MODERN PUBLIC RELATIONS –The Road Ahead and Implications for Korea

Margaret Key – Burson-Marsteller Korea, Market Leader

Definition of Public Relations…Harold Burson

“The public relations

profession aims to

manage people’s

perceptions in a

scientific way.”

- Harold Burson

In the past, ‘scientific’ we were not…

• Based on relationships with face-to-face key

• There was attention span & focused thinking

• Analogue methods were used to

• Primitive technology

• Deliberate and slow

• Publicity vs PR

• Text was King

“Building modern PR campaigns& telling digital stories inthe age of social technology.”Presented by Bob Pickard at Hong Kong Baptist UniversityNov. 9, 2010

• Remote e-relationships

• Digital methods

• No attention span;

• Distraction is a constant

• People continuously online

• Scant time for stories

• Technology massively propagates pictures, videos

• Images are King

In the present, ‘scientific’ we must be…

“Building modern PR campaigns& telling digital stories inthe age of social technology.”Presented by Bob Pickard at Hong Kong Baptist University (Nov. 9, 2010)

“The internet has been the most fundamental change during my

lifetime and for hundreds of years.

Someone the other day said…

‘It’s the biggest thing since writing.’”

- Rupert Murdoch

The media world has changed…

* Source: Burson-Marsteller EMEA Media Survey 2010, among 115 senior journalists from top-tier media organizations in 27 countries.

• Almost 300 newspapers folded in the US during 2009

• Eight magazines (with +1 million circulations) stopped printing

• 600 staff journalists were laid off from top tier publications.

• Circulation in Korea’s top 116 general dailies is also down…

The media world has changed…

The result…

Decreased news story

QUALITYDecreased news story

QUANTITY

Decreased media

CREDIBILTY

Decreasing control over brand imagery

The Message Gap: Mainstream Media

Company Message Mainstream

MediaMessage

48%

Gap

The Message Gap: Mainstream Media by Region

U.S. Gap: 45%

Latin America Gap: 53%

Europe Gap: 40%

Asia-Pacific Gap: 58%

Mainstream Media Global Gap: 48%

The Message Gap: Bloggers by Region

U.S. Gap: 76%

Latin America Gap: 82%

Europe Gap: 59%

Blogger Global Gap: 69%

Asia-Pacific Gap: 63%

Reduced audience density

So…?

• The Internet and explosion in social media has changed the way in which we communicate as PR professionals

• The media finds itself playing in an intensified, competitive market where time is critical and the story needs to garner interest

• Consumers and publics have less time and rely on various news sources -traditional media + social media

• Our messages are being diluted and we have a tougher time in making sure our initiatives resonate with credibility

So what are we to do?

The PR Response

thestory is the most important

things a company needs to tell its target audiences…

…so that those people will do and think

what we want them

to do or think

Back to the Basics…

Bad PR?

“Starbucks is another example of America pushing its cultural

agenda….”

“Their products are contributing to obesity

around the world…”

“A company abusing the developing world…”

“Way too expensive…”

More than just a cup of coffee…1971 – Starbucks opens it first location in Seattle’s Pike

Place Market

1982 – Howard Schultz joins Starbucks as director of retail operations and marketing.

1983 – Schulz visits Italy, where he is impressed with the popularity of espresso bars in Milan.

1984 – Schultz convinces founders of Starbucks to test the coffeehouse concept in downtown Seattle

1988 – Starbucks location total at fiscal year end =17

1989 – Starbucks location total of fiscal year end = 551991 – Established a relationship with CARE, the

international relief and development organization,

- Becomes first privately owned US company to offer a stock option program that includes part-time employees.

More than just a cup of coffee…

1995 – Begins selling CDs as part of in-house music

1996 – Opens in Japan with a total of 1,015 locations

1999 – Opens in Korea with a total of 2,498 locations

2010 - Total stores 16,706Serving:

• Handcrafted Beverages

• Fresh-brewed coffee, hot and iced espresso beverages,

• coffee and non-coffee blended beverages,

• Merchandise

• Home espresso machines, coffee brewers and grinders,

• coffee mugs and accessories, packaged goods,

• Fresh Food

• Baked pastries, sandwiches, salads, oatmeal, yogurt

• parfaits and fruit cups.

• Consumer Products

The Starbucks Story…

• One of the most socially responsible companies

• A global company

– Starbucks, proudly displays its beans from exotic locations—Sumatra, Kenya, Guatemala, Costa Rica, Ethiopia

– Food – salmon sandwiches in Japan; green tea frappuccinos in Asia; men-only and family areas in the Middle East.

.

And a social media success….1) Starbucks on Twitter – 705, 000 followers

2) Starbucks on Facebook - 5, 448,000 fans

3) Starbucks on YouTube -Over 4800 people subscribe to the channel. They upload videos of commercials as well as informational videos explaining the origins of the different coffee blends and some of their charity work videos. Starbucks also allows people to embed its videos anywhere they like on the Web.

4) My Starbucks Idea – Starbucks’ own version of a social network where customers are asked to share their ideas on anything related to Starbucks. The site gives users the ability to see what others are suggesting, vote on ideas and check out the results

5) Starbucks Blog entitled “Ideas in Action” - This blog is written by various Starbucks employees and talks about what Starbucks is doing with the ideas

given by users on the My Starbucks Idea site.

The Starbucks Story Today• Now located in 36 countries

• From 17 stores in 1988 to now 11,000+ stores /

Opening 5 per day

• Over 130,000 partners / Hiring more than 200 per day

• Stock has grown 6,500% since going public in 1992

• A dedicated employer

– Partners, not Employees

– First company to give stock options to part-time

employees

– Fortune Most Admired Companies

– Fortune 100 Best Places to Work

– World Class engagement as measured by Hewitt & Gallup

– Astonishing employee involvement in communications

STARBUCKS LISTENS, ENGAGES AND

PARTCIPATES – it is brand that has heart and appeal

all over the world

Implications for Korean Companies

Where PR storytelling is growing

Entertainment media Social media

The digital consumer

Store/agent/dealer interactions

Consumer-driven marketing

Past experience

Company-driven marketing

•Word of mouth

•Online research

•Offline and/or print reviews

•Traditional advertising

•Direct marketing

•Sponsorship

•In-store product experience

•Salesperson contact

% effectiveness of consumer touch points

Source: McKinsey Quarterly

“The consumer decision-making journey” 2009 Vol. 3

26

Trusted channels

Source: TNS (2010)

Channeling audiences to content

Keyword strategy

Hosted communities

Social communities

Content streams

Multimedia

Cloud content

Location-based

Our world has changed and we know

the mix between traditional + social is

critical but how are

Korean companies coping in

the New Communications Order?

B-M Corporate Social Media StudyOctober 2010

B-M Corporate Social Media StudyOctober 2010

B-M Corporate Social Media StudyOctober 2010

B-M Corporate Social Media StudyOctober 2010

So Korean companies are active

compared to other Asian companies….

but is this social media prowess

connected to

PR initiatives and

story-telling?

NO!

Why?• Blogs as marketing tools: Korean companies seem to be more

interested in using blogs as marketing tools to communicate with their customers rather than using them as Public Relations (PR) platforms. Korean companies use blogs to promote new brands or product launches.

• CEO blogs are important and should be maintained: Everyone thought having a blog was important but then CEOs would not update and those companies lose more on reputation and mindshare vs companies which never ever opened a blog.

• Korean companies want message control: Korean companies want to be innovative but they want to be innovative without risk. For companies to have a corporate blog, outreach with international media is expected and so a 100% guarantee of message control is lost.

Why?

• SNS is not just content but profile: who is talking, who is sharing and how relationships evolving are critical

– Kim Yuna posted a simple tweet, "Going back to the big rink tmr!!^0^" and this was echoed (or "retweeted," in Twitter lingo) enthusiastically among Korean users.

– Hyundai Card has 5 different dedicated blogs with rich content and that is changing constantly.

• Stop trying to copy but focus on innovation: Twitter? Many experts say that Korea is a country that is capable of easily following vs taking the lead. It is time for companies to engage, open themselves to risk and criticism and listen to what is being said in the social media landscape.

Modern means to build an image

#1 – Listen obsessively

#2 – Be authentic & transparent

#3 – Go peer-to-peer

#4 – Focus on the 1%

#5 – Be human

#6 – Build relationships

#7 – Commit for the long-term

#8 – Use storytelling

Be transparent

“When there exists a connection between the endorser and the seller of the advertised product that materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.”

Federal Trade Commission: Guides Concerning the Use of Endorsements and Testimonials in Advertising

http://www.ftc.gov/os/2009/10/091005endorsementguidesfnnotice.pdf

Source: The Customer Collective Blog

http://www.thecustomercollective.com/Home/36101

Focus on the 1%

Be human

Build relationships

Use digital storytelling ?

Digital

Written Oral

Art

DAOW

Closing Thoughts

Korea – My View

• A very local market= very local services…Naver, Daum and Cyworld

• But strong international connection so early adoption and ability to move quickly

• Korea adapts to new technology very fast. What’s incubulated in Korea right now: IPTV, Robot, 3D technology etc.

• Because of the strong infrastructure and government support towards a IT-friendly culture, Korea is an excellent test bed and the market to watch.

• In terms of PR and digital PR, Korea can be a pioneer – more PHd students in the US studying the market – and when it comes to PR professionals, you have a first class group…hard working, ambitious and always primed for learning…

“BRIC…I think you need to call it BRICK with the ‘K’ representing Korea.

Korea may be small compared to say India or China but

the online community can be remarkably powerful…and can serve as a

benchmark on how to create powerful PR stories and ones that are mass appealing and

extremely successful.”

- Margaret Key

Margaret Key

Burson-Marsteller Korea

Market Leader, Korea

Margaret.key@bm.com