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For those of you who don't follow the sausage-making behind the world of technology marketing, public relations (better known as PR) is the segment of marketing communications focused on getting free press coverage for products and services.
One of my missions here on DIY-IT is to provide guidance for small businesses, and one of the biggest pieces of advice I could ever give a small business owner is to spend marketing money carefully. This article spotlights one of the many examples of what not to do. It's a story of unnecessary waste.
What's the difference between sales, advertising, and PR?
Techies sheltered from the world of marketing tend to confuse three different disciplines: sales, advertising, and PR. Let's summarize each in turn, and then I'll discuss yet another example of what not to do when doing PR.
Sales is the practice of achieving the transfer of a good or service for money. It's the practice of convincing customers to buy, and all the activities related to that (handshakes, contracts, orders, etc.). Many sales people also do some form of marketing and PR, in that they often go out and find customers, figure out who their prospects are, and otherwise create awareness.
Advertising is the act of paying for space in a media outlet, and inserting a message of choice. When you see TV commercials, banner ads, or magazine ads, those are messages crafted by the paying advertiser and simply passed along to the viewer or reader. The media outlet (with some limited exceptions) does not control or influence the message, giving the advertiser control of the message (for good or bad).
Advertising can be very expensive. Companies pay the media outlet for the actual space used. By contrast, PR is supposed to be very inexpensive, because the media outlet is never supposed to be paid for publication.
PR is the practice of trying to get members of the press to write about your product or service. PR professionals are the people that reviewers often talk to, that often provide us with information and previews of products, and the like. PR professionals would love to influence what is said, but their primary job is persuasion.
Some writers do allow themselves to be compensated in some way for coverage, but that's considered highly unethical -- and it's strictly forbidden here at ZDNet. In fact, that's why we have disclosure statements here on ZDNet: so if we do have outside influences, you know about them, and can make an informed decision about how to interpret what we recommend to you.
That's also why reviews are more credible than ads. Reviewers aren't paid by the seller to say what they say. They're paid by their media outlet to be objective.
We reviewers, journalists, and columnists all have our "stupid PR people" stories. We've all been bullied, threatened, and cajoled at one time or another by an over-zealous PR professional. Many of us have been offered, and turned down, some simply astonishing perks or even bribes to provide undeservedly positive reviews. And almost all of us have stories to tell of the most ridiculous schemes PR representatives have used over the years.
Before I take you into today's story of waste, let me say a few things.
First, when they're good, PR professionals are a huge help to both their clients and to the press. I couldn't have written my first book on Lotus Notes without some exceptional help from a Lotus PR agent and her agency. At the time, she pretty much moved heaven and earth to give me unfettered access to the very earliest versions of Lotus Notes, developers, and Lotus management.
In many cases, companies don't do their own PR. They outsource it to PR agencies who are supposed to have all the press contacts and relationships. This becomes an expense for the product makers.
When done right, when outsourcing PR to an excellent PR agent with excellent industry contacts and the respect of journalists, this can be a huge win for a company. But when done wrong, as one HDTV antenna maker did recently, it's just a huge expense -- and can lead to negative PR, like this article.
What I received
So, let's get on with today's example of what not to do. I recently received a large FedEx box, containing a 14-inch by 15-inch (by 1-inch) HDTV antenna. It came with a letter and a DVD. The letter asked me to publish an article called "How to significantly cut your TV-viewing costs".
They wanted me to simply run it, as-is, along with pictures they'd provided.
The letter was signed by someone claiming to be "VP Public Relations" from a public relations firm located in Grand Rapids, Iowa.
How much did this promotion cost?
This sort of spam product promotion is expensive, and the manufacturer probably paid their PR agency quite a bit to promote this thing. Here's a rough breakdown of the cost for the package I received:
- I called FedEx, and the company estimates that the cost to ship the package was $26.79 for two-day shipping from Grand Rapids, Iowa to Florida
- The FedEx rep told me there was a chance the shipping cost might have a 15% volume shipping discount, so let's estimate each package at $22.77
- The package was in FedEx livery, so let's give them the benefit of the doubt and call the box free
- The antenna retails for about $36, so their cost of goods was probably roughly $8.64 (I spent years as a product manager, these numbers now come naturally)
- There was a DVD, large envelope, and letter in the package, so lets put that at $0.65
If you add it all up, the package itself probably cost something on the order of $32 to ship to me. Now, figure they've probably sent this, without any sort of qualification of interest, to about 5,000 members of the technology press. That's when it starts getting quite costly. 5,000 times $32 is ... $160,000.
Okay, so let's say they sent it to only a thousand members of the press. You're still talking $32,000.
Not exactly chump change.
Next up, who's side are they on and what they did wrong...
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This project: Small business tips
Whose side are they on?
I've told you I respect the PR industry and its best professionals. But it really burns my bum when -- either out of stupidity or crassness -- a PR firm costs its client a ton of cash while at the same time conducting the PR equivalent of worst practices.
Unfortunately, many advertising agencies (and, to a lesser extent, PR agencies) make their income by taking a percentage of the marketing costs. So, for example, if you're an antenna manufacturer and you want to buy an ad in Antenna Monthly, that ad might cost $5,000. The ad agency often wouldn't be paid based on their time and materials. Instead, they'd be compensated a percentage of the ad rate, say 15%. That means the ad agency would take in $750 for that ad buy.
So, ask yourself this: if the ad agency can find an ad that costs $1,000 or one that costs $10,000, which one are they most inclined to recommend to their client? To be fair, most ad agencies are scrupulously ethical, and only recommend what's truly best for their clients, but the business model itself is stacked against making ethical recommendations.
Some PR agencies are similarly compensated, often based on the cost of the promotional program. Expenses might include things like buying press lists, postage, packaging, and the like. 15% of $160,000 is a lot of money. You do the math.
I'm not saying that's definitely the case with the instance I'm recounting here, but it's possible. Obviously, I'm making a lot of assumptions, but they are based on actual things I've seen throughout the years in this field.
What they did wrong
So, what exactly did the PR firm do that's so wrong? Why was this a flagrant waste of their client's money, and why isn't this just a story of a cranky reviewer being cranky?
Well, first, this was clearly spam. Although I don't normally cover HDTV, it's possible they sent me the package because of my Father's Day interview HDTV guru Alfred Poor. But they never asked me if I'd be interested in reviewing it.
I have two cable TV feeds and an ultra-fast Internet connection. I'm not about to hook up an HDTV antenna. If they'd sent me a query, I'd either have answered it (probably not), or ignored it (probably). If I'd answered it, they would have known I was interested. If I -- far more likely -- hadn't answered it, they'd have saved $32.
How many times, with how many members of the press, has that been repeated? How much of the manufacturer's money did this PR agency blithely spend, without the slightest qualification of whether the recipients were interested -- or even covered this area of technology?
So, spamming to an unqualified audience was the first crime.
The second crime was the assumption that we'd just take the article they wrote and run it. No credible media outlet will just run a provided article. Either the PR firm didn't know that, or just didn't care.
Lessons to learn
It's hard for a manufacturer to design a product, produce it, bring it to market, support all its employees, and make a success. The PR professionals on its team should be doing everything to help make that success happen, not tear it down.
By the way, I thought about telling you the name of the product and the name of the PR company, but if I'm going to practice compassion for companies being able to make payroll. I don't want to make an example of anyone. I don't want anyone to lose their job -- even if they deserve it.
However, if you're doing promotion for your business, take this example in mind and ask exactly where your press list came from and if each member being sent a review item asked for it.
Finally, don't let your PR agency measure effectiveness by the number of mentions of your product or their promotion in a Google search. A mention here or CNET is going to be far more powerful than a hundred mentions on the various article mill or "spinner" blogs out there.