Consumer Roundtable: Dialogue yields valuable insight

Erica Iacono and Nicole Zerillo visited Chicago to discuss consumer PR

This year, PRWeek will visit eight cities where an industry close to that respective region will be discussed. For each event, leading PR pros from a variety of firms, companies, and other organizations will gather in a roundtable discussion about the issues affecting them and their peers. Erica Iacono and Nicole Zerillo were in Chicago to discuss consumer PR.


The business of consumer PR

Erica Iacono (PRWeek): How would you describe business right now in general? What are the current challenges for consumer PR?

Audrey Reed-Granger (Whirlpool): Business is down, big surprise. They're protecting PR at least at Whirlpool. But, the downside of that is that I know exactly when an advertising meeting has just happened and they told category people and brand associates that [they've] just lost [their] budget. My phone starts to ring. And it's people I haven't talked to in two months, and [they say], “Audrey, have any great PR ideas?” [I say], “What happened?” “Well, my budget just got cut,” . . .  That's the sort of thing that's happening a lot. Every quarter of this year, and it's interesting, they used to not cut [other disciplines]. They used to say, “PR, we can start cutting there.” Now, they're cutting the bigger budgets and saving PR.

Jennifer Taylor (SC Johnson): [PR] is very cost-effective, but with that they think that you can do “everything PR”. You know it should, at its best, be part of the marketing mix as opposed to a standalone. And, you have brand managers who expect the world with a very small budget. And, it's just not going to happen that way.

Edd Snyder (General Motors): Maybe the times are driving PR and marketing together. And you have to form some sort of relationship, two against the world, rather than being very separate. Especially in the social media area, I don't think marketing people have quite figured out how to handle that. But in public relations if you've done some online person-to-person stuff or blogger-to-blogger activities, we've reached out to people and you get the dialogue going. And, I think marketing people see something there, [but] they can't quite figure out how to turn that into a marketing activity.

Reed-Granger (Whirlpool): They're not fighting you for it though?

Snyder (GM): No, we've been meeting to find out how you can't really sell to these people [that are online]. It's not really what they want. It's a complete turn-off. So, I think the idea is to connect with them in a way that is agreeable to all. I think PR has figured it out. I think the people on the receiving end have figured it out, and I think the people on the marketing end have to work their way through there.

Michael O'Brien (Cohn & Wolfe): The exciting opportunity here is that it capitalizes on one of our core skills, which is relationship building. So, instead of talking at people, we're used to selling ideas, creating that dialogue. So, the point is that [marketers are] used to dictating terms, but the game has changed. And, I think that our core skill set is proving to be very useful. Now, the interesting thing, and the $10 million question, as it relates to what happens when other parts of the marketing mix get cut is, how can we scale this? How can we make this bigger? How can we create more reach and frequency than we have before?

 

Ellen Ryan Mardiks (GolinHarris): As Erica raised the question, we morphed into this area very quickly, discussing digital and social media, for a very good reason. There is no question that the rise is in social media, the tremendous impact that digital is having, on all that we're doing around this table is protecting our budgets, growing out budgets, and taking a challenging time and really buffering that significantly. And, I agree with the folks that have already said this— there is nobody who knows how to do this better than we do. And, we have to make sure that it's not really a turf thing, but make sure that we're maximizing effectiveness, not just cost- effectiveness. That's what we're doing. So, I see our business as being very healthy, though I'm sure that there will be some challenges this year. But, it's healthy and growing, and that's one of the reasons why.

Emily Frager (Fleishman-Hillard): The entrée into digital or our relationships that have come to life have given us the chance to be the integrator and to prove that we really should be the integrator in projects that are overlooked. We got in the door because of social media or digital, but they keep us there because we prove to be the strongest project managers.

Iacono (PRWeek): You brought up integration. How many of you are really seeing this? Is it something the client is driving or the agency? What are the challenges of achieving that true integration that everyone strives for?

Susan Howe (Weber Shandwick):  I feel our clients are seeing an integrated team more and more and doing it better and better. One thing I've noticed over the past couple of years is that PR is now equal at the table at the beginning of a conversation and I really think it's the norm versus the exception. We're seeing [this change] with our clients, and [we're] working to deliver even better results. We were talking a minute ago about what was going on in the economic climate, and my situation I think is similar to what other people have said: That growth has slowed, but business is still good. We're hearing from our clients that PR is being seen as very nimble, which I think is a different nuance because that means we can come in quickly and respond to what is going on in the marketplace. And, I think in these economic times, that's even more important, to seize opportunities more quickly.

Renee Zahery (Kraft): We have a very integrated approach and have for a number of years. All the disciplines sit there, and work together. It doesn't matter where the idea comes from. In terms of the economy and ideas and funding, we will always fund a creative, big idea that will move cases and do things for us. If you bring [big ideas] to the table, that are going to work [we're] going to find the money for them.

But also, we've taken it, and you look at the economy from a business perspective and there is no doubt that input costs have affected prices and we're looking at it from a consumer perspective: what can we do to help consumers through these things? And we've put a few programs in place from online things to discount offers, so it's also an opportunity to provide services to a consumer as well.           

Iacono (PRWeek): When talking to consumers about rising costs, how do you then convince them to buy a brand name, when there are cheaper, generic options?

Mardiks (GH): You do more for them, you mean more to them, and come through for them.

Zahery (Kraft):  New product innovations. Things as simple as better packaging, new reformulations, higher quality. Take your iconic brands and really make them sing for consumers. Do that on a number of fronts.

Snyder (GM): Audrey and I may have the most expensive things to sell, which is a whole other world. And, what you've read and think about General Motors and the auto industry in the past two weeks, what we sold to people a month ago does not work today. We have to sell fuel economy, alternative fuels, and it's not the look of the car, [though] that still exists. [Consumers say], “I don't want to put five dollars of gas in a tank and watch it disappear. What can you do for me?” Our whole message has turned overnight on something that has cost 60 to 70 thousand dollars.

That is our message. Now, we're talking about the technology, the different propulsion systems, which was a good thing to talk about before, but it wasn't the primary thing.

Rick Miller (Northlich PR): There's a tendency in times like this when we've got storms being created: economic, environmental, dietary, you go down the list . . . brands forget who they are. And, they say, “I'm going to cut costs. I'm going to give it away on promotions to go to place,” and we've seen examples of that. We've seen brands have to go back and remind themselves of who they are, deliver innovations through functional benefits. But, who they are drives the emotional relationships. And, people are losing that.

Zahery (Kraft): It's not even just who they are to consumers. [It's] what's the consumer insight? And, those are things that gets them excited, what is it that really makes them want to buy your product?And, that's how we go to market— the key consumer insight [is] the driver, and you look at things like Oreo, milk and cookies, and you look across our portfolio, you'll see that going all the way.

Frager (Fleishman-Hillard): One thing we're seeing across our practice is segmentation, specific segments of consumers, where we can really speak in authentic relationships and all of the buzz words we've heard before. But, those are the key areas that we're seeing. We're busy. We're using this time, and seeing this from our clients as well. Let's take advantage of a slow time and not stop. Let's use this as a rebuilding time, and a time to stack the deck for ourselves and we're doing that with our baby boomer, retail, with cues marketing. 

Julian Green (MillerCoors): [MillerCoors'] sales have been great. People have said this for the past decade, for the past 20 years going back, that beer is a recession food product. And, even with the cost of goods, we've been able to manage that through risk management strategies, and basically buying up front for next several years at a particular cost. And, we haven't passed that cost onto consumers.  But, I agree that in our positioning we have a lot of consumers trading down from wine and spirits to beer. One campaign, that some of you may be familiar with is the delivery guy campaign, the Miller High Life Man. This was a 103-year-old brand, and basically had been in decline for the last 10 years.

In October 2006, we launched this campaign where this big burly delivery guy comes in and says, “This is the high life, not $10 for a hamburger or sky boxes. This is not what the high life is.” And, as a result of that, people really caught on because it was the positioning of that brand as a common sense brand for common sense type of person.  And, as the economy began to struggle, people start looking at value and they remember that campaign, that this campaign speaks to the value, and was more of a regional campaign than marketing. [The company] really put out the pilot test, but started supporting that with PR. And, we started taking this particular character out on the road to baseball games, tailgate parties, the pub, to other delivery guys, and it just resonated.

And we have brand PR division, so we do have a seat at the table. When marketing campaigns are put together and getting ready to launch a new product, we can help drive brand PR ideas from the beginning.

O'Brien (C&W): Integration [was mentioned] before, and if someone walked into the room right now, and heard some of things [all of] you were saying, they might guess you were head of a business unit or a marketer or a CMO, because you're speaking the language of those people. And, I think, as you think about integration, it's sort of a push, pull. They need us more than they ever did before, meaning business leaders and the marketers. On the other hand, I think this industry has really raised its game over the last 10 years. Our clients sitting at table with people who make the decisions are frankly better about deep diving into their businesses, better at figuring out how PR fits into the marketing mix, and expanding the marketing mix to such a degree that they'll be a key part of that discussion. I think if we're being honest with ourselves, 15 years ago we weren't good enough to have that seat at the table. And, we realize that this is our moment. This is that moment, where the combination of higher level skills and huge need in the marketing marketplace is connecting, in a way that I think is meaningful for our industry. The fact that so many budgets have not been cut, I think is a testament to that.

Cheryll Forsatz (MWW Group): There was a time when marketing was here, PR was over here and not allowed to sit at the table, and had to latch on to that PR topspin. . . PR [is now seen] as a way to expand and extend dollars.

Reed-Granger (Whirlpool): I think we changed. We used to consider ourselves just strictly media relations. Or, [someone would say], “We just launched our advertising campaign, go out and do this.” We changed. We became savvier about the discussion over influencers and the pulling and pushing. We got smarter about what we could do. And, then, all the tools, that became available through social media and grassroots, guerilla marketing. It changed. . . PR is [now] a function of marketing. That's what changed. We never used to put ourselves in the same class as marketing.

Snyder (GM): To somebody's point that this is our greatest opportunity, it also raises another issue of responsibility because it is an opportunity to say what we want to say, do a lot of things that we want to do. Then, you have to prove that you were effective it at it. And, because the research part is in my daily way, it's very frightening, because then you have to think…”How do I prove this?” The social media kind of works because you can [track] the hits, touches, or other things like that. But, some of the other ideas that we have, they're harder to substantiate, but probably better than marketing people.

Iacono (PRWeek): Measurement and ROI has always been the Holy Grail. But do you have the budget for measurement? How are you measuring your PR efforts?

Forsatz (MWW Group): We do a lot of our work in this area. And, a lot of our activities will get tied to sales for specific promotions or product launches, and it's incumbent on us at the beginning to develop a plan and say, “Here are the goals for media impressions, sampling of the people we want to reach.” But [sometimes], what we'll do is launch PR activities maybe a couple of days before the advertising launch, and we can see. . . when you isolate it, not that it's always possible.

Mardiks (GolinHarris): PR is as measurable as anything-else, that anybody does . . . However, the investment needs to be there, and oftentimes it isn't.

Miller (Northlich PR): PRWeek did a large feature a year ago on P&G's marketing mix modeling. So, there's all kinds of press [out] there for how that can occur—regression analysis and everything else. We've got this body of knowledge, but day to day, what's happening—and I think why digital has such an impact on us— is because we can do research in the wild. We can go out on the Web and look. We can dialogue with consumers and we can get to the table quickly, informed, and just as smart as folks that spent a lot more money. And, on the back end, we're back to seeing the promotions we couldn't do in the old days, [now we] can do them on the Web. [We] can see people participating with cheap channels to create brand engagement, that we just couldn't do before.

Howe (Weber Shandwick): Consumers are such a huge feedback loop, because they all have a platform and place to speak.

Green (MillerCoors): When we started looking at measurement platforms, prior to me coming to Miller, there was this discussion with the CEO that basically we understood the value that PR brought to the table and the sense was, “I don't need a stack of clips at the end of the day.” And basically, the measurement model was just too cost prohibitive for the department. What we started looking at doing when I came to the company is really measuring against the narrative of the company, and really having a conversation with executive leadership and asking, “What is the story you want to tell to the market? What is the story you want to see in the Wall Street Journal? And, if you want to see that story, then it's one thing for us go out and pitch and sell that story to the Wall Street Journal, but it's another thing if we're taking the actions to deliver that story.” So, it's a marriage of both worlds. We're going to say, “Miller is going to take the action, the shares from Anheuser-Busch, be bolder, faster, stronger.” Then, we also need the marketing side to say “What are the actions that [they] will take to help us tell that story?” So, at the end of the year, when we sit down with our [CEO], rather than coming in with a big old stack of clips and saying that 85% were positive, and 50% were negative, the 85% that were positive probably didn't sell beer. It could have been about a corporate social responsibility campaign or something-else. But, when we look at the narrative that we agreed upon a year ago, “Did we deliver against these actions, against these actions marketing delivered, and did we go out and tell the story?”    

Reed Granger (Whirlpool): When I was on the agency side my biggest frustration was dependence on media impressions. That was [a] simplistic [metric]. My client would not understand that media impressions were the measure of the lazy practitioner. [For example], when I worked for [one home improvement retailer],we redid Katie Couric's dressing room. Then, when she was on air she gave credit to [its competitor]. And, everyone was like “We got her! Yay!” Yeah, but it was what she said. She didn't give credit to the right home retailer. And, I said, “You guys this is why I don't want us to focus on impressions because it's about the penetration of the message.”

So, I said my dream is to go on the corporate side and institute a weighted message, and I couldn't get the client to sign off on it. So, when I went to Whirlpool, I sat down with all the brand managers and said, “OK, tell me the true stories behind your products. Tell me, what your products are about.” Then, of course, they tell you about things that aren't really important. And, then I would sift through that, and help them work on it. And, then we would agree, and have the top three to five messages per product per category and that would be what we would then go after.

So at the end of each quarter we would go back. We have an agency here [in Chicago] that analyzes all of our coverage to see what message penetrated, and then we do a weighted key average to other things inclusive of impressions that then give us a grade by category, by product. And, it changed the whole discussion of the corporation. [They ask], “What grade did we get? Did we get an A?” [And now I can say],“No, because we were trying to tell the wrong story. It's not resonating with the consumer.”

          

Mardiks (GolinHarris): Still, [there are] some clients who are comfortable with the impressions and living there, but I think it's our responsibility to push them beyond that.

Forsatz (MWW Group): This goes to the educating part because you have clients, who [are] in certain sectors,  like consumer electronics, where everybody wants to [work with] those core tech reporters who write with the Wall Street Journal [or] the Times [with] and have these big impression numbers, and that's where your consumer electronic companies want to be. But, when it comes to influence, it's in [Web sites like] Engadget and Gizmodo, their [page] impression numbers are so small [compared to traditional sites]. . . but should be more meaningful because that's what consumers are looking to.

 

Iacono (PRWeek): Whose responsibility is it to change the thinking and get clients away from using the numbers as a measure of success?

O'Brien (C&W): The one thing that I think is dead is the annualized approach to measuring. So, people want to have this big roll-off at the end of the year that tells the whole story of success or failure. In the end, we need to be capitalizing on our flexibility by looking at it week to week and asking ourselves, “Well, what's the opportunity to deliver what message to what public, right now? And, how have the things that have happened around us, enhanced that or made that more difficult?” And, it's that willingness to be nimble that gives us our power. That moment to tell that messaging, to tell that unique message to that singular person or singular group of people, you have to be ready for that. So, that means preparation, scenario planning, that means all the things we do that get us on our toes, so to speak. So, that when it happens, we're cognizant of our world around us, and pounce. And, that's what I want to measure on, that ability to hit that person with the right message. . . From an agency's perspective, all I want is a client that is in there with me every day. The client that says, “I'm going to be in there battling with you,” not “I'm going to sit back and wait for the document at the end of the rainbow.”

Miller (Northlich): So, we've also got stress on the other end, because we have more and more clients, who have thinner staffs, [as well as] want more and more turn-key programs, [that] want  delivered from the agency at the end of the day. And, they may go fight for it, but the reality is that that's increasingly harder to do.

Taylor (SC Johnson): I think on the internal side, the conversations we have a lot are understanding the true demographic that we're trying to reach. Because, time and time again, the brand wants Oprah, and [then I try to] pull them back to who are we truly trying to speak to, and what are we trying to say because the numbers will be very different. [For example], it could be that you're not looking for mass. Then, the challenge becomes the brands all speak to one another and they start to compare what they got for the dollar and it's re-educating them and saying, “It's OK. Your numbers weren't as big as this campaign because this campaign truly was going after mass. [Your] campaign is going after 18 year-old girls.”

Reed-Granger (Whirlpool): At least Whirlpool is more focused on the psychographics than the demographics. From a segmentation standpoint, [that difference] gives us much easier ground to stand on.

Blogging and new media

Zahery (Kraft): At Kraft, we consider blogging [to be] media. You don't just go out there. We've had a few overzealous brand managers, and that's nothing pretty, but it only takes once.

Snyder (GM): That's what we've done all our lives. When traditional media called us, we measured what we said, answered some questions, didn't answer others, and we guided people in different directions. . .

 

Zahery (Kraft): It's instantaneous and you've got a half-hour max if you're on an issue or anything-else, and you've got to be ready to go all the time. It's just so fast-paced now.

Forsatz (MWW Group): To me, blogging is a part of media. With account executives, [you have to be able to] go through all the steps you take if you're pitching a reporter, you read their outlet, you understand, you treat that blogger and that Web site in the same exact way.

Frager (Fleishman-Hillard): Regardless of the industry, whether it's a b-to-b company, they're all consumer focused. Anybody, who touches on other b-to-b type categories, it's a fun change that we're seeing being able to educate them about how to think three channels down or through the end of the channel, if you will. I think that's a new trend as well, where they used to be only communicating to one step next, now they're seeing the whole spectrum.   

Zahery (Kraft): What's interesting, too, is the people who are blogging are doing things that may become stories [for the mainstream media]. It's really interesting that stories we may have placed with a blogger then become fodder for a bigger story elsewhere.

O'Brien (C&W): The other thing that's interesting is categories that people thought that nobody would blog about that, there are these huge communities of people who are pumped about whatever [you're working on].

Iacono (PRWeek): How do you choose which blog posting  to respond to?

Zahery (Kraft): It depends on what it is. If it's a serious issue that can cause irreparable harm to our reputation, we're going to get right on it. And, you can't let those kinds of things fester. We have a pretty good network to see what's going on out there and monitoring, if there are issues. We've done a lot of talking about consumer public relations. We've spoken mostly about what I call the offense, where we're out there, pushing and talking. But, in a corporation, [what's] equally important, if not more [so], is the defense that you play for your brands and your company. And, you spend a lot of time on that. Part of our goal is to see what things on the horizon could be coming up that we need to be prepared for. And, one of things that is most valuable to us is our agencies [because they] bring the outside in for us. And, it's really easy in a corporation to get a little bit myopic because you have your little role. Our agencies bring a different perspective and that really resonates with brands. And Kraft is a relatively experimental company. We'll place a lot of small bets on different things. And we'll try different things and see what works, what doesn't, and that's where PR really meshes. These guys can do it really quickly and conveniently. And, they have made such strides in becoming valued partners. . .So, to go back to your earlier question, about where to respond, you pick and choose. It depends on if you're going to see something escalate pretty quickly, if it's in the headlines a lot, you're going to have to respond. But, sometimes, as we all know, not responding can be good too. Sometimes, if you're the first responder you can become the face of the issue, and you don't want to be that.

Snyder (GM): [The] interesting part of that question is it's a self-correcting phenomenon. Somebody will weigh in negatively, and somebody will weigh in positively, and you can sit on the sidelines and watch this go on. And, the dolts will be separated from the intelligentsia, and pretty soon you'll get a pretty even conversation, and sometimes you don't have to do a thing.

O'Brien (C&W): There are some really great tools now that allow you to look at the blogosphere and figure out who are the influencers and who are really there for themselves. We've been tiering media for a thousand years, figuring out what is the hierarchy. So, you build relationships with those that are really connecting to many different people, and are hubs for information. [People] create more of a cursory relationship with those who fall short of that.

Miller (Northlich PR): Sometimes people tend to treat the blogosphere as if you're dealing with a foreign language, a different beast. Throw all convention out the window, and do things [you] would never conceive of doing in the general market. We had a client who had [a customer] call who was very upset …and [had] threatened to blog. And, they had no idea what to do. And somebody finally said, “Has anybody called them and talked to them?” So, again it's that common sense, “How would I deal with this? How would I want to be treated?” This is my customer speaking, and sometimes we forget because this is a language we're all trying to learn.

Mardiks (GH): Now we have these measurement tools. Now, we have ways to really understand who's saying what, who has credibility, and who doesn't. It's not quite what it was. It was the Wild West for a while, now it's just part of our business.

Howe (Weber Shandwick): We do a lot of work in food, and people used to make decisions based on taste, convenience, nutrition, but now what you might have considered an issue also comes into their decision-set in terms of sustainability and food safety. So where consumer marketing used to be over here and issues was over there those two have really come together because of what's going on in the digital space, with the platforms that people have to share their points of view. 

Iacono (PRWeek): We were talking earlier about how PR professionals have changed in how they approach business. What are you seeing from the talent coming into the industry? Are they prepared for this?

Reed-Granger (Whirlpool): [One] part of the talent issue that I'm having is the education. It's not just spell check. It's the Associated Press stylebook. It's our bible, know it. And, there are a lot of agencies now that have a structured “media relations team” and so the core team that is my account team never pitches. Some other team that is like on high in a cloud in heaven in New York or Chicago handles all of the media relations. So when I call Ms. 23-year-old sitting at her desk, and say, “I need you to get on the phone and talk to so and so, Carolyn Forte at Good Housekeeping.” [She says],”Ok, I'll call Jessica in New York. . .” And [I say,] “Why can't you do that? I can pick up the phone and call Jessica, but I've got to go to a meeting” [She says] “Oh, our media relations team is supposed to do that.” “No, you're supposed to do that.” [She] doesn't know anything [about the brand]. So, now it's going through a translator… That is not the direct communications you're looking for [as a client]

Mardiks (GolinHarris): They're coming into the agencies, and it's the agencies job to train these people, who have talent from wherever, whether it's right out of these schools, another business, or whatever. It's our job to do that. And, I think it's also our job to think, “Sure, we are developing their business skills,” and I think it's the client's job to help us develop their knowledge of your business. So, it's really two of three parts are up to the agency, and one part you've got to help us on.

 

Forsatz (MWW Group): I've been seeing a really good talent flow coming in. There used to be a time when [we would ask], do they have a communications degree, a PR degree, a marketing degree. But I think now with the way our business is changing, we're looking for candidates from diverse backgrounds, and I'm not [just] talking about ethnic. Are they from business, accountant, public affairs, business school. . . Do they know politics, history, English? I think the candidates that we're seeing and end up hiring, [it's] not so much about do they how to write a press release [but rather do they]have an intellectual curiosity that you can mold to learn a client's business?


Key points:

In a weakened economy, PR is viewed by many clients as being more nimble and therefore has the opportunity to be more valuable than its marketing counterparts.

PR professionals must craft measurement programs to align with the client or company's overall business and communications goals.

It's important to remember that most of the basic tenets of good PR still apply in a new and social media world.

 

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