Thank you so much, Michael
Final: 16TH May 2011
Silo or Prairie:The Changing relationship Between Marketing
& PR
May 18, 2011
Miles Young, CEO, Ogilvy & Mather Worldwide
[SHOW SLIDE: Silo or Prairie]
[Ladies & Gentlemen: it is a very great pleasure to be with
you at the 2011 SABRE Awards here in Prague.]
Let me make a confession. I am an enemy alien. I am not a PR
person. I have had no formal training in public relations. I joined
Ogilvy & Mather as an adman. And after eight years in
advertising, I moved to the Direct Marketing business. But during
this time I became interested with an increasing sense of passion
in integration, in how collaborative working between different
specialists could produce seamless programmes. One of the first of
these was an OPR led campaign for the British Insurance Companies
as they responded to changes in the UK regulatory environment. It
sounds like a no-brainer now, but back in the 1980s it was
revolutionary stuff. Then, when I moved to Asia, I became
organizationally responsible for Ogilvy PublicRelations, along with
our other disciplines, and saw it move, under a number of very able
managers, into a leadership position. In particular, I became
involved in our PR business in China.
So what you are hearing described in a roundabout way is a
business model in which the different communications disciplines of
Ogilvy & Mather public relations, advertising, direct marketing
and activation sit under one roof.
[SHOW SLIDE: 360]We call it 360, and each of these disciplines,
while existing independently, and being resolutely committed to
their specialist insights and techniques, owe their ultimate
loyalty to a holistic view of the clients problem, not just a
narrow 90 view. A whole series of interactions from cultural values
to digital platforms to common training - reinforce the mutuality
which lies at the heart of what we do day-to-day in pursuit of deep
integration, the sort of integration which starts at a strategic
level as opposed to the sort which is merely executional, where
things look and feel the same, but where the intellectual
underpinning is simply not there.
[SHOW SLIDE: IMAGE OF SILO]Public Relations was not born in a
silo but at some stage from the middle of the last century it
started to inhabit one. I realized when I submitted my title to you
that the word silo was perhaps not a familiar one. Silos are those
vast objects in which harvested grain is stored: closed, with bleak
walls, they symbolize isolation from the world around them. While
the founders of modern PR in the USA men such as Ledbetter Lee -
were truly broad-minded, their successors tended towards
silo-mindedness, if only perhaps, to signal their differences from
the advertising industry, and their forgivable pride in earning
media coverage rather than just paying for it. Their skills and
their activities were primarily premised on what we would think of
today as media relations. It was a model which served the industry
well, but which I suggest, is now dead as dead as a dodo, as dead
as a dinosaur. Three forces have killed it: the forces of
socialization, of fragmentation, and of globalization. Their
impeccably perfect sense of timing has resulted in a beautiful
congruence right now. Its an exciting time if we are prepared to
open our silos.
[SHOW SLIDE : SOCIALIZATION}First, let me talk about
socialization. I do not have to lecture you on the evidence of the
arrival of social media. The absolute numbers are out there for all
to see. We can all have fun adding up how many countries Facebooks
population is the equivalent of. Hardly surprising, then, that 25%
of the search results for the worlds top 20 brands comprise links
to user generated content. Social media is the flavour du jour for
any savvy marketer: numbers count and it offers numbers.
What we can see as a result is the arrival of a new phenomenon
strangers with experience. How odd this phrase might have seemed
five years ago. More traditional sources of advice have declined in
the trust given to them. In the US now, between 34 to 50% trust
strangers with experience, in other words, on-line peer advice. In
China, it is around the same. In the EU, the same.
[SHOW SLIDE : SOCIALIZATION- TRANSPARENCY]But the arrival of
social media has had a more profound effect still - on the
corporations which make those brands. Put simply, there is no
longer any hiding place. The bracing wind of transparency has blown
through corporate corridors in a way which defies resistance. Of
course, we have seen recent examples of attempted resistance. When
Toyota first started to receive reports of accidents, and credible
attributions of those accidents to defective brake pedals, its
first reactions were slow. As the truth emerged, it seemed that it
had to be dragged out. Now I do not believe there was any willful
conspiracy not to be transparent: rather, the culture and politics
of a conflicted organization just never put a premium on
transparency as a value; and hundreds of small decisions added up
to an overall behavioral trait. The learning came the hard way.
The good news is that when it comes, transparency can heal. It
has redemptive power. Toyota was able, for instance, after a while,
to stimulate supporters groups on Facebook in the US who felt the
process of vilification had gone too far.
About 40 days after BPs oil spill in the Gulf of Mexico, and
well into its unprecedented media crisis, which that created, our
Digital Influence team were engaged. [SHOW SLIDE :BP]We had a team
in the Houston command centre, 24/7. Their role was to make heard
BPs commitment to transparency.
From no social media uptake at all, the new You Tube, Twitter
and Facebook sites quickly generated significant numbers of
followers and fans.[SHOW SLIDE BP-CHARTS]
[SHOW SLIDE :BP FLICKR]Transparency was literally streamed out
daily via an infographics campaign, letting the facts speak, and
photos were streamed out on Flickr.
There was an Ah-hah moment during the crucial pressure test of
the well-casing CNN was covering the situation live and was
mistakenly reporting that the pressure gauges on screen were what
should be watched to assess the success or failure of the
operation. [SHOW SLIDE :BP CNN]We were able, immediately; to corral
the BP technologist, draft the words to clarify, and then to tweet.
The tweet reached the anchor, who corrected the story. An on-air
academic confirmed our tweet as accurate. Bob Dudley, the new CEO
of BP, was present at the time and had a vivid demonstration of the
real time power of social media. While still in its early days,
there were signs that BPs transparent approach was beginning to
turn the tide of opinion in the US.
The first requirement of transparency is the ability to listen.
You live or die by it. [SHOW SLIDE: BP LISTENING POSTS]You need to
understand what people are saying. Listening posts, like this one
provides, against agreed conversation criteria, a set of actionable
reports.
But understanding how people search is as important as what they
say. [SHOW SLIDE: SKIN CARE INFLUENCERS] Lets think of search as
the new shelf-space.Against any set of key words, we can now
understand how the search shelf is constituted: in other words,
where do the results fall, by %? In shopping sites, on video, in
images, in wiki, on news, in blogs, magazines or books? We can also
understand the constituents of search volume in any category.
Insights like these are the sine qua non of any social influence
strategy. Now, the Pareto principle, which I was brought up with in
my Direct Marketing career, that 20% of the users amount to 80% of
the value, applies also to social media. Our task is to influence
those who most influence. Here, for instance is an influence map,
for the beauty business in the US. It shows graphically the
influence muscle of style bloggers, fitness sites, travel and
cooking sites, and so on of which beauty bloggers are just one
component. They are now the 80%.
[SHOW SLIDE: CONVERSATION MANAGEMENT]Then we also have to seek
peer-to-peer influence. This is activity at the social grass roots.
It creates an entirely new art form, that of conversation
management. The besetting sin here is the one off the tactical
Facebook page or Twitter feed. What is important is to see
conversation in terms of a calendar, with conversation managers
overseeing the grass roots it serves. The context of the
conversation has to promote everyday engagement, remarkable
experiences and be sustained over time.
You can see all these things coming together in some of the work
we do for Ford. Recently, we designed an enterprise-level digital
influence strategy which showed that Ford is different and which
has helped to deliver market share growth at a time when one can
still feel the after-effects of the auto industry crises.
[SHOW SLIDE : FORD CES]With the reveal of its first-ever
consumer electric vehicle sheduled for CEO Alan Mulallys keynote at
the 2011 Consumer Electronic Show, Ford Motor Company knew it would
have no trouble making the news. However, other automotive
companies have increasingly used CES for big announcements, so Ford
knew it had to be innovative. After using Facebook for a teaser
photo countdown to the reveal, we hosted a 24-hour technology and
innovation live-stream on Fords Facebook page counting down to the
keynote. Bloggers from the around the world participated as well as
Ford executives live from the show floor. As a result, Ford social
media mentions exceeded 63% share of voice of the major automakers
presenting news at CES, live-stream viewers watched for double the
time and Ford achieved nearly 50 million social media impressions
digital efforts.
Even when Ford has not controlled the content directly, it has
still been able to manage conversations through digital
strategy.
[ SHOW SLIDE: FORD GLOBAL TEST DRIVE]In Febuary 2011, Ford
hosted nearly 20 key social media influencers internet journalists
and bloggers with focuses on technology and social media at the
Focus Global Test Drive event at INTA in Spain. These bloggers were
sent personal video invites and asked to come experience the new
2012 Ford Focus under a variety of conditions and then encouraged
to document their drives. After this event, blogs reached 5.3
million visitors, videos created by bloggers generated over 500,000
views and Global Test Drive related tweets reached 12.3 million
followers.
[SHOW SLIDE: SOCIALIZATION- TRANSPARENCY- COMMUNITY]I think it
will be evident now that if the result of socialization is
transparency, then community is the dividend of transparency.
However, a community cannot be built haphazardly. It has to be
grounded in a digital influence strategy. There is a real case here
to make haste, not hurry. The collection of expired initiatives,
ignored sites and unattended accounts litter the social universe
like satellite debris in outer space. I hope I have been able to
suggest to you that a response to socialization lies at the heart
of an enterprise, not at its edges. If you accept this, and I am
sure you will, there is a huge implication for corporate
governance. Imagine, for instance, an organization which has
complex channels or maybe licensed partners. A governance mechanism
which manages one-step-away conversations has to be worked out, not
just ignored or assumed. If a customer seeks to engage a soft drink
manufacturer via for instance the brands bottler, who manages the
conversation, and how? We are dealing here with a genuine
transformation of how the public in public relations is legislated
for and catered for. In the new world, the role of PR lies with
issues like this. Its role is to help socialize the enterprise.
[SHOW SLIDE FRAGMENTATION]
Next, I want to talk about fragmentation. Again, I do not have
to adduce the evidence here. It is clear for all to see. But the
de-massification of media has been accompanied by iPad or android
technology: another perfect storm to rage around that increasingly
exposed silo. Multi-purpose devices aggregate the vast fragmented
mass of available disaggregated content: they are so much the new
normal it seems hardly worth commenting on them.
Of course, the fragmentation and the risk associated with it is
not totally new. An early but prescient commentator of the
implications was the American sociologist Orrin Klapp. In the
1980s, Professor Klapp pondered the fragmentation of the media, and
the consequent proliferation of information, and coined a phrase to
describe the result. He called it the meaning gap in other words as
the quantity of information increases, the inability to extract
meaning from it also grows. Klapp is all but forgotten now, but
never, I would suggest, has his thinking been more relevant.
It has been advertising much more than Public Relations which as
a discipline has explored the realms of neuro-science. It seems
rather urgent to me to rectify that. In fact, comparative
psychology has much to teach us about how we qualitatively deal, in
our brains, with the quantity of information we are now exposed to.
Essentially, we have moved into an era of cognitive overload, where
our brains lose the ability to encode. Welcome to the meaning gap.
In an intelligent article on the subject, John Lorinc wrote and his
words have never been more timely: It often seems as though the
sheer glut of data itself has supported the kind of focused,
reflective attention that might make this information useful in the
first place. The dysfunction of our information environment is an
outgrowth of its extraordinary fecundity. Digital communications
technology has demonstrated a striking capacity to sub-divide our
attention with smaller and smaller increments; increasingly, it
seems as if the days work has become a matter of interrupting the
interruptions.
What on earth can we do about it? Lorinc rightly criticizes
those who believe the solution lies in more technology. Rather, it
seems to him and to me that it lies within us. In fact, we need
look not much further than a white paper of the Arthur W. Page
society of the USA entitled The Authentic Enterprise. [SHOW SLIDE :
AUTHENTIC ENTERPRISE] It posits the urgency to a corporation of
being grounded in some sense of what defines it, why it exists and
what it stands for. The authenticity of these things is described
as the coin of the realm for successful corporations and those who
lead them. In place of the voice of authority, these stakeholders
demand proof of authenticity. Are you who you claim to be? And, who
do you claim to be?
[SHOW SLIDE :FRAGMENTATION-AUTHENTICITY]One of the co-authors of
this white paper went on to become the IBM CMO, Jon Iwata. Jon is a
remarkable client who is helping reinvent traditional notions of
marketing and public relations. He has in instinctive dislike of
what he calls campaignery, which has inspired a remarkable case
history within the last two years. A quotation from Abraham Lincoln
is much in use at IBM: character is the tree, reputation is the
shadow. Is Public Relations a player in the shadows, or a builder
of character?
[SHOW SLIDE: IBM ]In the IBM story, a lot of work went into the
matter of values, in thinking about the tree, about what made IBM
authentic. And a great deal more work went into defining the role
of the tree in the world.
In the new internet of things, there is still massive
inefficiency. On average 67% of energy is lost moving on grids, for
instance.
Well, out of this emerged the belief that the world would be a
better place if it simply worked better; and out of that came IBMs
Smarter Planet platform. [SHOW SLIDE:IBM SMARTER PLANET LOGO]
This platform was launched by the Chairman of IBM, Sam Palmisano
at the US Council of Foreign Relations in a significant policy
speech only then did it turn into advertising in the form,
literally, of a manifesto.
[SHOW SLIDE: IBM MANIFESTO]
Then it morphed into a whole series of op-eds on topics,
published each week in the Journal and the New York Times. [SHOW
SLIDE: IBM JOURNALS]
[SHOW SLIDE:IBM JOURNALS 2] Each one expressed itself in a
different way symbolically, drawing from the work of contemporary
designers: design was a value which the founders had baked into
IBMs DNA, but which sometimes in its history became lost.
[SHOW SLIDE: IBM ECO-SYETM]Behind these, a whole eco-system of
content developed. In fact, the agencys role became that of a
content producer in which the traditional definitions of
copywriting, journalism, academic research, public affairs, and
design all became mashed together. It is true integration, but in
truth all the components come from a Public Relations view of
authenticity. It has become a much talked about phenomenon and
something of a reference point for US clients. There are many
testaments to its success so far but the one I like the most is
that within weeks a set of op-eds appeared on the walls of senior
White House staffers. And it has achieved exceptional results both
in terms of attitudinal measure and hard sales. This was the tree
casting its long shadow.
So, if the need from fragmentation is authenticity, the output
of authenticity is belief.
[SHOW SLIDE :FRAGMENTATION- AUTH-BELIEF]A striking endorsement
of the power of belief in business came to us from some research we
conducted last year. Just as IBM had a point-of-view that the world
would be a better place if it worked better, some companies also
seem to have well-articulated beliefs underpinned by a sense of
authenticity. Yet, in the same categories others do not, to the
same degree.
One part of that research was conducted with pairs of brands,
which were allocated into two groups, those with a higher
point-of-view rating and those with a lower. In other words, those
that had a belief about the world, or stood for something.
Consumers sorted them very clearly. And we learnt that if a brand
is seen to have a strong point of view, then its consideration is
heightened. Brands with stronger points of view also ranked higher
in consumer perception. Then we were able to take these ratings and
correlate them on a larger scale through WPPs Millward Browns
BrandZ database. We found that best performing brands for
point-of-view out performed the lowest by 2.2 times in terms of
brand voltage, which is usually accepted as one component of market
share prediction. In other words, it pays to believe.
Now I confess this makes me very happy; and so it should all of
us because it demonstrates that platforms predicated on belief
galvanize brands in a way which I think had become somewhat
forgotten. So it is no coincidence that when Sam Palmisano talks
about the Smarter Planet agenda he talks about it as a
point-of-view and expresses it as a belief. He did not talk about
it as a strategy or expresses it as a vision, for instance.
In this way I sense a bigger mission for Public Relations than
its silo comfortably provides for, one which values definition and
sustenance is as important as message projection.
[SHOW SLIDE :GLOBALIZATON]Finally, let me deal with
globalization.
Again, I need not labor the evidence. In our Public Relations
business, the US is our largest market, China is the second. That
is globalization. But sometimes I see in articles about Public
Relations a perhaps unjustified faith that there is a flat
world.
Of course were all familiar with the phrase flat world, so
brilliantly promoted by Tom Friedman. I happen to believe that the
world is not quite as flat as all that. Certainly its shrunk, made
smaller by technology. But some would argue its still got a lot of
mountain peaks on it.
I happen to believe the truth lies somewhere between two
extremes. As I see it, the world in which we do business today is
neither completely flat, nor is it totally peaky. Rather it is
bumpy. The bumps can be quite intimidating. They can be overcome,
but we need to be wary of them in all we do.
In my experience, these bumps are not primarily to do with
economics, or politics, or technology the topics which the
literature on globalization tends to concentrate on but rather they
are cultural. And it needs broadmindedness to navigate through
them.
This was really brought home to me in an incident which involved
one of the students I taught at the Tsinghua School of Journalism,
in Beijing. [SHOW SLIDE : CHINA-TIBET]You will recall that in 2008
Tibet was hit by unrest. In the West, the tendency was to assume
the rioters were heroes. But in China the popular view not just the
Government view was the opposite. I am not even beginning to enter
the debate of who is right and who is wrong. But what then happened
was that the Western news media started publishing photographs of
the riots.{SHOW SLIDE: RIOTS]
[SHOW SLIDE:RIOTS] Showing demonstrators being beaten by police.
Appalling. The only problem is that these police were actually in
Katmandu, not in Lhasa. In the foreign press a Han Chinese rescued
by the police was described as a demonstrator being arrested. And
CNN started cropping photographs in a way which removed
rock-throwing rioters.
The effect on my journalism students was dramatic. Having been
taught that Western journalism was all about objectivity they felt
betrayed. [SHOW SLIDE:ANTI CNN]CNN took the brunt of the anger; and
my student set up a website called anti-cnn.com which in days was
recording millions of hits and recruiting thousands of volunteers
predicated solely on finding and publishing examples of Western
journalistic inaccuracy. Of course, for Westerners this is an
uncomfortable story. The internet the great flattener can easily be
the inflamer of bumpiness.
My point is that cultural perspectives even amongst the young
are not globally homogenous. Business-to-business marketing has
recognized cultural difference for some time. Geert Hofstede, the
Dutch sociologist did the pioneering research on this. Hofstede
used a number of dimensions to define cultural difference: such as
the relationship between leaders and followers, the importance of
rules or long-term view. The differences between the dimensions
dramatically impact the buying process.
[SHOW SLIDE; IPHONE] Incidentally, there is now a cool i-touch
application which turns Hofstede into a cultural ready reckoner.
See the differences, US versus China, for long term view.
[SHOW SLIDE: GLOBALIZATION- DIVERSITY]The point I am making is
that the response Public Relations can make to globalization as
much in its ability to bring diversity to the party, as in its
(much more limited) ability to provide homogeneity. Of course, Im
not arguing that it should not be global, but simply that global
promises need to be grounded in the reality of the bumps.
Recognizing that the internet, for instance, is an aspect of
diversity itself is a mission critical promise. One only has to
consider, for instance, the nature of the Chinese digerati a very
different tribe in some ways from those in the US, not just in what
they believe in but in how they use the internet. In fact, just
this year we recently created a dedicated China practice based in
New York which aims at synergizing Ogilvys global resources to help
companies, governments and investors expand both inside and into
the Chinese market.
Another example of bumpy diversity is the worlds Islamic
community. They represent a global market of some 1.8 customers:
yet few have paid attention to their own needs in communications.
Ogilvy Noor, our new Islamic branding consultancy, aims to do
exactly that. Concepts such as halal and haram should in fact go to
the very heart of any truly global enterprises value set.
[SHOW SLIDE: GLOBALIZATION- DIVERSITY-CQ]Public relations needs
to escape twice over from this silo: once from inevitable
constraint of ethno-centricity in any market of origin; but then,
again, from any superficially credible but practically flawed
notion of a flat world which is likely to run against the whole
notion of grass roots. Thus, if the requirement of globalization is
to recognize the value of diversity, then CQ, cultural
intelligence, is the output of diversity. In the globalized world,
IQ is not enough.
So, we have three inputs socialization, fragmentation and
globalization. We have three requirements transparency,
authenticity, and diversity. And we have three outputs. Welcome to
the world of community, belief and cultural intelligence!
[SHOW SLIDE: CPR]Herein, I think, lies the opportunity for
Public Relations in the future, which is to break out of any
vestige of a self-imposed silo, and assume a central role for
helping define the corporate public responsibility of the client.
Its a higher order, for instance, than just corporate social
responsibility, though it certainly includes it. I do not think,
unlike some, that the time has come to rename Public Relations.
Formulae such as Public Engagement, Public Interaction and so on
which have been put forward by various wise men seem to me to be
missing the point. The point is, to what end are we interacting? To
what purpose are we engaging? Likewise models which seek to
classify forms of engagement or interaction do not provide the key
to the silo for me. [SHOW SLIDE :VALUES AND TACTICS]
For me, the tension is between values and tactics on the one
hand, and between reacting to publics versus creating communities
on the other. Some of the founders of this business let us flag
Edward L. Bernays as one unfortunate example operated very much in
the interaction of reaction and tactics. This is the territory of
spin.
[SHOW SLIDE :SPIN]
The whole point of my speech today is that the sweet spot lies
in the intersection of values and creation. [SHOW SLIDE: CREATING]
It is no coincidence, of course, that the original Arthur W. Page
in his long-term role from 1927 to1960 at Bell and AT&T
espoused in his time just such a point of view. Only, he didnt have
the technologies fully to exploit it.
[SHOW SLIDE: PRAIRIE]This is the prairie of my title. Here is
the broad horizon and luscious grassland which Public Relations
needs to stake its centricity in.
Last year in Stockholm, PR professionals from around the world
gathered and deliberated and announced the Stockholm Accords. They
are a significant step in attacking silo-ism and deserve credit.
They talk of the communicative organization, which I understand,
but which perhaps does not go far enough in the direction of
authenticity. Where I worry is in the Accords definition of the
role of the Public Relations Director, who they say cannot
realistically hope to directly monitor more than 10% of its
organizations communicative behavior. Here, I think, there is
insufficient ambition. But isnt the real role that of leadership
itself? Of helping lead the leaders? And should not that role be
central and not peripheral?
In fact, recent changes in a number of organizations have begun
to recognize the opportunity. I have already mentioned IBM, where
corporate PR, brand PR and marketing have converged
organizationally. Another example would be P&G, where the Brand
Building organization is now connected organizationally into
External Relations. This recognizes that in the new world of
influence corporate reputation in a company cannot have one
guardian, and a brand reputation in the same company another.
To me this is highly empowering. The silos are breaking down.
The prairie dogs are howling and their message is about the
centricity of the new Public Relations to the business world of
tomorrow.
EMBED PowerPoint.Slide.8
EMBED PowerPoint.Slide.8
2
_1346591253.ppt
Reacting
Creating
Values
Tactics
SPIN
_1346654885.ppt
Reacting
Creating
Values
Tactics
