More than three-quarters of company finance directors believe that corporate PR has a direct positive impact upon the bottom line. Or so say corporate affairs directors from organisations across the world.
On a global basis, 30 per cent of corporate affairs directors said they tended to accept that their finance director belived PR made a difference to profits, while a further 35 per cent strongly believed it.
This cheering news for the PR industry comes from new research into attitudes to corporate branding. To build successful corporate brands, companies have to develop integrated communication programmes with all stakeholders, from consumers, to employees, suppliers, environmental groups and investors.
Different stakeholders have different interests and requirements. But when it works well, effective corporate brand management can lead to greater market share, improved profits and happier employees and customers.
Until recently, however, there was little hard evidence about the importance of the corporate brand and what it can deliver. In a bid to rectify this situation, last year market research agency Opinion Research Corporation International (ORC) undertook the first global survey into attitudes to corporate branding.
This year, in its second survey, the agency beefed up the sample size from 100 to 250 and took a closer look at the major issues that arose in 1999. 'It's our hope that this survey will build upon the knowledge and debate generated in last year's report and act as a catalyst for further academic and business exploration in this increas-ingly important area,' says ORC director Milorad Ajder.
The results are published in a rep-ort entitled: 'Global 250: Exploring attitudes and practices in corporate branding.' What makes it a particularly relevant read is that all the respondents are taken from top flight multinational companies in the US, Europe and the Pacific Rim region.
Within each organisation, the researchers targeted the most senior executive with overall responsibility for communicating the corporate brand.
Having outlined CEOs' commitment to corporate branding in 1999, in this year's survey the ORC team looked at attitudes among human resources directors as well as financial directors. With the HR function involved in employee recruitment, retention and motivation issues, it comes as no shock to discover that overall, 80 per cent of respondents agreed that their HR director believed that 'corporate PR contributes to a more motivated and productive workforce'.
'This is a real testament to the extent that PR has climbed up the executive agenda,' says Ajder. 'I would have expected a far greater divulgence between HR and finance directors. But this shows that PR is really winning.'
Another striking finding from the survey was the existence of a global consensus. Naturally there were some inter-regional variations, but these tended to focus on the priority of specific responses rather than their content. 'One could argue that the degree of consistency is a testament to the increasingly global nature of business branding, both in terms of current thinking and best practice,' says Ajder.
The only real exception to this uniformity was when respondents were asked to name leading brand ambassadors. Globally, the top three responses were Microsoft's Bill Gates, Virgin's Sir Richard Branson and General Electric's Jack Welch, with 23 per cent, 14 per cent and 11 per cent of the vote respectively. But, whereas Gates was universally represented, Branson's following was strongest in Europe, at 58 per cent, while Welch achieved an overwhelming US score of 79 per cent.
One of the key factors the research team was keen to examine was the range and diversity of corporate brand values adopted by leading companies around the world. The survey revealed that the foremost value was customer service or customer satisfaction, which was mentioned by almost half of respondents in the US, 37 per cent in Europe and 28 per cent in the Pacific Rim. This highlighted that for the majority of organisations taking part in the research, the customer was situated at the heart of their thinking.
But what also emerged from this line of questioning was the very limited list of values to which organisations aspire. For the most part, these revolved around the concepts of service, quality, innovation, reliability and integrity.
'It confirms that there is a finite vocabulary of words and concepts available to companies, and organis-ations that try to create a set of 'unique' values will be sorely disappointed,' says Ajder.
However, the research also threw up some areas of concern for guardians of the corporate brand, most notably the extent to which employees are excluded from their organisation's reputation.
Globally, over half of respondents agreed that the brand mission, vision and values are understood by all employees, most of whom believe in them strongly. But a mere ten per cent indicated that issues of corporate brand and reputation management were most frequently discussed in departmental meetings.
The findings suggest that the subject is still predominantly owned by senior company executives and not infiltrating much beyond the marketing and PR functions. 'If as most CEOs believe, the employees and their ability to 'live the brand' is a prerequisite of success in this area, then more action is clearly needed to pluralise the entire process,' says Ajder.
This issue of employee exclusion was reinforced when companies listed the ways in which they evaluated the health of their brand. Again, employee research achieved a relatively low score overall (12 per cent). However, this question clearly revealed that companies are becoming increasingly concerned about how they are represented in the media.
Not surprisingly, market research was streets ahead in terms of evaluation, being mentioned by over two- thirds of respondents. But media research crept in second and was particularly favoured in the US and Pacific Rim region over Europe.
The survey questions how far companies are prepared to financially commit to the corporate brand.
Globally, lack of financial resources was cited as the greatest obstacle to realising the brand's full potential by 16 per cent of respondents.
Lack of management commitment and weak internal communications were joint second (11 per cent each). One UK respondent added: 'Due to our large company size, it is difficult to reach an agreement on positioning, because of too many staff and conflicts of interest.'
Although the US and Europe ranked cash concerns first, and the Pacific Rim countries rated weak internal communications as the primary obstacle to realising their brand's potential, there was significant global consistency on this issue. But Pacific Rim respondents highlighted another interesting concern: the difficulty in internally differentiating between the corporate and consumer brand.
In the case of monolithic corporate brands, where the brand identity remains constant from head office to the market place, there is perhaps confusion and possibly even conflict as to which function - corporate communications or consumer marketing - retains overall responsibility for the organisational brand.
The report revisited a number of issues examined in last year's survey, including the level of integration respondents felt existed between the brand and the business planning process. This showed that globally, results have migrated from 'quite integrated' to 'very integrated' by four per cent, to 32 per cent. Rather disappointingly, this improvement was balanced out by a four per cent upward shift in the 'not integrated' category, from 12 per cent last year, to 16 per cent in 2000.
The survey is not a definitive picture of what is happening on the corporate branding front, but it is an important step in understanding some of the current issues and practices. It also raises issues that are worthy of further debate. As Ajder says: 'There is predisposition for people to put their corporate brand on a pedestal and not integrate it into the fabric of their organisation. The challenge is to make it a reality, day in and day out.'
For a copy of the report, telephone ORC on (020) 7675 1000.
HOW THE SURVEY WAS COMPILED
263 companies were involved in the survey, with a geographical spread of US: 76, UK: 29, France: 25, Germany: 29, Italy: 26, Scandinavia: 25, Japan: 15, Australia and New Zealand: 23, South-East Asia: 15. For the purposes of reporting, these were aggregated as US: 76, Europe: 134, and Pacific Rim: 53.
The sample was drawn from international stock exchange listings from London, New York, Frankfurt and Hong Kong. Companies were primarily selected by virtue of their size - by turnover and capitalisation - with a bias towards organisations occupying a top 200 position in their country or region of origin.
Job titles varied, but respondents to the telephone survey were senior corporate communicators and brand guardians who had overall responsibility for corporate communications and/or corporate branding.