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WE Communications

PR is in an existential moment

May 02, 2018 by Matthew Chapman

Seismic events have created a moment of existential crisis for the industry, according to WE Communications international president Alan VanderMolen...

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WE Communications' international president, Alan VanderMolen, believes Elon Musk launching his Tesla convertible into space in SpaceX’s Falcon Heavy reignited the definitional debate about PR. 

He said: "At a time when the entire industry engages in discussion about the complexity of the media ecosystem and the meshing of paid, earned, owned, social, experiential and search and what this all means for PR, Elon Musk has simplified things for us: PR is great media.

"PT Barnum is celebrating, while today’s PR practitioners are stressing." 

VanderMolen argues Musk’s stunt has made the PR jobs at Jeff Bezos’ Blue Origin and Richard Branson’s Virgin Galactica the two worst in commercial PR.

He explained: "Elon Musk successfully dominated traditional and social media for himself, Tesla and SpaceX. One stunt has resulted in immeasurable executive profiling, new heights in automotive brand building and an exponential boost in demand-generation for SpaceX and, likely, for Tesla.

"If I was running or involved in PR for either of the other two billionaire entrepreneurs, I am pretty sure I know what my two-word reaction would have been while seeing the news." 

The existential moment in PR has been heightened by Sir Martin Sorrell resigning after more than 30 years as chief executive of WPP, a period that has set the tone for the entire marketing services industry.

VanderMolen believes Sorrell downplayed the impact Google and Facebook were having on WPP, which should teach others the importance of paying attention to disruptors. 

VanderMolen said: "Media fragmentation is not slowing down anytime soon and we had better understand the commercial and business model implications of that lest we find ourselves riding White Elephants."

Sorrell’s resignation could have serious repercussions on the holding company model that he created, which has grown to dominate marketing services. 

Analysts are already suggesting the WPP empire could be broken up because there is more value in the constituent parts than in the current share price.

The holding company model was already under strain prior to Sorrell’s departure. Three of the four major holding companies have their stock under severe pressure. This helped contribute towards WPP and Omnicom consolidating assets.

This has involved WPP’s mega-consolidation of Burson-Marsteller with Cohn & Wolfe, and Omnicom’s mini-me consolidation of FH, Ketchum and Porter Novelli into Omnicom PR Group in Singapore and parts of continental Europe.

This consolidation has stifled innovation, according to VanderMolen.

He said: "Financial markets want both growth and margin – consistently. This is something Sir Martin knows and has driven for three decades. In the markets, however, when growth slows or reverses there is immediate call for cost cutting.

"Consolidation does not bring innovation. It brings cost savings. Will the smaller Cohn & Wolfe be able to revive growth in Burson through consolidation? Doubtful. Consolidation is a desperate tactic and is, in fact, anti-innovation.

"Marketing services broadly, and PR specifically, need to invest in modernisation to reflect what is happening in the media ecosystem and decrease reliance on earned media not throw a collection of earned media shops together and hope for a different result."

VanderMolen advises that agencies need to place their faith in renegade characters - in the vein of Armageddon protagonist Harry S. Stamper – in an era of existential crisis where figurative meteors are hurtling towards the industry. 

He argues that despite being in a technology-driven era the day "still screams for humanity, but in union with technology" and an inner Stamper is required to drive growth-focused innovation.

VanderMolen concluded: "I am very concerned about what will restore consistent, innovation-led growth to marketing services and, specifically, to PR.

"I believe the answers will emerge from the "SpaceXs", not the "WPPs". From small- and mid-sized agencies (likely independents) and from risk-taking clients that place incentives on innovating to grow vs. the behemoths who incentivise to deliver margin."

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