3.2 Issues Management

The world of PR is full of pretty sounding vagaries and obfuscations. Issues management, whilst a popular buzzword within the industry listed as a service on the web sites of virtually all the big PR companies, is one of the more vague terms.

Burson-Marsteller promote their Issues Management service thus "Operating at the intersection where business concerns often collide with public policy issues, we help clients navigate difficult challenges that—if left unchecked—could undermine growth, reduce market share or damage an institution's reputation… we have senior professionals who are experts in influencing debates surrounding contentious legislative and regulatory issues…Our approach to issues management… mirrors that of a political campaign."[44]

As an example of Issues Management, B-M's web site offers a case study of its work for American Airlines in response to an anti-trust suit brought against them by the US Department of Justice in May 1999. The DoJ was accusing the airline of unfair pricing designed to drive smaller rivals out of the Dallas-Fort Worth hub. B-M was hired to run a campaign influencing "perceptions about the strength of the government's case, the underlying facts, and the dynamics of the overall industry" in order to change opinions in the political and legal spheres, hopefully increasing the probability of a successful outcome in court, as well as mitigating damage to the company's reputation with customers shareholders and the wider public[45]

The Issues Management Council defines issues management very differently: "the process used to align organizational activities and stakeholder expectations"[46]. This process is "a formal management process to anticipate and take appropriate action on emerging trends, concerns, or issues likely to affect an organization and its stakeholders" and a "genuine and ethical long-term commitment by the organization to a two-way, inclusive standard of corporate responsibility toward stakeholders" but definitely not "control of public policy issues", "spin or damage control", or "a superficial imposition of a set of values and way of doing business".

Issues management is often about influencing the public perception of a broad issue over a long time scale. Monsanto's 1998 'Food, Health, Hope' advertising campaign might be described as crisis management - a response to the extraordinary backlash against GM crops in the UK, while the industry's current far less overtly aggressive campaign might be characterised as long term issues management.

The impressions of a PR Watch correspondent attending the November 1997 conference of the Issues Management Council can be found on the PR Watch web site.

3.3 Branding and Marketing

Marketing does not only involve advertising and promotions. The PR industry is carving out an ever-increasing share of the marketing business. Julie Hamilton of Ketchum Inc defines "advertising as paid media, while non-paid media and direct-to-the-consumer events fall under the umbrella of PR,"[47] and this is proving an ever richer market for the PR companies to work in.

Most of the big PR companies have a brand marketing practice. In the modern business environment branding is regarded as crucial to effective marketing and simple advertising is no longer enough to mark a brand out in the public mind. In addition to the ever increasing volume of advertising to which we are exposed now the media carry more and more 'news stories' about the latest gadget or service being offered by a company X. The majority of such campaigns may be fairly innocuous, such as the launch of a new brand of crisps[48], or they may promote an environmentally damaging industry, as when raising the profile of an airline[49]. It is always about consumerism however.

Perhaps the most insidious aspect of this practice is its 'dumbing down' effect on the nature of the media [see section 5.0].

An innovative and highly intrusive new promotional method was reported in PR Watch's "Weekly Spin" news service: Jonathan Ressler's company, Big Fat, Inc. uses "guerrilla advertising" to bypass consumer resistance to traditional advertising.

Big Fat employs actors to pose as "real people" and extol the virtues of his clients' products in bars, parks and other public places. "We plant a group of people in a bar or other public setting and instruct them to use a brand, perform a ritual, repeat a sound bite, and involve others in the activity," Ressler explains[50].

3.4 Public Affairs/Lobbying

PR has long been used as a tool to influence legislators and governments. The potential rewards to a company of being able to influence the legislative process or other government policy are obvious. And it is an area that requires specialisation and expertise to get results.

In the 1960s Hill and Knowlton was the first PR company to offer lobbying services. This brought an immediate advantage over competitors by being able to integrate PR activities with lobbying. Very soon all the major PR companies were buying into lobbying. A wave of innovation in the art of influence was engendered by this development. The PR companies were then able to coordinate communications aimed at legislators with those aimed at the public, increasing their influence.

Bell Pottinger, the UK's largest PR company proudly advertises its ability to "advise clients in all the regulated sectors on how they can influence the political dynamics to the decisions that impact on their bottom line."[51]

As in the sixties when H&K's Washington office began to offer lobbying services on the strength of Robert Keith Gray's political experience[52], the Public Affairs business still depends greatly on the political experience and contacts of key individuals. The Waterfront Partnership for instance, a British public affairs company specialising in transport industry issues, is a partnership of several individuals with extensive experience in the political life of the transport industry[53]. One of the twelve partners, Stephen Bramall, worked as a civil servant in the Department of Transport for over 16 years including three years as permanent private secretary to Ministers of State for Transport, whilst another, Arthur Leathley worked as journalist for nineteen years, with several years as transport correspondent for the Times and several more as Political correspondent. Without the experience and contacts acquired by such individuals the partnership would be worth very little.

It is not a simple task to measure the effectiveness of lobbyists. The majority of their contracts are never mentioned in the public domain and even if they were, evaluating the concessions and amendments to legislation that may be achieved through lobbying can be a specialist activity.

3.5 Reputation Management/Corporate PR

To quote Fleishman-Hillard's web site, "Reputation is a corporation's most important asset... Reputation influences all the goals a company can set — getting a higher stock multiple, generating higher profit margins, attracting and retaining the best employees, finding strong business partners, and capturing both the attention and loyalty of customers. Reputation also is a critical factor in how well a company weathers a crisis."[54]

As this belief has become standard corporate dogma, a vast new market has opened up for PR agencies and all of the big companies offer 'reputation management' or 'corporate PR' as a service.

3.6 Investor Relations/Financial PR

In the frantic world of finance where confidence and image is everything, the PR companies can play a decisive role and they push their advantages as far as they can. Getting the financial press to talk up the prospects for a particular company can translate into a boost in the share price. Conversely planting "negative PR" stories may damage competitors.

Financial PR took off in the 1980s and has been growing at an extraordinary rate ever since. In 1986 British companies spent £37m on financial PR. In 1996 they spent £250m[55] and "far from slowing down, as we look towards the new millennium this rampant growth is set to accelerate," David Michie predicts.

With business booming, the big PR conglomerates have been buying into financial PR rapidly. Of the top British agencies, only the market leader, Brunswick[56], and Tulchan, founded by an ex-Brunswick partner, are still wholly independent[57]. In the USA most financial PR has traditionally been conducted by in-house PR departments although specialist financial PR agencies are rapidly growing their business on Wall Street.

Sarah Whitebloom, financial reporter with the Guardian, writes "If you really want to know what is going on in business and the City, don't bother reading the financial press. Ninety percent of their stories have come hot off the fax machines of public relations firms or have been 'provided' by one of the innumerable PR men who stalk the Square Mile.

"When it comes to 'spin-doctoring, political practitioners such as Peter Mandelson and Charles Lewington are amateurs compared with their financial PR counterparts…. These days a good contact is regarded by many junior reporters as a PR man who actually pays for lunch."[58]

Financial spin doctors can wield enormous influence over journalists just as they can in other PR sectors [see section 5, "PR and the Media"]. They have some additional incentives for encouraging journalist cooperation that other PR people do not. Michie quotes an anonymous City PR insider, "Let's say a journalist hears from an insider that a company's results are going to be ahead of forecasts, and lets say he hears this a few days before the official announcement. That gives him plenty of time to buy a few grand of shares through Aunt Mabel, write an upbeat exclusive, see the share price rocket and offload his shares, turning an easy ten percent."[59] Such practices are not uncommon in the Square Mile.