’s only one catch: the hats are emblazoned with the word F@#K.

Far fetched? Not in Paris, mes amis. I just returned from a week’s vacation in the French capital, the birthplace of the Age of Enlightenment. Amid the statues of Rousseau and Verlaine, the F-bomb seems to the plat du jour of young Parisians. I noticed no fewer than three young French people strolling down the boulevards of Paris with F@#K boldly emblazoned on either a trucker hat or t-shirt. 

Look, I’m not here to judge. I’m as big on cultural relativism as the next person. But I admit it does throw me to sit in a café in a city that claims to be the capital of high fashion, gourmet cooking and all the sophisticated things in life—and see one of George Carlin’s “Seven Words You Can’t Say on TV” coming at me. (Warning: the Carlin clip embedded herein is raunchy and launches immediately in your browser. Beware if you’re listening in a cubicle.)

But that’s beside the point. Our job as professional communicators is not to judge. Our job is to learn and understand. Is there something about Parisian youth culture that makes this word particularly attractive? Are there other curses we can leverage with an even fatter profit margin than the F@#K hat? Or are these three F@#KING examples I noticed just statistical anomalies? 

If your client came to you with the F@#K campaign, what would you do?

2009 is long gone and the results of your Q4 PR efforts are finally in. Let’s say you had 100 media placements during this time period and you want to know how you did. Before you even read the executive summary of the PR measurement report, what can you expect? The good, the bad, or the mediocre? 

The correct answer is: all of the above. 

But many of us fall in this trap where our expectations are shaped by extreme events: “We had a great hit in the NYT this quarter. That means we did great!” or “The WSJ article ripped us apart, we are dreading the report findings.” We tend to focus too much on one or two good or bad eggs out of a whole basket, and wrongfully so. Now don’t get me wrong, it’s important to identify and be mindful of the outliers, but if you’re measuring the overall success of a PR initiative, it’s the central tendency of the effort that really matters.

To illustrate, let’s go back to my initial question: If you had 100 media mentions in Q4 of 2009, what should your expectation be? I can bet you that, on average, you’ll see the following: 16 poor hits, 68 mediocre hits, and 16 exceptional hits.  How do I know this? It’s not magic; it’s called the normal distribution.

In statistics, the normal distribution is a bell-shaped curve that describes, or at least approximates, any variable that tends to cluster around the mean (or average).  So, if PR measurements are designed to do just that – measure PR outputs – one would naturally expect that some media placements “underperform” vis-à-vis expectations while others “outperform” expectations, with the remainder clustering around the average. 

If you see anything other than this pattern it should automatically raise a red flag. Measurements that do not look like a normal distribution may be inaccurate and that’s enough to be a cause of concern, especially if they’re used to make important strategic and tactical business decisions. 

So the next time your PR measurement team says, “You did great this quarter!” ask them to see a frequency distribution of your media placements. If it doesn’t resemble a normal distribution at all, their yardstick is seriously crooked.

But if it passes the test, you’re in for some insightful findings.  You’ll be able to not only see the central tendency (average) of your and your competitors’ media placements, but its spread (standard deviation) as well.  This will tell you how well, or poorly, you’re doing – on average – and to what extent there’s under- and over-performance. Take that a step further and track it over time, and you now have a few interesting trends to examine and/or explain.

At the end of the day, PR measurements are not immune to the “laws” of statistics. And if they seem to be, then there’s a pretty high probability that they – to put it nicely – belong on the lower end of the bell-curve.

You know the whining must be loud when you can hear it all the way from Switzerland. The world’s banking titans are once again assembled in Davos for their annual confab. Amid all the confusion about how the global banking system may look in the future, one thing is painfully clear: the big banks still don’t get it when it comes to PR.

Financial giants are complaining that government leaders are threatening to place tighter restrictions on the way they do business. However, at least in the U.S., only a small portion of citizens surveyed in a recent Rasmussem poll opposes such measures. For example, only 29% of respondents are against limits on the type of investments banks can make.

But the bankers quoted in this Financial Times article just don’t understand the power of public opinion. Politicians read polls religiously, and they are feeding off the disgust Main Street currently has for Wall Street, the City, etc.

Instead of complaining, the banks need to become aggressive. Where is their proactive response to this reputational crisis? How about a top 10 list of actions banks are taking today to decrease systemic risk? How about a depositors’ bill of rights, spelling out exactly what consumers can expect in terms of financial security? How about town hall meetings with small depositors, to give them a chance to ask questions of bank CEOs?

Instead, we hear news like this: money manager State Street Bank & Trust just agreed to pay $300 million in restitution and a $10 million fine to settle charges that it misled investors about their exposure to mortgage-backed securities.

A huge disconnect still exists between banks, the general public and their elected officials. Unless banks come up with ways to convince the public that they are no longer doing business as usual, the politicians will continue to come pounding on the doors.