In this second year of its Regional Forums, PRWeek will focus on seven top markets: Los Angeles, New York, Chicago, Atlanta, Washington, DC, the Bay Area, and Texas.
For each of these regions, leading PR professionals from a variety of agencies, corporations, and nonprofits will participate in a roundtable discussion about the PR issues that affect them and their peers. Julia Hood and John N. Frank were in Chicago for the third of this year's PRWeek Regional Forums. The complete transcript can be found below. Click here for the piece as it appears in print. For pictures of the event, click here.
Kathy Baughman President, HLB Communications
Keith Burton Regional MD, Central region & worldwide director, corporate/employee comms Golin Harris
Paul Davis President, Black PR Society of Chicago VP, Danielle Ashley Communications
D. Michelle Flowers President and CEO Flowers Communications Group
Julian Green Director of comms, Chicago Park District
Nick Kalm Partner, Reputation Partners
Bob Kornecki President and CEO Midwest, Burson-Marsteller
Jim Martinez GM, GCI Group
Gary Ross Manager of corporate PR, CDW
Howard Solomon Managing director, Ruder Finn
Pam Talbot President & COO - US, Edelman
Sally Benjamin Young VP, global comms, Baxter International
Julia Hood (PRWeek): What's going on in terms of new business? Are things picking up in the market?
Nick Kalm (Reputation Partners): The market is picking up. There is definitely some pent up demand. You're seeing some companies that have budgets or some agencies that were maybe downsized before are staffing back up. There's definitely more organic growth and other new opportunities coming out from companies looking to spend money that haven't [recently].
Pam Talbot (Edelman): There are many more opportunities than there were a year ago, but the competition has been much stiffer. In the past where there have been two or three agencies, now there are six or seven and the RFPs have been much more complicated. So there has been much more business and still very tough competition to land it.
Keith Burton (Golin Harris): There's been some big stuff in this region. All of us are saying it's an issue as much of worker talent as it is of new business.
Howard Solomon (Ruder-Finn): Business is certainly picking up. The beginning of the year was a little strange, but we've seen tremendous momentum in the last 60 days alone. I agree the RFPs are more competitive and you're seeing different strata of competitors.
Jim Martinez (GCI Group): A lot of the folks actually found homes on the client side. There's a much more rigorous process. A few years ago you could commit a response to an RFP and there was a chance that that was the final round. Now there's a three round that's waiting for the four round.
Joel Curran (CKPR): Chemistry is a big part of it. They're evaluating on talent and creative ideas. But, more than ever, chemistry has become a big part of it. Maybe it has been since all the staff shifts back in the late '90s. Now they really want to be able to evaluate the team. They want to see the senior leadership that's going to be there day-to-day.
Michelle Flowers (Flowers Communications Group): They also want to see the diversity. A lot more of the general marketing agencies call me now to partner with them. To lend a different perspective in terms of business picking up, I really did not see decline over the past couple of years because the African-American market is growing, and the budgets tend to be smaller, so fortunately we were not cut as much as a lot of the general agencies. But I am seeing more business this year primarily through partnerships with the general marketing firms. Many of them are now looking at the browning of America, and with Chicago being 38% African-American, they now want to see that reflection in their programs, We will often have an agency call us up. They will come up with an umbrella strategy and look to us to make sure that it is employed in the African-American community as well even to the point of development of names of their programs to make sure that the name and direction of the program is culturally reflective and not offensive to the African-American and Hispanic consumers as well, so I'm getting called on by general marketing agencies to provide substantive support.
Talbot (Edelman): That's true. The marketing sides of most corporations are looking for diversity marketing that's [also] mainstream.
Paul Davis (Danielle Ashley Communications): I would echo what Michelle said. We have a small, African-American-owned agency, and post 9-11 hasn't really impacted us at all. We're very aggressive in the governmental sector, and non-profit probably represents about 15% of our clients. We've picked up a lot of real estate clients. We've probably grown 30% in the past year.
John Frank (PRWeek): What about the corporate side? What are you doing with PR?
Sally Benjamin Young (Baxter International): On the budget side, we are pretty flat and tight, which has raised a challenge for us. We really need much more personal talent inside. In terms of the work we do with agencies, we're much more selective on which products we will work with [them on], and we'll work with a smaller handful of agencies to get those done. That means the people on our teams need to be both strategic and can be very selective on the tactical front. At the same time, they must be very grounded in the business.
Gary Ross (CDW): At CDW, we really haven't added more talent in-house. We are growing our business and we did continue to do well in the downturn. I'm fortunate that the PR budget is in a pretty healthy situation.
Hood (PRWeek): What has changed here during the past year?
Martinez (GCI): The window shopping has ended. We're all seeing an increase in legitimately funded business opportunities.
Bob Kornecki (Burson-Marsteller): We've had a regional approach to business development. My job is to mine those opportunities that exist in the Midwest and might have been overlooked in the past. Given the orientation of most large firms, most of the business development that would occur was in New York and Washington. So there were a lot of opportunities in the Midwest that were left really undeveloped. We're trying to put more of a sharp focus on regional business development.
Martinez (GCI): People are no longer taking it at face value they want proof, which is a relief because people who have experience had previously been edged out by really impressive light weights and the problem undermined the professionals and mades us all look bad when there were spectacular failures.
Ross (CDW): On the corporate side, we're looking for areas of expertise. We might not need it right then and there, but we might need it six months from now. We want it to be there because, otherwise, it creates difficulties when it comes time to knock on that door and no one's home. I just want to go back to talking about general market expertise. Our culture and internal comms are a big part of what we do. There's more of a move for integrated communications and branding at CDW. Public relations is part of the branding group, and I'm personally going to embark on a whole messaging project that will go beyond media relations. There's more of a move to this integrated approach where there's a terrific opportunity for agencies in their current relationships where say [the client] is only working on three categories. There's a good chance that the company is going to move into categories four, five and six. If the current agency [has that] expertise, then that's the place [the firm] is going to look first.
Young (Baxter): There is a fine line now between the kind of communications that are done externally and internally. There is increased scrutiny externally. You might be working with an agency on areas, but everyone on the inside is now watching and there's so much more visibility. It is so important that there not be a disconnect between what you are saying internally and externally or you completely lose the confidence of your internal team. As a result, we're spending a lot more time going a lot deeper in developing the programs from an internal perspective. That gives you a huge opportunity to move an employee base in a certain direction.
Martinez (GCI): Companies have come to recognize that internal communications, in many ways, are more important than external companies that have done it really well. What's exciting is talk of branding. When there was talk about branding 10 years ago, the average person in marketing would look at us like we were selling corn because public relations isn't branding; public relations is public relations. But now that people have started to realize just what an impact they could have through public relations, it's incumbent on us to make people realize public relations is different. I don't want advertising people to have the branding. They've had their chance and their budgets. Now I want their budgets.
Kalm (Reputation): That's been another result of the downturn. You see more non-public relations providers trying to get into public relations. Whether they are advertising agencies or event marketing firms, the competition has real changed.
Talbot (Edelman): That's been the biggest sea change in the last couple of years. There is a growing gray area that nobody owns because some of it has never been done before. We're moving into new territory and no one is clear who should do it.
Hood (PRWeek): How competitive are ad agencies and PR firms in this market?
Talbot (Edelman): Everybody is creeping into everybody else's area. That's caused an enormous amount of upheaval. It's a jump ball essentially.
Ross (CDW): Marketing, advertising, and public relations are going to have different roles in B to B...
Martinez (GCI): If you're doing guerilla marketing or community marketing, you need a fresh approach.
Curran (CKPR): At CKPR, we came out of Cramer Krasselt Advertising. We found that most clients came up to us and said, 'We want to do public relations, but we don't want to get caught up in whether advertising or public relations people will lead it. We just want the best thinking.'
Flowers (Flowers): I'm competing more and more against the big advertising firms. They get up there and they show these wonderful commercials with young African-American children running throughout them, and I'm showing the clips. Sometimes, in these pitches, the [potential client] is looking at apples and oranges. So you need a client who's looking at the strategic direction and messaging that says, 'Ok, I need this African-American public relations firm and not one of the major advertising firms.'
Martinez (GCI): Aren't you finding that clients are the ones who are integrating? I have an integrated marketing model, but I don't think clients have quite bought in to buying a one stop integrated shop. My sense is they're still the ones who want to do the choosing. They're integrating more and more. The secret is how we're going to integrate with our teams.
Kathy Baughman (HLB Communications): They're looking for someone to lead these teams. More and more clients want to buy smart. They want to buy somebody that can help them put all the pieces together and figure out what's the best thing to do - whether it's public relations or advertising or whatever. If you can go and provide a point of view that helps them figure out what is it we need to do, you're going to have a good long-term partnership with them and you're going to end up doing things that are very non-traditional from a public relations standpoint. You have companies that have been stripped of their own human capital over the years that they have to have people on the same page that march to the same tune.
Burton (Golin): The point is our client has changed. The role of brand management today has changed; the people we deal with are moving around.
Frank (PRWeek): What messages is government here putting out with PR?
Julian Green (Chicago Park District): We traditionally haven't engaged full service public relations firms, but we look for a one-stop shop when we do. We've looked at firms to work with us downstate as well. It's been a combination of public relations firms that can do intergovernmental affairs, public affairs, and guerrilla marketing and more of these holistic activities to take that message because most of our organizations have a director of communications and possibly have a staff to do day-to-day messaging and press release. So we are looking for firms to help with the community because we don't have the wherewithal to cover a city of three million people. We just announced a budget deficit, which doesn't allow us to pay market rate for different things.
Davis (Ashley): One of the things that I discovered for a shop our size was that we were all of sudden in this RFP market with groups of folks from within the community who thought themselves to be community experts. On this particular RFP involving state highway reconstruction, there were all sorts of grassroots groups. Initially when this RFP process started three years ago, there were only public relations people in the room and, now, I'm in the room with all these community grassroots folks who say, 'We know how to reach the community, churches, and alderman.' Suddenly we were up against these groups. Public relations people were saying, 'Who are these people?' I happened to know a lot of these people and said, 'Hey they're the community itself.' I find it very interesting that a lot of the larger agencies don't like to engage in this sort of blue collar work, so they hire people like us who can run people into the streets and hold public hearings and get down and get dirt under the nails. Having people who are going to help to pave the way is really important.
Solomon (RF): We talked so much about changes on the agency side, but not as much has been focused on the client side. There have been some seismic changes, and it's a wonderful thing from my viewpoint. We're finding a lot more clients have worked on the agency side, so there's a lot more togetherness. I find the clients are driving a lot of this. It's been really refreshing the last couple of years.
Davis (Ashley): Look at the Wal-Mart situation here. They're making some missteps in Chicago where they're trying to build on the South Side and the West Side. They've made mistakes by ignoring the indigenous agencies that could relate to those communities. They actually had an African-American advertising agency, but they didn't go to them for advice.
Martinez (GCI): Wal-Mart made the classic mistake of assuming that Chicago was Chicago was Chicago. The West Side is not the same as the South Side; the bottom line is that it's a different market. I would argue that is a more complex market not just in terms of the real estate example but there's more complexity in the market today in everything whether it's a business-to-business initiative or a consumer initiative. Things aren't as simple as they used to be. We have a better understanding of nuances in public relations because we live in the gray area. We get that there is no black and white truth. We have the opportunity to take leadership. Maybe not 'the' leadership role but 'a' leadership role.
Young (Baxter): This leads me to the idea of relating it back to internal communications and being able to see the gray area and being able to maneuver through that gray area is hugely important in the corporation. You can help the entire management team see the impact of decisions before they actually commit to those decisions and help influence them to take another route.
Frank (PRWeek): How are you helping staffers make the transition to a more integrated marketplace?
Burton (Golin): The raw material that is coming out of school today is more diverse. They have a greater expectation of loyalty from the company than they did even five years ago.
Solomon (RF): That's a Midwest phenomenon. It absolutely exists here. Having come from our NY office originally and having responsibility for LA, [I can tell that] it's very different in those markets.
Curran (CKPR): The raw talent coming out today is more diverse, much more in tune with grassroots marketing and in tune with what young people want. The great itch that everyone is trying to scratch right now is how you develop that great rung of middle management and find a way to keep them We're all spending a great deal of time and effort and money on this. The account supervisor and VP are the people you hope you can build into the foundation of whatever comes next. We look for people who want to become greater and we try to put programs in place that will help develop that.
Kalm (Reputation): Stopping the exodus to the agency side and even the client side or out of the profession completely is as big if not a bigger issue than hiring the next generation. It's challenging to work very long hours for no pay increases or pay cuts or RFPs that don't come to fruition.
Kornecki (Burson): Recruiting is relatively easy in this environment. The industry has suffered so much that raises have been withheld and people are just put upon by the environment. If a great opportunity comes along and you have a chance to earn a hell of a lot more money than at the company you're working for, you're going to scoot. One of the critical things in terms of retention, that we often times forget, is that the critical asset of our business is people. Management and middle management need to take a personal interest in cultivating young people. Unless you've got that kind of mentoring relationship and unless you make people feel they are a core asset of the organization, they're going to scoot. We don't do that as often as we should. Having that kind of personal relationship with your staff is critically important. Doing things like performance reviews on a regular basis become critically important. You can't just blow if off because, when you do that, you're sending a message to people that it's not as important as chasing the next business opportunity.
Solomon (RF): To achieve loyalty you have to show loyalty. We did the little things, like putting people on a track they could see. I know my people are getting the calls. I'm seeing loyalty.
Green (Park District): It's a little bit different in the government sector. We're looking for is someone who can handle the porch collapse at midnight and take media calls very quickly. The unfortunate thing is you can't hire anyone too green who doesn't have the political or media savvy [chops] to deal with a situation like that. Also, we really can't raid your shops because your best and brightest command a salary that we can't pay. So we usually have to pull from within. So those who have dealt with community relations often become public relations specialists and learn the public relations trade by matter of fact. Otherwise we find ourselves pulling former reporters out of the media.
Talbot (Edelman): I do think that public relations is better regarded than it was several years ago. A challenge for us is not only keeping the people who are at our front porch now, but also bringing in people who have never been in public relations and really have something to add to the business as we go through some of these changes. You know some of the things that we looked at is bringing in branding experts and people you wouldn't traditionally find at a public relations firm. These are people we need to be there and teach us skills and integrate our people.
Frank (PRWeek): Is there a great mass of PR people just waiting to jump to new jobs as the job market improves here?
Burton (Golin): Absolutely
Ross (CDW): In all the talk about training, how many of the agency folks here are doing any training or hiring with this in mind, the areas of financial expertise, business expertise especially with Sarbanes-Oxley. I know that's a big issue right now. Is there much internal training on this or are you hiring?
Martinez (GCI): You need a holistic view of what gets a company from here to there. We hired someone with a business consulting background. We started to roll off business training programs.
Davis (Ashley): A lot of the times the reporters are trying to wade through a company's annual report, and they need someone on the other end of the phone who can explain it to them. The industry remains challenged. We have to continue to educate people at to what public relations is. It used to be, 'You're the guys that were able to place news releases or arrange an interview.' We're community relations people who are advocates. To the extent that we continue to forge ahead to educate business, we're constantly challenged. We've got to be able to raise the level of intellect and understanding among the public to understand how we really impact services and help companies to grow and evolve with their needs.
Young (Baxter): You can't do that if you don't speak the language of business. The more the folks on my team speak that language of business to the folks in our company, irrespective of whether they're in marketing, finance, or whatever, it is there where we immediately get the credibility in pulling [potential clients] into our stand. The biggest problem I've seen over the years is that when you can not speak that language, you can not engage your business partners.
Martinez (GCI): It's all about language.
Flowers (Flowers): Given the dearth of African-Americans in public relations, I have to train almost everyone who comes to my door, and I've been in business now 12 years. I can't go out and catch too many African-Americans with management experience and bring them into my firm, so it has impeded my growth. I tell people all the time [the firm would] be double the size it is now if I could go out there and really snatch that talent pool, not just of African-Americans in public relations but who also have that agency mentality. I know a lot of strong African-American practioners on the corporate side, non-profit side, and government side. The agency side is a whole different experience. We're almost masochists sometimes and you have to live it, breathe it, and look at it very different. I've seen some people - who I truly respect - that have tried to make that crossover who can not. I came on board at Golin Harris in the early '80s and there was one other African-American woman who proceeded me, someone I respect very highly, who did not make the cut over there because she couldn't get into that agency mentality and how we just move on a dime sometimes. I've had to home grow everyone that I've had in my agency, and then I become this training ground for the Edelmans and the Bursons and everyone else. It's ok because it's for the profession. You've got to help the general market agencies.
Kornecki (Burson): Some of it goes to the education people get in college. There's not enough orientation toward business if they're in journalism or communications. Even as people get into our midst, we probably need to do as better job of bringing them along on business. Often you focus on the creativity of it all; you don't really focus on the front end. We could all do a better job on that.
Frank (PRWeek): Are agencies doing a good job recruiting with ethnic and racial diversity in mind?
Flowers (Flowers): I do not see African-Americans at a mid- or senior-level on the agency side. I see them more on the corporate side, on the non-profit side, or on the government side.
Kalm (Reputation): Is that because you need a certain agency mindset?
Flowers (Flowers): I don't think there is the true commitment to diversity. You hear the top dogs talk it, but it doesn't filter down into someone's performance objectives to say we would like our agency to better reflect the diversity of Chicago. Chicago is 35-38% African-American. There are no general marketing agencies in this city who even come close to that in terms of their employment base. Not because the talent pool is not there - because you could do the same thing I do - bring them in and train them - but maybe the commitment isn't as strong as one would think.
Solomon (RF): I respectfully disagree with that. I agree the numbers may not quite be there, but we're high. At Ruder Finn we hired an African-American to head up...
Flowers (Flowers): What's your percent? One in two, one in five, one in ten? I don't think so.
Solomon (RF): My point is a simple one: I do think we're trying.
Flowers (Flowers): Trying versus [being] committed, to me, are two different things.
Talbot (Edelman): We specifically go looking for diversity. I would say there is a commitment but we're inept and I'm not quit sure what goes wrong. We do say this is what we want to do, and we think it is a smart business move. We have a Hispanic practice. We ask ourselves, as African-Americans leave, why? They say, 'We're not happy here.'
Davis (Ashley): I'm the president of the black public relations society. I probably have met with more senior general market chairmen than a lot of people in the city and I ask each and every one of them, 'What's your percentage?' Not one person [in the past two years] has told me what their percentage is. They don't want to tell me, but I know.
Curran (CKPR): I'm on the board for PRSA in Chicago and we're trying to reach out. One of the issues for everyone in the room is we've got to do a better job of cooperatively recruiting. I came out of the Disney organization and we spent a lot of time recruiting. We went to the traditionally black colleges and we found a lot of talent. It's hard for my mid-size agency to attract this great talent and I don't necessarily have the resources to invest in it. The industry - and specifically Chicago - has to try to feed into a system to where we can work with the black public relations group and try to find a way to work in a cooperative effort and do something special in Chicago that isn't able to be done in other markets. It should be done in LA, but I don't think it's being done there. I don't think it's being done in New York. We can do something special in Chicago. We've got great leadership with Edelman and other shops that are homegrown and we need to get together. Maybe we can start with this group through the PRSA, our board. This is a very important point for us.
Green (Park District): From a government perspective, we do a very good job. We have a mayor who has made a commitment through his top executive staff, it filters down to the organization. I've probably seen more diversity in government than in any job I've had. Coming from the agency side in 1996, I was the only African-American in the agency, and when I did see other African-Americans, they were in administrative roles. So it begged the question: 'Where are the people in the organization that I can learn from?' That's when I reached out to Paul Davis almost 10 years ago and found out about the Black Public Relations Society and found out how can we help more African-Americans get through the door in these major agencies. It does help at the end of the day.
Burton (Golin): We've been dealing with this issue for many, many years. It goes beyond ethnicity and lifestyle choice. The issue is building the kind of culture where people will feel comfortable.
Green (Park District): I saw two clients asking about diversity on their teams while I was at an agency.
Kornecki (Burson) It's a two-way street. Some agencies started recruiting at traditional black colleges, but I'm not sure how active people of color are in marketing themselves to the general marketing agencies. We'd love to be able to hire more people of color in the firm, but we just don't see the resumes coming in, so people are really self-selecting.
Green (Park District): I went to a historically black college. I haven't seen traditional public relations programs at universities like Morehouse Spellman College or Alabama University. Having worked in agencies and seeing students from Northwestern who come out with public relations degrees who come out with integrated marketing degrees, there's certainly a difference because they come out of college knowing who the top 10 public relations firms are. I knew nothing of public relations coming out of college, but I got acclimated to public relations when I came back to Chicago and began working in radio and television.
Hood (PRWeek): What's it like working with the Chicago media?
Talbot (Edelman): Most of our clients don't care about being in the Chicago media. They want to be in the New York Times or the Journal. I think we spend half of our time explaining ourselves to angry Chicago reporters who ask why you didn't break that story here. There is this odd tension that here we are sitting in Chicago and Chicago media are not the top of our pecking order This has created a very terrible relation for us with the local media.
Young (Baxter): Because Chicago is [a large] market, there is a lot of the national media based here as well. You end up with an even greater tension because they're all Chicago based, but if you have your choice of breaking a story with a national publication or a local publication, you probably want national visibility. You've got to nurture the individual contact with national media without alienating the locals who truly are important as well in carrying your message to the local community.
Ross (CDW): It depends on the story. A lot of times we may look back and say, 'Ok, here are the stories we have. What might be more appropriate for the New York Times or the Journal?' With members of the national media that are based here in Chicago, we try to manage those relationships as well as with people based in New York. A lot of times people based here in Chicago don't like it when we have those relationships with people in New York.
Kalm (Reputation): Chicago media has become much harder to pitch. Their resources are tapped, they're covering two or three beats, they're chained to their desks, or they don't want to come out and see a story. They're frustrated that they're not getting the national stories, but there's a good reason the people with national stories are pitching them nationally. But it's getting harder to pitch the regional stories, and there are a lot of them. There's general skepticism they have about business that's really permeated the business pages.
Solomon (RF): One interesting phenomenon that we're experiencing and, it might be because a lot of our clients are in the tech space, is that the Sun-Times is gaining much more credibility for a lot of our clients. I've only been in Chicago about six years and, when I came here, the Sun-Times was looked at with a bit of disdain. Now, from a business perspective, they're quite a bit [prone] to take risks. They'll look at companies the Tribune might deem not traditional enough. They've taken a degree of share from the Trib from a credibility point of view.
Ross (CDW): They've done a great job in finding their niche.
Green (Park District): There is a hierarchy in terms of news coverage in Chicago, and the government is in that top tier. When I started working in the mayor's press office, I was on a first name basis with every assignment editor. When I was on the agency side it was difficult to break through. Channel 9 is probably the most public relations friendly station because you have four hours of broadcast news. They take bands, and they do product announcements. You can probably get most of anything on that station, but when you're talking about Channels 2, 5, or 7, it's basically hard news. It's a stretch when you're talking about new products or new initiatives and announcements.
Ross (CDW): WBBM-AM (the all news station) has expanded their business coverage on the tech side. Channel 5 still has the tech segment on weekends. It's nice that it has a dedicated tech reporter. Our headquarters is an hour north of the city. We always have the challenge of [whether] we can get a crew out there.
Frank (PRWeek): What about working with Crain's Chicago Business?
Kornecki (Burson): The general view there is that big companies have targets on their backs. If anything has gone awry with a company, they're going to exploit that, but that's also true of a lot of different regional publications.
Baughman (HLB): They have a stated editorial policy that if you're not in the top tiers of your industry, you don't even have a chance of getting a good story.
Kalm (Reputation): They don't liked to be pitched. They wait until you screw up and then they come after you.
Martinez (GCI): They've carved out a niche. They're not looking for huge volume of readership. I would argue Crain's is carving up their own life. In some way, Crain's beat reporters are more accessible, but it depends. They don't have to feed a daily hunger.
Ross (CDW): In overall financial and business reporting, there still seems to be an overall negative bent. We're fortunate enough to have good things to talk about and it is really hard to get that coverage. You look at the predominate financial news coverage and it's all about these layoffs. We try to do is again build the relationship to put these numbers in context in the overall story. Bad news sometimes is just more palatable to editors than good news is.
Talbot (Edelman): Some of the reporters feel they missed the bad stories. We too were serving up stories and not all of them turned out to be substantial or true. It's always been this way. It's an even more challenging and contentious environment in recent years.
Ross (CDW): What's adding to that is ethical battles newspapers themselves are having.
Young (Baxter): At the end of the day, it's about trust and building credibility and the best way to do that is through transparency. And the more that corporations and media have honest dialogue when things are going well and when things aren't going well, the better things are. You can't just choose when you want to speak out and when you don't. The greater the transparency, the more you're building trust over time.