For More Information

GAP VII: Seventh Communication and Public Relations Generally Accepted Practices Study (Q3,4 2011 data)

222

For More Information● Email: [email protected]

● Website: www.annenberg.usc.edu/scprc

333

Background J. Swerling

40+ years, majority in agency senior management

• USC Annenberg (14 years): Prof. and Director of PR Studies (BA, MA, SCPRC)

• Management consultant : agency search, organization (Toshiba, Cisco, GM, HD, State Farm, CSC, Intuit, Symantec, Remy Cointreau, Toyota ++ )

SCPRC Launched 2002: Advance the study, practice and value of the public

relations/communications function by means of practical, applied research

Bridge academic/practitioner gap

Generally Accepted Practices (GAP) Study Provide the profession with actionable guidance on mission critical

decisions

Track trends, issues, emerging best practices

GAP VII: 620 decision-maker participants; Now “the largest, most comprehensive study of the PR/Communication field.”

GAP VIII: Fall, 2013

444

GAP VII: Professional Partnerships

555

IABC OC: Approach Synthesis of:

GAPs I – VII (The whole is far greater than the sum of its parts)

Ongoing anecdotal data Input from multiple sources (Page, IPR, media,

etc.) Personal experience and observation

666

IABC OC: Key Takeaways1. PR/COM no longer a seat of the pants business

2. “Seat at the table” no longer the issue; it’s what you do in the seat

3. Profound shift from “Old School” to “New School”

4. Pace of change is accelerating

5. Trends and signs are generally very positive for the discipline

6. Practice is expanding in terms of responsibilities…if not budgets

7. Two-way direct engagement with audiences increasingly the norm

Traditional intermediaries becoming less important

8. PR/COM increasingly at the center of the organization

Organizational savvy, accountability, metrics

9. Are we ready for the professional and ethical challenges???

7777

Budgets

888

Budgets: Public Companies, 2009 vs. 2011

<$1B

$1B-$

4.99

B

$5B-$

9.99

B

$10B

-$19

.99B

$20B

-$40

B

$40B

+$0

$5

$10

$15

$20

$25

$30

$1.70

$4.80$3.10

$14.60$12.60

$28.00

$2.60

$6.50

$9.50 $8.80

$26.20

2009 2011

$ M

illions

• GAPs I – VII: Budgets generally trending up…but not like the boom years

999

Budgets, Anticipated: Corporate Respondents, 2012 vs. 2011

Expect an Increase Expect No Change Expect a Decrease0%

20%

40%

60%

80%

100%

20%

57%

21%27%

53%

14%

Public Private

More than 50% expected flat budgets in 2012; prediction confirmed by anecdotal data

2013 hypothesis: greater % expecting increases

101010

Budget, All Respondents: Allocations

Staff Salaries and Re-lated Costs

PR/Communication Management &

Evaluation

Outside Agency Fees PR/Communication Program Execution

0%

20%

40%

60%

80%

100%

48.3%

8.5%18.0%

25.3%

GAPs I – VII: % for agency fees has decreased

111111

Budget: Insights Those with budget increases were no more likely

to score higher on success, reputation  Those with budget decreases were less likely to

score higher on success, reputation  Success not necessarily a function of budget In lean times when efficiency and productivity

are the watchwords, our ability to achieve much with relatively little can be a huge advantage

12121212

Responsibilities and Functions

131313

Responsibilities, Corporate: Core*GAP 2009 GAP

2011

Corporate communication 87% 88%

Executive communications 74% 80%

Internal communications 67% 80%

Crisis management 73% 72%

Social media monitoring 53% 70%

Social media participation 53% 66%

Issues management 47% 58%

Community relations 56% 57%

Corporate external website 54% 55%

Corporate intranet 49% 54%

Marketing/Product PR 61% 50%

Is Marketing,

Product PR transitioning to social?

* Defined as more than 50% reporting budgetary re-sponsibility in 2011.

141414

Responsibilities, Corporate: On the Rise

Budgetary Responsibility 2009 2011 Increase

Social media monitoring & participation* 53% 70%,

66%17%, 13%

Search engine optimization 18% 31% 13%

Internal communications 47% 58% 13%

Issues management 47% 58% 11%

Customer relations 6% 15% 9%

Multimedia production new item 40% --

*In 2011, monitoring and participation asked as two questions

151515

Budgetary Responsibilities, Corporate: On the Decline

Budgetary Responsibility 2009 2011 Decrease

Marketing/Product PR 61% 50% -11%

Is traditional product promotion giving way to social?

161616

Responsibilities, Functions: Insights Added responsibilities (i.e. social) without added

budget Relationship between the number of core

responsibilities and total PR budget size? YES Relationship between number of digital activities and

budget increase? NO Relationship between overall number or kind of

responsibilities and budget increase? NO Doing digital or “non core” activities hasn’t led to

budget increases The key to budgetary effectiveness:

• Ongoing evaluation of all activities• Objective (ruthless?) prioritization relative to contribution, cost• No sacred cows• Retraining /reallocation of staff

17171717

Management and Use of Social Media

181818

Digital/Social Tools: Budgetary Control

Department 70% Budgetary Control or Higher

PR/Communication 50%

Marketing 41%

Customer Service 6%

Information Systems 8%

Other 9%

191919

Digital/Social Tools: Strategic Control

Department 70% Strategic Control or Better

PR/Communication 54%

Marketing 37%

Customer Service 7%

Information Systems 7%

Other 11%

202020

Digital/Social Tools, Usage: Core*

Digital/Social Practice GAP VI GAP VII

Social Networking Sites 3.44 4.75

Sharing Online Videos 4.32 4.48

SEO NA 4.48

Twitter 3.34 4.33

Producing Online Videos NA 4.19

*Defined as above 4.0 average use

1=Didn’t use; 7=Used significantly

Observation: all continue to trend up Increasing demand for engaging multimedia content (we

now teach all forms of production Increasing experimentation

212121

Digital/Social Tools, Usage: Has Beens

Digital/Social Practice GAP VI GAP VII

Decrease

Wikis 1.96 1.80 -.16

Virtual Worlds (e.g., Second Life) 1.40 1.26 -.14 1=Didn’t use; 7=Used significantly

222222

Digital/Social Tools: Insights 70% control by COM or Marketing = Higher score on

Success factor

Multimedia - especially video – increasingly crucial

Don’t fall in love with any single platform; rapid change the norm Anecdotal: College students making less use of Facebook

New social market environment is permanent The norm for younger generations: two way, social, audience of one,

peer influencers

Co-ownership of brands

Not just B to C; B to B and B to G moving that way, too

“Social organizations”

*Scored above 4 on 7-point scale

23232323

Measurement and Evaluation

242424

Measurement and Evaluation: Budget Allocations

Public <$1B Public $1B-4.99B

Public $5B-9.99B

Public $10-19.99B

Public $20-40B

Public $40B+ Private <$2.5B

Private $2.5B+

0%

5%

10%

15%

20%

25%

3.9% 3.9% 4.0% 3.6%2.7% 2.3%

4.5%

2.5%2.2%

4.6%3.7% 3.4% 3.8%

6.6%5.1%

2.9%

6.3%

8.4% 8.0%9.0%

6.8%

9.5% 9.6%

6.9%

GAP 2004GAP 2009GAP 2011

% P

erc

ent

Budget allocation for research, measurement and evaluation has increased sharply

252525

Measurement and Evaluation: Top Ten Tools

Influence on Corporate Reputation 5.1 Crisis Mitigation 4.2

Influence on Employee Attitudes 4.8 Content Analysis of Clips 4.1

Metrics for Digital/Social 4.6 Influence on Share of Voice 4.0

Influence on Stakeholder Awareness 4.6 Total Impressions 4.0

Influence on Corporate Culture 4.5 Total Clips in Top-Tier

Media 4.0

• Core tools: Greater than 4.1• None higher than 5.1 (consistent with past GAPs)• Ad equivalency nowhere to be seen

1=Don’t use; 7=Use significantly

262626

Measurement and Evaluation: On the Rise

Measurement/Eval Approach GAP VI GAP VII Increase

Metrics for Digital/Social 3.1 4.6 +1.5

Primary Research, Pre-Campaign 2.4 3.4 +1.0

Primary Research, Post-Campaign 2.6 3.5 +.9

1=Didn’t use; 7=Used significantly

Growth concentrated in more sophisticated, objective, quantitative techniques

GAP VIII Hypothesis: Digital/Social: 5.5; Pre/Post: 4.0

272727

Measurement and Evaluation: Categories (Factor Analysis)

Stakeholder outcomes

Strategic outcomes

Bottom line outcomes

PR outputs

Infl. on corporate culture

Metrics for digital and social media

Contribution to market share AVEs

Infl. on corporate reputation

Primary research-pre-campaign

Contribution to sales

Content analysis of clips

Infl. on employee attitudes

Primary research-post campaign

Influence on stock performance

Clip counts

Infl. on stakeholder awareness

Total circulation

Crisis mitigation Impressions

*Factor analyses conducted using the full sample.

282828

Measurement and Evaluation: Insights

Outcomes measures (Stakeholder, Strategic and Bottom Line) linked to success factors? YES

PR Outputs measures linked to success factors? NO

29292929

Agency Relationships

303030

Agency Relationships: Fee Allocations as % of Total Budget

* Question changed in 2011

GAP 2002 GAP 2004 GAP 2009 GAP 20110%5%

10%15%20%25%30%35%40%45%50%

30.3%

24.9% 23.6%

18.0%

313131

Agency Relationships, Public Companies: Types, 2002 - 2011

• AOR continues downward trend

Single agency of record

Multiple ongoing Pre-approved, Projects Ad hoc, Projects0%

20%

40%

60%

80%

100%

47.2%

13.0%3.7%

36.1%30.2%

43.6%

5.6%

20.6%24.6%

53.1%

6.2%16.1%14.9%

39.9%

9.6%16.0%

GAP 2002 GAP 2007 GAP 2009 GAP 2011

323232

Agency Relationships, Corporate: Number of Agencies Used, 2002 - 2011

GAP 2002 GAP 2004 GAP 2009 GAP 20110

1

2

3

4

5

2.5 2.4

3.23.6

Number continues to increase.

333333

Agency Relationships: Reasons

Additional Arms and Legs 6.0 Help Quantify

Results 4.4

Unique Perspective 5.7 Digital/Social Media 4.3

Marketing Insight 5.6 Limited Headcount 4.2

Strategic Point of View 5.3 Cheaper 4.1

Geographic Reach 4.5

Arms and legs #1 since GAP I 18% more dependent on agencies for strategic

insight in the last two years

1=Not important; 7=Very important;Among those reporting use of agencies.

343434

Agency Relationships: Categories (Factor Analysis)

Strategic Tactical

Unique expertise Cheaper than hiring staff

Market insights For arms and legs

To quantify results Because we have limited headcount

For their strategic point of view *Factor analyses conducted using the full sample.

353535

Agency Relationships: Insights Significant relationship between Strategic agency use and

(1) recommendations taken seriously, and (2) positive CEO perceptions

Descriptively*, high strategic use, low tactical use, associated with strongest scores on multiple success factors

Descriptively*, low strategic use, high tactical use, associated with weakest scores on multiple success factors

Challenge/Opportunity for agencies: Grow business by providing Strategic added value on even labor-centric assignments

Challenge/Opportunity for clients: Optimize relationships by seeking/being open to Strategic added value on even labor-centric assignments

* Not statistically valid, but high confidence level.

36363636

Organization/Reporting

37373737

Organization/Reporting: Reporting Lines

• Consistent with past GAPs

Any C-Suite CEO Only Marketing only HR only Multiple report0%

20%

40%

60%

80%

100%

56.8%

26.5%

12.9%7.6%

27.0%

383838

Satisfaction with Reporting Lines

● Is your reporting line effective?● 60% strongly agree, 16% strongly disagree

● No difference in perceived effectiveness between single (5.20 on 7 point scale) and multiple reports (5.24). Why?● 88% of multiple reports have a line to the C-Suite; only

44% of single reports

● Those with C-Suite access are more satisfied (5.87) than those without (4.33)

393939

Reporting Lines and the Perceived Value of COM/PR

Recommendations taken seriously

Role in strategic planning

Contributes to share value

Contributes to financial success

Contributes to sales

0

1

2

3

4

5

6

76.1 5.7 5.5 5.7 5.55.6

4.6 4.9 5.1 4.8

C-Suite Access No C-Suite Access

Significant mean differences, p<.000

404040

Organization/Reporting: Insights● Reporting line may sometimes be situational (i.e.

marketing-driven companies), but broader conclusions are inescapable

● To achieve its full potential PR/COM must be included in the Dominant Coalition, i.e. report to the C-Suite

● Reasons for non-inclusion: Organizational limitations

Professional limitations

Both

41414141

Integration

424242

Intra-Functional (Among COM Functions) Integration and Success

0

2

4

65.8 5.6 5.95.4

4.6 4.5

Integrated functions Unintegrated functions

*Coordinated functions=Top 3 box; CEO values contributions=average agreement with “My CEO/top exec. believes PR contributes to… stock valuation, financial success, sales; PR recommendations=average agreement with “PR recs taken seriously…” and “PR generally invited to senior-level meetings…”

Higher levels of integration/ coordination among COM functions are associated with multiple success factors.

434343

Inter-Functional (COM and Other Functions) Integration and Success

0

2

4

65.8 5.7 6.05.5

4.6 4.5

Integrated departments Unintegrated departments

*Coordinated departments=Top 3 box; CEO values contributions=average agreement with “My CEO/top exec. believes PR contributes to… stock valuation, financial success, sales; PR recommendations=average agreement with “PR recs taken seriously…” and “PR generally invited to senior-level meetings…”

Higher levels of integration/ coordination between PR/COM and non-COM functions are associated with multiple success factors.

444444

Organizational Integration and Reporting Line Intra-departmental and Inter-departmental

integration strongly related to: Success factors

Reporting line Intra-functional integration: 5.5 with C-suite access, 5.1 without.

Inter-functional integration: 5.5 with C-suite access, 4.9 without.

45454545

Excellence and Best Practices

GAP VII, Section 9

464646

Excellence and Best Practices - Insights Causality yet to be proven, but patterns are very

compelling and long-lived (over multiple GAPs)

Integration: Champion intra-functional and inter-functional integration and coordination.*

Measurement/Evaluation: Invest at least the average % of total budget in evaluation; Invest in metrics other than, and/or in addition to, media outputs.*

Culture/Character: Beginning within the PR/Communication function, champion the adoption of a culture/character that is: proactive; long-term/strategic; flexible; ethical, and people-first.*

Agency relationships: Optimize strategic value, not just tactical.*

Optimal Reporting Line: Usually a direct line to the C-Suite. Be part of the Dominant Coalition.*

* Strongly associated with success variables.

47474747

Excellence and Best Practices, Key Insight: A Period of Profound Transition from Old School to New School

OLD SCHOOL Measures media outputs

Believes focus is on media relations

Does not believe social media are pervasive, worries about control

Orientation is short term/reactive

NEW SCHOOL Measures outcomes

Believes social media belongs in COM/PR

Embraces pervasiveness of social media, still with modicum of control

Orientation is long-term strategic

Recommendations are taken more seriously

484848

FIN