The Institute for PR dinner last week had two of the newsiest speakers in its history—Martin Sorrell of WPP, whose stock has been battered to less than half its recent value, and Steve Harris, PR head of General Motors, which the same day was in Washington, D.C., pleading for billions from the U.S. government to save it from bankruptcy.
Sorrell spoke for 50 minutes but allowed no questions. Harris attended via a pre-recorded videotape so no questions were possible.
His message of disaster for the U.S. if GM went bankrupt was a riff on GM CEO Charlie Wilson's remark to Congress in 1953 that "What is good for the country was good for GM and vice versa." This haunted GM for many years.
Sorrell praised the interactive nature of the web and said this was made to order for PR. He had a chance demonstrate interactivity with an audience but did not do so. Sorrell and Harris used the IPR to plant their "messages." It was advertising rather than PR.
The WPP head was there to paint a glowing picture of prospects for his PR firms which do about $1.2 billion. He has been saying that the ad business is in for a very rough 2009.
Congloms Brought Ad Secrecy to PR
It was ironic that Sorrell should be addressing the high temple of PR research, which had a blue chip audience, when he, CEO John Wren of Omnicom, and the heads of the other ad conglomerates have for seven years blocked the release of revenue or employment totals for their thousands of ad/pr agencies.
This has removed an immense amount of data needed for research on these firms.
The reason given–Sarbanes-Oxley–is full of holes. Release of employment and payroll totals would not violate anything in SOX, it has been argued by Tim Dyson, CEO of publicly-held NextFifteen, which releases figures for its Text 100 PR unit.
Publicly-held Cossette of Canada releases figures for its U.S.-based PainePR. Canada has its own "SOX" law.
CPAs say that employment and payroll totals are "mere compilations." They are not subject to differing interpretations and therefore they fall outside of Generally Accepted Accounting Principles. WPP can't dialogue on this issue.
Besides withholding financial information, conglomerate-owned PR firms have reduced or eliminated client lists. Hill & Knowlton, a WPP agency, has not been allowed to provide an account list for about 15 years. Previously, it published a list of nearly 500 clients.
Martin Sorrell speaks at the IPR dinner. |
Sorrell swept through the IPR dinner like a freight train.
We got to the Yale Club IPR reception at 6:15 p.m. and his name plate was still on the table.
At 6:30, just as we were starting to converse with attendees, the crowd was told it had to go up to the dining hall. Usually the cocktail "hour" lasts an hour—until 7 p.m.
But we were told that Sorrell was in a big rush and had to leave by 7:45. We're quite familiar with what we call "bum's rush" PR ("Oooh, I'm soooo busy I can't possibly deal with you").
He skipped the cocktail party and dinner and the chance to converse with some of the more than 200 people present, although his speech said that is exactly what PR pros and even execs must do in the new web world.
The normal IPR schedule was upended to accommodate Sorrell.
Instead of the awards coming first, then dinner, and then the IPR "Distingished Lecture," Sorrell came first, then dinner, then the Hamilton acceptance speech by Harris, and then the awards. Sorrell also skipped dinner with the attendees.
The wave of PR firm sell-outs is past. Based on the macro totals that WPP and Omnicom provide about their PR holdings, many independent PR firms are growing at about three times the rate that conglom PR units are growing.
Providing documentation of their revenues and staff from 2007 to the O'Dwyer Co. were 190 independents, a gain of 42. Twenty-one of the 50 largest firms had revenue gains of more than 20%. A total of 618 specialty rankings (healthcare, tech, etc.), was provided, up 30% from 479.
Regrettably, the conglom PR firms have missed this boat.
Although Sorrell said "social media" are made for PR people because they are used to interaction and "nuanced" communication, we think this falls under the remark that CBS commentator Andrew Cohen made about PR earlier this year—that what PR people do is try to convince others that "a turkey is really an eagle."
PR pros today are confronted not only with out-of-control reporters, experts that media quote, and organized pressure groups, but millions of citizens including their own employees who don't hesitate to take a bite out of an organization's hide.
Attendees at the Institute for PR event last night in New York. |
Furthermore, PR pros today are not allowed to circulate freely among reporters and build relationships like they once did. Organizations decided decades ago that PR/press fraternization was a threat to corporate secrets. Having friends in the press today can be career-threatening.
Our favorite passage in the Sorrell speech (full PDF of text is here) is where he describes PR's role in the "turf wars" that take place in clients.
These are internal political "battles" for control of an organization. "Sometimes, if customers saw what went on within a company they would be horrified," Sorrell told the IPR dinner.
These battles (and PR pros must make sure they're on the right side) take up a lot of PR's time.
"You could argue that most of the communication we coordinate for our clients is aimed at internal audiences rather than external ones," said Sorrell.
"To express it a little more brutally," he said, "probably the biggest block to progress for our clients is internal politics."
So, PR people, besides being communicators, must be politicians. They must get on what will be the "winning side" or they will be out of jobs.
For instance, if one faction is media-oriented and another is hostile to media, PR people would need to determine which one will win. If a contender for CEO is hostile to the Wall Street Journal, (or the opposite), then a PR staffer's behavior would have to reflect this. If factions are lining up as green-oriented or not green-oriented, then staff PR pros would have to pick the likely winner and behave accordingly.
Staffers are so sensitive to the wants of CEOs that at one company, when the CEO expressed a preference for the color red, many execs started wearing red ties, red dresses became common and offices started to have red furniture and window dressings.
Harris in Delicate Spot
Harris became the first person ever to win the IPR's Alexander Hamilton Medal and not show up to get it.
Harris' speech was delivered via video. |
General Motors, as we all know, is in dire straits. But we think Harris could have taken a few hours to come to New York and accept the award and answer some questions. He would have had to act like Sorrell—no mixing with the cocktail hour crowd, no dinner with attendees, no questions, and a quick exit.
The behavior of these two executives provided a lesson in today's PR. One slip of the tongue by Harris might have made its way into the press and jeopardized the delicate negotiations going on in D.C.
PR people once said information was the "most precious commodity." It is now also "the most dangerous commodity."
Student Questions Worth of PR
The part of Harris' speech that intrigued us was the fact that he was disturbed by something a student said to him at the PR Society conference in Detroit last month.
The student asked Harris if working in PR "is an honorable thing to do and if PR is an honorable profession?"
"Wow! That really set me back," Harris told the IPR dinner.
He answered the student by saying, "What makes anything honorable is the person and how they conduct themselves, their ethics, their morals, and their integrity. Any profession can be honorable or dishonorable–it really depends on the individual."
Harris further said the PR industry can do its "most honorable, our most noble work ever" by helping their companies in the "current global economic crisis."
Our opinion: PR is honorable when it interfaces with experts in the press or experts used by the press and answers their questions. Dodging the press and experts is dishonorable.
We didn't find professional-level PR when we tried to get an advance on Sorrell's speech so it would be ready for our website the next morning. Neither Fran Butera nor Kevin McCormick, the two PR pros in the New York WPP office, would answer our phone calls or e-mails. We downloaded the text from the IPR website the next day. We have never seen Butera or McCormick although their office is two blocks from ours. If we did, we think it would cost them their jobs. The GM office readily provided an advance of the Harris speech...the PR Society's refusal to provide members or the press a copy of the 136-page transcript of the 2008 Assembly flies in the face of basic democratic principles and also violates the PRS tradition of providing such transcripts. We have 3.5-inch disks containing transcripts of the 2002, 2003 and 2004 Assemblies and once having established this practice we don't think the Society can suddenly stop it. If a property owner allows the general public to take a short cut through part of his or her property for several years, this right may not be terminated by the owner. An "easement" may have been created. This same principle may hold true for the withheld transcripts. Also germane is the famous "Brown Act" passed by California in 1953. It is used in that state and throughout the U.S. to bring openness to government bodies. It can also apply to non-profit corporations "formed by a public agency." PRS is chartered by New York State. One provision in Brown is that the public "may inspect any recording made by an agency of its open meetings." The 2008 Assembly was an open meeting and was recorded. If the Society wants to live up to the spirit of the law (and its own constant declarations of "openness and transparency" and "advancing the free flow of accurate and truthful information," it will give the transcripts to members and the press. Apparently, even delegates are being blocked from getting the transcript. The ban could even extend to board members. We can't ask any directors because they have signed iron-clad agreements to let chair Jeff Julin and the VP-PR of PRS act as sole spokespersons.