Do we need to adjust our technology priorities?

Two stories in the New York Times’ July 5 edition demonstrated the dichotomy of technology investment in the United States today.

The first story was a front-page report about technology that identifies what we watch on our smart TV and sends that information to marketers to deliver ads to our computers, tablets and phones. Companies are scrambling to sell this technology and TV makers like it because it gives them additional revenue. Marketers are signing on to the technology, though the effectiveness is far from proven.

The story affirms that, here in the U.S., we’re really good at tracking what people watch, no matter the device, then delivering a related marketing message, no matter where they are or the device they’re using. I recently searched for information on life insurance; now I can’t go anywhere without an ad for a life insurance company staring me in the face.  

The second story was an opinion column, which cites the views of many IT experts that the U.S. is woefully unprepared for a cyberattack – one that could cripple the nation’s basic infrastructure, including electricity and water delivery.

As someone who has worked in marketing and public relations for decades, I understand the importance of delivering a relevant message to consumers. I also understand that those advancements in delivering messages are accelerating because there’s plenty of money from investors.

But those messages will have no effect if the devices to receive them can’t turn on because they’re out of power.

Is Google’s Decision a Victory for Corporate Values?

Communication professionals spend considerable time and resources working with corporate executives to create a vision, mission, and values that help to guide the company’s actions. Their goal is to get company employees to “live” those values. Looking at recent actions at Google, it appears its communication executives have succeeded.

According to reporting from Gizmodo and other media, Google executives have chosen not to pursue additional work to help the U.S. military use artificial intelligence (AI) to analyze drone footage. The CEO of Google Cloud acknowledged that an employee backlash against the work played a role in the decision. Thousands of employees signed a petition asking company executives to cancel the contract; some even resigned in protest. Later this week, the company plans to unveil new ethical principles about its use of AI.

When Google first became a public company in 2004, one of its core values was “don’t be evil.” Today, the company website states that “our goal has been to develop services that significantly improve the lives of as many people as possible. Not just for some. For everyone.” However, a large percentage of Google employees apparently didn’t see how helping the military improve drone attacks was improving lives.

It’s important to note the Defense Department contract was a tiny percentage of Google’s business Maybe employees would feel differently or executives would react differently if military work was a significant share of company operations. But for now, Google workers not only accepted the company’s stated values, they took action to remind top executives that their decision didn’t align with them.

To me, that’s called “living.”

Mmm, Mmm, Not So Good

Last week was a roller-coaster ride for Campbell Soup CEO Denise Morrison. On Thursday, she was named one of the 10 most reputable CEOs in the world – the only woman on the list. On Friday, the company announced that Morrison had chosen to “retire” and was being replaced at least temporarily by a member of its board of directors.

Business media reported that the change was necessary because Campbell’s stock was down 29 percent this year; after her departure, it dropped further, to its lowest level in five years. But until the past year, Campbell’s stock had consistently risen under Morrison, even delivering a better return than the S&P 500 index. In fact, the same media recognized that Campbell faces the same situation as other companies in its market – a long-term trend away from processed foods to fresher, healthier alternatives. Sales have been down for the past few years and now inflation has help to drive up costs.

Morrison has received mostly positive press during her tenure as CEO. In its report on CEO reputation, the Reputation Institute cited her positive effect on the company’s reputation. It noted that Morrison had Campbell pull out of an industry trade association because the association’s stance on GMO labeling “no longer aligned with Campbell’s values,” and said she was putting principle over profit.  

Apparently, Campbell’s board and its investors have a different philosophy. Like most of Wall Street, their focus seems to be on short-term gain; that is, how much can we pump up the stock and make a profit in the short term?  Its interim CEO provided a clue when he was quoted as telling employees that “as a public company, Campbell was for sale every day, but that his strategy was not to sell the company.” However, other comments he made on an analyst conference call create the impression that sales and/or mergers are likely.

Morrison’s leadership help to raise Campbell’s profile and improve its reputation. Ironically, that likely made the company more valuable, which should help as the company is sold or broken into pieces. As a result, Campbell will become a company facing the same trends it does now, but one only concerned with costs…in other words, just like nearly all other companies in the industry. That’s not a long-term recipe for success.

R.I.P. AVE

Public relations firms worldwide have moved away from using advertising value equivalency (AVE) to measure communications effectiveness. Most now employ “value metrics” that focus on specific, measurable objectives.

I have one word for this trend…hallelujah!

PR professionals have used AVE for decades to justify the programs they implement for their organizations and clients. It involves estimating the equivalent advertising cost for an article placement; for example, if Fortune Magazine runs a half-page item on your client, then the value of that placement is the cost of running a half-page ad in the publication. Sometimes, the ad cost would be multiplied, under the assumption that a news story was more credible than an advertisement.

But AVE has several issues that have always made it a suspect measure. It doesn’t take into account whether an article is positive or negative, or how much of the article actually mentions a company. And, no research ever found a multiplier effect.

PR professionals need to employ systematic legitimate measures of effectiveness; for example, whether an audience becomes aware of and understands a message, or whether the message resulted in changing audience attitude or behavior. When they do, they help move public relations from a fuzzy function to a strategic management practice that adds measurable value.

Business Execs Now Understand Reputation Value

In recent years, business executives have begun to understand the importance of company reputation and the role that public relations plays in defining and maintaining that reputation.

PRSA research found that 98 percent of business leaders wanted to see reputation management and corporate communication included in MBA curriculum. They see a lack of those skills in young executives. A survey by the Economist Intelligence Unit found that 75 percent of a company’s value is connected to its reputation. If you think that sounds high, ask executives at BP, Toyota, Volkswagen or Chipotle what happened to their reputations in the past few years.

To hedge against financial losses from a damaged reputation, some corporations are purchasing reputation insurance. But that’s like a person buying life insurance or disability insurance. It pays you some money when something really bad happens.

A better approach is to develop a strong communication program; like preventive medicine, it helps decrease your chance of something bad happening. Today, people perceive more value in information, communication and relationships. Communication professionals can help organizations maintain that value.