Public Engagement: The Evolution of Public Relations

Richard Edelman Grunig Lecture

University of Maryland October 30, 2008

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A Play in Four Acts

Act I A Time Like No Other

Act II Tectonic Plates Shifting

Act III Introducing Public Engagement

Act IV How Public Engagement Works Thesis: The world has changed in a fundamental way,

requiring reassessment of communications strategy and programming

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Act I – A Time Like No Other

“It's all about confidence, stupid. Every financial system depends on trust. People have to believe that the institutions they deal with will perform as expected. We are in a full-blown crisis because investors and financial managers have lost that trust.”

Robert J. Samuelson, Newsweek

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The Current Crisis: Failure of Policy and Communications

Shocking ineptitude in business management

Lack of government regulation

Complete breakdown of communications Private sector over-promises, under-delivers Government uses old model of media relations

How the “Bailout” package was lost…

Then found

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Act II - Tectonic Plates Shifting

Huge global rise in government intervention

Staggering losses in personal wealth

Rich / Poor divide growing – Perception of unfairness

Culture shift to ‘what we need,’ from ‘what we want ‘

Decline in trust in established institutions and spokespeople US: only 23% and 21% of people trust information from a CEO or

government official respectively (Edelman Trust Barometer ‘08)

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Dispersion of Authority: The New Influencer Elite position based on expertise, passion, frequency of

communication Influencers can’t be bought, and start off neutral – which is why

their potential is so great Influencers are not equal – they can be assessed, ranked and

prioritized “Someone like me” is the most trusted source (60% in US)

Samuel Wurzelbacher, aka, “Joe the Plumber”

Diabetes Blog TechCrunch

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GE Global Research Blog

Edelman 2008 Trust Barometer

Survey

Employees are the New Credible Source Twice as Believable as CEO’s

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World of Expression: Four Forces Driving Media

“News-Tainment” authority + entertainment in bite-sized pieces

Merging traditional with on-line operations

Vox Populi: Citizen journalists,

Social networks and SMS

New media amplification effect – YouTube

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Mainstream and New Media Morphing

US daily newspaper circulation down 30% in last 30 years (Pew) Number of nightly news viewers in US down from 60 million to 20 million in last

decade Blogs attract 77.7 million visitors in the US (comScore) Google aggregates over 4,500 English-language news sources 13 hours of video are uploaded to YouTube every minute YouTube surpassed Yahoo and is now the second in terms of search, after Google. Power of Cellular Platform – 30% of People Magazine readers access People.com

on mobile device

Unique Visitors May '08 in M

Change May '06 - '08

CNN.com 33.1 54%

NYTimes.com 58 73%

Google News 11.4 12%

Fox.com 10.1 36%

wsj.com 24 400%

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Social Networks Going Global

Facebook reaches 130 million global users… Overtakes MySpace

Chinese premiere Wen Jiabao ranks among Top 10 politicians on Facebook

Hugely popular photo album called "Wenchuan Earthquake,“ where he is shown with families of victims

Citizen Journalism also global: OhMyNews in Korea – 50,000 contributors

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The Asian Communications Revolution: The Truly Mass Medium May Be SMS

China 235 million Chinese Internet Users: 75% are urban, educated; 80+% are 15

– 35 years old 60+ million active blogs; 80+ million active Bulletin Boarders

600 million mobile subscribers Q1 CY 2008, nearly 175 billion text messages 5 – 10 million new subscribers a month

Korea CyWorld, the social network, has 47.8% of Koreans as subscribers 45% of Koreans are bloggers India More than 300 million people with mobile phones vs 120 million with TV

and 200 million read newspapers

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mybarackobama.com

“Crowd Surfing”, by David Brain

Campaign makes citizens its partners and advocates

Obama campaign has over 5 million email addresses in database - $150 million raised on line from 3 million donors

2.2 million people on Facebook and 800,000 people on MySpace

Mobilizing donations and volunteers through wikis, twitter, blogs, website and mobile applications

Politics: The Latest in “Crowd – Surfing”

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“Every Company is a Media Company”, Andrew Heyward, CBS News

Companies Create Their Own Content & Applications

Design your own Coke bottle Over 90,000 global

submissions Tie-in with international

celebrities

Parenting portal owned by Johnson & Johnson

Webby award for “Best Parenting” website in 2006

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The Changing Role of Corporations

Provide leadership on big societal problems:

Lee Scott, CEO Wal-Mart

“When I travel to Washington or London or Mexico City, and I meet with government leaders, the conversations have changed. They want to know about our leadership on sustainability and health care – or what we see in the economy, and how that is affecting our customers. And when they have suggestions for us, we are listening.”

Sales of fluorescent bulbs to date keeps 3 power plants off the grid

Wal-Mart’s $4 prescription program saved $1.1b in 20 months

Wal-Mart Blog

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Consumer Empowerment

Brand Democracy/ Brand Personalization

Company’s New Social Role and Relevance

Corporation in Trust Flux

Brand Corporate Reputation

Rise of Mutual Social Responsibility

Mutual Social

Responsibility

Cause-Related

Marketing

Corporate Social

Responsibility

17 Source: Advertising Age

Strategy

Advertising ($11.6B in US)

PR ($3.2B in

US)

Digital ($3.4B in US) Research

($5B in US)

Management Consulting

(Est. $20B in US)

Communications

Marketplace of Today

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Advertising PR

PR sits uniquely between Communications & Strategy Incorporates Digital, Research & Consulting

Strategy Communications

Marketplace of the Future

Advertising PR

Digital

Research

Management Consulting

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Our Challenge/Opportunity

Challenge to Free Market Ethos

Era of Citizenship Business now accountable

for more than making money

New Technologies Democratization of media

Client Budgets

Historically went to advertising, are being invested elsewhere

End of Reagan/Thatcher era

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Act III – Introducing Public Engagement

From Public Relations To Public Engagement

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Media online and offline Consumers

Influencers

Retailers Academics

Government

Employees

Investors

Sphere of Cross - Influence 2000-2007

Pyramid of Influence

1950 to 2000

Models of Influence

Elites

Company

Mass Audiences

Advertising

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Public Engagement Model Sphere of Cross - Influence in World of Expression

Media online

and offline

Government

Influencers

Retailers Academics

Consumers

Employees

Investors

Bottom-Up

Top-Down

Conversation

Talk

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Key Tenets of Public Engagement

Democratic and Decentralized

Inform the Conversation

Engage with Influencers of All Stripes

Policy and Communication

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3 4

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Consulting

Powerful ideas

that cross channels

5 Across: Media, Digital, Direct,

3rd Parties

Listen, continuous dialogue, Measure results

Public Engagement Process

Consulting on

Values, Strategy,

Policy

Business objectives Scope of Problem

1 2

Environment, audiences and

stakeholders DEFINE

RESEARCH

STRATEGY

IDEATE

EXECUTE

EVALUATE

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Open Communication

Open Collaboration

Controlled Communication

Controlled Collaboration

How Public Engagement Works- Implement in All Four Spaces

Viral Video Micro-blogs Employee/CEO blog MSM interviews Influencer

Roundtable

Communication Collaboration

Open

Controlled

Podcasts Search mktg Widgets CEO Speeches

Video contests Social nets Sponsored content

with third parties Town Halls

Ideastorms Wikipedia Issue

Aggregator Pilot Programs Coalition Development

Key Judgment: Complexity of Stakeholder Environment

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Act IV – How Public

Engagement Works

“What you’re doing speaks so loud, I can’t hear what

you’re saying”

Ralph Waldo Emerson

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Unilever’s “Dirt is Good”: Engaging Influencers

A global campaign “Every Child Has The Right To Play” that goes beyond consumer need – taking a laundry brand into the social sphere – 96% positive media - Market share increased

Lesson: Grounded in thought leadership research, expert/academic endorsement and regional CSR activities

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Filter for Good: Policy and Communication

Reduce bottled water waste by switching to a reusable bottle with filtered water

People to pledge their commitment to using a refillable bottle with filtered tap water endorsed by NGO‘s

Double digit sales increase during the first year saving nearly 90 million bottles from landfills in one year

Lesson: Viral Campaign

that enabled consumers to act and recruit

BRITA’S

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Starbucks Democratic + Decentralized

Lesson: An energized customer base can get excited about products and services

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Johnson & Johnson Family Health Initiative Reaching New Influencers

Changing stakeholders’ perception towards J&J from a mother-baby company to a healthcare company

Creating new programs to address unmet needs in China’s healthcare system

J&J is now widely recognized as a healthcare company that stands for caring (according to survey by China Brand Institute)

Lesson - Address Unmet Needs in China’s Healthcare System

JJFHI reaches millions of Chinese consumers and patients, and tens of thousands healthcare professional through its programs, as well as media and online communications

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Launch of Masdar Inform the Conversation

Public-private partnership to make Abu Dhabi the international hub for alternative energy

Launching World Future Energy Summit in 2009

Groundbreaking of Masdar City, the world’s first carbon neutral, zero-waste, car-free city

On-line resource on alternative energy

900 Million Media Impressions

Lesson: Work with influencers, then global media, to prove validity of concept

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Rationale for Public Engagement

“In a connected world, countries, governments and companies have character— how they do what they do, how they keep promises, how they make decisions, how things really happen inside, how they connect and collaborate, how they engender trust, how they relate to their customers, to the environment and to the communities in which they operate…we need to get back to collaborating the old-fashioned way. That is… thinking about how – not just how much.”

“Why How Matters” Thomas Friedman, New York Times October 14, 2008

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Now is Our Time – PR to Lead Business, Government need to regain trust – Can’t

buy it

Demands New Form of Expression to work in multiple stakeholder world

Inform the Conversation – Different Media Strategy

Policy and Communication

PR Public Engagement