Sheffield University Management School is a triple-accredited business school with a world-class reputation for high quality teaching, ground-breaking research and cutting-edge thinking. Part of Britain's elite Russell Group of research-driven universities, it runs one of the few MBA programmes to involve a compulsory semester-long course on Integrated Marketing Communications. This 2006 presentation was given to MBA students at the school to outline the opportunities for public relations, the obstacles preventing PR from meeting its potential, and the solutions for both PR as a function, and for MBAs looking to move up in the industry.

1. Integrating PR
How IMC can save public relations
And how you can help
Duncan Chapple
dc@duncanchapple.com

2. Agenda
Agenda, Self-introduction, Overview

3. Agenda
• Introduction
• The opportunity for PR
• The obstacles facing PR
• Solutions
• How to sell yourself as part of the
solution

4. My background:
MSc. Business Analysis, and then…

5. In a nutshell
• Opportunity exists to use PR to
grow business value through
building brand equity
• But PR managers deliver high-
volume, low-strategy and barely
profitable commoditised PR
• PR can improve measurably
• You can make a major difference
• Focus on brand & business outcomes
• Make PR a profit centre, not a net cost
• Need a vision of what to create

6. I saw the angel in the marble and
carved until I set him free.
Michelangelo

7. The opportunity
The opportunity exists to use PR to grow business
value through building brand equity

8. “If I had one last marketing dollar I’d
spend it on Public Relations.”
• Bill Gates’ famous endorsement
– Achieving editorial coverage is often
• More powerful
– Seems independent
• Uniquely credible
– Growing scepticism of consumers
• More economical than advertising
– Fraction of the cost
• Also rooted in the crisis in
advertising

9. Where to begin?

10. US Firms’ Marketing Spend
• Overall spend
over $1 trillion
– Since 2005…
• $40 bn fall in
advertising/d
irect
marketing
• $40 bn rise
in public and
analyst
relations
• Broadly
reflective of
global trends
Source: Blackfriars Marketing Index (Blackfriars Inc.)

11. The end of advertising’s dominance
Sergio Zyman:
former CMO of
Coca Cola; founder
of Zyman Institute
at Emory University

12. Gates made systematic
• Advertising is brand maintenance.
PR is brand building.
• How many advertising messages is the
average person exposed to during an
average day?
... guesses ranging up to five thousand per day.
...we tend to tune advertising messages out.
• The goal of traditional advertising is not
to make product famous.
The goal of traditional advertising is to
make the advertising famous.
Al Ries: co-author
of crucial works
on positioning

13. More good news? Is PR easier?
• Global decline of journalism is
deeply underestimated
– The media are industrialized and
under deep commercial pressures
• Journalists unable to generate stories
• Aspirational role models of journalists are
columnists not investigators
• Limits on press/broadcasting freedom
– Advertising pressures grow internationally
– Scores of journalists killed every year
– Most news stories result from PR

14. Summing up the opportunity
• PR is benefiting from a crisis in the
credibility of advertising
• PR can drive business value
• PR can drive brand equity

15. Gauging the obstacle: Quick quiz
How often
does
‘public
relations’
appear in
the indexes
of these
leading
MBA
marketing
textbooks?

16. Obstacles
Most PR managers deliver high-volume, low-strategy
and barely profitable commoditised PR

17. Life in the PR industry

18. 40,000 people; 3.8% profit
• Around one-third of the Top 1000 UK PR
agencies have been gradually increasing
their levels of debt
– Debt is eroding profits throughout the
industry
• Around a quarter of companies are loss
making.
– 208 companies are overtrading and selling at
a loss
• £1.1 billion profit is lost every year
• 44 companies are 'ripe' for acquisition
– 92 companies enjoyed over 20% growth
• 50 companies are aggressively attacking the
market share of others
Sources: PRSA; Plimsoll
Portfolio Analysis
www.plimsoll.co.uk/mark
etreports.aspx?
market=pr_consultants

19. Journalists’ requests condemn PR
• “A press release is
not a pitch. An e-mail
is a pitch, and I
assume it’s
exclusive.”
• “Know whom to
pitch to.”
• “Get back to us
quickly with honest
responses and be
accessible. Don’t
give a story away to
our competition
without telling us.”
• “Not being able to
accept criticism,
should negatives
arise in stories [is
mistaken]”
• “Don’t pepper the
newsroom”
• “Shun repetition and
overwriting”
• “Eschew executive
speak and corporate
clichés” Source: Jan Thomas,
Thomas Hunt &
Associates Public
Relations

20. “PR consultants are perpetrators of
catastrophic errors” -- McCusker
PR consultants themselves are increasingly being 'outed' as the
perpetrators of the catastrophic errors of judgment and ethics
that create or catalyze PR disasters.
Just recently we had a UK PR guru having to pay six-figure damages
against a former Tory MP for slander, while one of the USA's
leading PR agencies, Ketchum, was embroiled in a 'cash for
comment' scandal, which revealed that they'd paid a media
'shill' $250,000 to talk up a government-led education initiative.
Bafflingly - for supposed PR specialists - Ketchum flatly denied
any impropriety, yet eventually admitted the error of their
payola ways when intrusive media attention refused to go
away.
Even a quick Internet sniff around the world's top 10 PR firms
suggests that around half of them have been variously linked to
supposed PR disasters; one firm manufactured evidence to
support America's need to get involved in Gulf War 1, while
another created and bankrolled a fake 'grassroots' lobby group
to try to influence US government decision making.
If it's true that 50%-plus of the world's top PR companies have been
linked to shady PR practice, there's unfortunately little deterrent
to dissuade errant practitioners from straying from the straight
and narrow. Little, except negative media coverage, that is.

21. Burson-Marsteller
tobaccodocuments.org/
pm/2028375325-
5344.html

23. A fascinating insight into ethics

24. O'Dwyer's PR Report :
“PR Ethics codes are worthless”
“These codes are not worth the paper they're
written on.
“They only leave the associations open to charges
of gross hypocrisy. They give the false
impression that the association is somehow
concerned about and is enforcing behavioral
guidelines and is following such guidelines
itself….
“Our experience is that both the Council of Public
Relations Firms and Public Relations Society of
America and their members could practically
commit murder and it would still not violate
their codes.”

25. Mindset: can’t measure real value
The Financial Times book on financial PR, the highest priced
segment, gives an overview of the mindset.
• “So how do managements
determine what financial public
relations is doing for them?
The simple answer is, they can’t.
Financial public relations is, in the
end, an imprecise and unscientific
activity.
Its payoff is very difficult to
separate from dozens of other
influential factors”

26. Less tangible substitutes?

27. Goal: sell journalists on benefits?
“Understanding effective uses of Public Relations is
what makes SOHO’s PR campaigns successful.
It is not the goal of public relations to "sell" editors
on your product.
It is the goal to provide them with news and
features that will interest their readers.
How will your product change the marketplace?
Who has used it effectively?
Who will most benefit from it?
When will it be widely available?
Who will use it and how will it benefit that person's
business or life?
Providing answers to these questions in a well
written article is part of effective uses of Public
Relations.”

28. Without goals, conflicting measures
• Advertising equivalent value
– Accounts for the relative market
values of media space and time
• prfirms.org/docs/pr_measurement2002.pdf
– Used by one third of the industry
– Ignores favour, brand and value
• Unfavourable mention on TV ‘better’ than
favourable mention in target media

29. Without goals, conflicting tasks
• Awareness rather than perception
– $1 bn firm has growth in negative
media coverage. Produces higher
awareness: PR is rewarded.
– $8 bn firm focuses on key media.
Increased favourability, but only in the
target audience: PR punished.
• Hopelessly off-brand ‘find & fill’
– Cult of personality
– Trivial, off brand messages
– Children, charity, celebrity

30. Wilkinson Sword Quattro

31. Is this streaker the real McCoy?

32. The Cloning Scenta

33. Kellogg’s Winders

34. The only thing worse than being talked
about is not to be talked about at all

35. PR needs a rudder: Brand
gobrandengineering.com

36. Even business schools confuse
attributes for brand
https://upload.mcgill.ca/
mba3/mba3-brand-
attributes.jpg

37. Solutions
PR can use brand to improve measurably

38. Integration rests on consistency

39. Consistency needs strong branding
• Hard to get people on board to
agree on operationalising a brand
• Research maps coherent brands
– Brand has been corrupted into design
– Tight, unique, shared, understood
• Subordinate PR to brand
– Messaging  What are we?
– Customers  Which can we own?
– Positioning  How do we conquer?

40. PR should focus on brand attributes
zibs.com/GuidetoBranding.pdf

41. Could your manager understand?

42. Only a little easier…

43. Case study: Tie to outcomes
• Connect in PR to
product launches,
telesales and
prospect seminars
– Excellent RoI
– Hardly anyone
takes approaches
like this

44. Selling yourself into PR
You can make a major difference
•Focus on brand & business outcomes
•Make PR a profit centre, not a net cost
•Need a vision of what to create

45. 1] MBAs turnaround agencies
• Since agencies struggle
to produce value, they
are pressured on price
• Furthermore, they fail
to price for normal
profitability
• Price elasticity is
normal, yet agencies
typically harmonise
price points
– In the UK, there is an
informal cartel
– Fees are similar, thus
price does not signal
quality reliably

46. 2] MBAs link PR functions up
• Bring the brand to life
– Align the brand with its customers
– Understand customers
– Measure perceptions in the target
audience not overall awareness
• Support marketing campaigns
– Align targets to the marketing plan
• Focus campaigns on single attributes
• Then prioritise secondary attributes
• Use PR to support push-pull tactics

47. 3] MBAs coach PRs into context
• PRs are focussed on volume
– ‘Cold Turkey’ manners self-esteem
– Senior PR managers often can’t show they
get the business, the brand or the respect of
the board
• Fetish of “Reach x Impact”
• MBAs focus on goals not tactics
– Get the team to stop digging a hole
– Understand business & marketing needs
– Have a tactic-neutral approach
– Can push the brand, not just attibutes

48. In a nutshell
• Opportunity exists to use PR to
grow business value through
building brand equity
• But PR managers deliver high-
volume, low-strategy and barely
profitable commoditised PR
• PR can improve measurably
• You can make a major difference
• Focus on brand & business outcomes
• Make PR a profit centre, not a net cost
• Need a vision of what to create

49. Questions?
Contact details
Duncan Chapple
dc@duncanchapple.com
020 7993 8655