StevenSilvers.com

Health care reform: Blaming bad communications doesn't fix bad attitudes

In the spin following the GOP’s game-changing Senate win in Massachusetts, the White House defended its beleaguered health care legislation with an old standard: What we have here is a failure to communicate.

"We lost some of that sense,” President Obama told ABC News, “…of speaking directly to the American people about what their core values are and why we have to make sure those institutions are matching up with those values.”

That talking point has been played down since then.  Good thing, too.  Because it’s terrible PR.

Think of health care reform as a high-profile but controversial consumer product being introduced into a marketplace of extreme fans and critics (like New Coke or Windows Vista).  Blaming a flat-out rejection on poor communications might seem a safe strategy. You hold yourself accountable but without faulting your intentions.

It’s not that your product’s bad. It’s the stupid packaging.

Except a lot of people will instead think you’re saying, “It’s the packaging, stupid.”

Your competitors will do everything they can to promote that interpretation.  As MSNBC points out, administration opponents are literally institutionalizing the word “arrogance” in reference to what Massachusetts voters were complaining about and how the White House has responded to it.

At the core of almost every public’s fear and loathing are legitimate issues.  You may think your smarts in creating a value-added product trumps all that.  They don’t. 

You can’t win people who think you’re dismissing them.  Even if you suspect they don’t have a clue what you’re really selling.
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Getting caught is the new transparency and other realities of the coming year

Five truths for 2010:

The age of transparency is mostly about getting caught.

Ten years into the new media era, the institutions we love to hate – government, banks, big business, media – aren’t any more willing to tell us what they’d rather keep to themselves. The constant outing of reality TV frauds, tax-supported executive bonuses, front groups and scumbag celebrities is still a function of how Americans use the Internet to inform and entertain themselves.  Not the other way around.

Social media is getting less social.

Over time, millions of people will stop using social media sites because 1) their bosses lock them out during working hours, 2) they tire of all the commercial clutter or 3) they learn how those revenue-hungry companies are sharing their profiles, posts and friends lists.

The Rocky Mountain News is still dead.

For all the outraged hang-wringing and new ventures, media consumers in Denver and many other American cities are still only willing to support one local daily newspaper.  Barely.

Journalism, however, isn’t dead.  It’s just changing.

So-called “advocacy” media will flourish as more formerly ad-supported news outlets – or individual journalists and commentators -- become funded by interest groups, politically leaning foundations, single corporations and even government.  Whether you think it’s biased or not will depend on your point of view.

No company will ever hide its identity again.  Har.  Kidding.

Getting nabbed isn’t as certain as, say, driving through a DWI checkpoint with an open bottle of cream de menthe in your lap.  But some well-known brand out there is going to have a major PR problem when it draws the first high-profile enforcement of the Federal Trade Commission’s new transparency in marketing rules.
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Associated Press story says media hoaxes work

AP television writer David Bauder expands on the “frightening message” that media hoaxes like Balloon Boy and the fake press conference in which activists reversed the U.S. Chamber’s position on global warming are increasingly successful publicity tools.

At least, we think it’s AP television writer David Bauder.
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Bloomberg makes big jump into consumer media with acquisition of BusinessWeek

The enduring but ailing BusinessWeek has been sold to Bloomberg LP in a cash deal that depending on who’s talking will either beef up the magazine or result in mass layoffs.

Bloomberg executives say they plan on substantially increasing the number of editorial pages in the magazine, which despite its prominence in the consumer business media market lost more than $40 million last year. 

Up to now, privately held Bloomberg has made most of its $6.3 billion in annual revenues from leasing data terminals to investment firms and corporate customers.
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A business primer on the new FTC transparency rules

Representing its most sweeping action in 30 years, the Federal Trade Commission’s new rules governing endorsements and testimonials will change how marketing is done.

Here’s what the Guides Concerning the Use of Endorsements and Testimonials in Advertising say:

ACCOUNTABLE FOR BLOGS AND SOCIAL MEDIA.

The FTC already directs online reviewers to disclose if they’re being paid by advertisers. Under the new rules, however, every blogger, Twitter user or social network member must disclose any “material connection” with a company, product or service.

Taken literally, this connection could result in fines for bloggers who fail to disclose anything from getting a sample can of chili in the mail to having a spouse who owns company stock. While consumer advocates support the guidelines, some prominent bloggers argue that the rules in effect force them to disclose every business relationship they’ve ever had.

Enforcement is another matter. The FTC says it will primarily go after the advertisers rather than individual bloggers, though it will take into account how companies encourage transparency in their paid reviews and freebies. Beyond that, the agency will decide matters on a case-by-case basis – which basically means they’ll know deceptive advertising when they see it. What makes things even more convoluted is that the agency doesn’t say by what means it will handle these situations.

Given that the new transparency standards for bloggers are higher than what’s required of commercial news media and politicians, the FTC rules are generating considerable debate among marketers and social media proponents alike. Stay tuned.

ACCOUNTABLE FOR TYPICAL RESULTS.

Ads that feature individual consumer experiences with a product will have to state clearly what kind of results everybody else can expect. Soon to be history are those ubiquitous ads that whisper “results not typical” while showing some guy who lost 300 pounds drinking vitamin shakes.

ACCOUNTABLE FOR EMPLOYEES.

Employees that promote their company or its products online must “clearly and conspicuously” disclose who they work for.

The FTC urges that companies have social media policies as one way to avoid fines or other actions when employees pretend to be someone else – say, a happy customer or invigorated shareholder.

Keep in mind, however, that a recent Deloitte study found that a third of all employees don’t even consider what their boss might think before posting something online.

ACCOUNTABLE FOR CELEBRITIES AND RESEARCH.

A warning to every company that uses movie stars, retired quarterbacks and 70’s sitcom actors for promotional tours. Under the new FTC guidelines, both advertisers and their celebrity spokespeople can be held liable for making false claims as part of a commercial endorsement.

The ramifications are huge. Celebrities making the rounds of late-night talk shows, state fairs and Twitter feeds must disclose their business relationship with any company or agency that’s paying them to pump movies, books, products or even charities.

Companies that quote research must also disclose if they paid for the studies, or if they have any business relationship with the organization that did the research.

These standards go way beyond front groups and hidden clients. From now on, any failure to disclose corporate affiliations could be considered deceptive advertising. That’s going to hit a lot of marketing PR campaigns.
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Download a PDF of the revised FTC rules here.

More CEOs serving as TV pitch-people

I’m quoted in a Chicago Tribune story about the increasing numbers of CEOs who star in their own advertising.  General Motors, Sprint and Walgreen are among the companies trying the boss-in-front strategy.

In most cases it doesn’t work.  There were several unique reasons why Lee Iacocca clicked as an advertising spokesperson.  There are a million reasons why today’s chief executives won’t.

At least most companies aren’t treating their CEOs like zany sitcom characters.  That’s worth something.
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Industry expert asks if Toyota's image is getting a free ride

Auto industry veteran Frank Sherosky asks if Toyota’s stellar reputation for quality is more a result of good image management than what really happens on the road.

CBS News reported that a former Toyota lawyer has filed a federal racketeering suit against the company for “ruthlessly” conspiring to hide evidence about hundreds of roll-over accidents in which the roof caved in.  The potentially damming case was filed in late July but took more than two months to make the news.

“In that respect,” Sherosky writes in the Detroit Auto Examiner, “it's hard not to at least question the media for bias. Does Toyota own a free-pass card in the press, when American companies like GM, Ford and Chrysler get slammed all the time?”

Toyota denies the allegations and says its former in-house counsel violated attorney-client privilege with his lawsuit and in the consulting work he did after leaving his job with a $3.7 million severance package.

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The most media-driven White House in history

“The Obama administration has started with 14 professionals working in the office of the press secretary—and an astounding 47 more devoted to other aspects of media and message—which is significantly more than the communications staffs of many Fortune 500 corporations. But the media operation goes deeper than that. It’s more central than in any previous administration, and run more knowledgeably.”

-- Vanity Fair columnist Michael Wolff in The Power and the Story, on the administration’s seemingly total control of the press.

CEOs won't say Twitter and other contradictions about the hottest social media thing since the one before it

What a time.

Four years ago, a BusinessWeek cover story said blogs will change your business and influence the course of civilization just like the invention of the printing press did more than five hundred years ago.

Now a Time Magazine cover story announces that Twitter will change the way we live .

At this rate we should expect another planet-altering social media tool by Labor Day.

That is, unless you don't think a free online short-message service rastes with our generation’s revolutionary information technologies: voice mail, cell phones, the Web.

You’re the people who think Twitter is the Internet-era version of the CB radio fad. 

And you don’t believe that hot hype will take precedent over the cold realities of the marketplace.

In "Ten ways Twitter will change American business,"  Time’s writer predicts that the ability to send and selectively receive 140-character Tweets will give business, politicians, media, investors and other interests the ability to “engage” people like never before. For example:

“Twitter … will increasingly become a place where companies build brands, do research, send information to customers, conduct e-commerce, and create communities for their users. Some industries, like local retail, could be transformed by Twitter… having the opportunity to tell customers about attractive sales and new products can be done at remarkably low cost while providing for greater geographic accuracy.”

The problem with this vision is that it assumes consumers will do four things:

… One, that they'll stay fixed on reading and writing Tweets all day long, day after day.

… Two, that they’ll want to receive product announcements, promotions, surveys, celebrity restaurant orders, contests and other sponsored messages, at every turn of their day.

… Three, that they’ll overlook the intrusive advertising and spam that will increasingly pollute their legitimate news and conversation stream.

… And four, that they won’t mind how Twitter reserves all rights to sell any information it has on them so others can identify, locate or contact users.

Consumers don’t behave this way.  They won’t for Twitter.

Twitter’s problem is that the Internet has no walls.  There are no beachheads to dissipate the relentless waves of marketing and campaigning.  We hear anecdotes like how a suitcase company responded to a customer who Tweeted about his broken handle.  But take that scenario a few years from now – if that long – and that same customer will be inundated by followers, followees and interlopers Tweeting everything from luggage deals and discount travel to political fundraisers and pleas to help some secret princess transfer money. 

Nobody says Twitter doesn’t have huge potential for mass communication.  It does. The Iranian election aftermath shows how microblogging can facilitate real-time citizen-journalism.  But the same holds true for misinformation and propaganda.  The bad guys know how to use Twitter too. 

That's one reason corporate America isn’t exactly clamoring to get on board. And Twitter's goofy dot-commish name itself alienates the service from thousands of CEOs already averse to social media.

In fact, big brands see less value and more risk in associating with any Internet free-for-alls.

Consider YouTube. Time Magazine reports that despite drawing 99.7 million viewers watching 5.9 billion videos, YouTube's content is overall so bad that marketers have become reluctant to embed their messages within it. 

After paying $1.65 billion to own it, Google told investors that YouTube is "not material,” making the Web’s third-most popular destination also one of the ten biggest technology failures of the last decade.

It's a stretch to think Twitter will do better.  It doesn’t even own the micro-blogging concept, and several competitors already offer more features and open-sourcing.  RSS inventor Dave Winer, who PC World calls the father of modern-day content distribution, went so far as to predict that Twitter is the next Netscape.

As for the 29 million users, new research also suggests that Twittermania may have already peaked:

• 90 percent of all Tweets come from only 10 percent of all Twitter users. (Harvard University study of randomly selected sample of 300,000 Twitter users)
  
  
• Though 99 percent of Generation Y -- age 18 to 24 -- use social media, only 22 percent of them use Twitter.  (Pace University study for Participatory Marketing Network)
  
  
• 55 percent of Twitter account holders have never posted a Tweet and 56 percent aren’t following anyone.  53 percent have no followers. (HubSpot analysis of 4.5 million Twitter accounts over nine-month period)
  
  
• 60 percent of Twitter users quit after the first month.  (Tracking from Nielsen Online)
  
  
• Twitter’s growth came to a screeching stop in May, growing by only 1.5 percent.  (Tracking by Mashable)

Then there’s the Oprah factor.

Well over a million people signed up for Twitter in the first 72 hours after Oprah featured the service on her show.  But as Silicon Valley Insider reported, Oprah is already bored with it.  Despite having 1.56 million followers, Oprah herself follows only 14 people and Tweeted just four times in June. 

So what are we to make of all this?  I agree with InternetNews columnist Mike Elgan, who thinks Twitter is simply leveling out to what it really is minus the hype. 

“It’s no longer a new frontier, an elite club or a culture-transforming medium,” he writes. “It's just a service for sending messages.”

And you can get mine at Twitter.com/StevenSilvers.  Or at least until I move on to the next big thing.
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Also read:  No, social media doesn't actually sell anything. And no, you can't afford to ignore it.

No, social media doesn't actually sell anything. And no, you can't afford to ignore it.

For all we know, social media services like Facebook and Twitter could change the course of marketing history just like the telephone, the Web and the commemorative plastic drink cup.

For now, however, social media isn't actually selling anything but itself.

A study from research firm Knowledge Networks shows that while 85 percent of people online use social media, less than five percent visit those networks for help making purchase decisions.

Word-of-mouth is still the greatest influence on what people decide to buy. That's followed by TV, a medium of influence that keeps hanging around despite its alleged obsolescence.

"Obviously, a lot of people are using social media, but they are not explicitly turning to it for marketing purposes, or for finding out what products to buy. It's really about connecting with friends, or connecting with other people," Knowledge Networks executive Dave Tice told Marketing VOX. "The influence of social media isn't at the bottom of the list, but it is somewhere in the long tail of marketing - about the same as print ads, or online [display] ads."

Lack of tangible results, however, aren't keeping companies from getting into social media as fast as mass media can hype it.

In a story headlined "Jumping on the Twitter bandwagon," USA Today reports that major banks like Wells Fargo and Bank of America are "establishing presences on social-networking sites to tap into a growing demographic and to control the conversation about their brands. Yet the economic turmoil, some say, makes it even more important to reach out to customers any way they can."

It's overstatement to suggest that collecting Facebook friends and Tweeting free 140-character online messages will give a company the power to control what consumers want to say about them. That's the hype part.

But as one banking company's spokeswoman told USA Today, "Social media is a whole new world, and you cannot afford to not be a part of it."

That's the truth part.
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Also read:  CEOs won't say Twitter and other contraditions about the hottest social media thing since the one before it.