Good PR critical to growth on the Net

January 18, 1999

BY MICHAEL KRAUSS

When fast food was in its infancy, a bold entrepreneur named Ray Kroc couldn't afford to advertise. He hired a young Chicago public relations executive named Al Golin to make McDonalds a household name.

In the realm of information technology, Silicon Valley would be unknown without the legendary efforts of publicist Regis McKenna.

Today, public relations is reshaping the Internet and the Internet, in turn, is redefining the practice of public relations. If you're moving into Interactive commerce, a solid knowledge of public relations is a must.

Most web entrepreneurs and their venture capitalist brethren would agree. They know that the right spin, publicity and public perception is as important to a high-tech start-up as the product engineering.

Just ask the newest billionaire, Pierre Omidyar, founder of eBay Inc. The on-line trading company enjoyed an IPO at $18 per share and watched the price climb to $234 per share on favorable publicity and public perception.

Becoming the Yahoo! "Daily Pick" can mean thousands of new visitors to your Web site. Just consider Victoriasecret.com, or webcertificate.com, two sites Yahoo! touted the day I wrote this column. Or, on a more cerebral note, having Infoseek Today rate your site with three stars under the topic "Internet in the Schools" must help establish the AT&T Learning Network. It made me click through to their site.

What's a recent favorable Business Week cover story worth to Jeff Bezos, CEO of Amazon.com? Does the favorable buzz for Bezos drive shoppers to Amazon.com and away from the late Sam Walton's Wal-Mart or Arthur Martinez's Sears stores? You bet it does.

The legal ruling in the Justice Department case against Microsoft will be important to Bill Gates's pocketbook. But, the lasting image and the perception of Microsoft Corp. as "predator," "geek" or "victim" may be more critical in the long term.

Nowhere, except perhaps in presidential politics, is public relations a more important part of the marketing mix than in interactive marketing. But most marketers get very little training in the methodologies of public relations, as compared to courses in consumer behavior, market research or advertising. And, few marketers have much respect for the power of this sometimes-stepchild member of the marketing mix.

Tom Harris, author of Value-Added Public Relations: The Secret Weapon of Integrated Marketing, has fought for years to ensure public relations plays its proper role in the marketing and business success of the corporate enterprise. A veteran senior public relations agency executive - currently a faculty member in the Integrated Marketing Communications program at the Medill School of Journalism at Northwestern University - Harris says, "People will look to the Net for information, not salesmanship, and that's the real opportunity for public relations."

Harris calls attention to a recent article in Jack O'Dwyer's newsletter, the bible of the public relations industry. It claims there's a war brewing between the public relations agencies and the advertising agencies for the future "control, "creation and organization of Internet content.

The logic goes like this. The Web presents a tremendous opportunity for companies to build one-to-one relationships with customers and other important stake-holders. Web sites require access to and the presentation of enormous amounts of information. Public relations professionals are more capable than advertising professionals to design and fill extraordinarily large blocks of information. Therefore, public relations agencies should do the heavy lifting in supplying content for the Internet, not advertising agencies.

Larry Weber, CEO of Weber Group, a leading technology-focused public relations agency, sees this battle more philosophically and conceptually.

"I believe all companies are going to evolve into having their Web site be a 24- hour-a-day channel that is going to need constant information in various categories," Weber says.

Still, Weber's skeptical. He doubts today's public relations professionals can step up to the challenge of interactive marketing.

"I don't think the PR profession has the horses to pull it off," Weber adds. "That's the problem. We were built the old-fashioned way on good liberal arts kids who couldn't get a job and were able to write. We're going to need management consultants, lawyers and really good MBA business thinkers to move into public relations."

Like everyone engaged in the vortex of interactive marketing, public relations professionals won't have much time to react. Weber sees a whole host of organizations, like strategy consultants McKinsey & Co., or systems integrators like Andersen Consulting, as easily able to migrate into providing a whole suite of services from technology infrastructure to communications management.

Weber sees a new crop of marketing communications consultants emerging that start to be the "masters of the reputation universe."

"That's where the fights are going to come in." says Weber.

Harris points out Burson-Marsteller, the largest public relations firm, already has repositioned itself as a "perception management organization" in order to align with this marketplace opportunity.

Harris adds, "the smartest, best integrator" should be the leader, whether they come from a consulting organization, a direct marketing shop, an advertising agency, a public relations firm or from the client side.

Senior statesman Golin, no stranger to today's technology and communications battles, weighed in by reinforcing the importance of human behavior and public relations expertise in the brave new world of bits and bytes.

Technology can be depersonalizing, Golin reminded me in an interview. "I worry that people who work just three offices from me will leave me a voice mail rather than just come in to have a conversation. The communication just isn't as effective," he says.

Tomorrow's interactive marketers still could learn a thing or two from the man who helped Kroc build his hamburger empire. Maybe those management consultants won't displace the public relations agencies so easily after all.

Michael Krauss is a partner with Diamond Technology Partners in Chicago.
He can be reached at news@ama.org.