Monday, July 6, 2020

The New Trust Deficit: Facebook, Facts & a Frantic News Cycle

The U.S. is facing a number of simultaneous crises -- rising COVID infections, ongoing civil rights protests for BLM, an economy in recession that's driving huge job losses, bankruptcies, supply chain issues that could cause further harm. 

But there's one thing making each of those crisis worse, more dangerous and out of control.

It's that we can't agree on a single set of facts.

Instead, we have a credibility gap making things worse. Different parts of the country can't even agree about how to frame the various crises, including those cited above and others that have been in the news lately.

CNN's Reliable Sources newsletter recently called this a "trust deficit" in a story about Facebook and why some companies have stopped buying ads on Facebook.

For Facebook, the trust deficit is fueled by allowing misinformation and hate speech to spread.

Social media platforms use algorithms to continue to feed you content similar to the kinds of content you click on. This makes it easy to perpetuate your bubble because you continually see posts that fit your narrative.

Part of the problem: some information may have already been debunked only after we've seen it. Which is too late. People who consume the original message, and used that to bolster their narrative, rarely see the correction or update afterwards.

Another problem: we're so inundated by news that we're overwhelmed. We don't have time to process yesterday's news. Which means we don't have time to process today's news, to put it into context, to make sure we understand it -- before we're hit with the latest shocking piece of news, which is replaced by the even-more-recent news.

The result: we now live in a world with strongly held opinions that aren't necessarily based on facts. 

Which means: we might not agree that the top stories that are, in fact, the most important stories. 

We certainly don't agree with the implications of those stories -- whether they are fake news or facts might be debatable if we could meaningfully debate these issues. 

And we definitely disagree regarding any possible solution to a given crisis.

It's a helluva way to celebrate our nation's independence. 

We try to avoid taking political stands in this blog. But we're tackling the trust deficit because we do see it as a potential business threat for marketers.

It means that where you advertise (and where you don't), where and what you post could be seen as supporting or fueling the trust deficit. It's more important than ever to think about how you communicate to your publics while being aware and sensitive to how your marketing plays today and how it might play in a couple of years.

Tuesday, June 23, 2020

2020: The Mid-Year in Review

From the perspective of late June, it feels like 2020 to date has had more chaos (including COVID, the suspension of all professional sports, the killing of Qasem Soleimani that seemed to push the U.S. to the brink of combat with Iran, Australia's devastating bushfires) and news (Black Lives Matter, Kobe's death, Brexit, the convictions of Roger Stone and Harvey Weinstein, etc.) in five months than we experience in a typical year. 

That doesn't include the impeachment -- which seems to belong in the distant past.

And we haven't reached peak campaign yet. Here's what Nate Silver of the FiveThirtyEight blog had to say (as reported in Brian Stelter's Reliable Sources newsletter):

"To get a sense for how much *news* there is in the a given election year, we looked at how many full-width headlines there are in the NYT from Jan. 1 through Election Day in election years going back to 1968. 2020 is, uh, pretty special." Most years, just 2 to 5 percent of the relevant editions had banner headlines. The years 1968 and 1972 were more intense, with banners across about 10 percent of the Page Ones. And 2016 was hectic too, with banners across 15 percent of the fronts. But 2020 is uniquely crazy: Thirty three days of the year have called for banner headlines so far, nearly 21 percent of the front pages since January, and it's only June!

Silver wrote: "The average election year features 10 full-width headlines through Election Day. There have already been *33* this year, and we're not done with June yet."

So it's not just your imagination -- there really is more news, and more intense news, than usual...
In our annual list of trends, we did not identify any of the above news stories.

But we did predict that 202 would mark an age of anxiety, fueled by distrust of big tech firms and traditional and social media.

So we feel we correct called the overall direction of 2020.

We're reminded of that because of an article that appeared in the Vietnam Investment Review entitled, "Pandemic throws global media trends up in the air." We find it interesting that an outlet around the world from us picked up on our view of the world.

Here are two key paragraphs in VIR's article:
Norman Birnbach, president of strategic PR firm Birnbach Communications, predicted in January that 2020 would mark an age of anxiety, fueled by distrust of big tech firms, and traditional and social media, even as people began to rely on those sources more than ever, especially in the United States. “Marketers must not only be relevant – they also need find ways to credibly appeal across a divided America.”
The projection was uttered at the start of the year – before coronavirus hit North America, and before civil unrest plagued the United States as it has done for the last few weeks. Divisions well-noted in the past have intensified to scarcely believable levels. And yet, as more and more citizens around the world look to the media for information, there is no easy solution for the industry to ensure that information is credible, accurate, timely, and is transparent in what it does with the data it collects.
We think the point about credible and reliable information is important. 

We're at a point where whether or not you wear a mask is seen as political. Where lies and misinformation on Facebook and Twitter by politicians is accepted because FB and Twitter don't want to be in the censuring business. Where the New York Times published a column that looks at whether or not there some kind of secret deal between Trump and Zuckerberg.  (Check out "What’s Facebook’s Deal With Donald Trump? Mark Zuckerberg has forged an uneasy alliance with the Trump administration. He may have gotten too close.") Where John Bolton's book can be accused of being full of lies that are classified information. 

We'll do a more thorough recap of the year in November, as always. But we thought it worth discussing information credibility. Because it is a real problem affecting the U.S. and the entire world.

Wednesday, April 29, 2020

Additional Thoughts on -- On Thursday the podcast company Stitcher and the University of Chicago are launching a new podcast, "Pandemic Economics," hosted by Eduardo Porter and Tess Vigeland and exec produced by Ellen Horne...

We're living in uncertain times due to a terrifying pandemic that continues to raise questions that healthcare professionals can't answer (like do you develop immunity from it if you've already recovered from COVID-19 -- or could you get sick again from it?) combined with economic chaos that's reshaping our economy while creating huge numbers of unemployed workers. 

Against that backdrop, two questions we've been hearing are: "Should businesses conduct marketing and PR campaigns?" and if so, "What's constitutes an effective campaign now?" 

We recently set to answer those questions in a blog post entitled, "9 Tips and Considerations for Conducting PR When It's Not Business-As-Usual" that appeared in CommPro.Biz.  

But after that article appeared, we came across a couple of additional thoughts we wanted to discuss.

For example, one colleague wrote on LinkedIn: "The biggest challenge for companies, IMO: Being relevant while not appearing predatory." 

We think that's right, that getting the balance right -- between letting their customers know they're open for business while also being sensitive to what we're all going through, and that this is far from business-as-usual -- will be a big challenge.

For example, we've seen a lot of ads that tout the heroism of their employees. But in our article, we advised companies that their marketing messages need to match reality. That may be a problem because some of those companies don't have a great reputation for how they treat their employees, unfortunately. They need to watch out for articles such as this from VOX: “'I did not sign up for the military. I signed up for Walmart.' What grocery store workers say they’re facing during the pandemic." We think there could be more articles that highlight the discrepancy between messaging and reality, and that could be a problem.

And according to CNN's great "Reliable Sources" newsletter, "Kantor Media held a webinar about 'TV & video consumption in 'the new normal.'" One of the findings was there's been "an even more pronounced surge in YouTube consumption than Netflix, and a relatively small decline in 'co-viewing,' or people watching together. That means increased TV/streaming consumption mostly consists of people scattering to watch, as opposed to a major bump in shared or family viewing."

But to our perspective, what's important are the implications for advertising. Kantor's "researchers found that people don't feel that brands should stop marketing during the pandemic, but that companies need to be careful not to appear as if they're exploiting it -- a 'fine line,' as media division CEO Andy Brown put it....But the findings generally reinforced some key points about increased consumption, acceleration of streaming and the hunger to return to some semblance of normalcy whenever that's possible..."

We do think the desire to return to normalcy among consumers is important to keep in mind. Marketing functions should keep that in mind when considering how to approach their marketing efforts.

We also expect there to be long-term changes in how we work (more will continue to work from home afterwards) and live, and how we pursue leisure and entertainment. Companies that can anticipate how this will play out should start developing campaigns to address that.

Let us know if you have additional thoughts about how to navigate this crisis from a marketing perspective. 

Monday, April 27, 2020

9 Tips and Considerations for Conducting PR When It's Not Business-As-Usual

For businesses and nonprofits, as for all of us, the world shifted dramatically with the arrival of COVID-19. 

It's certainly far from business-as-usual. 

Yet business continues, and organizations need to continue to operate and keep in communication with their employees, customers, and other stakeholders.

This article will offer some ideas of steps to take during the crisis. But before we get into that, we want to thank: healthcare workers who are taking care of others, EMTS and oher first responders,  along with everyone who work in supermarkets -- those who stock shelves and the cashiers -- and other always-essential stores that remain open, including restaurants -- and everyone in the kitchen -- now offering take-out food. We also want to thanks all those who deliver and transport the things we need as well as cable and phone technicians who are maintaining our Internet capabilities, while we're sheltering in place. 

Here are some ideas:
  1. Understand that the media's focus has changed. This is important, especially if you're targeting consumer or national business media (as opposed to trade media): every reporter now also covers how COVID is impacting their regular beat. This is true for trade media, too, since they continue to cover their regular business but they are likely to ask questions about the impact of COVID.
  2. Recognize that COVID-related layoffs have shrunk a lot of newsrooms. A lot of businesses are suffering -- we're not trying to minimize that. But for PR and marketing functions that work with reporters, it's important to realize that a lot of local and trade media have initiated significant cutbacks on staff. That means that newsrooms may not have the resources to cover your story (even if they did just a few weeks ago).
  3. Re-evaluate your communications and marketing objectives, strategies, goals, announcements and product roadmaps. Whatever you planned for 2020 may no longer be relevant, starting with launches and trade shows -- especially launches at trade shows. While we don't know yet when the general economy will reopen, you should like at key themes, plans, announcement and goals and adjust them given current conditions. It will require being more flexible and more sensitive to context than usual. 
  4. Stay relevant. Look for ways to support and contribute to your community because they need that support. For a software development client, we suggested offering tips for programmers working from home -- and found some interest among trade reporters. Make sure you and your messaging stays focused on employees and customers (and not on the company itself unless its how the company is taking specific new steps to help employees and customers).
  5. Postpone unnecessary announcements. Not all announcements are equally important. Those that aren't should be pushed back or dropped. A potential client asked us about issuing a press release to announce a new CEO for a small, international healthcare product company. We told them to hold off on that press release. While trade media continues to publish, it seems like it would be better to wait. For one thing, the news might get lost or overwhelmed amid the COVID news. Please note: some announcements are absolutely necessary; those should go forward but make sure you understand the context of when and how you issue the release. Also keep in mind: your news may not get the coverage it would have just a few months ago.
  6. Don't try to generate coverage because you're doing something about COVID. Every organization has had to shift its operations to adjust to the current crisis. So doing something to fight COVID isn't enough. You need to have something special to stand apart from what everyone else is doing. There's a lot of COVID messaging. ads, content (including this blog entry) and spam so you need to find ways to break through the clutter. Keep in mind:  Jumping on the COVID bandwagon risks making your organization look desperate. 
  7. Find a way to stand out by doing something unexpected but that fits with your brand. This won't work for most brands, but Steak-umm's social media experimented has paid off, according to the Wall St. Journal: "Steak-ummEmerges as Unlikely Coronavirus Misinformation Watchdog: Processed-meat maker encourages Twitter followers not to trust everything they read; ‘peak irony’ for a brand builder." 
  8. Content remains important. Trade media remains interested in bylined articles; we've been in touch with a couple of editors in different sectors who have been requesting content for May, June and July. They’re thinking ahead but some of the planning is taking place now. For the short-term, you still need content for your blog and social media if only to show that your organization is active and current. 
  9. Think long-term. There's still work to be done, even during a crisis. After the dot-com crash and in 2007-8 financial crisis, we used the down time to develop new processes and content for when we came out the other side. We're working with clients to continue to develop relevant content (some of which will be posted after the crisis is over), and we're doing that for ourselves, too. 
We're going through something that requires the sensitivity of the post-9/11 era and the post-financial crash of 2007-08. And it may be weeks, if not months, before we're able to get back to some sort of normalcy. (Unfortunately, our guess is that this will happen later rather than sooner.) And we think that once we're on the other side of the crisis, there will be significant changes to how we live, work, shop, educate, and entertain ourselves. Companies need to start thinking about what that future may look like. In the meantime, it's an opportunity to re-evaluate what your organization does and how it approach and update that.

Tuesday, April 21, 2020

Pew Research Validates Fragmentation As An Ongoing Trend

According to a new Pew Research Center report on media polarization, Americans place their trust in two nearly inverse news media environments.

According to Pew, not surprisingly, 65% of Republicans and those leaning toward the GOP trust Fox News. By contrast, Democrats and those who lean that way, 67% trust CNN, 61% trust NBC, and 60% trust ABC. 

Again, without taking a stance either Republican or Democratic, this is not surprising but provides some context for what we predicted back in January (which feels like a different era): further fracturing and fragmentation of the media and the country. This Pew report confirms our prediction that Americans are divided by news sources, and that further fragments our country.

Companies need to find ways to talk with both sides. Not to be cynical about it but to be successful, marketing functions will need to be able to tell their stories in two ways, to tailor the story to appeal to two different sets of news teams to reach people on both sides of the aisle.

That's not always easy to do, of course. But it does speak to developing customized pitches (as opposed to sending out a single generic pitch) to the media. It takes more time but could expand coverage of your story.

Tuesday, March 31, 2020

New York Times & Wall St. Journal Validate Predictions about Facial Recognition, Robots, Retailapacolpyse and More

Some trends move more quickly than others.

We predicted that privacy would be a big issue this year — this, after years when people said Millennials aren’t concerned about privacy. We’re seeing a lot of articles that raise concerns about privacy. We also said that facial recognition would get a lot of attention this year.

The New York Times recently wrote “Facial Recognition Moves Into a New Front: Schools,” noting that, “A district in New York has adopted the technology in the name of safety. Opponents cite privacy and bias concerns.”

Part of the reason for putting facial recognition in schools is a topic we didn’t identify: the need to improve safety to prevent mass shootings in places that didn’t have or need much security before, including schools, churches and temples. (We do expect to see a lot more coverage about protecting these kinds of locations this year, as these organizations, often nonprofits or otherwise under financed, have to figure out a way to protect the people who visit those locations without keeping away people who need their services.) 

In addition to reporting on facial recognition, the Times also wrote about robots, which we said, “Robots won’t take over in 2020 but will be more commonplace. ” The Times recently published an article, “The Robots Are Coming. Prepare for Trouble,” noting that “Artificial intelligence won’t eliminate every retail job, an economist says, but the future could be grim unless we start planning now.” First, it says that “robots are coming,” not that they are fully here yet, which aligns with our prediction. 

The article also looks at AI and how it’s used in retail — which correlates with another of our predictions! The article notes that the impact of robots and AI in retail has led to more than 6,000 store closings in 2018. Interestingly, the growth of e-commerce is strong, growing at nearly doubled but over the past five years, it went from 6% to 11%.
 (You’d think from all the claims of Amazonification or the coming of the Retailapacalypse, that the percentage of e-commerce as a share of the overall retail market would be substantially higher.) Just wait, we guess.

But the article also mentions how AI is being used to “figure out what customers want and to get it to them quickly,” which is another point we made. 

Meanwhile, more bad news the retail sector. Bloomingdale’s is shutting down its fur boutiques — but that seems like being the victim of fashion trends. But Macy’s is shutting down 125 stores over the next three years and approximately 2000 corporate jobs. The impact is that Macy’s has “served as a backbone for America’s shopping malls.”

This is our final validation for this blog: we had said that food delivery apps are going to face challenges this year, due to completion from other apps and from restaurateurs realizing that they’re not making enough money, maybe even losing money, and that this is not sustainable. Here’s the latest on this from the Journal: “Grubhub Spends to Draw In More Diners: Tight competition is pushing food-delivery rivals to experiment, adapt to industry in flux.” The costs for consumers will have to increase in order to make it sustainable for apps DoorDash, GrubHubs, Uber Eats, and Postmates as well as for the restaurants themselves.

Grubhub said it will sacrifice profits to compete — the challenge is how long they can operate before generating a profit. With an expected $100 million in profits for this fiscal year, we guess they have some runway to reach sustainability. 

We're living in an interesting time: there is a trend for people to spend more time cooking for themselves, with organic ingredients, even with food selection and recipes delivered to your door for you to cook at home. At the same time, we're seeing a strong appetite (pun intended) for food delivery services for people who don't want to prep, cook and clean. We guess that means you can have it your way. 

Which is our way of saying: consumers will have more choices for how to approach meals, and they seem willing to pay a premium for convenience. How much of a premium has yet to be answered.

Tuesday, March 24, 2020

More News For Retail That Validates Three Predictions

There’s been a string of bad news in the retail sector: 
  1. Pier 1 Imports — which one late night comedian (accurately) described as “that store where you bought that pillow one time” — has filed for bankruptcy. The bricks-and-mortar retailer plans to close nearly half of its 940 stores, according to the Wall St. Journal.
  2. Wayfair recently announced the layoff of 500 employees, per the Wall St. Journal, while Walmart laid off 200 employees from an online furniture retailer it owns. 
  3. Victoria’s Secret has been sold to a private equity group, with the Wall St. Journal noting that: “Les Wexner’s decision to part ways with Victoria’s Secret is an admission that the 82-year-old billionaire couldn’t revive the fortunes of a troubled lingerie brand he had built around shopping malls and sex appeal.” 
So we’re seeing ongoing weakness from both primarily mall-based as well as online retailers. 

That’s a real problem, and a trend that we’ve been predicting for some time. We’re not happy to be right, especially because we don’t have any recommendations or solutions.

But AdWeek has some suggestions for brands — which is not the same thing but shows that even brands that do well selling online are fearful. Check out “How Brands Are Battling Knockoffs on Amazon: With a proliferation of third-party sellers, fighting copycats can feel like a never-ending game” and “How to Protect Your Amazon Listings From Copycats.”

Meanwhile, validating another trend that retailers will use technology to improve the customer experience, in an article entitled, “Grocers Wrest Back Control of Shelf Space,” the Wall St. Journal reports that, “Retailers are relying on their own proprietary research to decide where to shelve products, dealing another blow to large U.S. food companies that are already dealing with increased competition and shifting consumer tastes.”

Finally, we’ve predicted that there’s a renewed push for profitability and financial discipline among apps, particularly pointing to food delivery services as a sector that would need to raise fees and change their business models to stay in business. That prediction has been validated by yet another Wall St. Journal article: “Food-Delivery Firms Put Mergers, IPOs on the Menu: DoorDash, Grubhub and others are weighing tie-ups or looking for funding.”

American consumers still seem fine spending their money, but spending patterns are evolving. And other than Amazon and Walmart, retailers don’t really knows how to survive. So we expect ongoing turmoil, unfortunately. We're not economists but it seems hard to believe this is not going to impact employment rates and the economy at large.