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Ogilvy Public Relations Worldwide

Right about now, the Global Financial Crisis has probably hit most companies marketing budgets, with CEO’s tightening the belt on expenses as their revenue lines come down.  Prudently these chief executives seek to bring costs into line with revenues.

A study by the Aberdeen Group, a Harte-Hanks company, found ‘82% of companies have reallocated their planned marketing spend for 2009 to varying degrees on account of the recession.’

The Aberdeen analyst continues with what would seem to be the bleeding obvious: ‘Companies need to ensure that they’re allocating their limited marketing funds in the most productive ways possible … In other cases, companies are actually investing more aggressively in various types of marketing programs, sensing an opportunity to capitalize on the grim economic headlines.’

So for PR managers across the globe this means that marketers are probably beating a direct path to their doorstep looking to leverage ‘free PR’ to augment their dwindling demand generation dollars. This is good news.

It’s good because like the Marines, PR comes to the rescue and to the forefront of marketers’ consciousness. It’s good because PR executed and managed correctly can do enormous good for awareness, consideration and preference. And finally it’s good because social media is the next black and PR as a discipline is primed and ready to take to this new vehicle with a vengeance.

Smart PR managers will be evaluating and prioritizing their core dollars and then looking to see how they can maximize and deliver results on the incremental dollars that some of the marketing folks will bring to the table. The even smarter ones will start to factor into their PR programs effectiveness metrics and will be able to provide a correlation between the campaign or program spend and execution and whatever pre-determined measures were agreed with the marketing folks. That then provides clear accountability and enables PR to talk the marketing talk and walk it at the same time.

Unlike traditional media, social media metrics provide a fantastic opportunity to highlight PR ROI, if done correctly. Linking back a PR-specific program to traffic, or eyeballs or community conversations can be easier (and cheaper) than the more traditional qual and quant analyses of print and broadcast media. There are powerful online tools that allow you to do this and even automate the reporting.

All in all, now is a great time to be in PR.

It must be research season. The latest report to hit the streets down under is the annual Grey’s Eye on Australia report, conducted by Sweeney Research. Whilst some of this makes for interesting reading, I think it also states the obvious. Not surprisingly, it focuses on consumer attitudes about the recession and how people are feeling. 

Reassuringly, despite the gloom, almost two-thirds of Aussies are “extremely” or “very” satisfied with life, despite rising unemployment and a greater focus on personal finances. Perhaps the Rudd Government’s decision in February to hand out wads of cash to a large proportion of the Australian population had something to do with that!

Grey director of planning, Simon Rich, said in the company’s press release:  “For most Australians, life is still OK. Interest rates are low, the cost of petrol is declining and unemployment has not yet reached crisis levels. So, we’re positive about today but concerned about what the future may hold and as a result we’re cutting back expenses and holding off on big ticket purchases.”

I don’t know what is happening in other parts of the world; do you all share Simon’s views?

In an effort to save cash, the purchase of luxury items is waning and consumers have returned to home brand goods. This report showed only 9% of consumers do not purchase house brands, and 41% are buying more than they did 12 months ago. Call me a snob, but home brands still lack quality and with three children to feed, there is in my opinion less waste in sticking with what you know, rather than downgrading to products you may not have tried before.

The changing role of women and how they have adapted to the financial downturn is also highlighted in the report, with Grey managing director Jane Emery saying that it shows women are still the backbone of the Australian household. The report says most major household decisions are undertaken solely by women, with 59% in charge of household expenses and 74% take charge of supermarket shopping – compared to 34% of men. Come on fellas, clearly we should be pulling our weight more!!

Other key findings (and my comments):

– 41% Australians feel they live in prosperous times – down from 70% in 2008 (no surprise);

– Unemployment and job security (29%) is seen as the number one issue facing Australians over the next five years (no surprise);

– 28% people know someone who has lost their job as the result of the global financial crisis (no surprise);

– 86% Australians are actively trying to reduce debt (no surprise and don’t we do this anyway recession or not?);

– Only 16% of women feel job opportunities are consistent for both sexes, compared to 49% of men (that is a concern);

– 39% consumers are prepared to pay more for eco-friendly products or services , which is down from 49% last year (so, does this mean we don’t care about the environment, or has the recession led many of us to abandon the priority of being green to save money?).

– 51% rate as the number one concern drought and water issues, which is a major issue in Australia.

– Most respondents (76%) think most companies are still not environmentally conscious and 83% agree companies should tell people what they are doing about the environment.

– Only 31% of consumers are ‘extremely’ or ‘very’ concerned about the effect of the environment on them personally or their household, compared to 37% in 2008 and 49% in 2007.

Finally, on Internet used (and my comments):

– Browsing the internet is Australians’ number one source of ‘unwinding’ (64%); – Contrary to belief, even 68% of Baby Boomers rate surfing the internet as their primary tactic for unwinding (are we that boring?);

– 74% of respondents subscribe to e-newsletters (boring…!);

– Only 45% of Australians have watched an advertisement online in the past two months (that did surprise me);

– or in an email someone sent to them (49%) – gotta be too much spam;

– 90% of respondents search for information on products or services online before buying (no surprise)

Overall, no real surprises, but some interesting differences. What do think? Are Australian consumers just an optimistic bunch, or is the recession hurting more in other markets? Clearly, the sun and surf may help keep us happy, but I suspect if Gray was to conduct this research again, today, many would not be so positive, with the bottom of the recession forecast to hit in October.

Tech PR in 2009 and beyond.

A new year. A new American President. A bad recession. There are many reasons why I have been thinking about the future of Tech PR, not just through 2009 but beyond. What is the role PR agencies play in this new world? I am an optimist by nature, and cautious by experience.

What can we expect to see, in the short term and the long? Is PR going to suffer as an industry?

I see seven major trends:

1.    Smart companies continue to invest in PR during recessions because this is the time to gain market share, differentiate yourself from your competition, build your brand and protect your reputation. I like the way Craig Barrett put it “You can’t save your way out of recession – you have to invest your way out.”

2.    PR agencies who can provide a seamless, integrated approach to tech companies will survive better than tech specialists. This is the time where you need to provide your clients with counsel on different issues, so you need to have a team of people with different backgrounds that you can pull from. Corporate reputation, crisis and issue management, consumer marketing, public affairs, government, and vertical expertise…the list goes on. The agency who can deliver a seamless, holistic mix has a huge competitive advantage (and will prove most useful to clients.)

3.    Tech companies need to learn how to better integrate PR and marketing. In a media world that is becoming more complex, fractured; where the difference between earned and paid media is blurry, companies that will develop a strategic, integrated marketing approach (we call it 360) will go beyond mere survival. It’s not about channels; it’s about how you engage with your stakeholders. The Obama campaign is an excellent example. Agencies that can deliver on that will hugely benefit from it (and so will their clients.)

4.    Social media is not killing PR agencies; on the contrary. It’s giving us more opportunities. We all read posts about social media killing PR… well, anyone who thinks PR is  just calling media doesn’t have a clue about what we actually do. As I mentioned above, the complexity of the environment is only adding square feet (and toys) to our already really fun sand box.

5.    Chief Content Officer. Content creation is key. With the media shrinking (every day we hear of layoffs at very prestigious media outlets) creating your own content and distributing it through different channels is critical to the success of building a powerful brand. Is it time for a new position? Chief Content Officer, anyone?

6.    The world is flat, yes. But it is also hot and crowded as Thomas Friedman pointed out. Two trends here. Global and Green. Let’s start with global. Clients need PR agencies to work with them on a global basis, but it’s not about “Think Globally, Act Locally” anymore. It’s about idea creation and sharing those ideas globally, efficiently. It’s about understanding the sensibilities of different markets and cultures.

7.    Green. As I wrote in my post the opportunity for working with green tech companies is huge. But the skill set needs to go beyond pure tech PR. You need to combine b2b tech with experience in public affairs, energy, government relations and corporate reputation.

PR is here to stay. Paraphrasing Neil Young’s “My My, Hey Hey (Out Of The Blue)” song, PR can never die, there’s more to the picture.

my my, hey hey
rock and roll is here to stay
it’s better to burn out
than to fade away
my my, hey hey

hey hey, my my
rock and roll can never die
there’s more to the picture
than meets the eye
hey hey, my my

Here is to a new era of responsibility.

Lexy Klain

by Lexy Klain
Category: Technology

I’m keen to understand how the global recession is impacting social media and particularly the North American powerhouse, Silicon Valley. I’m interested in the develpments occurring at Silicon Valley mostly because today we can consider it the backbone behind a lot of the big Web 2.0 companies.

Belts seem to be tightening in all industries across the board – banking, automotive, retail and so on – yet we’re still seeing big injections of capital in many of the Web 2.0 companies.

Take micro-blogging service Twitter for example. It was announced this week that Twitter has managed to raise $35 million in venture capital in spite of the challenging economic climate. This capital has come from Institutional Venture Partners and Benchmark Capital.

Are venture capitalists finally seeing the real value of Web 2.0 in helping deal with challenging times ahead?

I think that social media will come out on top in these tough times as people start using it as a means of cost-saving on entertainment. This is especially important at a time when people are becoming increasingly budget-conscious and are rather choosing to bunker indoors and save their pennies.

I’m a good example of this. I seem to find myself on fewer outings to the movies and instead I keep my cinema experience to my lounge room with my LCD TV, entertainment system and complete surround sound system. In fact, I can’t remember the last movie I saw at the cinemas but I could rattle off at least five DVDs that I have watched at home. I also spend less time travelling and more time talking to my friends overseas via Facebook and Twitter.

There are a plethora of online technologies and digital devices out there that provide consumers with their own portal to entertainment. Aside from big screen TVs that bring you a cinema at home, there are also notebook PCs to consider.

Notebooks are another means of cost-effective entertainment to online services such as online gaming, online video, video conferencing and instant connection to friends and family via IM, social networking sites, email or Skype with those embedded with broadband solutions.

Interestingly enough, consumer experts are also already tipping that many Australians will use the planned $950 Rudd Government cash handouts to splurge on games and gadgets, following record spending on electronics last year (as reported by the Courier Mail).

I’ll be watching these developments closely but please feel free to share any information specifically around how you think social media will fare in light of the global recession.

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