MARKET FOCUS: Business as usual

Andrew Gordon looks at PR's role in increasing the acceptance of the internet.

Andrew Gordon looks at PR's role in increasing the acceptance of the internet.

"New economy wistfully recalled as tiny dot-com promotional object found in drawer," read a headline in The Onion on January 22. While the story was obviously one of the "newspaper's" trademark satirical spoofs, it serves as a blunt reminder of the silliness that prevailed four years ago, just before the word "dot-com" became synonymous with failure. But that was then. Despite an air of skepticism that immediately followed the dot-com downfall, the internet has become an important and accepted vehicle for doing business. Internet companies have had to bring their online operations into the real world, finding sustainable business models that support their bottom lines. And PR has played its part. "People may scoff at the bubble and all the trite things that went along with it, but it sped up people's acceptance of the internet dramatically," argues Rick Sneed, senior manager of PR at Netflix. "If it wasn't for all the Pets.coms, people wouldn't have been as familiar with the internet. And PR played a huge role in that." PR also played a major role after the dot-com crash. "You're much more likely to believe The Wall Street Journal about the security of a website than that company's advertising," says Sneed. Many brick-and-mortar businesses, from banks and insurance companies to airlines and retails stores, actually realized the internet's potential by extending the equity of the brands online. They took the trust and reliability people felt for their brands, and brought that to the internet, using PR to drive their online initiatives, whether it was researching how to buy a car, selecting stocks, or investing in b-to-b services. "So many companies had to battle skepticism after the crash," says Kim Olson, director of brand PR for General Mills. "Pets.com is one thing. Cheerios.com is something else. We borrowed our brand equity." The main reason the internet gained respectability so quickly is that after all the buzz-worthy dot-coms bit the dust, it was the companies with sound business plans that moved in to fill the void. "Companies are now smarter about understanding their [online] audience and tailoring that online experience for their customers," explains Karen Spiegel, corporate communications director for New York-based agency R/GA. "Companies also understand how to use publicity better. They know it can play an important role, provided there's something important to talk about." Martha Papalia, CNET's VP of corporate communications, has seen a similar shift in attitude when it comes to PR. Gone are days when dot-com or hi-tech companies would fire off one press release after another, regardless of how meaningful they were. "The actual volume of announcements has probably been cut in half," she says. "What you have to say has to be so important to get [the audience's attention]. They only want to hear what you have to say if it's of some value. "One of the great results of all of this is clarity," explains Papalia. "Companies are much more careful and strategic about their PR, so that when key audiences hear news, they know it's going to be significant." ----- PR's role in online sustainability Amazon Approximately 30 million monthly unique visitors The 800-pound gorilla of e-commerce has always been about the customer experience, says director of PR Bill Curry. "You have to remember that it was a capital market bubble, not a customer-experience bubble," he says. But so many of those companies failed because they failed to retain consumers, thanks to shaky customer service. So Curry stands by the "old PR adage of performance, then recognition. There's no PR that you can do to overcome what your actual performance is." Curry is content to let the customer experience speak for itself, although a little amplification thanks to PR certainly hasn't hurt Amazon's ability to attract and retain new customers, making it one of the few dot-coms to turn a narrow profit. Bank of America 6.5 million monthly unique visitors Financial institutions not only had to convince people that banking online was viable after the bubble burst, but still have to sell the security of online banking today, particularly with identity theft in the news. "We often talk to analysts about the progress we've made with online banking," says Betty Riess, senior media relations specialist. "We're continually educating our audiences about online banking and bill pay." To get past security concerns, Bank of America uses PR to promote features such as its online-banking guarantee, which frees customers of liability for fraudulent activity. The bank has used PR to extend the trust customers have with it to their online banking. "People generally have a sense of security for their financial institution. We've done a lot of education on the security of online banking." BusinessWeek 2.1 million average monthly unique visitors For most media outlets, an online presence is about brand extension and delivering original content. "It's been a two-pronged process," says Peggy White, general manager of BusinessWeek online. "We've emphasized that there is differentiated content on the website, with new business news every day. But we also focus on our long, rich history. We've never been skeptical about what the internet was about. We've seen continued audience growth." The site's PR activities range from partnerships with companies such as AOL and Yahoo! that drive traffic to BusinessWeek.com, to promoting original online content to the magazine's subscribers, banking on the print magazine's brand equity to attract readers to the website. CNET 55 million monthly unique visitors to all CNET properties, including News.com, ZDNet, and Download.com After watching so many technology companies crash and burn, companies that soared on press releases and parties that generated buzz, CNET rethought its PR strategy, says Martha Papalia, VP of corporate communications. "We look at our PR program in two ways. We have to educate people about our products. The other is visibility of our editorial knowledge. We place our editors in other press as experts. It helps reinforce our standing as a top source for technology news." And much like the companies it covers, CNET only announces its most strategic moves. "We've really gone back to the basics. Now when a press release comes out, it has to be so much more significant." The Gap Doesn't release visitor numbers, but says that 70% of customers who shop online also shop in-store The Gap integrates its retail website into every PR campaign, whether it's an overall marketing campaign or the introduction of new seasonal clothing, says Stacy MacLean, manager of external communications. But the Gap also promotes its website as a way to pre-shop. Customers can either browse online, and then buy in-store, or vice-versa, says MacLean. The Gap also uses its website to introduce new products. "We introduced our maternity wear online," says MacLean. "We also offer extended sizes online that we might not have in the stores." Introducing and promoting products online enables the Gap to determine their potential success when they become available in the stores. General Mills More than 1 million unique monthly visitors to Bettycrocker.com "It's a unique way to connect with customers," says Kim Olson, director of brand PR. "It helps increase the share of heart our customers have for our brands. Many companies don't take advantage of that." Olson admits that internet PR isn't easy to gauge. "Will putting something on Pillsbury.com sell 3 million cases of biscuits? No. But it will raise awareness." So General Mills relies on its websites to extend brand affinity. Country singer Reba McEntire promoted Spoonfulsofstories.com, a Cheerios-themed reading site, on a media tour. Marie Osmond also went on a media tour to promote the Pillsbury bake-off website. "General Mills has brands people trust. We borrow that equity to the internet." General Motors 1.5 million unique monthly visitors to GMBuyPower.com With more consumers researching cars online, GM splits its PR surrounding GMBuyPower.com between car buyers and dealers. "When we launched the site in 1999, PR led the advertising," says Ryndee Carney, manager of marketing communications. "We held a press conference to launch the site. Today, PR is more integrated into all of our marketing. But when we have executives speak about sales and marketing, we have them talk about GM BuyPower. We bring up our online [initiatives] in interviews." And since most consumers are taken to GM BuyPower after perusing a car brand's site, GM also uses PR to convince more car dealers to participate in the online buying program. Netflix 3.4 million unique visitors in December Knowing that analysts and the press didn't want to hear about another dot-com after the bubble popped, Netflix didn't focus its PR efforts on promoting the company, but rather on the potential of the DVD format, says Rick Sneed, senior manager of PR. After educating analysts and the press about the superiority of DVDs, Netflix was swept along with the massive surge in popularity of DVDs, one of the fastest-adopted consumer products in history. Once DVDs took off, Netflix focused its attention on the company, presenting itself as the most convenient way to rent and receive DVDs. "We pushed DVDs as a new way to watch movies, and Netflix as a new way to rent them," says Sneed. Travelocity 10 million monthly unique visitors "Our CEO learned quickly that PR was the sweet spot for creating awareness for the company," explains Al Comeaux, VP of PR. Travelocity generated buzz and publicity by creating unique features and tools on the website. "We knew this wouldn't necessarily drive traffic or revenue, but it would drive buzz." But after the dot-com implosion, buzz became a four-letter word at Travelocity. The company shifted its PR focus, using PR to showcase Travelocity as a viable company that would survive the downturn. "We focused on not being just a website, but a travel company. We used PR to promote the travel experience Travelocity provided." UPS 7.2 million daily tracking requests While many clients visit UPS.com daily to track their packages, UPS focuses much PR on promoting its wireless, supply chain, and other online business services. "We've used press releases, media kits, and other PR to promote those solutions," says media rep Laurie Mallis. "We try to leverage the internet to provide web-based solutions, so a lot of PR is also through the internet." While many clients go online to track packages, research rates, or print labels, UPS' PR promotes many online tools that customers can download and use within their own IT network. "We've created media kits for our online solutions. We also send out the Brown Bulletin, an online newsletter that tells customers about these services."

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