Holmes Report Blog

The Holmes Report blog focuses on news and issues of interest to public relations professionals. Our main site can be found at www.holmesreport.com.

Saturday, January 28, 2006

Are Blogs a Fad?: Over at Hill & Knowlton’s blogging community, Darren Leroux recounts a conversation I’m sure most of us have had with colleagues or clients “about the ‘fad’ factor that continues to linger on in my head. The discussion we had focused around the early mass-popularity of the Internet, when everyone and their mother were creating personal Web pages…. It didn’t last. These personal sites were abandoned as the novelty of it wore off….

“Which brings us to today—I can’t help wonder if blogging is following this same trend. Inevitably, millions of voices will grow quiet as the novelty wears off.”

This seems to me to be one of those discussion—along with the “most blogs are just shrill egotistical garbage” that misses the point. Yes, most political blogs consist of little more than partisan supporters spewing rhetoric. Yes, most blogs of all kinds will fail to create anything by way of a community. Yes, the majority of bloggers will one day grow tired or bored and their blogs will fail.

So what?

No one is suggesting that PR people reach out to every blog. But there are a handful of blogs in every space—politics, sport, technology, marketing, PR—that have already established themselves as trusted sources of information, that have established communities of like-minded individuals, that already enjoy influence as real as any mainstream magazine.

Identifying those blogs, knowing the difference between them and their soon-to-be-defunct rivals is one of the reasons companies need to hire experts to guide them through the blogosphere. It’s why PR people need to learn to identify the most influential citizen journalists—the same way they identify the most influential mainstream journalists—and reach out to them, while not wasting time and money and energy on the mass of mediocre, self-indulgent bloggers.
Oprah’s Apology: I was unimpressed when Oprah called Larry King to stick up for best-selling liar James Frey, so I should note her apology and acknowledgement that lying to your customers is never a good thing. Better late than never.

Friday, January 27, 2006

Monkey Business: Arctic Monkeys, a band you’ve almost certainly never heard of, saw their debut album go straight to number one in the U.K. this week. Not only that, but the album—Whatever People Say I Am, That’s What I’m Not—single-handedly outsold the rest of the top 20.

How did the Monkeys—four lads from unfashionable Sheffield in Yorkshire—generate so much hype that their first opus is expected to shatter the previous record for a debut album in the U.K? By giving their songs away over the Internet, of course.

In the FT, indie rocker Tom Findlay and music journalist Rob Wood point out that “Giving away your product might defy the rules of economics, but in the world of the internet-savvy fan it is a gesture on which dividends will be paid when the album is available to buy…. The huge, cranky major labels have been slow to make sense of how the internet is changing the consumption of music. The profits from the million copies that the Arctic Monkeys album will undoubtedly soon sell will largely be enjoyed by the independent label, Domino Recordings.”

The major record labels are, in fact, still suing their best customers for downloading their songs, on the assumption that downloads damage sales. The reality, as any music fan can tell you, is that downloads drive sales.

(By the way, the album--which won't be released in the U.S. for another three weeks--is really, really good.)
Welcome: Ronn Torossian, president of (extremely) fast-growing New York PR boutique 5W, has launched his own blog. Ronn has a bizarre client list that ranges from Fortune 100 companies to Israeli political figures to rap stars, and he's not shy about voicing opinions, so his blog should make interesting reading.

His first two posts suggest an eclectic mix. The first deals with Kanye West's personal branding efforts. The second addresses Ford's public relations efforts in the wake of announced job cuts, and he's impressed: "Simply put, Bill Ford’s presence creates the perception that Ford is forging ahead while their competition pauses to lick their wounds."
Seeing Red: It’s not every new cause-related marketing initiative that makes the front page of one of the world’s great newspapers, so I’m sure American Express, Converse, Gap and Giorgio Armani must already be delighted with the return on their investment in Red—Bono’s new brand designed to fight AIDS in Africa—which attracted banner coverage in the Financial Times yesterday.

According to the FT, Red will first manifest itself through the “creation of an AmexCo Red credit card that will be marketed first in the UK to an estimated 1.5m British ‘conscience consumers,’ who are seen as more likely to buy products associated with a social benefit…. Other Red products available this spring will include Converse sports shoes made with African mud-cloth; a new line of Gap vintage-style T-shirts, in red and other colours; and wraparound Emporio Armani sunglasses embossed with a Red logo.”

"Red is a 21st century idea," says Bono, the owner of the brand, front-man for U2 and longtime campaigner on AIDS and other humanitarian issues. "I think doing the Red thing, doing good, will turn out to be good business for them." (Nice branding Bono, making “the red thing” synonymous with “doing good.”)
Bobbing and Weaving: Over at Slate, John Dickerson examines the evasive techniques of the President—though with a lapog media still loyally swallowing whatever treats the White House tosses it way I don’t quite understand why he needs them.

Thursday, January 26, 2006

Pastor's New Plan: Apparently unable to damage Nike via a traditional boycott, Seattle-based pastor Ken Hutcherson has a diabolical new scheme to punish the company for its support of human rights.

Hutcherson, still angry that the company doesn't hate homosexuals, has asked his followers to buy up the company's stock and then dump it to drive prices down. He wants supporters to buy one or two shares over the next few months, then sell them May 1.

Perhaps I'm missing something, but wouldn't this work better if people already owned the stock? Won't buying the stock in the first place drive the share price up? And won't a hell of a lot of people have to buy "one or two" shares to make this work? And... But there I go applying rational thought, when clearly what is required here is "faith."
Walk, Don't Run...: To David Maister's website, where he is giving away podcasts of the lessons he's learned over more than 20 years of teaching about and consulting with professional service firm management. David is author of some (most?) of the best books on the topic, including Managing the Professional Service Firm (1993), True Professionalism (1997), and Practice What You Preach (2001).

The four podcasts available for free focus on Understanding Relationships and Transactions: The rewards of building trusting relationships with clients as opposed to taking a transactional view of marketing; Business Development: The five groups of activities needed for a balanced approach to building a business; Listening to Clients: How you can gain a sharper competitive edge by being better at understanding how clients think - simply by asking them to talk to you; and Great Service: The tools, tips and tactics that create excellent client service and will lead to return business and new clients.

Wednesday, January 25, 2006

The Church's CEO Speaks Out: I'd like to hear what Leslie Gaines-Ross has to say about this, although she's in Japan and may have other things on her mind.

But Leslie has written extensively about the "first 100 days" of a CEO,and the importance of using that time for learning and listening. I know Pope Benedict has been "CEO" of the Roman Catholic church for a little more than 100 days, but his first encyclical is obviously an important milestone, an opportunity to communicate his vision for the organization he now leads.

Was this bold defense of love--most of it could have been written by a protestant, a Hindu, a Buddhist, or an atheist like me--a positive (deflecting criticism that he might be a hard-liner on some cultural issues) or anegative (so bland it's almost meaingless)?
Transparent Partnerships: The Financial Times examines "Fears Over Side-Effects of Charities' Links with Pharmaceutical Industry" (sub req'd).

In some ways, the discussion over pharma company payments to patient groups seems quaint compared to the debate over physician payments in the U.S. In fact, on the whole I think it's a good thing that patients and the companies that make their medicines are working together. I remember a baffling case in which Glaxo Wellcome created a front group to frighten patients into action when it could far more easily have worked openly with its customers. Open cooperation between companies and patient groups is surely, in principle, a good thing.

But while companies are being open with the patient groups they now work with, they may still be lacking transparency when it comes to disclosing funding. According to the FT, a "new code requires companies to make public a list of the organisations they fund and to draw up contracts setting out their relationship. But there is no obligation to make public the amounts companies donate or the contracts agreed and no financial penalties for violators."

Companies -- and charities -- should disclose the details of these financial relationships. Otherwise, they risk losing the credibility that such joint efforts offer.

Tuesday, January 24, 2006

A Meaty New Blog: Steve Rubel flags the new McDonald's blog, Open for Discussion, which promises "Perspectives on McDonald’s aspirations, activities, and challenges as we work to make a difference on corporate social responsibility issues that matter."

Stakeholder blogs--as opposed to those used primarily for marketing--are still relatively unusual. It will be interesting to see how candid and engaging this one will be. Stay tuned.
Physician Payola: I guess it's nice to know that journalists are not the only ones falling prey to corporate corruption. Of course, I could be doing everyone involved an injustice. There may be some perfectly logical explanation for this:

"A prominent surgeon in Wisconsin was paid $400,000 a year by Medtronic for a consulting contract requiring him to work just eight days. Another doctor in Virginia received nearly $700,000 in consulting fees from Medtronic for the first nine months of 2005."

Needless to say, "All the doctors involved in the lawsuit who were reached for comment said that the payments to them were appropriate and fair compensation for work done for Medtronic."
Why It Matters: Just a reminder of why the payola issue is relevant to all of us. Over the years, I have heard many PR people make the case that editorial coverage is more credible (three times more credible is a claim I’ve heard more than once) than advertising. That’s the biggest reason for companies to invest in PR over other message delivery systems.

But this study, which I reported in the newsletter in December, suggests that almost two-thirds of consumers assume that advertisers pay for product mentions in the editorial pages of magazines. So for two thirds of consumers, PR is no more credible than advertising.
Our value as an industry is dependent upon credibility. How much value have we lost over the last year?
Scrushy Scandal Expands: The Scrushy payola scandal has now expanded to include Charlie Russell, a well-known Denver area public relations executive who says he paid faux-journalist Audrey Lewis $2,500 on behalf of the embattled HealthSouth CEO. He says the money was an advance for possible work after Scrushy’s fraud trial was concluded—although Lewis never actually did any of that work.

I’m not going to comment on the Scrushy-Lewis story that they took pity on Lewis because she was “a nice Christian woman that we thought had been treated badly” (Scrushy) and “one of her relatives died in Detroit and she lacked funds to get to the funeral.” Suffice it to say that a 40-point headline above the fold in the Denver Post does little to restore the reputation of either journalism or public relations.

We’re a full year on from the Armstrong Williams debacle, and this kind of ethically indefensible behavior seems to be more prevalent than ever.

Sunday, January 22, 2006

Action on Payola?: Richard Edelman doesn’t pull any punches in his coverage of the latest payola scandal, which we mentioned briefly on Thursday. And he suggests a remedy:

“I am calling for the key associations in the PR business around the world to consider licensing PR firms in their countries to do business…. We need to… have CEOs of PR firms sign onto a code of proper behavior that forbids payments to reporters, that mandates transparency on arrangements with third party experts and that bars a media company from having a licensed PR firm in the family. These standards must be enforceable, with the group given power to expel transgressors, then to demand a public apology and remanding of questionable earnings to the aggrieved client. I will attend the February 5 board meeting of PRSA and make this proposal. Can others who are similarly outraged and frustrated please help me with the wording of such a resolution, so that we have the means to protect our precious profession. Thanks as always.”

I wish Richard luck, but I’m not sure there’s anything to be done. The reason the PRSA and the Council of PR Firms have toothless codes of ethics is because any code that has teeth leaves an organization open to legal action for restraint of trade. And even if PRSA could expel members for this kind of sleazy behavior, being drummed out of the PRSA is not exactly the death of a PR career. Most of the best and most successful PR people in America are not members to begin with.

I’ve always been opposed to licensing of PR people—I just don’t believe you can license something that is essentially a first amendment right—but this succession of payola scandals has made me wish, for the first time, that we had some way of drumming people who engage in this kind of media corruption (starting with the folks at the Lincoln Group) out of our profession.

Sadly, I suspect we’ll have to settle for another unenforceable statement of principles. Right now, even that would be a step in the right direction if it brings some clarity to the issue.
Good for Google: Google’s share price may have taken a hit on Friday—down 7.6 percent in heavy trading—after the Justice Department filed a legal motion in an attempt to force the company to comply with a subpoena for consumer search records. But there are plenty of people who believe Google’s stand, which contrasts to the capitulation of competitors like Yahoo!—will be good for the company in the long run.

“We believe the market will react negatively to this news, decreasing Google’s share price,” Denise Garcia, an analyst at WR Hambrecht & Co., said in a note to clients Friday. “Ultimately, we believe Google’s leadership position, resisting compliance while their competitors have bowed to government pressure, will bode well with its user base.”

Martin Wolk, chief economics correspondent at MSNBC, agrees. “For a company that declares its corporate motto is ‘Don’t Be Evil,’ the decision to take a principled stand against the broad demand for information offers a rare opportunity to distinguish itself from its rivals [and from the phone companies—if Google goes into the telecom business, it can have my business] just as the issue of government snooping is heating up politically on Capitol Hill.

“But by choosing to fight the subpoena in court, contending it is overly broad, Google signals to its customers that it is a company that can be trusted with sensitive personal information as it presses ahead with an ambitious business plan to move well beyond search into technology services that compete with established software, media and entertainment companies.”