PR's forefathers

PRWeek editor-in-chief Keith O'Brien and publishing director Julia Hood held a luncheon this summer in Chicago with four men who have more than 200 combined years of experience in the industry.

PRWeek editor-in-chief Keith O'Brien and publishing director Julia Hood held a luncheon this summer in Chicago with four men who have more than 200 combined years of experience in the industry. Harold Burson, Daniel Edelman, Al Golin, and David Finn helped to establish the PR industry that exists today. They discussed how they entered the field, who tried to acquire whom, and what the future holds.

Keith O'Brien: So, Harold, how did you get your start?

Harold Burson: I started my own business in 1946. From 1946 to 1952, I was on my own. Then I joined Marsteller. Before I went into the Army, I had worked for a very large engineering building firm, which I would equate to a Bechtel [today]. I traveled with the CEO and did publicity for the company. I was dealing with the trade press and observed that I was the only one who was calling on most of them.

I went into the Army in early 1944. My boss died during the war when I was in Europe. If he had not died, I would have undoubtedly gone back to his company. But I wrote the people who were running the company and said, “I would like for you to be my client.” I started a firm; they were my first client.

Everyone says, “You didn't have any competition [when you started].” I kept hearing that throughout the years – that there weren't very many [other firms]. But... remember, every military unit had a PIO. Most were newspaper men. When they went back to Omaha, they didn't want go back to working for the [paper]. They wanted to go into their own business. Years later, I had someone go to the New York Public Library and look at the 1947 Yellow Pages. I said, “I want you to look under ‘public relations' and ‘publicity' and take out the duplicates.” There were over 500 names listed in New York.

I was very lucky... One client paid me $750 a month. Another man had left this company and joined a non-competing engineering business. He gave me $500 a month and office space. I started out with $1,250 a month. I was 25 years old, and I thought I was rich.

David Finn: I was in the US Air Force, and I was a communications person.

Daniel Edelman: In my case, I realized there were a couple of firms in New York – Ruder Finn was a major force. And even though I had New York roots, I thought to myself, “I'll start a firm in Chicago.” I had been public relations director of a company – the Toni division of Gillette. They agreed [to hire me and] pay me a good fee; I had about seven people to start. They understood I was the kind of guy who would want to go off on my own. [Toni cofounders Neison and Irving Harris] introduced me to a half-dozen CEOs of companies who became clients in the first six months.

Finn: Our first client was Perry Como and he paid us $50 a week. That was $200 a month. He was a very nice guy. One year, he took a full ad out in Billboard and said, “Thank you Bill Ruder and David Finn, for doing such a wonderful job.” He became the number-one singer after we started working with him. We didn't really deserve the credit, but he was nice enough to give us credit. That was the only time a client took an ad out thanking us for the work we did.

When we started, [PR pioneer] Carl Byoir invited Bill Ruder and me to lunch at the 21 Club. We had never been to the 21 and had no idea what the hell it was all about. He wanted to tell us how pleased he was that two young guys had gone into public relations.

Edelman: Isn't that amazing?

Finn: He said, "I wanted to thank you guys for joining the world." I knew John Hill. Knowlton I never knew, but [Hill] hired us to do some work for his company. He was really friendly.

O'Brien: Al, when you started in 1956, what did you know of the other agencies?

Al Golin: I knew the other three. Even at that time, they were well-known in the industry. I got into the business because my family was in the theater business, and I always thought I wanted to get into movie production. I got a job doing publicity for MGM Pictures, thinking it would lead to movie production. I never got into that – I stayed in this industry.

I joined a guy from a small agency in Chicago named [Max] Cooper. Shortly afterward, I made a cold call to [McDonald's founder] Ray Kroc, who was running restaurants around Chicago. That sort of launched our business.

Edelman: How did you connect with Tom Harris?

Golin: That was much later. He joined after he had been with you – and after he had been with Foote, Cone & Belding… He started with you, I think.

Finn: What's he doing now?

Golin: He was teaching at Northwestern. He does some consulting, and teaches a jazz class. He's a great jazz authority. Jazz was always his big love.

O'Brien: When you started, was PR very much a local thing? Were most of your clients in New York or in the Midwest for those of you who were in Chicago?

Golin: I was pretty local.

Edelman: Ours were national companies that were based in Chicago: Sara Lee, Real Lemon, and others. They came in the first six months. I was amazed. They were just laying out there, waiting to be plucked. I was thrilled. We got off to a fast start.

Burson: Before the Burson-Marsteller days, my first client was based in Cleveland. And I was doing some work with the American Institute of Architecture down in Washington.

Finn: When we started, the YPO – Young Presidents Organization – had just come into existence. The guy who was running that worked with us to help us get YPO clients.

Edelman: I was a member of YPO, and I didn't get clients [LAUGHS].

O'Brien: How were your interactions with journalists?

Golin: Antagonistic [LAUGHS].

Burson: In those days, all of us had really close relationships with journalists. In fact, a journalist from The New York Times brought me and Bill Marsteller together.

I got a call from [the reporter] one day. He said there was a guy in Chicago [with] an advertising agency who has a client in Pittsburgh named Rockwell [Manufacturing]. They have a project, and he's looking for a small agency... The project came about and the result of it was beyond what anyone had expected. I got three full pages in Life, Thanksgiving Week, for a $289 product. They gave a lunch for me a couple weeks later in Pittsburgh, and I talked to Al Rockwell, the CEO, saying we ought to be working on a retainer basis.

At the time, I was working on a per diem. He said, “How much would it cost me?” I took a deep breath and said, “$3,000 a month plus, of course, $1,500 of out-of-pocket expenses.” He said, “That sounds reasonable.” Literally, a couple of weeks later, Bill had me meet the CEO of Clark Equipment Company, which was a leading forklift truck manufacturer. In the first meeting, [the CEO] hired us. I took a deeper breath and said, “[Billings should be] $4,000 a month.” Marsteller and I had never talked about any kind of financial arrangement. I called Bill and said, “This thing is working pretty well. Why don't we start a new company?” I didn't want to be part of an ad agency, and I felt that we could do the work, but we weren't really getting times up at bat. So I thought we could mine Marsteller's advertising client list, and build a business around it. The two of us got together for breakfast one cold Saturday morning in January, and decided to build Burson-Marsteller.

Edelman: Harold, you mentioned Marsteller – brings to my mind the question of your relationship as part of an ad agency now. I know the cash was good – that enticed the sale - but how is the working relationship subsequently?

Burson: If you go back to post-World War II … McCann Erickson established a [PR] business. J. Walter Thompson was the largest PR agency firm for years and years…. BBDO was in it. Y&R was in it. After they had been in it for six or so years, they couldn't make any money out of it. And they started realizing that this $300,000 PR account is going to jeopardize the $10 million advertising account. Every one of them got out of it. We were the first advertising agency-PR firm… selling what today we call integrated communications – we called it total communications. Until the late 80s, we and Hill & Knowlton were the only two international agencies. Then when the big agencies started PR firms, everywhere we had a dot on the map, they wanted one.

Finn: We were international at that point. We had offices all around the map in the 60s.

Golin: The answer to Dan's questions is the key to being part of an ad agency is to maintain your own culture and identity. We stuck with our historic culture, and I think they respected it.

Finn: The question is are the young kids running PR agencies – small firms – going to be interested in being bought by ad agencies or not? I think they may not be.

O'Brien: Were the four of you always competing for business?

Edelman: You kidding? (laughs)

Finn: We always did, yeah.

O'Brien: Did it ever turn personal?

Finn: No; we never disliked each other. We had respect for each other.

Burson: One of my closest friends in this business was John Hill (cofounder of Hill & Knowlton).

Edelman: I never felt any animosity; I just felt [we had to] beat them. Not to win is a big loss.

O'Brien: How is it working with your son?

Edelman: Richard's presence and leadership –he's really done the job. I can't make a single suggestion to him that he hasn't thought of before. My son [John] is in charge of human resources worldwide, and some of the offices work with him. And [my daughter] Renee knows more media people than, I think, anyone in [PR]. She can call any publication's Joe and Jane, and she has an immediate entrée.

O'Brien: Did they express an early interest in working in PR?

Edelman: [Richard] was in Harvard Business School, and I said, “I'll give you the salary of the average graduate of the Harvard Business School.” He said that was fair. I said, “Let's try it for a year.” Now it's been 30 years. (Turns to Richard) You're getting a little grey. We're delighted with the contribution he's made and Renee and John have made. We wouldn't be where we are [without Richard].

Finn: I wrote a book called the Corporate Oligarch, (Simon & Schuster, April 1969) about people who run companies. I had a chapter about families, and I pointed out in that chapter that most of the examples I have where sons or daughters went into the business with their father... it didn't work out. I wrote that – giving a message to my four children (laughs) – don't think about coming into the business; it's probably a lousy idea.

Now, Bill Ruder had a rule that his children could not work in the business. I did not have that rule. The first one who came into the business was my son, Peter, who was going to become a teacher in high school in New England. I said, “Before you go into that job, why don't you try public relations? Try research.” He said, “I'll try it for six months. If I don't like it, I'll go become a teacher.” And he liked it.

Then his sister, Kathy, was getting her PhD. He used her as a freelancer for some of the studies he was doing. She then joined him. Amy and Dena came in also, walking backwards. They're all doing well, and I now have three grandkids in the business. I have lunch with my three grandchildren every month, and it's very nice.

O'Brien: At some point in time, did your businesses go in different directions?

Finn: I think interactive was a big difference for us. Our fastest growing operation is interactive.

Edelman: It varies by agency and company. Consumer marketing and product publicity is a big part of our business. I think GolinHarris is very much that way. Burson is more corporate reputation and Washington and research. That's our reading of it.

Burson: We have a big digital operation.

Golin: I think we've all changed a great deal. We're all fiercely competitive, but friendly. I think we all have that in common, and that's a healthy thing. I got a call a few years ago about a large client. My wife asked, “Why are you getting so excited? What difference is it going to make in your life?” I said, “If it didn't make any difference, then I'd get out of this business.” Financially, I don't think it would make any difference, but we're all competitive.

Burson: We decided in the late ‘60s that we wouldn't continue to grow if we stayed in just b-to-b. So we got into the consumer business by buying a firm that specialized in food - Theodore Sills; so we got 30-40 people - all women, except one guy. That put us in the consumer business; and they had really great client list in the food industry. Then we got into public affairs; I bought a small firm in Washington [run by] Carl Levin, which had a half-dozen people. We all just sort of added specialties as we went along.

Julia Hood: Once you knew PR was becoming a big business, what steps did you take to grow your individual agencies?

Edelman: We were carried by the flow... A company might be headquartered in another city – not New York, Chicago, or LA – so we had to open an office there. You do these things because they're required at the moment to meet a particular opportunity.

Finn: In the '60s, we were growing rapidly. Hill & Knowlton was the largest firm, and we went past them. John Hill said to me, “I understand you're the largest firm in the business.” At the time, we were $6 million. But then we became conscious of the limits of growth in the late '60s and '70s. Bill Ruder and I decided not to grow any more; it took us 10 years to realize that was a mistake, while you guys were growing (laughs).

Golin: We realized if we want to compete with these agencies, we had to have more dots on the map and go after the clients we wanted. Our company is a little different in the sense that we don't have a laundry list of clients. We probably have fewer clients than anybody of our size. We like our people to become more involved with the clients.

Finn: You probably don't remember, but we were so impressed by you guys that you and I got together and said, “Why don't we join forces?”

Golin: Oh, I do remember.

Finn: You said, “Oh, I don't know. I don't think so.” (laughs)

O'Brien: When did you guys sense the Internet was a big deal?

Finn: In the 1970s, a scholar from Columbia University came to us and said, “We believe [what was to become the Internet] is going to change the nature of communications, and we would like to suggest that you sponsor a study with Columbia University as to how it will.” We thought about it and decided it would cost too much money. They said, “Ten years from now, your business will be completely different.” Ten years went by, and it wasn't completely different. Another 10 years went by, and it still wasn't completely different. But then the third 10 years went by, in the '90s, and it was different.

Golin: I was a consultant in the Commerce Department at the tail end of the Carter administration, and when I went to the offices I would see them deliver these huge Wang computers – hundreds of them. I came back to Chicago and said to the person running our office, “We don't have one damn computer in this place. We better bring someone in who is a consultant in this area because this is going to be the future.”

Burson: The Internet is part of a continuum of utilities [facilitating] how we communicate and distribute information. Our first big move was in the 60s when the carousel projector was invented. Slides and multimedia presentations started. And we made a substantial investment back then putting slide presentations together - 2,000 slides and 24 cameras and projectors. When we moved into our building at 230 Park Avenue South, that was when computer graphics started to come in. We decided to go into that business. It was a $5 million business. It was the most profitable part, ever, of Burson's business. It had 60% profit margins. We also put in broadcast studios; we had the only really qualified, capable studio south of 34th Street. We invested like $5 million into equipment. The original MTV taped with our equipment. It was great at the time, but it was a business we should not have gone into.

O'Brien: How has the industry changed?

Finn: We publish a magazine called Move. [A recent] issue deals with new means of communication. I edit it, and I can hardly understand the articles (laughs) because there's a lot going on. There is a major change going on.

Edelman: It's changed, but not all that much. I think back to my time as a PR director at a company. What I was doing all of those years ago in the late '40s is not all that different from what we do now. The fundamentals of PR were there, and they're not that different today, in my mind.

Golin: It's changed; but there's a word of caution because you can go overboard with the technology. There was a book John Naisbitt wrote called Megatrends (Warner Books, 1982) He was way ahead of his time. He talked about balancing a lot of this hi-tech with “hi-touch.” That left a lasting impression with me over the years. We have to be careful in not losing that “hi-touch” with all of the technology.

Burson: A year ago, I got curious about how The New York Times treated the commercialization of the telephone. So I read the back issue of the Times. It was going to put the transportation industry out of business because it was no longer necessary to see people when you could talk to them. It was going to put all of the salesmen out of business because you could place your order on the telephone. For its time, it was probably as revolutionary as we are treating the Internet now.

And the other part of it, it was very expensive when it first came out. It was like $5.00 a minute to talk to California when it first came out. They also thought it was going to take all of the women in United States to be telephone operators. These different eras of communications all have their ups and downs. Neville Isdell, just retiring as CEO of Coke is a long-time friend of mine. I wrote him a letter two weeks ago, congratulated him, about four days later, I got a letter back from him. It was one of the great thrills I have had to get a letter from someone in response to my letter. The Postal Service is a long-term client of ours - over 30 years. I called Jack Potter - The Postmaster General. I said, "Jack, I just discovered something. If you really want to stand out with somebody, don't send them an e-mail; send them a letter with a stamp on the envelope." You get so few of them now, that they become very special.

Finn: Many years ago, I met this scholar in Rome. I had done books on Ghiberti, and was programming Ghiberti's sculptures in Florence. I went to see a beautiful apartment in Rome; it was filled with books, bookcases on all sides. I complemented him on these books. He said, "You know what the home of a scholar like me will look like in 20-30 years? It will all be cabinets. No books on the walls." I said, "I can't believe. I don't think books are going to out of our lives. I have 15,000 books I'm going to give to Brown University. I love those books, and I can't imagine the next generation won't love books."

O'Brien: Pretty much all of those hundreds or thousands of PR firms that started up post-World War II didn't get to this point. So what did you guys do to make sure you succeeded while a lot of them either faded away or got absorbed?

Burson: My feeling is that most of these firms were started by extremely bright people where the business was entirely centered around them. They either did not want to or didn't know how to pass on the leadership function to a second generation. There are only a few firms that have survived for 50 years.

Finn: There are very few young people who leave their firms to start their own companies. If they leave, they go to another company. In our day, people were starting companies all over the place.

Burson: That's happening a lot overseas.

Golin: I missed paychecks for months at a time, but no one who ever worked for us missed them. We were willing to do those sort of things. We did whatever it took.

Edelman: Harold was on target earlier on this discussion. Being smart, but also being willing to work very hard. Working on Saturdays was routine. I would be in the office until three, then I would go over to the club to play squash or paddleball. We worked very hard.

Hood: What milestones did you guys hit when you knew PR was become a big business?

Edelman: We were carried by the flow.... A company might be headquartered in another city - not New York, Chicago, or LA - so we had to open an office there. You do these things because they're required at the moment to meet a particulat opportunity.

Finn: In the '60s, we were growing rapidly. Hill & Knowlton was the largest firm, and we went past them. John Hill said to me, "I understand you're the largest firm in the business." At the time, we were 6 million dollars. But then we became conscious of the limits of growth in the late '60s and '70s. Bill Ruder and I decided not to grow any more; it took us ten years to realize that was a mistake, while you guys were growing [laughs].

Golin: We realized if we want to compete with these agencies, we had to have more dots on the map and go after the clients we wanted. Our company is a little different in the sense that we don't have a laundry list of clients. We probably have fewer clients than anybody of our size. We like our people to become more involved with the clients.

Finn: You probably don't remember, but we were so impressed by you guys that you and I got together and said, "Why don't we join forces?"

Golin: Oh, I do remember.

Finn: You said, "Oh, I don't know. I don't think so." [laughs]

Hood: Would you start a PR firm today if you were 25 years old?

Golin: I think it would be much more difficult today, in the sense that our firms are so well established and have so many things to offer in the way of facilities and coverage. Young people starting up would have a tough go at that, unless they carve a niche in a particular area. And I think there's a lot of room for that. Our business has come of age. They do not have to do the sort of pioneering work we did.

Finn: When we started, firms were coming up all over the place. There had been no real business during World War II; it was all war-devoted activities. It's not that way today.

Burson: I attribute the growth of Burson-Marsteller to the fact that in the '60s and '70s we were able to hire 125 to 150 people who stayed anywhere from 15 to 40 years with us. I'm not sure you can do that today. I don't think the mindset of people is to find an employer they can spend their lives with. Rather, they think, “I'm going to find 10 jobs.”

Finn: Why haven't we retired?

Golin: A lot of my contemporaries will ask: “Are you still doing it?” One guy – who I thought was a friend – said, “You must be greedy.” I said, “Greedy? That's a strange word. Why would you say that? I don't do it for the money. I don't want my mind to turn to Jell-O, like maybe yours is by making that statement.” I think we all love what we do and are still stimulated by it.

Finn: Whether we work really hard, or not as hard, we're still very involved because it's a part of our lives and personalities. I've been on many boards and a lot of other things, but I would never leave public relations.

This transcript was edited for clarity and length.

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