Giving For ROI: Wall Street Journal

As part of National Volunteer Week, I wanted to remind everyone that The Wall Street Journal picked up on a study from the Social Science Research Network (SSRN) back in January. It deserves more attention. The study revealed corporate giving can increase company profits at a rate of return of 200 to 300 percent.

The study, examined 251 corporate donors and their giving contributions from 1989 to 2000. Led by Prof. Baruch Lev at New York University’s Stern School of Business, the researchers found that corporate giving is associated with subsequent sales growth, particularly when consumer perception is important.

(Side note: This information has been around for some time. As far back as 1999, one report, from Cone/Roper Cause Trends Report, noted that 76 percent of consumers said they would switch brands/retailers to one associated with a good cause if price and quality are equal.)

Keep in mind, most of the firms in the SSRN study spent 50 times more on marketing than philanthropy, and their average giving was only 0.1 percent of average sales revenue. Still, the rate of return on giving exceeds the investment and, depending on what a company considers measurable results, business giving and volunteer programs deliver substantial benefits inside as well as outside a company, especially for small businesses with limited resources.

Business Giving Benefits
• Improves customer loyalty; impacts profitability
• Increases employee morale, loyalty, and productivity
• Establishes new internal and external relationships
• Improves internal communication and teamwork
• Enhances employee recruitment and retention
• Encourages new approaches to strategic business objectives
• Positions a company as a leader in the community
• Increases brand recognition and community awareness

Employee Volunteer Benefits
• Strengthens employee leadership and decision-making skills
• Encourages teamwork to develop positive communication
• Enables unrelated departments to interact and network
• Reduces work-related stress and increases morale
• Creates a better quality of life where employees live and work
• Increases employee awareness and interest in community issues
• Generates increased sense of patriotism, citizenship and civic pride
• Develops a community-minded culture, improving customer service

You see, most programs don't have to be large, cumbersome, costly, or time-consuming to develop win-win-win solutions. The best starts can be as simple as thinking about what your company can do.

For example, just today, we reported on TXU Electric Delivery's partnership with the Rogers Wildlife Rehabilitation Center. The company relies on the center to rescue and remove birds, including blue herons, that have nested in electrical equipment.

To support the center, TXU Electric Delivery is raising funds by recycling printer ink cartridges and used cell phones; some employees have also volunteered to work on a number of special projects at the center this summer. It's simple, effective, and everyone wins: the company, the employees, the center, and the community.

While I'm not sure if TXU Electric Delivery has a formal giving program, I do see they've taken the first steps. Mostly, however, I just like their case study because it demonstrates how relatively easy it is for a company to develop some type of program, formal or informal.

Here are a few other tips we've picked up along the way from working with nonprofit organizations and dozens of companies:

Create A Statement: Some people might call it a mission for a strategic philanthropy program, but I suggest smaller companies or independent professionals keep it simple. The real goal is to define when and how your company can best give back.

Choose A Niche: Focus on a specific need or a few needs within your community, which will give your company a better chance to measure results within the community. You can choose something that is important to your employees or closely aligned with what your company provides.

Develop A Road Map: Many companies will call it a strategy, but what we're really talking about is a road map to help you get where you want to go. For example, one company we know has an advocacy campaign aimed at increasing its role as a specialty provider in elementary school curriculum.

You can learn more about business philanthropy on this blog. In 2005, I republished a three-year-old article I wrote on the topic for the publication we were managing at the time. Don't let the date fool you; or that the entire article is tucked in the comments section. (I posted it back when I was led to believe all blog posts had to be short ... darn those useless rules other people promote!)

The article, Business Philanthropy | The Impact of Giving, included interviews with Microsoft, Salesforce.com, and the Business Community Investment Council.

I'll be happy to post more on business giving and community relations in the future, assuming there is an interest in the subject. Right now, we simply post best case studies on our other blog.

Next week, I'll be back to offering up some biting commentary on some communication disasters we missed this week, including a few sad thoughts on a few groups hoping to capitalize on the tragedy at Virginia Tech. Publicity, ho hum, indeed.

Counting Casualties: DraftFCB

Of all the casualties related to the Julie Roehm vs. Wal-Mart legal battle, the quietest past participant seems to be nursing the largest wounds. According to Noreen O'Leary's Apr. 2 story in ADWEEK, DraftFCB is still in the shadow of scandal.

Although there is no public evidence that the agency's recent account woes are linked to Wal-Mart, O'Leary writes that some claim reviews of the $1.5 million John Deere and $3.5 Applebee's account may both be linked to the scandal. (DraftFCB will not participate in these reviews). Along with these accounts, Qwest Communications, a $95 million client that generates about $15 million in revenue, confirmed it is launching a creative review. The story also implies that S.C. Johnson and Verizon Communications are less secure.

"Whenever there's negative press, there's going to be short-term damage. But I don't think there's any fundamental damage to Howard or his agency," said Michael Roth, chairman of Interpublic Group. "In this business, you're only as good as your last account win. This model of the future, of putting these two companies together and winning Wal-Mart, proves the validity of it. I'm still very bullish about this (the DraftFCB merger)."

Others disagree. One former FCB employee described the mood at the company's New York flagship as "grim," according to O'Leary. "Everyone knew from the beginning that Draft would take the lead, but still, it's as if 100 years of FCB heritage is being shredded by Howard Draft."

I think Roth might be right. If DraftFCB can land a major account that gives it the opportunity to demonstrate creative result-driven work (which has not been easy for the Draft side, some say), it may be able to reverse its course. However, this is a very tall order and will require a sympathetic high-profile major account.

Part of the challenge will no doubt be reflective of the ADWEEK poll that revealed 29 percent of the 2,400 respondents said Draft fared the worst in recent industry scandals, second only to Roehm, with 46 percent. Although recent publicity that revealed Wal-Mart's past electronic surveillance and other espionage missions against employees was extreme, only 10 percent said Wal-Mart fared worst.

Here's my unsolicited take for the three most visible parties might consider for turnarounds and wins in the months ahead:

DraftFCB — Since you already made amends by supplying e-mails to Wal-Mart, take a page from the JetBlue crisis communication plan (sans apologizing forever) and create an agency ethics guide. Take a breath and consider some Ragan Communications findings that suggest: more than 60 percent of mergers and acquisitions fail to deliver the benefits that are promised—often because of the poor quality of communication. You need a message beyond picking up 90 smaller accounts worldwide. The message you have, Draft ROI with FCB creative, doesn't seem to be working. Spark up some integrated social media pitches and that will frighten other agencies, after they stop laughing.

Julie Roehm — Stop calling yourself a "change agent," drop the suit, get out of the press, take an extended vacation, come back refreshed (perhaps a bit remorseful), and start your own "marketing 2.x" firm, whatever that is. Your first few clients will likely be smaller accounts, perhaps in the automotive industry, but sometimes smaller accounts can turn into giants if your ideas really work. (Bonus tip for Sean Womack: stay away! Stay far, far away!) Marriage counseling wouldn't be a bad idea either, even if you didn't do anything as you said. (By the way, I'm married. Don't e-mail me!)

Wal-Mart — Sure, you asked Roehm to pass on perks from vendors and it didn't work. It's not your fault. But the time has come to give up on the notion anybody will make you happy with traditional marketing. You do need something new, but new doesn't mean Roehm's "progressive" and "sexy" that would have never reached your target anyway. So the best advice for the fine folks working on your next campaign is simply this: to get back to basics and rekindle that grassroots shopping for common people concept you once had before all the public relations nightmares and bad communication consulting distracted you. Who knows? Maybe what I call "income marketing" would be right up your aisle.

"Income Marketing" is marketing that generates income instead of simply producing expenses so that even CFOs might like it. Sure, it sounds like something that goes against my shell game post, but one of my colleagues told me to call it something. Besides, that was part of Amitai Givertz's excellent comment at RecuitingBloggers.com.

Have a nice weekend and happy Easter!

Being Almost Famous: Antonella Barba

In one of the more interesting recent public figure public relations twists in television, Antonella Barba managed to surprise American Idol viewers with mildly risque photos, gain their sympathy when a second set of pornographic photos were proven to be fakes, and then lose all likeability last night with a display of spoiled daughter syndrome. Many viewers seemed put off after she likened herself to Jennifer Hudson given Barba delivered the worst performance of any female vocalist.

Hudson, of course, went from American Idol contestant to star as Effie Melody White in the 2006 musical film Dreamgirls, for which she won an Academy Award, a Golden Globe, a BAFTA, and a SAG Award. Most people look back and conclude she was voted out too early. Barba brought Hudson up after sticking her tongue out at Randy Jackson and then claiming Simon Cowell was as wrong about her as he was Hudson. Cowell said he didn't vote Hudson off, the viewers did.

Barba's mini-tantrum over the judges comments won't bode well for the 20-year-old wannabe singer, especially after Jackson, Cowell, and even Seacrest went to bat for her in USA Today. Here's a recap of USA Today sound bites...

• "Nobody's clean in the entertainment business," said Jackson.

• "[I would] absolutely let [Barba] stay on. If American Idol is a true representation of American youth, we're going to find imperfections," said Seacrest.

• "[The photos should] not affect her standing on the show, and if the public wants to keep her in, they'll keep her in," said Cowell, who also stressed the photos were not illegal, but personal (but not so personal nowadays).

After last night, their USA Today opinions read as pointless. After Barba's extremely bad performance, followed by an unwillingness to accept criticism (which traditionally prompts viewers to vote ego-oriented contestants off), it seems to me that Barba's best bet is if she carries the Votefortheworst.com vote. She'd better hope so, because if last night's public relations/personality gaffe is any indication of the real Barba, then her 15 minutes of fame might be over.

From a public relations perspective, Barba would have been better off agreeing she could have done better, leaving the American viewing audience to wonder if the stress of the photos possibly impacted her performance. Instead, she came off as smug, irritated by the fact the judges didn't think she did as well as she thought, giving viewers a clear indication she's not bothered by anything other than something standing in her way to being famous, er, almost famous. I guess we'll see tonight.

Spinning To Disaster: Gavin Newsom

I first learned of San Francisco Mayor Gavin Newsom's decision to hit his self-destruction button over at Recruiting Animal's blog and, as a political consultant, I have been itching to write about it ever since. Wow ... the difference a couple days can make.

Without a doubt, Newsom wants to apply the "celebrity spin" card in an attempt to save his political career, which, in my opinion, ended the day he said "I think the public in many cases finds it rather entertaining that suddenly they have someone who's still alive holding public office." Considering he said this in response to admitting an affair with the wife of a former top campaign aide, I guess he failed to appreciate that the people of San Francisco did not elect him to be entertaining.

In politics, there is one cliche that holds true: where there's smoke, there's fire. And sometimes, it's a real barn burner. Yesterday, Newsom attempted to spin the affair story away with the sudden realization he has a drinking problem.

No one was surprised, but many seem perplexed why Newsom would mount one scandal on another. After all, he had already come under fire as supervisor Jake McGoldrick called the mayor a “pathetic role model” who should resign. McGoldrick is not alone in his opinion, but Newsom seems to be gaining some sympathy from some very misguided people. And, in my opinion, supervisor Sophie Maxwell is at the front of this misguided pack.

“This is the mayor’s personal business and affairs,” says Maxwell. “If I look at what the mayor’s been doing on The City’s business I don’t see a reason to resign.”

What? Ms. Maxwell, with all due respect, an utter lack of judgement has everything to do with his ability to lead, and it goes well beyond making San Francisco a three-ring circus. Sure, the affair shows the shallowness of his character, driven by ego. Yes, the noted drinking problem demonstrates a man out of control, largely claiming to be unaccountable for his actions. But the real crime here is his handling of, well, everything.

After all, it is Newsom who made these personal problems the center of public attention during several press conferences. So please, spare me the idea that he is a victim. He is not and, even if he was, he is only a victim by his own hand, er, mouth, er, whatever.

If you want to meet a victim, check in with the campaign aide who will have to endure what experts say is 3-5 years of pain and suffering as he recovers (if he is lucky enough to recover) from this dual betrayal. Add to that additional exposure in a society much more sympathetic to women who are victimized by cheating spouses. Without a doubt, too many people assume the husband must have done something to alienate his wife. Maybe, maybe not.

The fact is that the only thing more appalling than Newsom's attempt to lampoon his unethical behavior is the utter idiocy of political consultant David Latterman's take on the situation.

“I can’t comment about whether he’s truly an alcoholic. There’s obviously been rumors about his drinking for quite a while,” he said. “But this is what celebrities do when they screw up, they go to rehab: Mel Gibson, Kramer, and now Gavin Newsom. It’s a tried and true public relations technique.”

Um, sorry, but Newsom has no celebrity status outside the context of his immoral, unethical behavior. Mayors are not celebrities and the public should not be expected to give elected officials (who are responsible for much more than a personal movie-making career) the same second chances they seem so willing to extend to actors, actresses, authors, and musicians.

While we have come to expect celebrities to enter rehabs and have affairs, I think we must appreciate that celebrities are different. Celebrities are not charged with governance of others. It does not impact the residents of San Francisco if Mel Gibson gets drunk. It does not damage them if Michael Richards needs anger management.

It does directly impact them if their mayor becomes the poster child for breaking personal and public trust on every level while claiming he is not responsible for his actions (the alcohol is). Further, it is deplorable that Newsom is so naive to think that you can create a media frenzy and claim that reporters are out of line in asking questions about his recent confessions. To think that he would be so arrogant to chastise an Examiner reporter who tried to ask a question by saying, “Could you possibly be respectful and could I close the door?”

It seems to me that question better belongs to his former campaign aide: “Could you possibly be respectful and leave my wife alone?”

As another Examiner article reveals: a political insider, who did not want to be named, called Newsom “thin-skinned” and said the reason why the mayor’s having a hard time with the press is because for the first several years of his tenure, “he had a relative love affair with the media.” And so goes the story of wannabe public figures who regret getting their wish.

Maybe someone should have told Newsom that getting at the truth and shaming the devil supersedes all relationships in the career of a reporter. Hmmm... it's kind of like a spouse I imagine. The love affair is great until something or someone changes the relationship. Imagine that. Except in this case, Mayor Newsom, you are solely responsible for your hurt feelings.

Funny. A few days ago, I might have been able to salvage this one. Today, I'd rather watch him spin himself to disaster.

Stacking Online Votes

On Christmas Day, Seth Godin did something nice for a few dozen blogs. He posted them on his blog, Seth Godin, and encouraged people to visit.

By creating a plexo at Squidoo, he enabled others to include their own blog (or blogs they liked) and vote for any they felt seemed interesting. "There is no A list, so there can't be a Z list. There's just good blogs," he wrote.

Unfortunately, one blogger felt otherwise, turning the true spirit of Godin's post into a case study that is similar to the challenges Reddit experienced a few months ago when overzealous marketing types voted their articles up and other articles down. However, unlike the Reddit stacking, Kim Klaver and a handful of her readers were less than anonymous. On her blog, which I won't link to, she wrote: "If we push it to #1, I'll take a screenshot pronto and post it here. We'll be 'Queen for a day.'"

Her marketing tactic worked, driving several readers to vote and then report her blog's progress. In fact, they voted hers up and other blogs down, enough so, that one commenter on her blog finally wrote: “You know, sending an email out in order to ask for votes is really quite lame. ... Deceptive if you ask me. Isn't this the very thing you preach against?” Obviously not.

"I don't mind asking for votes though, since people can do it or not. I might even send out another email, so be forewarned...hehehe,” Klaver replied. "If the blog writers didn't tell their readers about the popularity contest, how would they know and how could they help their favorite writers?"

Klaver seems to have missed the point of the post entirely. It was never meant to be a popularity contest, especially because Squidoo doesn't track IP numbers, only e-mail addresses. This means that anyone with multiple e-mail addresses can vote for whatever blog they like as many times as they like. With Klaver's encouragement, that is exactly what her readers seemed to do.

The most basic Internet tracking reveals the story behind her empty victory; many blogs were voted down despite never being visited. It is a shame, because I visited many of those blogs today and several were worthwhile despite being voted down.

But then again, I suppose that is the difference between Klaver's "new school of marketing" and communicators like me. I subscribe to a code of ethics that includes credible communicators "engage in truthful, accurate and fair communication that facilitates respect and mutual understanding."

Branding Wars Ahead

What's in a name?

Last July, BusinessWeek reported that Apple's global brand value was up almost 14 percent over 2005, placing it 39th among all globally recognized brands. The publication also estimated Apple's total brand value at almost $9,130 million, fueled largely by stylized iPod, iTunes, and iMac product lines. With that in mind, it was no surprise that Apple was rumored to be releasing an "iPhone" sometime in 2007.

What is a surprise: Linksys (a division of Cisco Systems, Inc.) launched an "iPhone" family of products for the holidays. But, despite boasting Internet services that use Skype and Yahoo! Messenger, most reviews have been less than stellar and include the added pressure of Cisco being accused of "stealing" an Apple brand identifier.

Russell Shaw over at ZDNet has a comprehensive overview of the proceedings (which does not include Apple) along with various filing reports. What he did not note, however, was that Cisco filed its "iPhone" trademark 10 years ago, with the mark published for opposition as early as Dec. 1998. That seems to predate most Apple "i" products, with exception to the iMac.

Still, it's a safe bet that Apple is hoping the Linksys phone might eventually get an unfriendly call from the U.S. Patent and Trademark Office, which is currently sorting through four "live" trademark assignments that include "iPhone" or derivative terms. It seems to me that Apple's wish would have less to do with the name of its future phone and more to do with any brand damage caused by a Linksys "i" product that is less phone (as the original application suggested) and more VoIP.

Simply put, Apple might not want to be associated with it. Even more ironic, Cisco's decision to rightfully use a trademark it has owned for 10 years might backfire anyway, forcing the company to spend millions in repackaging. You see, while the "iPhone" might be their trademark, Apple's brand mastery over "i" products has grown exponentially in 10 years.

In the end, Cisco, right or wrong, knowingly or unknowingly, has started a brand war. And, like all wars, there is hardly ever a clear winner when the smoke settles and investors wonder what they got for it. It seems to me that Apple would be wise to sit this one out, letting the others fight it out for the right to use a trademark that Apple might not own, but clearly dominates. Besides, Apple may have never intended to call its product an "iPhone" anyway.

Attacking Allen's Past

Recent headlines have created a buzz about Sen. George Allen after three former college football teammates say he repeatedly used an inflammatory racial epithet and demonstrated racist attitudes toward blacks during the early 1970's.

Perhaps it's because one of my favorite made-for-TV movies in the 70s was Brian's Song, which recalls the details of Brian Piccolo (played by James Caan), a football player stricken with terminal cancer, and his friendship with Chicago Bears teammate Gale Sayers (Billy Dee Williams), who helps him through the difficult struggle, but the so-called Allen controversy is none too surprising to me. Allen, like many people, grew up in an era known for racial tension and played in a sport that struggled with the question of desegregation. Many people were confused about race at the time, black and white equally.

For those of you unfamiliar with the film, racial tension is created after team coach George Halas decides that the pair should room together during training camp and road games because they are both rookie fullbacks. Given the fact that Piccolo is white and Sayers is African-American during a time when blacks were still fighting for civil rights in America, it was viewed as a progressive and controversial decision. At the time, no black player had ever been the roommate of a white player in the history of the NFL. Eventually, the racial tension gives way to understanding.

It seems that Allen took a somewhat similar journey in that he once embraced some shortcomings of 70s-era Southern culture, but then later concluded the Confederate flag was a symbol of violence for black Americans (as opposed to thinking it a symbol for the Dukes of Hazzard) and expressed some regret. "There are a lot of things that I wish I had learned earlier in life," Allen said in an appearance this month on NBC's "Meet the Press."

"I grew up in a football family, as you well know, and my parents and those teams taught me a lot," Allen said on the program. "And one of the things that you learn in football is that you don't care about someone's race or ethnicity or religion."

At present, this does not seem all that dissimilar from the made-up brand damage recently experienced by Tiger Woods' wife, where false allegations created some temporary brand damage. In truth, of 19 former teammates and college friends, two said they do not remember Allen acting in an overtly racist manner. Seven others said they did not know Allen well outside the football team, but do not remember him demonstrating any racist feelings. Seven more teammates and friends said they knew Allen well and did not believe he held racist views.

The seemingly lone, non-anonymous vocal attacker is a radiologist in North Carolina who played tight end on the team when Allen was quarterback. He claims Allen came to Virginia because he wanted to play football in a place where 'blacks knew their place' and used the N-word on a regular basis. Ironically, it was the radiologist who sported the nickname 'wizard.'

I'm unconvinced that Allen was an active racist as this former teammate claims, but Allen's team has to do a better job addressing it in a timely manner. Unresponsiveness gives credibility to even the most baseless charges.

Trending Toward Entertainment

There are hundreds of comments critiquing Katie Couric and her debut on Tuesday as a “CBS Evening News” anchor and the first woman to solo anchor for a major broadcast network newscast. Whether you think she seemed to struggle to keep a lid on her trademark perkiness or not, public relations professionals should take note.

National news, much like local news, has been and continues to trend toward interactive entertainment. From asking viewers to send in potential Couric sign-off lines to including a new regular feature called "Free Speech," a segment of opinion and commentary from a wide range of Americans, it's clear that the network has a new formula in mind for the future of news.

As Greg Kandra, CBS editor, wrote on one of several CBS blog strings: "Katie intends for this blog to be a dialogue, not a monologue. Don't be bashful. Most postings will have a comment section, so feel free to post and comment and tell us what you really think."

Why? News commentary and controversy have become the norm and CBS is struggling to emerge with something fresh for television by borrowing something old from radio: active participation. It's an interesting concept that means public relations professionals should prep clients as if they are attending a public forum as well as a media interview.

For the public, as the trend solidifies, it means even more difficulty in discerning fact from opinion, especially as more and more reporters seem eager to polarize what once was their common ground to find the truth. In today's world, the only common ground seems to be that criticism delivered Olberman-style means stealing tomorrow's headlines and public interest or that presenting to extremely polar opposite guests always makes for interesting, if nonsensical, controversy.

Nowadays, the truth is often, not always, somewhere in the ever-expanding middle. Personally, I hope the public knows it.

Prescribing Credibility Online

A new study of consumer attitudes toward health care information sponsored by Medical Broadcasting Company (MBC) and fielded by Nielsen/NetRatings found that the Internet is seen as the most trusted media source for consumers, decisively outstripping offline media when consumers want credible health information.

While research shows that consumers trust their doctor first when it comes to health information, patients are increasingly using the Internet to inform the doctor-patient dialogue. In this new survey, 42 percent of respondents said they trusted health information they found on the Internet, compared to just 16 percent for information found in other forms of media. Consumers are also taking advantage of the great depth of health information on the Internet. More than 85 percent of respondents said they look at two or more Web sites when searching for health information.

The survey also found that over 65 percent of respondents said they use the Internet to research important health topics before and after they visit a doctor. And despite recent challenges to the credibility of the pharmaceutical industry, nearly one-third of respondents said they use the Internet to visit pharmaceutical company Web sites for information about prescription products.

This growing trend is not limited to health care. More and more, people are turning to the Internet in order to formulate a base knowledge on products and services before they consult experts or purchase products and to gain more insight prior to making a decision. Part of the reason can easily be attributed to the searchability of the Internet. But another part of the reason can be traced to consumer trust, online and off.

For years, consumers have been plagued by marketers aiming to oversimplify messages, leaving consumers with no reasonable understanding of how to make their purchasing decisions. For example, one newly released book claims that emotion-laced copy stands a better chance to sell a diamond than a brief description of its size, shape and four Cs.

Hmmm. I'm not entirely convinced. Certainly some emotion-laced copy might draw the reader in, but sooner or later a well-versed consumer who has searched the Internet and become familiar with the four Cs will use that information to draw comparisons between one stone and another (unless you give them a reason that supersedes the four Cs as we recently did for one of our European clients).

Certainly the authors have demonstrated some great streamlining Web solutions for several clients, but they miss the mark on crafting messages by falling into the trap of telling people what they 'should do.' Marketing and advertising are as much an art as a science. There are no 'shoulds' and more consumers know that now more than ever before. As the study suggests: consumers are no longer satisfied with doctors saying they 'should' take this or that. They want to know what taking this and that means exactly. They want to feel informed and they are finding the Internet makes them feel that way.