Starbucks (and Apple) don’t differentiate between advertising, public relations

People know Starbucks. They recognize the logo, the brand and the name. However, unlike other conglomerates, you will rarely see a Starbucks commercial or billboard. Even with revenues of $10.7 billion in 2010 and 16,850 shops in 40 countries, the massive corporation rarely advertises and occasionally combines its public relations and advertising campaigns when it need to restore its image. Without promotional material, you wonder how the company garners as much revenue as it does.

Starbucks doesn’t rely on traditional advertising.
CEO Howard Schultz has claimed that traditional advertising cannot capture the “heart and soul” of the Starbucks culture. Instead of aggressively advertising on mainstream media with standard commercials, the company has used product placement in several blockbusters to increase recognition of its brand. When Starbucks does advertise, they tend to use billboards or mobile platforms to reach their audiences, such as targeted Web advertisements and their mobile app. Generally, their advertising is not specific and is not the main source of image safeguarding the company uses.

Public relations does it all for Starbucks.
However, after the 2008 economic crisis, Starbucks had the slowest two years of growth in its history. To counter these effects, the company hired Edelman to increase its brand recognition and public image for its fortieth anniversary. Edelman brainstormed a strategic campaign which Starbucks enacted, and the by the third quarter of 2011 the company had record earnings, operating income and earnings per share. The campaign catered to customers, consumers and stakeholders alike, so although the company termed it a ‘public relations campaign,’ it had the elements of both public relations and advertising.

Starbucks doesn’t generally use traditional advertising techniques, but when the company encounters hard times, they tackle their public image by combining public relations and advertising into singular campaigns.

But Apple does it too!                                                         Apple has a similar business model. If you’re visiting New York City, you may see an Apple billboard or two. But you won’t ever see your TV screen plastered with Apple commercials.

At first glance, Starbucks and Apple may not have much in common-one is an innovative tech company, the other a beverage giant. But if you dig a little deeper, the two companies have products-maybe you consider them ‘designer’-that are priced well above the competition. And yet people keep forking over loads of extra cash for products they can obtain for far cheaper on the retail market.This is because the two corporations, unlike most today, rely on simple, old-fashioned hype to promote their products-and they do a darn good job, too.

Stay tuned for details on Starbucks’ and Apple’s marketing models in my next post.

 

Social media’s two-way communication enables consumers to play pivotal role in corporate decisions

Social media has brought many changes to the public relations industry, but the most important leap has been the shift of communication methods with public relations professionals and their publics. Communication has become a conversation, instead of the speech, or linear method it used to be. Dr. Sahar Khamis, assistant professor of communication at the University of Maryland, describes the general trends social media have introduced to the public relations field. 

An essential requirement for PR professionals used to be building and maintaining relationships with journalists who would “push” their agendas to the public, but that requirement has weakened in importance as social media allows PR professionals to instantly reach their audiences.

Social media requires companies to give stakeholders a say in corporate decisions

Because PR is about building relationships with audiences, social media makes the core of good PR easier to do. According to Top Rank Blog,

Human connections made possible by listening and replying via social media bring the audience closer to a brand and softens the barrier that exists when people feel as if they’re talking to a company that views them strictly as a potential sale.

To foster better relationships, companies can connect with consumers who are seeking solutions to problems, and company representatives can help out. Because consumers can hop over to the company’s Facebook or Twitter page and post complaints or praise, it is essential for businesses to actively maintain and monitor their pages and reach out to their stakeholders. This trend helps companies increase brand and consumer loyalty. 

For example, many businesses have begun to involve their consumers in product development. As Communications Passionista describes, Lay’s Potato Chips launched an intensive campaign which asked the public to invent potato chip flavors. The winner would have the honor of his or her flavor launched and be awarded $1 million.

However, there is a flip side to social media: stakeholders also believe that increased interaction means they have more influence within a company, and monitoring and responding to complaints and conversation is essential to maintaining the company’s reputation. 

 

This infographic, based on research from Maritz and Evolve24, shows 83 percent of consumers were very satisfied or satisfied when companies responded to their tweets. This positive reaction emphasizes the importance of interacting with customers: companies have the opportunity to make consumers happy by simply addressing their comments. Southwest Airlines, for example, devotes a total of six employees to managing their social media and responding to customer complaints and concerns. Perhaps not coincidentally, Southwest was also rated highest in customer satisfaction in 2013.

Khamis describes how consumers play a role in corporate decisions via social media, and how corporations can be held accountable when they don’t consider their consumers.

Additionally, The Real Time Report states 88 percent of consumers are somewhat or far less likely to buy from a brand that has unanswered complaints on the company’s social media page.

Companies must remember to address their consumers on social media, because if customers aren’t happy with the company’s response, or lack thereof, they may take their business elsewhere.

Social media may render the standard press release obsolete 

Social media has also warranted the adaption of the press release, according to Mashable. Vistaprint PR manager Jeff Esposito believes the standard press release, invented in 1906 by Ivy Lee, will take three forms in the future:

  • Video with links to company site
  • Evolution of social media release
  • Stay the same, with standard boilerplate and stock information

The popular blog pr-squared agrees that news releases may become extinct. Because many Internet users head straight to social networks in lieu of search engines, social media present ample opportunities for company information to appear in searches, which in turn drives brand recognition. 

Michael Pranikoff, Global Director of Emerging Media for PR Newswire, a news release website, agrees with the importance of companies making their news releases and information searchable. He believes in the future of the news release, but that its traditional approach must be re-assessed. Because consumers today must be considered by companies, releases must be tailored to address these audiences. 

The release may take on some new forms and use new ways to communicate the message, but the idea of the release is far from dead.

Not all PR practitioners feel the same way. Khamis believes the standard press release will continue to exist, but will be supplemented with social media.

Whether social media will entirely replace traditional messaging platforms is up in the air, but social media’s effect on PR is undisputed. To summarize, new media has primarily influenced PR in:

  • Changing the field from one-way to two-way communication
  • Involving consumers in corporate decisions
  • Slowly evolving the news release

At its core, social media presents a new requirement for companies to involve their publics in corporate decisions whenever possible. Publics should also be considered in company decisions which don’t directly involve them, including press release platforms, relationships with PR professionals and crafting strategic media messages.