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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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How breaking news becomes grist for the pop culture mill in only three days

The Balloon Boy hubbub proves a rule that companies in crisis should keep in mind: News is entertainment at the  speed of the Internet.

Here’s how it happens:

The incident goes live. In this case, Balloon Boy’s parents called the TV stations.

The incident becomes breaking news. A herd mentality takes over competing media outlets. Nobody wants to miss the shot that everybody else has. Time elapsed: About half an hour.

Breaking news becomes a national story. Local coverage feeds into national outlets, and everything feeds into the Internet. Live event coverage goes viral. News links and commentary fly around email, Facebook and Twitter. People at work see headlines on the little TVs in the elevators. Time elapsed: About an hour.

The story becomes a controversy. News reports contradict earlier reports, creating scandal. Questions, rumors and speculation become a constant din interspersed with breaking news updates of even the most minuscule facts. Talking heads on cable and radio blame liberals or conservatives for allowing things like this to happen. Internet coverage and chatter multiplies a thousand-fold. Time elapsed: Three to four hours.

The controversy becomes pop culture. The people who started it get interviewed on Larry King. Leno and Letterman make jokes that night. Saturday Night Live refers to it in a promo for this week’s show. Three times the number of media outlets show up the next day, and so do dozens of other people from all over. Some bring alcohol, others bring hand-made posters. Internet coverage and chatter multiplies several thousand-fold. Supermarket tabloids do cover stories. Time elapsed: One to two days.

Pop culture becomes the story. Media coverage and Internet chatter is the same as follows a popular reality TV show. People take sides with and against victims, villains and heroes. Everyone becomes a celebrity. Journalists – many of them ticked off for being played -- investigate school transcripts, arrest records and anonymous tips. Web sites pop up.  Talk shows devote whole hours. Authorities launch formal investigations. Politicians express concern. Somebody announces a book.

Media critics blame the news media. News media blame consumers. Consumers find Balloon Boy Halloween costumes on the Internet.

Total time elapsed: About 72 hours, give or take.

(Photo: The New York Post reported that an online gaming company in San Francisco put “Balloon Boy Game” on the Internet in only about six hours after the news story went national.)
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• The Harvard Crimson:  Sailing away with Balloon Boy
• American Chronicle  |  The "Balloon Boy" and the White House:  Good lessons for not mixing "news" and entertainment
• Philadelphia Inquirer  |  Mr. and Mrs. Balloon Boy did it because we will watch
• Washington Post  |  Balloon Boy, media stunts, dream up your own
  

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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I'm...sitting...on...the...patio.

A Verizon Wireless commercial creates a classic catch-phrase that embodies the multi-generation goofiness of today’s social media phenomenon.

Score another one for the brand that also defined the mobile phone boom with “Can you hear me now?”

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.

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.

Like so many others, Google finally turns to TV ads

Google's decision to run television advertising is another vindication of the marketing medium that was supposed to have been made obsolete by the Internet age.

But as Advertising Age reports, "even Google is seeing the limits of search ads and YouTube."

It's amazing how even companies that grew to be huge success stories without commercials eventually come to decide they can't live without them. Case in point: Hershey's began running TV advertising in 1970 after relying on only word-of-mouth marketing from the day the company was founded in 1901.

Google's TV ads will promote the company's new browser, Google Chrome.  (Look for the Scatterbox review in early June.)
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America's pundit problem

In the aftermath of Wall Street's collapse, experts are pointing to the negative impact of experts.

An Emery University study, for example, asked students to consider making several personal finance decisions.  When those students were given advice from a recognized expert, the decision-making and calculating parts of their brains simply simply shut down.

What makes this really scary is how experts are so often wrong.

New York Times columnist Nicholas D. Kristof recalls how professor Philip Tetlok spent 20 years tracking 82,000 predictions from 284 experts.  Tetlok found that the pundits were only slightly more correct than random guesses.  It didn't matter if they were doctors, politicians, economists or financial advisers.

"Indeed, the only consistent predictor was fame - and it was an inverse relationship," Kristof writes.   "The more famous experts did worse than unknown ones.  That had to do with a fault in the media.  Talent bookers for television shows and reporters tended to call up experts who provided strong, coherent points of view, who saw things in blacks and whites.  People who shouted - like, yes, Jim Cramer!"

Will past mistakes mean fewer experts?  Hardly.

Pundits are to mass media what baseballs are to the major league.  They're cheaper than staff researchers or reporters.  They compete for exposure by being available and quotable.

Most importantly, subject-matter authorities are rarely held accountable by the industry that relies on them for content.  Sometimes they're even celebrated for being so wrong.  A few years ago, the Rocky Mountain News profiled a "controversial" aviation consultant who had become an international media darling by giving "colorful" sound bites insisting that Denver International Airport would go bankrupt.  DIA hasn't lost money since it opened in 1995.

The public brain-freeze over pundits is what makes John Stewart's skewering of Mad Money's Jim Cramer so telling.  Mainstream media is full of experts laying blame for the financial crisis.  But it took a comedy show host to publicly chastise one of Wall Street's biggest media celebrities for his part in it.

Indeed, there are partisan watchdogs like the conservative Business & Media Institute and the liberal Media Matters, which recently launched a new website targeting financial news and opinion.  But these groups are politically biased in their criticisms and don't reach nearly an audience like The Daily Show with John Stewart.

But they're among the closest things we have to Consumer Reports Guide to Pundits.  And right now we need all the critical reviews we can get.

At least, that's my expert opinion.
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Photo courtesy Associated Press

Newspaper business sections going extinct

Following a trend among the nation's struggling newspapers, the Washington Post is doing away with its stand-alone business section.

An internal memo published on Politico.com says the newspaper will fold business news into the A section.

At least eight daily newspapers around the country have made similar moves this year. The LA Times eliminated its separate business section in January.  Here in Colorado, the Denver Post moved business news inside the B section, except on Sundays.   The paper also recently added a gossip column that runs four times a week next to top business stories.

Publishing experts say local newspaper business sections never generate much advertising revenue in large part because they are often beat to stories by online and national media.
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