Thursday, April 28, 2005

Firing a client

I fired a client last week. Never fun.

Well, let me re-phrase that. Firing a client is never fun - but the resulting approbation of a grateful staff, that's pretty fun.

In this case, the client had enjoyed a terrific program (despite the fact that the product was not quite ready for prime time), but when 1 little thing went wrong, the CEO went ballistic. He was belligerent and petty; all of the many moons' worth of great work was instantly and conveniently forgotten.

You know what? That's fine. The vitriol was directed at me, not the team, and I've grown a thick skin. Plus, I understand that a CEO shoulders a lot of responsibility and in their headlong rush to success must often willfully ignore a lot of the imperfections and inefficiencies that they detect within their organization. At some point they just blow up, and sometimes it's easier to take it out on a vendor than on their personal staff.

But, by lashing out at me in what was really an odd way, his outburst led me to probe the team about his treatment of them, and his bearing while engaged with the media. Turns out that he could be supercilious with the team (more red flags), but downright overbearing with the media. Deal-breaker!

In managing a PR firm (or team), I always remember that a Service industry like ours depends on the caliber and happiness of the people performing the Service. I tell our VPs that their chief job function is to guide, cultivate and encourage their junior staffers. So if a client is acting like an ass; if he/she demeans the agency staff, it needs to be addressed. And if they are jerks with the media, cut 'em loose. The agency's reputation among the media is critically important.

You want to be known as the PR firm with all the jerky clients? Me neither.

Tough industry

Did ya'll see recent PR WEEK agency rankings?

First off, I applaud the fact that the publication broke out the results of the oligarch-style conglomerates from the independents. It was nice to see apples compared to apples. The big guys' results unfairly skewed the results in past years.

What struck me in particular, though, was how relentlessly tough the PR industry can be:

The #1 player was Edelman, with about $150M in billings.

The #2 player was Waggener Edstrom - roughly ONE-HALF the size of Edelman, at $77M. Ruder-Finn, at #3, was equivalent in size.

The #4 player listed was the MWW Group - which was roughly ONE-HALF the size of Wag-Ed, at about $40M!

Taking a look at just the largest oligarch, Omnicom, you see that ALL of that conglomerate's PR agencies' combined revenues added about $90M to the bottom line. Average that $90M across Omnicom's 7 agencies and you get an average of just $12M per firm.

(Obviously that's not an accurate yardstick: Omnicom's group includes Ketchum, Fleishman-Hillard and Porter-Novelli, three of our industry's most important stars, and these three units alone probably accounted for the bulk of Omnicom's PR revenues. But to me, that's even scarier. What if these 3 Omnicom agencies made up 100 percent of Omnicom's PR revenue? That $90M divided by 3 equals $30M per firm, which is top-10, sure, but sooooo far behind Edelman and, let's face it, $30M is a lot of money but it's just a stone's throw away from what 2nd tier agencies were raking-in during the Bubble Days.)

And it's all downhill from there, folks: by the time you get to ranking #15, you're looking at agencies that made $10M or less last year. That includes familiar names like Horn Group, Hoffman, Bite, Outcast, etc. And last year, let's not forget, was a pretty good year for most firms!

Why are we doing this, again? ;)

Meanwhile, even though we've got to be extra-creative to attune and disseminate our clients' messages across channels ranging from the blogosphere to the TODAY Show to EE Times, the advertising guys still get all the big dough, the cool cars and get to hang with the supermodels.

Pretty pictures, catchy tunes and gimmickry trump us every time. Why? Hold on, lemme pull-out my soapbox....

'Cuz as an industry, PR people continue to shy away from bottom-line metrics that would validate our contributions to client revenues.

If you're curious, SHIFT Communications came in at #64. Not too shabby after just 2 years in business, but I was kinda' bummed to see that number at first. I started to feel a little better when I calculated that of the top 65 firms, we were 13th in terms of growth rates. We're shooting for the top 50 this year; wish us luck.

Tuesday, April 05, 2005

When Bloggers Attack

In an earlier post, I talked about how the dynamics of influence had flipped: instead of an elite 20% influencing the rest-of-us, now the Internet allowed the commoners to drive trends in a more forceful and visible way.

So the question's come up at the shop: what do you do "when bloggers attack?" (Sounds like that cheesey Fox tv special!)

What if a blogger gets so peeved at your company that they devote their blogs to taking you down?

This is not a new or uncommon problem. Before blogs were au courant, there were sites like BestBuy Sux, which has been around since 1999. Before that, companies fretted about "getting flamed" in Usenet.

There is a difference, however. Sites like BestBuy Sux exist in a vaccum; they are one step away from being static pages. People get P.O.'d at BestBuy then go to the site, rant, and most likely never come back.

Blogs, by contrast, are more interactive and community oriented. To quote yet another of my earlier posts: "...The inner circle of well-known blogs, which are incestuously interlinked, have a growing measure of social influence. Blog audiences grow attuned to the opinions of their fave bloggers and come to trust their opinions as much as they'd trust the opinions of a neighbor. The blogger, in effect, has become a link in the consumer's own social network."

So, it is one thing for me to get pissy at BestBuy and rant at BestBuy Sux: that post is tomorrow's birdcage liner. It's another thing altogether if I am venting my frustration in front of a group of influential friends who not only share my pain but also go out of their way to help spread my tale of woe. The mole-hill can become a mountain.

I hate to be so danged self-referential here, but this brings me back to that original post cited earlier, which suggested that companies had best prepare themselves for unprecendented transparency to their customers. You can't dick around with Joe Sixpack in Toledo and expect that that regional misfire will die quietly, with no national repercussions. Joe Sixpack is now Joe Blogger. And Joe Blogger has friends.

This level of transparency requires a valiant and responsible and ongoing quest for customer service and product excellence.

But the question remains: whaddaya do "When Bloggers Attack?"

First, don't panic. Panic never solved anything, and especially not in "Internet Time" (as it is so breathlessly described by the pundits). The speed and power of the Internet begs for a more reasoned, rational, strategic response to the blogger's complaints.

Next: think like the Blogosphere. For the most part these folks are independent spirits, often with too much time on their hands - which can make them a bit self-absorbed and easily offended. That may be an unfair characterization, but please remember for the purposes of this post that I am talking not only about a blogger who attacked you, but also about a community of bloggers who felt impassioned enough to take up their brother's cause.

If you think like a member of this blogging community, you realize that this crisis should be handled like most other corporate communications crises: speedily, with as much honesty as possible, and with an action plan for how you'll do it better next time (if that's possible or necessary). Think "Tylenol Scare" - it's Crisis Management 101 and perfectly relevent.

That's a quick synopsis of HOW to respond. But, WHERE? Some hidebound PR types who see a blogging crisis emerging will fall-back to the ever-handy press release. Don't do it, yet. Respond where you are SUPPOSED to respond in the Blogosphere - in the "Comments" field of the original flame. Then monitor the subsequent comments and jump in as necessary...but as little as possible. Don't make a nuisance of yourself. (Remember your Shakespeare? "Milady doth protest too much!")

Be open, be honest, be candid. Try not to sound too much like a corporate flunky. But for pity's sake, DON'T try to sound cool, either. Just be straightforward.

Then, get out of the way for a while and see how your response was received.

You need to also remember another danger - the TrackBacks. Be sure to monitor the other blogs that referred to the post (and maybe added their two cents!), and again - patiently and calmly give a similar response.

That's a quick primer. And lastly you ought to remember that there's one other good thing about the bloggers: like a pack of wild dogs, they will all pile on the carcass for a while...ripping and chewing on your corporate reputation...but eventually - and sooner rather than later - they move on.

Monday, April 04, 2005

Marketers to PR: Show Me The Money

Warning: the following post will sound a lot like shameless self-promotion. But read it anyway, 'cuz if you're in PR, the concepts below will ultimately change your world.

Last week, my firm unveiled the fruits of a 2-year-long effort to FINALLY allow marketers to show the revenue impact of each of their marketing programs. Crucially, and I daresay for the first time, this process also measures the impact of PR on lead generation.

As you've seen in previous posts, I think that today's guiding lights of PR Measurement are a whole lotta hooey. The fact is, Ad-Value Equivalency, Share Of Voice, etc., have no meaningful, LONG-TERM impact on the perceived value of PR in the minds of the C-Suite executives who pay our invoices.

The CEO, CFO, and yes, even the wild-n-wacky CMO care about MONEY. They know implicitly that reputation drives REVENUE, which is the only reason they care about reputation in the first place.

It's also the reason so many of today's marketers are being tasked with "metrics." Virtually every other marketing program has been automated in some way or another, and thus can be measured. PR stands alone on the mountaintop, thinking itself unmeasurable - but dammit, being "hard to quantify" does not make our tradecraft unassailable! Sooner or later, for the whole PR industry, if you can't PROVE it, they won't PAY FOR IT.

If a Chief Marketing Officer can point to a graphical analysis of where the company's sales leads come from, tagged and analyzed by respective marketing program, then they can stop the perception that "Marketing is a cost center" and instead have their heretofore "fuzzy-wuzzy" department be viewed as a strategic profit center.

How often in Corporate America do VPs of Sales argue that "Marketing isn't providing enough leads?" and hear the retort, "Marketing is providing hundreds of leads, that Sales won't follow-up on?" which leads to the rejoinder, "That's cuz they're crappy leads to start with!" Oy! What a headache. A miserable conversation that could be quelled if Sales and Marketing were working from the same set of data about lead generation results.

It's relatively easy, in the world of e-marketing, to know that X number of people clicked on a Google AdWord or replied to an e-mail campaign. The clickstream is there to see. But how can PR firms show their revenue value? And how can the value of PR be integrated with the data that comes from more specific datasets that come from electronic campaigns?

That's the secret sauce of the SHIFT LeadSensor.