Category Archives: 5. General Business

Marketing Trends: Public Relations Budgets going Social?

Sudden stormI haven’t been up for air in weeks. Somehow, despite the economic downturn, despite the nuclear winter in venture capital markets for early stage startups, SocialRep is humming. I’ve been buried in social media tracking scans for customers and prospects, and new inquiries are coming in over the transom. I’m also excited about an invitation to present at Thunderbird’s Winterim in New York in January, where I’ll be talking about our emerging framework for integrated social media marketing and technology. So how can I account for the uptick in energy despite the gloomy market? I’m starting to see my theory about natural selection play out.

Over the past couple of months, SocialRep has been tracking a massive swath of online dialog about marketing. Not surprisingly, the trends in dialog are overwhelmingly focused on the impact of the economic downturn, with various flavors of speculation, panic and punditry. Some examples:

  • A few weeks ago, various reports on budget planning for 2009 highlighted a marked migration in marketing spend from traditional to digital media. The nearly universal read on this move is that online marketing is more measureable than offline, but there was surprisingly little citical analysis of  the challenges with online metrics, and how those challenges are being addressed.
  • As the economic crisis deepened, the panic did too. Sequoia Capital stoked the flames with a presentation they posted online telling their entrepreneurs to “get real or go home”. The presentation went massively viral, spreading the talking points for belt tightening and death pool speculation for various startup sectors, but few specifics on the tactics companies should pursue to refine their market approach.
  • As if in response to the panic–and mindful of the bloodbath marketing usually suffers in a downturn–marketing pundits took up the mantra that, whatever you do, DON’T STOP SPENDING. Some (myself included) cited the anecdotes that companies like P&G, Kellogg and Chevy increased ad spending during the Great Depression and pulled ahead of competitors. But most simply pronounced the incantation forcefully, that smart companies don’t cut marketing, but didn’t offer specifics on how companies should adjust their programs. Jonathan Baskin called this trend perfectly.

Notice a pattern here? Lots of punditry and trend analysis, but very few specific recommendations for how companies should adjust their marketing programs to deal with the economic crisis. There were a couple of exceptions, most notably a lot of dialog about the dangers of discounting and how price cuts undermine brand equity. But in terms of substantive recommendations for adjusting marketing strategy and operations, not so much. So I was interested to see a tangible sign of how some companies are adjusting based on the sudden increase of inquiries at SocialRep.

~  free  ~We’re still in the early stages at SocialRep. After beating the streets for Series A funding over the summer, we read the tea leaves and readjusted to focus our energy on customers and product. In this market, we’re going to live or die by our success in serving customers, not VCs. But bootstrapping a technology company can be tenuous. You need customers, but if you’re too opportunistic and grab at anything you can drag over the doorstep, you’ll quickly fragment your product and team by trying to be all things to all prospects. So you have to be deliberate in choosing customers, which means being a little more slow and quiet than would otherwise seem prudent. When you find a good market vein, you mine it, and pay close attention to the way your prospects frame the problem they want you to solve.

What surprised me was the sudden influx over the past few weeks in the number of companies that found us, and how they framed their interest in our social media offering. The common refrain was that, in the face of an emerging recession, these companies were aggressively reviewing every dollar of their marketing spend. One area in particular was not standing up to scrutiny: Public Relations. These companies complained about spending 5-figure monthly PR budgets on activities that produced activity without results. The mandate these companies had been given was to take the PR budget that was not performing and invest it in something innovative, like social media marketing.

Silencio!!! by Loud VillaNow I know this will provoke some howls, so let me make a preemptive disclaimer. I believe in PR. Or, I should say, I believe in good PR. And having spent 15 years on every side of PR, I can define the difference between good and bad PR. Years ago, when I was the editor of a magazine, my inbox overflowed every day with pitches and press releases that had absolutely no relation to what my magazine covered. Today as a blogger, I still get totally irrelevant PR-spam, more artfully framed as “blogger relations”. This is the lazily “scientific” ethic of bad PR: blast a fire hose of pitches and press releases at everyone that looks like they might be a journalist or blogger, and hope someone picks up your story. In the place of actual stories that influence the market, this approach produces monthly “activity reports” and media mentions in off-the-beaten-path blogs or news feeds.

Good PR is different. It’s about relationships and market expertise. PR companies in this category take the time to hire and train smart people who get to know a market, the competitive landscape, the products, and of course, the analysts, reporters and bloggers. They don’t spam their contacts with press releases; they build relationships based on sharing knowledge and insight. Reporters and bloggers answer their calls because they know their time won’t be wasted, and they may get an important tip. This kind of PR produces relevant stories that influence markets.

The problem is, the ratio of good to bad PR is not good. And even among the better PR companies, an understanding of how to manage the dramatic shift from traditional to social media is still largely predicated on the notion of cultivating asymmetrical influence more than reciprocal dialog. Moreover, few traditional PR companies have the culture to passionately embrace the tech-driven social media paradigm. So in the face of a market downturn, when belts are tightening, we’re seeing companies looking at the money poured into PR, and deciding that now is the time to try something new.

What does “something new” look like? That’s the topic of my next post. In the meantime, here’s a hint: social media marketing is just like PR, in the sense that there’s “good” and “bad” SMM. And the distinction is based largely on the same dynamic–activity vs. results, influence vs. relationships.

Slimy Opt-In Tactics

After upgrading my system, I just tried to view a RealPlayer video file for the first time. As opposed to Flash video players, like YouTube, or the kind I recently launched for MarketingRev, RealPlayer has a dedicated client application that sits on your computer to play RealPlayer files, and oh yeah, communicate back to Real. These pods that communicate back to the mother ship have been abused enough to make consumers leary of them, but if it’s something you really want to watch, you just shut up and let them play.

So I’m forced to go through an initializing wizard with my RealPlayer. Of course, it first tries to take over all my video files by helpfully auto-checking the box "Make RealPlayer My Default Media Player", but I catch it and decline. It’s the next screen that Really pisses me off. It’s an opt-in screen that invites me to subscribe to a list of Spam-bot feeds with lots of FREE RealPlayer content. You can see four  feeds in the small selection box, and to my surprise, they’re not automatically checked for my opt-in permission.


Okay, I’m not being hoodwinked on this screen. I’m about to click "next" when I notice there’s a scroll bar on the selection box. I scroll down, and low and behold, when get below the fold there are a lot more Spam feeds, and these hidden feeds are auto-checked for opt-in permission.


Those scum sucking slimebags.

There is absolutely no question in my mind that this box was set up to purposely deceive users into opting in to email they had no intention of subscribing to. The unchecked subscription boxes are shown to users so they let down their guard, while the auto-checked boxes are hidden in a way that the vast majority of users would never notice. This kind of tactic is a tacit admission in my mind of an inability to effectively market information people actually want so they have to resort to deceptive tactics in order to fool people into subscribing. I can only imagine what their spamming tactics are like.  

Biting the Hand that Used to Feed Me

In the interest of full disclosure before delivering this post, I recently left BusinessWeek as a columnist for the online edition. The bottom line is that after 2 and a half years of writing for the small business section, our paths diverged. There’s a lot of good stuff happening at BW, but unfortunately I don’t think the Web site is as strong as it could be–from underlying investments in technology, to editorial focus. I wasn’t too inspired to say anything about the transition until I close a new gig, but a feature I read today changed my mind.

BusinessWeek is posting on its site its editorial picks for "best of the Web".  They frame the list by saying: "with only 24 hours in the day, we have to settle on a relative few as places to work, play, and get things done online. These are our picks for the cream of the crop". Take a look at the list, flip through some of the links, and then ask yourself how this serves the BusinessWeek audience? The listings are vaguely categorized, have no description, and worst of all, as a whole they have only tangential relevance to a business reader. Lets just take a few examples:

Travel is listed under "play", not under "@work". I guess business people only travel for pleasure.

There are more links relevant to personal entertainment than business.

"Blogs" as a category contains a random sampling of high-profile mostly-technology blogs, with no breakdown into business categories, like technology, finance, management, and oh, I don’t know, marketing?

What the hell is "collaboration" supposed to mean here? You’ve got a project management ASP, an SFA provider, an open source depository?? What is this category?

"Research" includes, a great social bookmark aggregator, but not, say, Edgars? Or Hoovers? Or Factiva? Or the US Patent and Trademark Office?

BusinessWeek has a great brand and a tremendous amount of goodwill in the market. Why are they having such a hard time using the Web to deliver the same quality of content they deliver through print? This list has all the hallmarks of an editor who’s had a task to create a "Best Of" list sitting on his desk for 3 months, coming up for review, and slamming out an email to all hands to submit their favorite sites before 5pm. Too bad. This could have been useful.

99-Cent Salvation

Is it just me, or is this not one of the most nauseating examples of street-pimp marketing ever vomited up by a barrel-scraping network? NBC is launching dear God no not another Reality-TV-Show-But-With-A-Twist this fall, and they’re trawling for media coverage and viewers by dragging dollar bills through America’s trailer parks as a moving testament to Christian faith.

Here’s the story: Lagging behind the other networks in the popularity of its Slit Your Wrists programming, NBC has concocted a reality show designed to appeal to God-fearing WalMart shoppers from America’s heartland. In NBC’s Three Wishes, an "unscripted show" premiering this fall "singer Amy Grant travels to a different town each week in an effort
to fulfill the heart’s desire of needy families and community groups." It sounds sweet. Really.

So NBC, looking to stir up some coverage for this faith-based initiative hires a publicity firm to cook up some media impressions. The big idea? Stalk "needy shoppers" in the checkout lines of discount retail chains and trot in on a big white horse to pick up the tab with a conspicuous stack of 1-dollar bills. Why waste time and money on creative marketing when you can just buy viewers, and through the magic of stunt media, multiply your audience?

Now I know the professional marketing purists will protest that Hey, they did their job and got national coverage, who cares if it’s singularly unimaginative? My response is that the skirmish won for publicity is a battle lost for NBC’s soul–ahem, I mean brand. The entire stunt paints NBC as a cynical manipulator of America’s poor and needy, eschewing substantive acts of service in favor of Good Samaritan skits prepackaged for the camera. The fact they’ve enlisted Amy Grant, the spokesmodel of shrinkwrapped Christian consumerism, only amplifies the effect.

Don’t get me wrong. I’m no voice crying out in the wilderness here. But this is a gravely disheartening view of America to me. The greasy aftertaste of this campaign is that faith and compassion in
America can only be signified by randomly showering money and
brand name appliances on unsuspecting poor people who look good on
screen being effusively grateful. Perhaps it’s a testament to the marketing company’s professionalism that they so effectively segmented their subject and target audience. Notice they’re distributing fistfuls of cash to people not so needy that they don’t have a credit card and an eye for brands.

I guess good faith comes with a minimum requirement of purchasing power.