Four types of sorry

Over the past few years the world has been treated to a long list of celebrity and political mea culpas, from Tiger Woods and Bill Clinton, to Kanye West and David Letterman.   Here at home we have been treated to apologies from cricketer Jesse Ryder, politician Nick Smith and the owners of the stricken cargo ship Rena to name but three.

Tomorrow disgraced cyclist and cancer survivor Lance Armstrong will seek redemption on the “altar of Oprah” participating in a two part “no holds barred” interview addressing allegations of cheating and illegal drug taking.

The world is buzzing with anticipation. Many will be sceptical, doubting Armstrong’s sincerity and whether he can truly be contrite after a decade of vigorous denial and systematic attack on any who dared to sully the Armstrong name. Will Armstrong apologise? And if so, what kind of apology will he deliver?

In the world of PR and reputation management, not only is the type of apology important, so is its timing.  Consider the options (these courtesy of Dr Tammy Lenski):

1.       I am sorry. I am at fault.  The holy grail of apologies. It is the one that is most difficult to give, and the one that makes us feel most vulnerable. It is the kind of apology associated with an action that had tragic or predictable circumstances.

2.       I am sorry. I regret it.  Not to be confused with the “I am at fault” apology. The regret apology acknowledges the impact of the deed, even when the impact wasn’t intended. An example of a regret apologies include: “I am sorry my actions had an impact on you. I didn’t understand that until now, and I regret that.”

3.       I am sorry. I sympathise. This apology shows compassion, understanding, and sympathy.  “I am sorry to hear of your father’s passing.”

4.       I am sorry. But not really. “I am sorry you feel that way”.  This kind of apology can work against its giver, escalating the situation further. The receiver knows the apology isn’t real and may feel more aggrieved as a result.

By the end of the weekend we will know if Armstrong is truly sorry, or only sorry he got caught. The next time you ask for an apology or someone asks you for one, consider what kind of apology suits the situation and the people involved and the message it will send.

Sorry doesn’t have to be the hardest word.

 

It’s customer service, stupid!

Ryanair CEO Michael O’Leary crossed an invisible line earlier this month, when he labelled passengers who forget to print their boarding passes as idiots.

Suzy McLeod was whacked with a 300 Euro fee to print out five boarding passes, and took her complaint to the Ryanair boss. Rather than resolving the issue and waiving the fee, he proceeded to call her stupid for not complying with the airline’s terms and conditions.

Not to be outdone, Suzy took her complaint to Facebook, where she quickly notched up half a million “likes” for her campaign against the budget airline, far more than the 178,000 likes on the company’s own Facebook page. Mainstream media picked up the story too and it was reported on both sides of the Atlantic.

It’s debatable whether Ryanair will learn from this. Customer complaints are water off a duck’s back for O’Leary whose memorable spoutings include: ”People say the customer is always right, but you know what - they're not. Sometimes they are wrong and they need to be told so."

Corporate culture is set from the top and O’Leary is eroding any chance at building brand loyal customers. What Ryanair doesn’t understand, is that people expect to be treated with respect, regardless of the price they pay for a seat. 

Social media channels finally give customers the critical mass and audience to fight back against corporate arrogance and just plain bad service.   How differently things could have been if Ryanair had responded with common sense and humanity rather than the high handed and draconian approach it took. But that could be asking too much of an airline that alongside fellow budget carrier EasyJet has been the subject of the most complaints by British airline passengers.

In a competitive market customers always have choices. Let’s hope that UK budget airline passengers send Ryanair a message that they can really understand, and budget carriers around the world take note, learning from the mistakes of others.

The Trans Pacific Partnership – why it matters and why New Zealand shouldn’t be afraid

The Trans Pacific Partnership (TPP) is viewed by some as the next European Union; an ultimately pointless exercise that will tether together large economies and create a serious restriction to the freedom of NZ to govern itself.
However, this perception is inaccurate as the partnership is a free trade agreement rather than a unification of countries with all the restrictions which accompany a unification of countries under one banner.

The benefits of a free trade agreement between NZ and major global powers such as the United States are right to be viewed with a healthy dose of cynicism, but also a realisation of the positive benefits it could bring.

For example, a free trade agreement means more than simply tighter copyright laws (which after all, only exist to protect the rights of the creators and should never be grumbled about by anyone keen to encourage innovation).

It means free access to some of the world’s largest and most lucrative markets. This would mean a boom for the Kiwi agricultural sector, making it easier to export goods to other countries by removing barriers and red tape. It would also allow other business sectors to tap into overseas markets, encouraging increased customer bases and ultimately profits.

With or without the TPP, the world is inevitably becoming a smaller place, even for New Zealand. We will increasingly be required to interact with the rest of the world and this agreement gives us the opportunity to negotiate advantages and forge partnerships with other countries to our own benefit, right here and right now. It will give us a voice in an increasingly crowded world and the advantage on our neighbours who may not be as forward-thinking.

How communication is defining the race for the White House

Barack Obama’s successful bid for the White House in 2009 was hailed as a triumph of social media. No presidential candidate had ever before utilised social media so successfully (or arguably had the opportunity to do so prior to the invention of Facebook and Twitter), allowing Obama to reach out to a younger and previously indifferent voting pool.


This year has seen a challenger to Obama’s social media crown, with a different lesson for us all – if you are not prepared to be quoted, then step away from the Twitterverse. Fast.

Presidential candidate Mitt Romney has attempted to use social media in a similar fashion, and has either shown brilliant communications skills or perhaps how bad communications kills a campaign.

Recent reports have quoted him as managing to offend many major powers in a matter of weeks, with US media labelling the trip ‘around the world in weighty gaffes’. A few choice quotes are Tweeting that the UK is not ready to host the Olympics; that a better culture is why Israel is more successful an economy than Palestine; and his press rep. telling journalists to kiss his unmentionable during a visit to Poland.

Is this however a stroke of genius and are these so-called gaffes been to show his more traditional Republican voters that he has strongly held opinions and means to stick to them? Or is he really just committing a series of uneducated blunders?

Perhaps in Romney’s case the old adages are the best – silence is golden.

What’s the difference between Brand and Reputation?

JML’s affiliate Hill+Knowlton Strategies recently conducted some research into the difference between brand and reputation which produced fascinating results. While brand and reputation are strongly correlated, it is important to understand the difference. Brand was once seen as the be all and end all of a company, but reputation is becoming increasingly important in a world saturated with social media.

Brand is essentially what appeals to consumers, and is the way a company’s products and services are projected to audiences. For example Apple has a stellar brand, particularly when it comes to iPhones. It has encapsulated its audience in such a way that includes them in a community, using phrases such as “if you don’t have an iPhone, well you don’t have an iPhone” in its campaigns. The brand is the perceptions held by the consumers about Apple’s products and services.

Reputation however, is the public perception of the company’s corporate actions which encompasses community relations and corporate social responsibility. It is what the company is doing to look after its triple bottom line – the people, the profit and the planet.

In good times, reputation can be the pillar that props up the company’s brand, but in times of crisis, it can be what erodes a successful brand. Take the case of the oil company BP. After the 2010 oil-spill in the Gulf of Mexico, BP’s favourability dropped sharply in the US. No part of BP’s oil (the brand) had changed, but the reputation of the company was suddenly very different. This erosion of BP’s reputation meant damage to BP’s brand.

As social media transcends temporal and spatial constraints, a company’s reputation has become increasingly more important. Access to this new media landscape demands higher levels of honesty and transparency if a company’s reputation is to thrive.

In the world of social media, your consumers can be your biggest fans or your harshest critics, and everyone is going to hear about it. Consumers are now demanding not only great products and services, but also tangible socially responsible actions. This means it is just as important to proactively build and maintain reputation, as it is to create and sustain a successful brand.

Olympics 2012: Rise of the Branding Police

By writing this blog JML Communications expects a crack team of brand police to come crashing through the office windows, armed with black markers. This terrifying team of undercover marketeers will then instruct everyone to hit the delete button, under pain of Olympic disapproval.

Yes, that is a bit dramatic but surprisingly not that inaccurate either. Why? Because this year’s Olympics is subject to the most stringent restrictions ever put in place to protect sponsors’ rights to the Olympic brand.

For example, games organiser Locog has informed the media that these restrictions mean athletes cannot Tweet about brands of food they consume for lunch and spectators cannot post pictures on Facebook. Even that most private of places, the humble toilet, could be subject to the branding police placing black tape over manufacturers’ logos on soap dispensers and wash basins if they fall within the Olympic radius.

Amusing as the image is of the branding police whacking sticky tape over a toilet logo, this does have serious implications for future copyright and sponsorship law. Because a breach of these newly updated acts is a criminal offence, a power that any major brand would trade its entire marketing team’s soul for.

Locog has even managed to convince rivals Nike and Adidas to sign a historic agreement not to target each other and have areas and activity each will respect – which is the first time this kind of agreement has been made for a major global sporting event. The days of ambush marketing, where major brands would hijack another brand’s sponsored event by sending in beautiful girls wearing their logos to draw the cameraman’s eye, are apparently now over.

Additional protection has also been added to the word ‘Olympics’ and the five ring symbol. But the major change is to ban any company/person/or even inanimate vegetable from making any association with the games.

Any said vegetable using two of the following words in marketing material will be in breach of the law; Games; Two Thousand and Twelve; 2012; Twenty-Twelve. And if you say these words with another more incriminating one, such as ‘medal’ or ‘sponsor’, then you could be expressing a link with the Olympics.

Semantics and questionable criminality aside, the issue will be on how to police social media. The Beijing Olmpics had strict guidelines in place, but no way of monitoring or punishing social media lapses.

Twitter has already agreed to play ball, by banning an already identified list of hashtags which may infringe the rights of sponsors. But it will be interesting to see whether it will be possible for the Olympics to succeed where governments, corporations and panicky Facebook users have failed – to censor social media.

Internet privacy - are we building our own Pandora’s Box?

The resignation of ACC chief executive Ralph Stewart highlights another, more disturbing issue slowly creeping through society; the erosion of personal privacy.

The ACC caused uproar when it sent the personal details of thousands of claimants to other clients in its database. Even in our advanced technological age, human error is evidently still a factor in many breaches of privacy.

But when we willingly hand over all our personal details it is inevitable that they will eventually be leaked or fall into the wrong hands.

According to Hackers Anonymous, there is not a computer system in the world that cannot be hacked.

No matter how tight our security measures, there will always be someone who can break them. This has led to the rise of the criminal hacker as paper money declines and spending is increasingly virtual, meaning the geeks really will inherit the earth.

The British government is proposing a new legislation which will allow it to capture and record all citizen’s personal phone calls, email destinations and website searches. While the outcry from human rights campaigners is understandable, it is perhaps the greater risk of leaks which is more concerning from a practical point of view.

Putting aside the issue of who has the right to hold so much information about a free people, aren’t we asking for trouble when we can’t even keep bank details out of the hands of hackers?

One in five New Zealanders sees no problem accessing social networking websites for personal use at work, according to a survey.

This means that theoretically one in five New Zealanders would be comfortable with their employers knowing what sites they access during work.

Considering this as a small scale experiment of the larger (and potentially global, because let’s face it, which government would not want the power to track its citizens’ every move) decision to track society’s technological footprint, how long would it be until someone leaked this list of websites to an external source?

The argument that innocent people need not fear their footprint being circulated is again, beside the point in this instance.

The issue here is how safe a Pandora’s box of information can possibly be when it is so valuable to hackers and people of a decidedly more criminal nature.

Budget 2012: Summary

The National government has just released its 2012 budget, which will see a number of reasonably minor yet important changes across several sectors.

Bill English’s fourth budget forecasts a surplus in the 2014 – 2015 year through a ‘zero’ budget for the upcoming years. This is briefly summarised in the following paragraphs.

National has announced the tightening of tax rules in an attempt to target those who ‘should’ be paying tax, while the rules around Kiwisaver have also changed. The SOE sales have been defended with the creation a Future Investment Fund, which will hold the sales profits for future investment into infrastructure.

Over the next four years, the economy is projected to grow about 3% and, thus, create more jobs.

Meanwhile, the government is increasing investment into science and technological innovation, as a means to address New Zealand’s key issues and save money in the future. Millions of dollars of National’s budget has been allocated to create the Advanced Technology institute to aid in achieving this purpose. The government is also acknowledging the importance of quality telecommunications for a geographically isolated country like New Zealand, and is maintaining its investments into this sector.

The Health sector was a big focus for the 2012 budget with just under $90million of the budget allocated to it to contribute to: hospital development, District Health Board budgets, targeted cancer treatment, reheumatic fever reduction and enhanced maternity care, public health screening, disability services and other health services. The allocated money will be supplemented by increased tobacco tax and prescription charges, which will rise from $3 to $5.

In transport, the final phase of KiwiRail’s turnaround plan has been allocated $250million of the budget, with investment also being made into improving state highways and local roading. Note that little is mentioned around the many aspects of New Zealand’s public transport system.

In the justice system, a new Justice Sector fund is being created to better allocate money within the sector. The government is also continuing to commit to reducing crime, with the ongoing roll out of the Prevention First and Policing Excellence programmes.

Finally, the government is also looking to invest in upgrading the national electricity grid.

The Highlights

Economy

•    The tax deductibility rules for mixed-use assets ($109 million over four years) and livestock valuation rules ($184 million over four years) will be tightened
•      Three tax credits that are generally no longer used for their original purpose ($117.1 million over four years) will be removed
•     New disclosure rules have been created around Kiwisaver, as well as the level of private contributions from 1 April 2013 being raised and the amount the Government is borrowing to subsidise the scheme being reduced
•    The expected profits from minority share sales of SOEs, expected to be $5-$7billion, will be channelled into a newly created Future Investments Fund. This fund will invest in modern schools and hospitals, innovation, and transport.
•    Economic growth is expected to average about 3 per cent a year over the next four years, with 154,000 net new jobs being created; an extra 40,000 jobs a year

Technology

•         The annual spending on science and innovation will increase by $385 million over the next four years, taking total science and innovation spending across government to more than $1.3 billion by 2015/16, largely split as follows:

§  $76.1million has been allocated to the creation of the Advanced Technology Institute

§  $60 million extra has been allocated for National Science Challenges

§  $100 million extra has been allocated to increase the Performance-Based Research Fund

§  $33.8 million will be used to fit out schools for ultra-fast broadband and an extra $300 million channelled into the Rural Broadband Initiative

§  $59 million to boost funding for science and engineering courses. Funding rates for  engineering degrees will be increased by 8.8 per cent and for science degrees by 2%

Health

•     $88.1million has been allocated to the health sector, most of which will be invested into hospital development
•   Prescription charges will increase from $3 to $5. Note, no family will pay more than $40 extra in a year as a result of these changes and there will still be no charge for under-sixes or those with a Pharmaceutical Subsidy Card
• Tobacco excise tax will increase by 10 per cent a year on 1 January in each of the next four years as part of a wider Government programme to prevent smoking
•   These three sources will fund:

§  An extra $1.11billion allocated to District Health Board budgets over the next four years

§  A ‘continued’ commitment to Frontline health services

§  $32.4 million for better, faster cancer treatment, including dedicated cancer nurses to support patients through the course of their treatment

§  $16 million to speed up diagnostic tests for patients

§  $48 million for more and faster elective surgery

§  $20.5 million to strengthen maternity services and boost PlunketLine and WellChild services.

§  $132.7 million to improve services and access for people with disabilities

§  $1.68 million for more public health screening

§  Residential care exemption will adjust from a flat increase of $10,000 a year to an annual inflation adjustment in line with other aged-care support adjustments

§  Provide $12 million to reduce rheumatic fever

§  Invest $133 million in disability support services

Transport

• $250 million has been allocated to the third and final phase of KiwiRail’s Turnaround Plan, which over the past two years has refurbished the locomotive fleet, renewed and upgraded the rail network to improve transit times, remove capacity constraints, and improve reliability and created the Aratere Cook Strait ferry extension – creating 30% more capacity for rail and trucks, and improving passenger facilities
• Around $12 billion has been allocated to improving state highways over the next 10 years
•  Investing more than $500 million a year in improving and maintaining local roads, and completing the $2.1 billion upgrade of the metro rail systems in Auckland and Wellington
• An additional $3.7 million will be spent for the 2012/13 financial year on operating the SuperGold Card off-peak public transport scheme bringing total government operating funding of the scheme to $21.7 million for the 2012/13 financial year

Justice

• A new Justice Sector Fund will give the justice sector flexibility to invest in areas that deliver better results for New Zealanders. The fund allows money saved in one justice sector agency to be used in another
• The Prevention First and Policing Excellence programmes continue to be rolled out and will help Police remain on course to reach their existing target of a 13% reduction in crime by 2014/15

Energy

• Through Transpower, the Government is investing $4.6 billion in upgrading the national electricity grid over the next 10 years

Just how all-encompassing could Facebook become?

It’s time to make a confession - all of us have done it – we quite like turning off our mobile phones.

Despite the flurry of recent stats claiming people feel physical pain if they cannot access their emails/ Twitter/Facebook accounts, many of us like being incommunicado. No more waiting for that ping which announces a new email and makes everyone around simultaneously wince and reach for their Smartphones.

Which of us doesn’t like being unreachable from time-to-time? But this is rapidly becoming a social taboo. It is now unacceptable to refuse to be a part of our huge and (definitely not brave, judging by the trolls) new world – the online community.

How far will this take us and most importantly, have we really thought about what this ‘brave new world’ will look like?

Facebook has been open about its long-term plan to take over the online world. Zuckerberg is aiming to turn Facebook into an omnipresent platform which influences what we buy, who we listen to and how we interact.

By picking up the breadcrumbs collected from the activities, links and likes that we all generate, Facebook should be able to predict what we're most likely to engage with, be it books or the latest diet.

But at what stage does this turn us into automatons or puppets? And how do we know who is pulling the strings?

At this stage, we know that advertisers have failed to buy into the idea that Facebook could be a channel for successfully advertising products in any traditional way, following the disappointing performance of the recently launched Facebook shares.

Whether this is a genuine scepticism of how effective Facebook is as an advertising vehicle, or simply a smear campaign, the trend is still clear – advertising is not the best commercial use of social media.

The ultimate question is what to do with all that extremely valuable data and how to regulate one entity? The answer isn’t clear yet, but to take a guess, we would say that Facebook will establish itself as a mainframe to host partner services run by companies which have an interest in collecting data based on the behaviour of their customers. For example, partners such as Spotify, LinkedIn and Pinterest, will operate within Facebook where they offer a great service at a price – the price being data collection and distribution to third parties.

These partners will ensure that every aspect of our social and commercial life can be found on Facebook, meaning it will be difficult to opt out in order to fully function in modern society. We will no longer be able to make a decision, visit a place or apply for a job without being watched, monitored and tagged by a huge network of companies. This consumer behaviour will be used as the basis to decide all future commercial and non-commercial ventures.

It’s therefore up to us to decide whether this gives the general public the ultimate power, or ultimately become enslaved within an online world of our own making.

A more long term - and worrying - development, is the planned expansion of Facebook currency. This is currently worth 15% of Facebook revenue and is a method of payment to for example, play Facebook games. But online evolution could see this extend to the official currency of the internet, which is a significant power for any individual country - let alone a company.

The evolution of PR

The roots of traditional media are heavily based in print, but over the past six months the fortunes of two major players in Australasia’s newspaper industry have taken a turn for the worse. Both APN News & Media and Fairfax media have announced restructuring to accommodate a digital focused future.

Fairfax media, publisher of Stuff, Sunday Star Times and a raft of regional papers, announced a forty-one percent drop in first half profit and has already reduced staff by four percent. APN, publisher of the NZ Herald, posted a A$45.1 million annual net loss.

The declining profit of these key players could spell disaster for the newsroom. As jobs are cut there are fewer experienced journalists, leaving more work for those junior staff that remain yet ironically with less ability to go out and find stories. Journalists now need to have multi-disciplinary skills, having to both direct and edit stories.

As the shift is made towards online and away from the print medium, the role of PR must also be evaluated and extended. This is perhaps the beginning of profound changes to the PR industry, and practitioners will need to work hard to make sure they are up for the challenge.

PR must now evolve to meet these new demands. It is necessary for us to stay at the forefront of trends and maintain the strongest media relationships possible. We must also utilise social media and online communication in the most conceivable way. Social media allows direct access to the wider world, so as print becomes less relevant we can still maintain a close relationship with other important audiences.

Both consultancies and in-house communications teams need to adjust and adapt to the new social media environment. It is unrealistic to expect just one senior person to be able to deal with the complexity and pace of issues that are possible online. There needs to be a devolving of power so that a number of people have the autonomy to remedy the problems presented in online channels in a timely and efficient manner.

The fate of Fairfax and APN print publications are an example of a worldwide phenomenon. As developments in the digital age provide constant challenges, PR practitioners must be dynamic, flexible and ready for anything.

Three ingredients to a great barbeque pitch for a successful social occasion

“ So, what do you do?”

A question you must have been faced with several times over the festive season. A standard conversation started and the opportunity to socially prove yourself – or face standing alone in a corner for the majority of the night. As the summer season draws to a close, it is time to start reflecting back on the social events you attended. The strategic approach to introducing yourself – what might otherwise be known as the ‘elevator pitch’ - allowed you to grab a chance to self market. So how did you do?

The ‘elevator pitch’ is a well known yet underutilised tool in the business world. It’s that 1 minute time slot you would get on a chance meeting in an elevator or on the street to make the best impression and hopefully further your prospective business opportunities. However, people often underestimate the benefits of approaching personal networking in the same way.

A typical Kiwi summer will feature a string of social occasions centring around the outdoors and the classic ‘barbie’. Therefore your ‘elevator pitch’ quickly becomes your ‘barbeque pitch’. If you feel as though you bumbled your way through the social occasions, making adequate small talk but not quite allowing yourself to shine, perhaps it is time to start practicing your ‘barbeque pitch’ now in time for the next round of networking opportunities.

Business connections made through informal networks often prove to be more effective than those made through other means. This is because your contact serves as a kind of character reference, an endorsement which makes the meeting more likely to happen, more relaxed and more likely to result in the development of trust.

Here are three ingredients to a great pitch:

1. Introduce yourself in terms of your audience. A person’s frame of reference is set in their own experiences and you are only interesting in the way you affect their world. At a social occasion your audience isn’t necessarily familiar with your field of work so don’t lose yourself in endless jargon.

2. Tell better work stories. Think of a short, sharp story that illustrates what you do, why you do it or what makes it oh so ‘cool’. The key word here is ‘short’. People don’t have endless attention spans. There’s no harm in dropping in the conversation that you were sent to a foreign country on a business trip, but don’t continue on about your day-to-day itinerary.

3. Now, stop talking about you and talk about them. A good conversation involves two people and people want to know that you are interested in them as much as they are interested in you. Ask them a question to get them talking; “So, you’re in real estate, you must see some interesting houses?”

Finally, make sure that barbeque pitch has a little thought behind it. A person is never let down by their ability to make a good first impression and each practice round brings you a little closer to perfection. It’s a small world – you never know when your neighbour’s cousin will become your work colleague, therefore it’s best to always present yourself in the best light possible.

Election lesson no 1 - don’t hide inside a digital bubble

The election has taught MPs a lesson in common sense about effective communication.

From the endlessly amusing ‘scandal of the teapot conversation’, to nationwide billboard tampering in the name of tradition, this election was a fascinating study in communication.

As is customary, many MPs across the country were ousted from their seats amidst a debate about their lack of insight into the voter mindset and ability to communicate their own policies.

But for the first time, candidates were competing in an online election. They had a glut of communication channels to choose from to reach voters, such as vlogs, blogs, Twitter, Facebook, microsites – if Machiavelli were alive, you can bet he would have signed up to each and every one of them.

In recent years, these technological leaps have allowed many public figures to communicate more effectively and reach a wider audience than before. An example is John Key’s video blog, which is regularly updated and addresses relevant issues.
Unfortunately, the flip side of this revolution is that it has also allowed many candidates to remain behind a glass wall of social media, carefully created and monitored by marketeers.

Ironically, although digital media was invented to increase communication between people across the globe, it is in reality another way of presenting a constructed digital image of a person or business; which the public can see through.

In the case of the recent election, add this digital image to the polished TV appearances, and voters have a right to feel they never see the real person behind the public figure.

Consequently, in an age when digital communications are fashionably considered the most important tool to reach the general public, we are in danger of further alienating audiences by forgetting that communication is always a two way process.

And sometimes, simply having a good old face-to-face chat is the most effective way to get to know your audience. But more importantly, it’s an opportunity for them to know you.

The traditional promotional mix has always been defined by five core activities; advertising; direct marketing; sales promotion; publicity; and most importantly in this case, personal selling.

Putting a person in front of a brand is a simple yet crucial rule, which is in danger of being forgotten by candidates keen to try out the latest online technique.

The most obvious example of the importance of personifying a brand is Labour’s decision to omit Phil Goff from billboards. The Labour Party argued that this was to focus on the policies, not the person, but it instilled a sense of unease in the general public and ultimately contributed to Labour’s defeat.

Another example, is National cabinet minister Paula Bennett, who recently won a recount after losing her Waitakere seat by only 11 votes to Labour's Carmel Sepuloni.
Although Bennett won the recount, it was a close call and she has to ask herself why she nearly lost the seat in the first place.

It could be argued that Sepuloni was more active in engaging with her constituents by carrying out a campaign of aggressively door-stepping them, allowing residents an opportunity to discuss her policies.

The Labour MP reportedly door-stepped her constituents at their home, visited the malls where they shopped and the supermarkets where they bought their food - basically spending hours speaking to potential voters to find out what they wanted and what was important in their lives.

Sepuloni later claimed that voters were tired of struggling to buy the bare necessities and were against Bennett’s apparent ‘beneficiary bashing’, perceiving her as having a hardline stance on welfare.

It’s debatable whether Sepuloni would have been aware of this feedback unless she had spoken to the constituents themselves.

This gave Sepuloni the opportunity to actively engage with the general public, by listening and then telling them how she would address their concerns.

This highlights the danger of relying on either a digital or an old-school campaign. To be successful in an online election, it is important to implement a fully integrated marketing campaign. There is a place for old school tactics where the general public can see the whites of candidates’ eyes, while remembering to reach out to the online community as well.

Sir Paul Callaghan's speech at the TIN100 Launch Event on 31 October

I’m delighted to be able to speak to you tonight at the launch of the 2011 TIN100 report. I first got involved in technology at age 11 when I built a crystal radio, using a diode, a coil and a tuning capacitor along with an aerial strung across the garden. It made a change from rugby, a sport at which I was particularly dreadful.

So I get 6 layer printed circuit boards but I accept that they are alienating to some and terrifying to others.

That brings me to how New Zealand views the way we make a living. We have a sustainable competitive advantage in food and fibre. We are blessed with strong primary industries, but these have limits to growth. Furthermore, when it comes to innovation, there are few incentives to innovate when you can sell commodities. Companies like Gallaghers or Fisher and Paykel Healthcare or my own company Magritek, either innovate or die.

And innovation is the key driver of productivity and economic growth in advanced economies.

New Zealand has the fundamentals in place. Painful reforms were carried out in the 1980s and 90s. Now we are ranked among the highest countries in the world for property rights, market freedom, free trade, lack of corruption and legal and political rights. And our taxation rate, personal and business, is one of the lowest in the OECD. Only Chile and Mexico are lower. Indeed we clearly beat Australia in all these measures. So when the 2025 task force says that the key to matching Australia’s per capita GDP is to further lower taxation and reduce regulation and constraints to free markets, they are clearly not referring to planet Earth where we already excel by their yardstick. What planet they are referring to I am not quite sure.

My view is that it is right to set a goal to improve per capita GDP to the level of Australia. Prosperity does matter, and the impact of the Christchurch rebuilding on our economy makes that abundantly clear. To achieve that goal we are looking at another $40 billion per annum GDP growth, preferably in exports. What is happening in New Zealand is that there is an underlying part of our export economy that is growing much faster than the total, and that part is the knowledge sector.

TIN100 growth rate, over the past 7 years since the list was compiled, is around 5% per annum. And the higher up the value chain one goes, the higher the growth rate. In the World Bank survey of high tech products, a subset of TIN100, the rate is 10% per annum.

However, the question that must exercise us is why will such businesses stay in New Zealand? It will not be because of proximity to markets, greater availability of skilled employees or deeper investment sources. It can only be because the principals of those companies, and especially their creative people, choose to live in New Zealand. For that reason our policy framework must be geared to ensuring that New Zealand is a place where talent wants to live. For that reason we protect our natural assets, our national parks, our coasts, lakes and rivers. And because creative people don’t like living in gated communities with poverty and crime on their doorstep, we need to address issues of wealth inequity and social justice. We need to look to the quality of our schools and our health system.

So my recipe for growing prosperity is to expand the TIN100 companies. Currently they export $5 billion, half of dairy. Ten times as many and we have achieved our goal. Even if we do nothing, their current growth rate suggests we may achieve our goal in a couple of decades. But we want to accelerate that. And to do that, we as a nation have to change our thinking, to realise that we can live by being smart, that to grow our economy we have to stop looking to our traditional land resources, and start to think like a Singapore or a Switzerland. Growth from here on requires that we innovate.

And nothing has quite so changed our perceptions as TIN100. Greg Shanahan has done an enormous service to New Zealand. Who else measures this? Certainly not Statistics New Zealand. TIN100 tells us how big this sector is. It tells us what we are good at-physical platform technologies, ICT, software, creative businesses like Weta, and a small component of biotech as well.

We will be good at what we are good at, and TIN100 tells us that some of what we are good at is quite surprising. I am not against cleantech, biotech, or any other fashionable area that a politician thinks we should be good at. So long as it is legal and not morally objectionable, I don’t care what it is. But what I am really interested in is where we are the world’s best and where we are profitable.

The other interesting thing we learn from TIN100 is the nature of the innovation system. When we plot numbers of companies against their export value on a log-log graph we find a straight line, a power law in other words. That’s the same power law shown by earthquakes or tree diameters in a forest. In other words our system is complex, interconnected and self-organised. What that means that you can’t have the big companies without the little ones. And to grow a company ten times larger than our largest, you probably need to grow the total number of companies by a factor of ten as well. These are powerful insights.

Let me say now why I think New Zealand has a great future. We have natural advantages in the world with abundant fresh water, renewable energy and robustness to climate change; we have extraordinarily beautiful natural environments, an excellent education system and a civil society. Once we get our on model of our country right, once we project who we are to the world as a smart innovative economy, we are an obvious place for talent to reside, attracting the best of our diaspora home, attracting the best migrants to want to live here. And most importantly we can motivate our most underutilised potential, our kids who know nothing of what is happening in the TIN00 story.

I want to finish with two requests to you all.

First, embrace the paradox. Because New Zealand is 0.2% of the world's economy, that economy is 500 times larger. That means we can succeed in the niche markets of the world, growing businesses that are substantial in the New Zealand context. We have to think like Singapore, not as we have done for 150 years, as a country that can live off its natural resources. And the further a business is from the primary sector, the more the drive to innovate.

Second, tell the story. Many of you are invisible because your markets are almost entirely abroad and what you do, in your niche areas of business, is often mysterious to the public. But your kids are growing up here. Be visible in New Zealand; work with local schools and the parents of the kids to tell them about the opportunities that businesses like yours present. Sponsor locally, even if your markets are abroad.

We have grown a $7 billion a year innovation sector with $5 billion per annum of exports without most New Zealanders even being aware that this is what we can do. Imagine what will happen when all New Zealanders discover what we really are good at. Then we will have bridged the prosperity gap and New Zealand really will be a place where talent wants to live.

The Trust Factor

“The way to gain a good reputation is to endeavour to be what you desire to appear” – Socrates 469-399 BC.

2,500 years later Socrates still speaks the truth about the importance of practicing what you preach.

A good, sound reputation has multiple layers, but there are two key factors without which a good reputation cannot be; trust and good practice.

Trust and good practice have been familiar since primary school; nobody still believes the smart kid is smart after he is caught cheating on his spelling test and that remains true throughout life.

However, the consequences of cheating in later life have harsher consequences.

And while it is familiar, one extreme example that has preoccupied our news headlines in the past month suggests not everyone takes notice. That story has a moral which will be well reinforced by a reminder about how trust eventually breaks down due to bad practice – and the previously held reputation will never be regained.

This particular story started in May, when a court order was granted to allow investigation into allegations of phone hacking.

Then Sienna Miller was awarded $100,000 in reparation for having her private phone line illegally tapped by News of the World staff.

Illegal activity is never good practice.

But it gets worse. Shortly after it was revealed that News of the World also tapped into the voicemail box of a murdered girl and then began deleting her messages to create space for more, giving false hope to a family about their daughter being alive.

This revelation sparked a huge investigation into News of the World’s staff and practices. News of the World was closed down. People were arrested, including former CEO Rebekah Brooks. Statements were given and retracted. Rupert Murdoch had a foam pie launched at his face. Investigations are ongoing and the situation is not getting any prettier.

In fact, the situation is far past the point of being able to be rectified. Other publications run by Rupert Murdoch, such as the Daily and the Sunday Mirror, are feeling the sting of a lack of trust and have to prove that they are tightening their practices. News of the World will not be reopened. It could not even give money to charity in its final two issues; the charities approached turned down the money.

Not every breach of good practice is punished by a court trial. Nor is interfering in the case of a missing person forgivable even where a company has countless credits in their bank of credibility.

But what is illustrated is the way that extremely poor practice is like pressing the self destruct button.

Poor practice is a major cause of reputation ruin because today people become emotionally invested in the companies they choose to support.

It is rarely the case that the deciding factor of applying for a job is because it’s the only position of its kind. Nor that you fill the car at the closest petrol station. There is so much choice that those few extra cents or few extra miles are no longer enough as a point of difference. This is where the power of a good reputation can be seen.

So as Socrates said millennia ago, a good reputation can no longer be based on a projected image. It has to be backed by good practice.

Because a reputation is like a vase. It is able to be glued back together, but that just makes it all the more easily broken again.

Managing Customer Communications after a Natural Disaster

The Christchurch community has been in disarray following the recent earthquakes, with many grieving and some homeless. On top of community values, the lines of communication between companies and their customers are now more important than ever.

Customers grow to trust companies that offer relevant and timely information over sustained periods of time, backing up their words with action. It is the trusted, familiar companies that are relied upon after natural disasters - aftermaths are not appropriate times for commencing new relationships with stakeholders.

There's more than one list of crisis management commandments, but many are just expanded or situation specific versions of the five 'C's Model, where message strength is judged by how well it demonstrates concern, clarity, control, confidence, and competence.

Customers need to feel that a company is genuinely concerned for them and the message needs to be communicated simply and clearly – it is unlikely that a customer has time to decode complex information. It's about thinking how the customer will receive the message and what impression they will get from it. The medium needs to be accessible for the majority of people. For example, if the power is out, wired electronic media is not suitable. Lastly, companies need to have a clear idea of what is going on before making any statements. Nothing is to be gained from blame-placing or careless information-giving, nor is it reassuring if the customer perceives the company to have been completely unprepared. The information needs to be controlled and substantial to ensure the company is confident in its distribution.

The Department of Labour used this model to effectively manage customer communication following the Christchurch earthquakes and won an award for using newer technology and the available infrastructure by sending personalised texts and emails to customers with relevant advice and information. This effectively demonstrated concern in an easy to understand manner through an appropriate battery powered medium.

B&D Doors is another example of a company exercising customer communication and the five ‘C’s model. Garage door manufacturer B&D Doors’ Christchurch factory was damaged during the February earthquakes. Production was suspended during the week-long clean up, and during this time the company communicated frequently with its customers and employees. A Facebook page was created for employees to share the latest developments and for messages of support to be posted from friends and family members, as well as B&D’s Auckland-based employees to stay in touch with their Southern colleagues.

Even though B&D’s computer systems were down, daily email updates and pdf newsletters were sent to key customers advising of progress made and key milestones such as the recommencement of manufacturing and deliveries. Keeping key stakeholders updated was important, as they in turn had customers whose expectations needed to be met. The frequency and content of the communication gave important stakeholders the confidence that B&D was doing everything it could to restore operations as soon as possible. This was especially important as marketplace rumours about the damage to B&D’s Christchurch operation were grossly exaggerated. Feedback of B&D’s transparent and informative approach to customer communication has since been positive.

Where information is lacking and speculation left unchecked, the stakeholders do not get an accurate view of the situation and trust in a company weakens. Natural disasters call organisations to reach out to their stakeholders – their customers, employees and suppliers.

Keep on talking. Have a disaster communication plan ready. It is hard to adhere to the 5 ‘C’s model if caught completely unaware. After all, what good would a company be if it left you in the dark when you needed it most?

JML Welcomes ...

Eloise Gibson to the team. She’s blonde, she’s sassy and she means business! Eloise has previously worked as an environment and science reporter at the NZ Herald as well as an environmental and planning lawyer in NZ and London. Her favourite thing about JML so far (apart from the sunny stroll to work from her Symonds St apartment) is meeting JML’s different clients and learning how she can share and support their plans and activities. Eloise will be working with a range of JML clients across energy, technology and corporate services. Check out her mention in this week’s National Business Review: http://bit.ly/fHH57N.

Can journalism survive the digital revolution?

Almost 2,000 communication professionals from 46 European countries predict that press and media relations will develop predominantly into online media by 2013.

Already over one million people own an iPad and messages can be sent around the world in a matter of seconds. Inevitably predictions show that traditional press will become redundant as fast-moving messages and news can be sent across the interweb cheaply and instantly.

Paid newspapers are being taken over by their free online editions and journalists are bearing the brunt of change. The Pew Project for Excellence in Journalism, states that in America, 2,400 full-time professional newsroom jobs disappeared in 2007, and 5,900 more were lost in 2008.

Since the rise of the internet over 50 million blogs have appeared, documenting news, events and opinions. The majority of these blogs are written by everyday people rather than by paid journalists, many publishing news before it even makes its way to the newsroom.

So will quality journalism be taken over by the everyday joe blogger in this internet age?

Maybe not. Media tycoon, Rupert Murdoch in a recent interview stated “We are moving from newspapers to news brands.” While he acknowledged newspaper subscriptions were decreasing and online editions growing, he suggested the public would be more drawn to trustworthy news brands that would deliver quality information from trained journalists.

Last week, Murdoch ‘wowed’ the world with the launch of a digital ipad-only newspaper - ‘The Daily’. Subscribers pay an annual fee to receive an online newspaper that claims superiority over other free editions.

He claimed the digital newspaper would be able to pay for itself and gain revenue even though it sported the best journalists, merely by saving money on printing and distribution costs.


On top of that, symbiosis is becoming apparent between journalists and the web. Twitter is becoming an effective research tool for new stories. When Heathrow Airport cancelled its flights over Christmas, New Zealand journalists were able to find and interview stranded New Zealanders who tweeted about their situation.

Journalists commonly use facebook and twitter to publicise their stories seconds after they are published. Twitter especially has become a competitive port for the latest news and information where links to not only stories, but videos and news discussions can be opened.

So which is it? Will journalists be swallowed up in the internet age or adapt and thrive in new conditions?

Watch this space.

Baby Steps: From Copenhagen to Cancun

Compared to the media frenzy at Copenhagen in 2009, coverage of the Cancun climate negotiations last year was relatively low-key.

In fact the UK’s Guardian newspaper estimated that in the months around the conference the big US media (the New York Times, USA Today, the Wall Street Journal, the Washington Post, ABC, CBS, Fox, MSNBC and NBC ) ran fewer than 200 stories tackling climate change, fewer than the Guardian alone.

But is that a bad thing?

While Copenhagen collapsed under the weight of impossibly high standards, Cancun kicked off with very low expectations.

The negotiations seemed to fare better without the full glare of the world’s media, visits by high-ranking world leaders and do-or-die political rhetoric – all the things that were supposed to help Copenhagen succeed.

This time, with comparatively little fanfare, negotiators made some small but helpful steps.

To start with, the UN’s REDD programme, which helps rich and poor countries team up to save tropical forests, officially became part of negotiations. Countries such as Brazil, Congo and Indonesia will be able to receive aid for not burning or logging forests – a major contributor to carbon emissions.

Countries also worked on furthering a promise made at Copenhagen to create a climate fund to help poor countries cope with climate effects - although the details remain very sketchy.

Perhaps most significantly, tentative progress was made towards allowing countries to keep tabs on each others’ emissions cuts – the subject of a sub-negotiations facilitated by New Zealand’s Climate Change Negotiations Minister Tim Groser.

For the first time, China has agreed to submit its emissions savings to international scrutiny – a must-have for the United States, and a source of tension between the two big polluters (although again there is no detail on how this will happen).

Having been conditioned to expect a shambles, politicians and environmental groups proclaimed Cancun a modest success. It gave new life to the UN process, which was in danger of losing all credibility.

The hard issues have not gone away - country pledges are well below what scientists say is needed, and negotiators will find it hard to keeping deferring legally binding pledges much longer. Kyoto expires at the end of 2012, and as yet there is nothing to replace it. The longer an agreement takes, the more steeply emissions will need to fall.

In the meantime, there is plenty of space for companies to take action.
With political negotiations moving at snails’-pace, some of the world’s biggest companies (Kraft, Unilever) have staked out sustainability strategies in preparation for a greener world economy.

The fourth State of Green Business Report – an annual pulse-checking exercise by Greenbiz.com – concluded that a “sea change” was happening in business sustainability, albeit a very slow one.

The report found that out of 20 “green business” measures, green buildings, water efficiency and investment in green product development had progressed well in the United States last year. Companies did less well when it came to collecting e-waste, encouraging telecommuting and reducing the intensity of greenhouse gas emissions per dollar earned.

The report is worth a look if you are interested in what companies in the world’s biggest economy are doing – and what your company could do better.
You can download a free copy at www.greenbiz.com/blog/2011/02/01/state-green-business-2011

Social Media: How to manage your online presence

Social media has transformed the public relations world, demanding new skills and creating new opportunities. Social media not only provides a platform for a more personal and direct relationship between brand and audience, but also opens up the boundaries for external influence in products and services.

While it initially looks impressive for a company portfolio to sport a blog, Twitter account and Facebook page, an organisation must ensure social media is used to enhance reputation rather than undermine it.

Diving into social media without any plans or guidelines can be risky for a major corporate. Many organisations are guilty of setting up grandiose social media sites then leaving them static and ignored - allowing abuse and misuse from the active online audience. Others see no value in the influence of social media users and miss out on resolving conflict while still in its early stages. As a result, social media has become a place for consumers to express their opinions and gather wide interest and support in their endeavours – especially against large corporations.

BP learnt the power of social media during its oil spill in the Gulf of Mexico earlier this year. On Facebook alone, over 16.5 million people publicly declared that they were either angry or they were going to boycott the corporation.
So too did Nestlé. when Greenpeace UK launched a social media protest about the use of palm oil in its Kit Kat chocolate bars, leading to the brand promising to use only certified sustainable palm oil by 2015.

Both situations saw large and previously considered indestructible organisations feel major effects due to the power of people being able to gang up online.
Social media can also be effectively used to great effect to increase the reputation and popularity of an organisation.

Auckland’s Giapo is testament to the positive use of social media. Since first becoming active online in January 2009, the ice cream store has almost 13,000 friends on Facebook and 4,000 on Twitter. The store encourages its customers to become active online by incorporating public suggestions into new ice cream flavours and instantly replying when customers talk online about their experiences at the store. Giapo displays large screens broadcasting their live Facebook, Twitter and blog pages inside their store and offers customers free wireless internet so they can write and see their own comments at the store.

Social media is an effective way to establish a two-way conversation and friendship between organisation and audience. While it is frequently misused, social media can strengthen relationships and loyalties in ways that would be impossible otherwise.
Organisations that use social media must establish a regularly monitored page with a solid network of followers so in times of crisis, the organisation can speak directly with their audience and solve the issue.

So how will your company make the most of social media?

For more on the topic check out this essay from Malcolm Gladwell of The New Yorker:
http://www.newyorker.com/reporting/2010/10/04/101004fa_fact_gladwell

Measuring PR

Effective public relations practitioners are able to demonstrate their achievements in a language their clients understand. There are several methods of measuring effectiveness. Similar to a trip to your favourite restaurant, the ‘menu of measurement’ is vast, and public relations practitioners must select the method of measurement most relevant to their clients’ communication objectives.

First up on the menu is Advertising Value Equivalent (AVE). This technique measures PR by the amount of media space generated. The physical size of the news piece multiplies the advertising rate card while reflecting the credibility of the particular news source. The resulting dollar value is the AVE.

While clients can appreciate the taste of AVE, it is falling out of favour. In fact, PRINZ’s Paul Dryden has said “AVE [is] flawed and damaging to public relations’ drive to professionalism and probably even unethical because it is so misleading in presenting an indicator of success to the organisation or client.”

The next choice uses goals or SMART objectives that are specific, measurable, achievable, realistic and timely. In order to measure the success of a campaign, all one needs to do is evaluate the results against the campaign’s initial goals such as the quantity and quality of the media coverage.

While SMART objectives appear simple and practical solutions, the reality is, they too fall short. The media is made of a complex range of stories. A story must be weighted depending on characteristics such as tone, key messages, accuracy, comprehension; action generated and source credibility to really measure its success.

For example, often the objective of public relations is to not generate media coverage, so if an unreliable source published the story, would it be seen as objective failure? Also, could the coverage still be counted as meeting the measured objective if it was written in a negative tone?

Next up is the chef’s special: PRINZ has developed six golden rules for media and PR measurement. These recognise that unlike AVE, the quality of information is much more valuable than its quantity. PRINZ suggest PR is to be measured by its outputs, out-takes and outcomes. In other words, menu option three is the combination of AVE, a measure of target reach or audience awareness and the actual behavioural, attitude and perceptive changes resulting from the campaign.

On top of this, PRINZ’s Catherine Arrow states that this process has become a lot more complex with the growth of social media and online tracking, opening up a whole new world for publishing and collecting PR information.

In a perfect world effective PR measurement would evaluate results by comparing pre-campaign and post-campaign research results. Realistically however many organisations simply don’t have the budget for this research and post analysis and would rather invest in more PR activity.

Overall, while PR influences many people, it takes effort and time to measure its results. Simply appearing in the news media is no longer the only way to convey an organisation’s messages to its publics. Further research is needed to measure not just the initial coverage but also the behavioural changes, relationships built and audience perception and attention.

If that is what you wish to order.