Foundations of Marketing

by Jonathan Groucutt

Chapter 10: Promotion

The Seminar Room

General

Celebrities and Potential Risks

Companies use personalities (including actors, politicians, musicians and models) to either endorse their products and/or feature in their advertisements. The difficulty for both companies and their brands is if the reputation of the celebrity is tarnished in anyway. This can have a negative impact – real or perceived – on the company and brand, let alone the celebrity themselves.

In late 2005 a photograph of supermodel Kate Moss snorting cocaine was published in a British Sunday newspaper. Initially this was an ‘alleged’ incident. However, the companies that had hired her to be the image of their brands began to re-appraise the situation. The result was that several companies, including the major fashion houses Burberry and H&M cancelled their substantial contracts with the supermodel.

Eventually the supermodel admitted to drug taking, issued an apology and checked herself into a major rehab clinic in the US. In this particular case the companies sought to ‘limit’ any potential damage. It is unlikely they were ‘damaged’ by the allegation against the supermodel. Some may say – right or wrong – that they perhaps should have been more supportive of the supermodel. However we have to understand that it can take a significant amount of time to resuscitate a damaged brand. If, of course, a brand can actually survive extremely negative public relations. Some companies have been bankrupted due, in the main, to boycotts and negative press due to their own actions.

Blogs and Blogging

Blogs originated in early part of the 21 st century as a means of individuals keeping and sharing online diaries. A blog is a web log that anyone can post on the Internet. Table 1 illustrates the scope of the blog environment. Thus why it has to be taken as a serious form of communication, both positively and negatively, as we shall discover.

50 million

The number of American Internet users who visited a blog in the first quarter of 2005.

100,000

The number of new blogs created each day.

50% - 60%

The portion of blog attacks considered to be sponsored by competitors within the US.

Table 1: The Scope of the Blog Environment (Source: Lyons, 2005)

Blogs can take various forms, for example:

  • It could be a general discussion of issues, events and life in general. Several politicians use blogs to engage with their electorate on issues that matter to the people.
  • An organization can use them to obtain feedback from their customers on existing and potential new products and services.
  • Individuals and groups may use them to criticise organizations, governments and individuals, for example politicians. Many would support such criticism, especially if it is constructive, honest and truthful. It is believed that it was bloggers that actually unearthed some of the abuse issues in Iraq ahead of journalists on the ground.

However, not all blogs match the three criteria of constructive, honest and truthful. Increasingly blogs have been used to attack brands, organizations and create smear campaigns. The ‘information’ contained with such blogs is usually inaccurate and fabricated with the intention of reaping the maximum damage on the victim. As they spread the level of inaccuracies and disinformation intensifies.

Major organizations such as Microsoft, CNN and Procter & Gamble have suffered prolonged attacks from this virulent form of blogging. As well as proliferating inaccuracies and often-downright lies it reduces the opportunity for serious and honest debate and the communication of ideas.

So who initiates and unleashes such unethical attacks?

They may be individuals who either have a grudge against the organization, perhaps because it is part of ‘big business’ and/or ‘global capitalism’.

There is also evidence to such that there are individuals or small groups that are secretly funded by competitor companies. Clearly such action is generally unethical however it may be breaching the agreed ethical policies of the particular industry of which the competitor in question is a member. Moreover, in some countries it may be deemed an uncompetitive act and thus illegal.

However what is clear is that such bloggers can strike swiftly and at anytime. With a potential online audience of almost 1 billion the viral effect of such blogs on an organisation, for example, can be devastating. Organizations under such constant attack have to be able to employ both defence and retaliation strategies to limit damage. This is increasingly achieved through a combination of intelligence gathering and public relations. Organizations that are potential targets enlist the support of companies specialising in monitoring blog sites. The organization should already have a defence plan in place just in case they become a target. As stated earlier an aggressive blogger can strike swiftly and at any time.

Amongst its counter attack strategies a company may:

  • Unleash its own blog supported by employees who build a blog swarm in defence of the organization. The aim being to overwhelm the attack bloggers with positive information about the organization, products, services and so on.
  • If the blogger has incorporated copyrighted material on their site without appropriate acknowledgement or permission there may be an opportunity (under local/regional laws) to sue the ISP. This may result in the ISP removing the blogger from the Internet. However, this may be temporary as the blogger may find another ISP to host their site. Although perhaps only short lived it may provide the organization with the opportunity to use public relations, for example, to build a credible case to overwhelm the blogger.
  • The organization may seek to take direct legal action against the blogger. This is, of course, easier said than done. First the organization has to locate the blogger and then take legal action with the jurisdiction of the country within which the blogger resides. There may be no local laws that govern such legal action. If there are it may take several years for the case to go to court. If the organization is successful it may take further years to gain any damages. Of course, such action may only bring on even more bloggers to attack the organization retaliation. Thus such action may be deemed more risky than reducing the threat of the blogger in another way (i.e. through public relations activities).

Sources: Hall, I. (2005) Get control of the search button…News Analysis, PR Week, 9 September. p19. Lyons, D. (2005) Attack of the blogs. Forbes 14 November, pp: 129 – 136.


Pan European

Public Relations - Definition

In February 2005 the UK’s Institute of Public Relations became the Chartered Institute of Public Relations. They define PR as:

“ … the discipline which builds and maintains reputation, with the aim of earning understanding and support and influencing opinion and behaviour. It is the planned and sustained effort to establish and maintain good will and mutual understanding between an organisation and its publics.’

As you will see this is a slight, but really only slight, deviation from the original cited within the textbook.

Is Public Relations Always Planned?

However, is it always a ‘planned’ activity? PR benefits can originate from the most unlikely sources (see the Mini Case: Spooks below).

Mini Case: Spooks (also known as MI5 in some countries)

A Kudos Film and TV production for the BBC.

Producer Jane Featherstone says of the series: "Spooks is a topical and edgy drama about passion, jeopardy and the intrigue of people who have to lie for a living - and who can never tell the truth to their loved ones about what it is that they do. Our ‘spooks’ are heroic in the way that only ordinary people doing ordinary things can be. They are people like you and me, but they are dealing with a pro-life activist one week, a racist terrorist conspiracy the next, and an embassy siege the week after that." (BBC PRESS DOCS)

The series Spooks (as of September 2005) had been sold to 27 countries including America (series renamed MI5), Australia (series renamed MI5), Canada, Iran, Israel, Japan, Latin America and Russia.

Top UK PR Consultancies

  • Bell Pottinger/Good Relations/Harvard
  • Citigate
  • Edelman
  • College Hill Associates
  • MediTech Media
  • The Red Consultancy
  • Beattie Communication Group
  • Lewis Communications
  • Consolidated Communications
  • Band & Brown Communications
  • Write Image
  • August One Communications
  • Jackie Cooper PR
  • Nelson Bostock Communications
  • Lexis Public Relations
  • Bite Communications
  • Firefly Communications
  • Portfolio Group
  • Lanson Communications
  • PPS Group

In 2004 the top 20 consultancies had a combined turnover of UK£366 million.

(Source: CIPR and PR Week)

Sales Promotions: Giveaways to Sell Newspapers

During 2005 several UK weekend editions of national newspapers offered readers free DVDs enclosed within specific editions. These are just the DVD of the movie itself.

These DVDs do not include any extras such as deleted scenes or mini documentaries of the making of the movie that are increasingly available on ‘expanded’ versions. These versions are only available in retail outlets for sale.

The objective is to create a situation where potential customers purchase the newspaper for the DVD, then become loyal customers. This increases the circulation of the newspapers and provides long-term stability. This, however, may be an assumption. Individuals may continue to only buy the newspaper which contains a DVD they want. Thus they are ‘loyal’ to no one single newspaper.

However, what is the cost of the DVD to the newspaper? Due to economies of scale the cost can be as low as 16 pence to 18 pence each. That will include the pressing of the disc, the wallet, artwork on both the disc and the wallet cover and royalties (both artistes and Philips – the company that devised DVDs). Consider such a cost though when a weekend newspaper can retail for between UK £1.20 and UK £1.60. Moreover, several million copies may be sold. Therefore the cost is marginal.

Now consider whether you may become loyal to a particular newspaper if DVDs were offered on a regular basis. Would you consider these as added value items to the core product – the newspaper?

Source: BBC (2005) How can papers afford to give away DVD? BBC News Online 11 October.

Street Musicians Promote CDs by Major Labels

It used to be that buskers (or street musicians) on either London’s metro system or near various landmarks were a mixture of the unemployed or music students practising their craft. Indeed, London’s Covent Garden echoes to the sound of music students singularly or in small ensembles playing a range of music from Vivaldi to The Beatles. Perhaps no better way to practice, earn additional cash and applause from an admiring audience.

Busking has become a feature of London, as it has in many of Europe’s capital cities. Often so much better than the canned music that permeates restaurants and shopping malls. [See Chapter 14: Physical Evidence.]

However, there is now a twist in the tale of buskers on London’s streets and on the metro. The record company Sony BMG paid buskers to sing Johnny Cash hits to link in with the release of the movie on the singer’s life – Walk the Line. The buskers sang two songs every hour from a greatest hit album, Ring of Fire (also released to coincide with the movie’s opening).

This is not the first time though that some buskers have been used to promote a CD. They have been paid to sing songs (to coincide with CDs) by the Scottish band Travis and the Eurythmics.

This is clearly an innovative way to promote the songs, CD and the movie. However, is there an ethical dilemma here? The record company is paying the busker. The unsuspecting passer-by hears the music and sees the busker, then drops coins into their guitar case or hat as an appreciation. Would the passer-by leave the coins if they knew that the busker was actually being paid to sing a specific song? What do you think and why?


Pan Pacific

Public Relations

The University of Melbourne have a free double postcard size promotion (through Avantcard – www.avantcard.com.au) at key sites within Melbourne including the Melbourne Tourist Centre in Federation Square. The postcard entitled ‘One Degree of Separation’ advertised the university’s Postgraduate Information Week (5-11 September 2005). The postcard listed the open days and times for each of the university’s schools/faculties and departments. Moreover it stated the ranking of the university not only in Australia but within the rest of the world.

This promotion stands out for the following reasons:

  • It is postcard size – a handy size to pick up and keep.
  • It was specific to the postgraduate event.
  • It was noticeable – it stood out from the rest of the free postcards on offer – it was different.
  • It was situated in an ‘unusual’ place – a tourist office. However, it was in the centre of Melbourne and the there is a significant amount of student/potential student traffic through the tourist office. Therefore it is not an unusual place to locate such information.

When is Bad Publicity Good Publicity?

There is school of thought that suggests that there is no such thing as bad publicity. In order to consider this point of view we are going to look back at an event that occurred in the 1980s - Spycatcher.

Consider this event from several different perspectives:

  • The rationale for the actions of the British government. Did they, for instance, consider the wider implications of their actions?
  • The series of events occurred under the gaze of the media spotlight – but before the widespread availability of the Internet and the world wide web. Although there was significant media coverage what do you think would be the impact today with 24/7 global TV news coverage and the instant access of the web? You may want to consider the role of blogging here as well. [See Chapter 10: Promotion, on this website for details of blogs and blogging activity.]
  • What do you think other organizations and companies can learn from analysing such events?

Peter Wright had worked as an intelligent officer for MI5, the British Security Service rising to the rank of Assistant Director. In January 1976 he retired and eventually settled in Tasmania where he began to write his memoirs. In 1985 the book Spycatcher appeared in Australia. Co-written with Paul Greengrass the book was published by Heinemann Australia.

However the British government immediately stepped in and banned it from being either published or sold within the UK. Details of the principal allegations contained within the book were sent to major British newspapers that sought to publish them. The British government stepped in once more and banned the newspapers from publishing the allegations. When the newspapers made further attempts to publish they were charged with contempt of court.

Peter Wright’s principal allegations were:

  • That Roger Hollis, the Head of MI5 in the 1960s, was actually working for the Russian Secret Service, the KGB. Thus passing British and American secrets to the Russians.
  • That MI5 plotted against the British Prime Minister, Harold Wilson, between 1974 and 1976. This was in collaboration with agents of the Central Intelligence Agency.
  • That MI5 bugged and burgled diplomatic conferences.
  • That MI5 was out of control.

It must be noted that several of these allegations had surfaced before and it was not Wright who had ‘blown the whistle’.

The British government’s case for banning the book on UK soil was on the grounds that Peter Wright had been a servant of the Crown and thus was prevented from writing about his work or indeed the work of the British security establishment. The irony was that the book was freely available in other countries such as Australia, the US and Ireland. British newspapers would publish photographs of journalists stepping off planes at London’s Heathrow airport with a copy of the book in their hands. This was perfectly legal as it was not considered an illegal import for an individual, only if a company had imported them with the intent to sell them. Even stranger it was perfectly legal to buy the book by mail order (remember there was no online purchasing at the time) so they had to be advertised in UK-based newspapers but shipped from Ireland.

In 1985 the British government sought an injunction in the Supreme Court of New South Wales to stop the publication of the book. A young Australian lawyer, Malcolm Turnbull, defended Peter Wright and his publishers against the British government’s actions. The British Prime Minister, Margaret Thatcher, despatched the then Cabinet Secretary Sir Robert Armstrong, amongst others, to defend the UK’s position. ‘Defend’ is perhaps the most appropriate word here because they were ‘wrong footed’ on almost every account. For instance, Turnbull asked Sir Robert if he had heard of MI6, the British Secret Intelligence Service. Sir Robert replied that he was not familiar with such an organization. This was clearly absurd, as the Cabinet Secretary would have come across the existence of such an organization in his role – but more to the point there were official World War II histories of the organization actually published by the government through Her Majesty’s Stationery Office and available to the general public. The very next day after this questioning by Turnbull, Sir Robert stated that he had been ‘economical with the truth’ - a statement that has now entered the international vocabulary. The whole case was clearly damaging to the British government who refused to back down and admit defeat, even though it was very much ‘in their face’.

The Supreme Court ruled against the British government. Not prepared to accept defeat the British government appealed and lost that case too. Further ignominy faced the British government when the Law Lords (The UK’s highest Court) ruled that publication overseas meant that it no longer contained secrets.

Furthermore in 1991 the European Court of Human Rights stated that the British government had breached European Convention of Human Rights by attempting to prevent the British newspapers publishing extracts from the book.

So what of the book and its ‘secrets’? As stated earlier much of what had been written as allegations had been stated before and dismissed. Whilst it was interesting in terms of one man’s perspective of life in the British Security Service, it wasn’t earth shattering. Indeed it was a very straightforward and some may say mundane account of life in the service. Wright never risked his life as say agents during World War II whose lives had been portrayed in both books and movies. That is not to denigrate his work in the service of his country, especially at the height of the Cold War, however his was a very different type of ‘war’.

So, if the British government hadn’t pursued Wright on the global media stage would the book have been a bestseller? Unlikely. However, the man who had left the service with a reduced pension (due to UK government restrictions of service) died in 1995, at the age of 78, a millionaire. The might of the British government proved to be extremely foolish in taking such action (at a cost of several millions to the British taxpayer) and a retired civil servant became a millionaire as a result.

In the 2004 General Election Malcolm Turnbull was elected Federal Member for Wentworth in New South Wales.

In 2001 Dame Stella Rimington, the first woman to become the Director General of MI5, published her autobiography – Open Secret. Although various members of the government of the day and former intelligence officers expressed their concern there was no hint of stopping her memoirs from being published. Her memoirs capture more of her life juggling family with the pressures of an extraordinary job.

Rimington had been the first Director General to come out of the shadows and present a public speech whilst in office. She became the public face and persona of MI5 and brought it to the public’s attention as a vital part of the defence of the UK. This subsequently lead to the development of the website (see the textbook for details) and post 9/11 it’s importance of protecting UK citizens against acts of terrorism.

Stella Rimington has gone on to become a writer of fictionalised espionage with At Risk (published in 2004) and Secret Asset (published 2006). She is perhaps following in the footsteps of John Le Carre (pseudonym of David Cornwall) who had dealings with the intelligence services when he was Second Secretary at the British Embassy in Bonn and then Consul in Hamburg in the early 1960s.

Today, most of the world’s intelligence services have websites.

Earlier I asked you to consider various issues as a result of this case. Here are few more to reflect upon.

  • Are there any other recent government or business cases that you can think of that have a ‘similarity’ with the Spycatcher trial?
  • If you were the Head of Public Relations for an organization what would you advise under similar conditions? Is there another way, especially within the 21 st Century, of tackling such a situation?
  • If this case was re-run today what would be, in your opinion, the impact of blogs?
  • In an expanding world of conspiracy theories how does a government, organization or indeed a company (for example, a defence contractor) protect themselves against potential anti-marketing activity?
  • ‘There is always a case for owning up and being honest about the past in order to protect the future assets of the business’. Discuss. (This is an issue that you may want to debate with your fellow colleagues. It should raise several ethical and moral issues. These are very issues that should go to the core of marketing – but are not always considered.)
  • Why do you think most of the world’s intelligence services have both PR teams and websites? What are they marketing?
  • So, is bad publicity good publicity? Discuss.

Sources: BBC (1998) Shatler recalls ‘Spyctacher’ farce, BBC News Online, 3 August. The Spycatcher Case. Mcquaire University www.law.mq.edu.au Malcolm Turnbull’s website www.turnbullforwentworth,org Wright, P. and Greengrass, P, (1987) Spycatcher. Richmond, Victoria: William Heinemann Australia.


North America

City PR – The NYPD

Have you ever wondered why so many TV and movie police dramas are set in New York? True it has one of the most diverse and dramatic cityscapes in the world and a mixed cultural background. What it also possesses is a Film Commission operating through the Mayor’s Office and a dedicated Police Movie and TV Unit.

Founded in 1966 the NYPD Movie/TV was the first of its kind in the US and has, in many instances, been the model for many other countries. Working in co-operation with the Mayor’s Office of Film, Theatre & Broadcasting, over 27 dedicated officers and supervisors are deployed to assist in film and TV production. This includes, amongst many other activities, traffic control and advice on locations and the creation of crime scenes. One of the many award-winning and critically acclaimed series filmed entirely in New York has been Law & Order.

PR for Spies

The NYPD are not the only US agency involved in assisting movie and TV companies for PR purposes. The Central Intelligence Agency (CIA) has a dedicated team to assist both authors and film makers. To quote:

“While protecting those things which must remain classified, the Publication and Film Industry Liaison Officer provides advice and guidance to authors, screen writers, directors, and producers who need information and insight into the world of foreign intelligence gathering – from clandestine and analytical tradecraft to photography of the CIA headquarters compound.

In working with the entertainment industry, the Office of Public Affairs believes that more realistic portrayals of the CIA in print and in film will provide the American public with a better understanding of and appreciation for the Agency, its mission and employees.’

While the British equivalent SIS (commonly known as MI6) and the internal security service (commonly known as MI5) do not provide such services they have publicly-accessibly websites. Increasingly they are becoming PR active.


The Café

  • PR is just really ‘spin’. It has no real value. What do you think and why?
  • Selling is more than knowing the features and benefits of a product or service

Selling is normally associated with sales people, but the fact is the ability to sell and to negotiate is critical throughout the business community. Virtually all of us, especially in today’s dynamic international marketplace, need to understand the role of sales both internally and externally to the organization.

Those involved in the selling process have to be confident. This is perhaps where the ‘hard sell’ image originated. However, today’s salesperson has the challenge of developing successful relationships by getting back to basics – building trust and credibility.

Although there has been a sea change in the approach to selling, problems still remain. There is still the tendency to talk too much, and talk at the customer. There is the story of a photocopier sales person who went to great lengths to explain all the features and benefits of a particular copier. It was fascinating to hear what technology could do – but was it right for the company’s needs? Simply, NO! The sales person was just too involved in the technology to ask the right questions about ‘needs’. What was required was a basic copier that could handle small runs, and not one that would ‘make the coffee in the mornings’. The salesperson simply failed to enquire, through questioning, the company’s actual requirements.

What the salesperson needed to do was to ask questions and listen. For listening is the most important weapon in a salesperson’s armoury. It is what’s on the buyer’s mind, not the salesperson’s that really drives the sale. What we need to do is learn active listening skills and consider what is being said to us by the potential customer – whether that customer is internal or external to the organization.

While there may be a natural tendency to detail the product’s features and benefits, the focus should be on developing the interpersonal relationship. When we listen to what a customer has to say, and respond with relevant linked questions, the customer may be more willing to reveal their preferences and ‘real’ needs. It is also a mechanism whereby we can build a longer-term relationship, and there is sound economic sense for building such relationships. The economist and sociologist Vilfredo Pareto (1848-1923) observed that in any series, small proportion accounted for a large share of the outcome. This has been translated in business terms as the 80/20 Rule where 80 percent of the sales will emanate from 20 percent of customers. The proportions may vary, however the principle remains the same. So developing a long-term relationship with customers is in the salesperson’s best interest.

So there are four key issues for you to consider here:

(1) Selling is not just about the features and benefits of the product or service on offer. Salespeople need the interpersonal skills to be successful.

(2) Salespeople need to build relationships. This perhaps goes to the heart of Relationship Marketing. [See Chapter 8: The Marketing Mix and Relationship Marketing.]

(3) It is about working with people. [See Chapter 13: People.]

(4) Salespeople through their interpersonal skills need to understand the psychology that lies behind the need or want. Just like Pareto’s law this is nothing new. In 1925 a book by Edward K. Strong Jr, Professor of Psychology at the Graduate School of Business, Stanford University was published. The title was The Psychology of Selling and Advertising.

Some of you may say that all this is common sense. You may be absolutely right. If so, why aren’t more people actively engaged in this skill development?


The Library

Articles

Liu, W-L. (2002) Advertising in China: product branding and beyond. Corporate Communications: An International Journal. Vol 7 No 2. pp: 117 – 125.

Books

Davis. A. (2004) Mastering Public Relations. Basingstoke: Palgrave Macmillan

Ewen, S. (1996) PR! A Social History of Spin. New York: Basic Books.


Useful websites

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