Click here for the press release.

Spirit Airlines is aiming to charge some of the lowest ticket prices.  I have found them to be consistently low priced compared to other airlines for comparable routes.  The problem is that instead of keeping everyone focused on leadership low ticket prices, they are quickly gaining a reputation for leadership in fees.  The exact opposite.    My advice, don’t fight with a Senator Schumer type complaint directly, but fight the message by changing the conversation.

First, lay the groundwork – Make it clear via editorial (earned) media, social media and paid media that Spirit Airlines core mission is to get people from point A to point B for the cheapest ticket price possible by stripping away all extras.  If you want extras, that’s also an option and the ticket price is then comparable to other airlines (it is, I checked).

Second, change the conversation about fees into one about passengers only paying the part of the flight they use.  Why should I pay for someone else that wants to use more of the airlines space (overhead) and time (staff time for boarding is longer with more overhead luggage).  These aren’t fees for carry on baggage, this is higher ticket price for people that want to use more of the airplane’s (and, annoyingly, my) time and space. 

Third, counterattack and challenge the critics.  Use the above points to make it crystal clear that people trying to kill their model are really trying to kill the cheapest ticket prices.   Challenge the critics to show if they can deliver a business model with the same ticket prices, the same level of service and the same level of fairness in paying only for the airline resources you use.   Let the critics know if they can meet this challenge – complete with technical, financial and proof of maintaining good service (e.g., no annoying carry on baggage), you would happily sit down and see if you can implement their models.

And if this debate goes on, make the challenge more public.  Make the Web site message clear that you are the fairest airline by not only charging the lowest basic ticket price, but by charging for the space and time you use, not what other people use.  After all, what beats both cheap and fair.

McKinsey makes some key points about what companies need to do on the reputation side.

"As a result, responses to reputational issues can be short term, ad hoc, and defensive–a poor combination today given the intensity of public concern. And therein lies a problem that companies must solve quickly: even as reputational challenges boost the importance of good PR, companies will struggle if they rely on PR alone, with little insight into the root causes of or the facts behind their reputational problems."

But Paul Holmes picks up on the unsaid theme – that it’s a management consulting agency, not a PR agency, making these important points:

I wish I could push back more aggressively against this–the idea that public relations is about "spin" rather than "changing business operations and conducting two-way conversations" is particularly offensive–but the reality is that the authors seem to have formed a pretty accurate impression of how most corporate communications departments actually work.  (This is where I would ordinarily go into a rant about the inherent problem with naming public relations departments "corporate communications," which is that public relationships are defined not by communications, but by actions, but you’ve all heard it a hundred times before.)

Finally, he pulls another solid quote that outlines what the most effective PR counselors do (hint, communication is not at the top of the list, understanding audiences and recommending actions is).

The authors’ conclusion: "Companies should emphasize three priorities. First, they need to assemble enough facts–most important, perhaps, a rich understanding of key stakeholders, including consumers–and not only the product preferences but also the political attitudes of consumer groups. Second, companies should focus on the actions that matter most to stakeholders, something that may call for an exaggerated degree of transparency about corporate priorities or operations. Third, they must try to influence stakeholders through techniques that go beyond traditional PR approaches, with an emphasis on two-way dialogue."

To those public relations professionals that see themselves as lead reputation counselors – do your measurement reports analyze media relations and social media measurement or do they measure reputation?   If the former, then you are a media relations or social media (or both) professional.  if the latter, then you are a reputation counselor.  Do you measure it all?  Then you are probably a well informed senior corporate communications / public relations professional.

I raise this as I regularly hear public relations professionals talk about managing reputation but then have measurement reports that focus on media or social media measurement.   Measuring media has never been a substitute for measuring reputation.  It has always been a good measurement of the effectiveness of the media relations function, but that is but one function in a communications department (even if it is a central one). 

Lately, companies have tried to use social media to measure reputation as social media is heavily driven by user generated content, meaning it has the voice of the audience.  However, only a small segment of the popular is actively engaged in the conversation (see slide 20 of Accenture’s research which includes how many people are not regularly engaged in the social part of social media – click here).  As a result, if you rely on social media measurement to measure public attitude and reputation, you may be getting a skewed portion of the population and one that does not represent broader sentiment (see an example in this AdAge article on the Twitter outcry to a Motrin campaign here).

So what should those who see themselves as reputation managers do?  Look to measure sentiment wi th the broader audience.  Ideally, companies would regularly conduct surveys.  This can be cost prohibitive so, in that client situation, we look at solutions that at least give us a voice of the audience – small virtual focus groups, short surveys, analysis of search engine data and so on.  This does not replace other forms of measurement but we’ve found it is a good start in knowing, directly, what the reputation of a company is with our key audiences.

There were engineers in almost every country, and way too many product people. We had one product management person for every three engineers,We had a lot of people telling engineers what to do but nobody fucking doing anything. Excuse me. I knew that would slip out one of these times. (click here for the audio)

Her honest approach to communications (talking the way she talks, not the way someone trained her to talk) seems to simply reflect her approach to business – no one doubts her sincerity and seriousness because she’s honest to a f***ing fault about getting things done.  Here’s a good outline of her style at GigaOm.

I’m one of the (few? many?) public relations professionals cheering on this style of communications.  While it’s often not appropriate, it is how people (including executives) talk in the real world and that needs to always be kept in mind.   When an executive doesn’t use their natural language style but instead gets caught up in PR speak (yes, I said it), audiences detect and that affects the trust factor.  People are more likely to believe someone they can relate to and people easily related to people who talk like they do.  

So have I actually told an executive it’s OK to curse?  Actually, yes (ping me as I’d rather not call out that executive…but they took my advice and it f***ing worked).   While executives should stay on message, they should also communicate messages in their natural, honest style.  And if that f***ing means dropping a lot of f***cking f-bombs, then f***cking do it.  You’re more likely to be believed.  And from what I’ve seen, no one doubts that Carol is seriously focused on fixing broken things f***cking fast.

You can find more examples of Bartz’s “real world communications” style at Alley Insider here.  

In a recent earnings call with Wall Street analysts, Mr. Bass was reporting a lousy last quarter for the last year and a murky, at best, outlook globally.  When an analyst, fishing hard for good news, asked what regions were immune to the global slump, Mr. Bass made it clear he would not try to spin bad news into good:

Well, I think Antarctica has been relatively immune, maybe Greenland, as well, although not Iceland, as we all found out.

Enough said.

(note: I first picked up on this in Fred Hickey’s High-Tech Report and you can get the full background from Barron’s).

In government, communications people are policy people; they know the details as thoroughly as those charged with the implementation of the policy…In business, communicators aren’t always business people nor are they close to the strategy of the company.”  He added that many CEOs fail to understand the value of communications. 

In my experience, the public relations counselor with the full grasp of the company’s strategy and technical understanding of its business are also able to relate the strategic value of communications to their CEOs.   PR counselors without this knowledge base are often seen in a tactical function and brought in after the strategy has been set. 

As is the ongoing theme of this blog, the PR skill required to be at the C-level table includes the strongest possible understanding of business in general, an analyst like knowledge of industries, a C-level understanding of a client’s (internal or external) business model and the ability to use this knowledge to help the C-level management manage a company’s reputation.

Bill George, former CEO of Medtronic; and professor at the Harvard Business School

[Siemen’s] competitors should have come out and stated their own anti-corruption principles…CEOs need to face reality…CEO’s often go into denial, and that’s the worst thing they can do.  it’s a huge mistake to hire a PR firm and ask it to restore your image – Bill George, former CEO of Medtronic and currently a professor of management at Harvard Business School.

Mr. George not only provided some very good PR counsel, he also highlighted a reputation problem with the PR agency industry’s reputation (yes, ironically).   Hiring a PR agency is often seen as a way to order a good reputation.  As this quote shows, smart executives know that is not the case.  

PR counselors, and in particular agency based executives, need to be consistently clear that reputation is not a function of communication, but is a function of communicating business action.  Mr. George understands this, but obviously does not see PR agencies as a source of this type of business counsel.

The level of respect for an agency’s work always goes up when clients see that clear, specialized business counsel, not simply PR counsel, is being provided.   Bill George’s quote is a strong reminder of the importance of this approach.  

Of course, for this to happen agencies have to start hiring based on strategic business smarts and not simply tactical smarts.  But that’s or another post…

P.S., I was recently asked why, as an PR agency owner, I would post advice to other agencies.  Simple, these are PR industry issues which, if solved by more agencies addressing them, would result in more and better business for all of us.

So if 2009 is the year of doom and gloom, how does a business put on a positive, confident face without seeming out of touch with reality?

One fantastic, and fun, example comes from First Round Capital.  Their message is simple, effective and to the point – do your best to have a good year in 2009 and stay on your toes.  They are not saying have a good year or that they will do well.  They are saying you should focus your energy that way but be vigilant (it reminds me of a favorite Ronald Reagan phrase – Trust, But Verify).

Here’s their terrific holiday video, with their portfolio companies, that sums it up.  Watch to the end.

http://holiday.firstround.com/

Thank you to Fred Destin who’s blog brought this to my attention: http://www.freddestin.com/blog/2008/12/from-firstroundcapital—finally-a-2009-cheer-that-makes-we-want-to-post.html

This leads to some important questions – how can a public relations department switch from the more commonly implemented reactive and tactical modes to an active mode where it is able to truly provide counsel during the decision-making process? Furthermore, how can PR move from merely talking about media relations to managing reputation risk and espousing the economic value around major business decisions such as customer service investments?

An active strategy for public perception management requires that a company view its relationship with public relations representation as a partnership. The PR team should be involved throughout multiple levels of the company and should be viewed as a critical component in decision-making processes. Instead of simply functioning to offer counsel when requested, the PR team should be viewed as a valuable resource – one that is engaged both at the earliest stages of business planning and at the final stages of business measurement and analysis.

Maximum effectiveness requires the PR team be placed in a position where it can truly understand how the company is seen by core audiences – primarily the company’s customers, prospects and investors. The team must be able to project the ways in which company actions will affect those perceptions and be capable of measuring any changes in audience opinions.  This is a major strategic shift, however it is one that public relations departments can facilitate through implementation of three crucial actions.

1. Introduce opinion survey and market analysis tools into the departmental skill set
Establishing an understanding of audience perceptions of a company, as well as why those perceptions were formed and what changes the company can implement that would spur positive actions amongst the audience, such as investing in or purchasing from the company, are the fundamental basis of any strong and effective strategic public relations program.

In current public relations practices, discovering whether or not the latest messaging and tactics have effectively reached target audiences and successfully affected opinions requires that professionals search for correlations and analyze data to determine how our output might have affected the audience’s opinion.

But what if we simply asked them?

Instead of establishing program recommendations according to how tactical output – i.e., media – might drive sales, programs could then based on audiences actually saying what would increase their purchase intent. Public relations professionals could then use this research to either recommend specific actions that would be required to positively impact audience perceptions or to gauge how actions recommended by other departments and business units will impact audience perception and actions. The latter can be likened to a lawyer providing counsel regarding the legal implications of business actions or an accountant similarly offering tax implications. A company’s public relations team should always be positioned to provide the valuable insights about the reputation implications of any suggested action or have the ability to contribute suggestions themselves.

Skills in areas including risk management, opinion surveys, business analysis and other tools critical to an active approach to public relations management are in short supply. Not only is there a lack of personnel with these skills, but the industry also suffers from a limited perception of its need for these skill sets. It’s easy to find a PR department searching for someone with media contacts. One is far less likely to find one searching for someone with risk management analysis and opinion survey analysis skills.

Politics is one domain in which such tools and strategies are evidently hard at work, with a high value placed on the skills and knowledge missing from many corporate PR teams. Politicians keep pollsters around precisely because pollsters provide politicians with critical information about exactly what people think, what needs to be said to affect what people think, and even how to say what needs to be said. Pollsters can then follow up, conducting surveys to find out if the program changes worked or not. Campaign managers don’t read clip books – they read survey results. CEOs may get clip books with fancy graphs, but those don’t give the bottom line – did we or didn’t we effectively alter opinions.

2. Change from PR-specific language to high-level business language
A company’s executive leadership is interested in how reputation drives bottom line metrics including sales and valuation. While the PR function may drive these metrics on a daily basis, PR language doesn’t always make that clear.

Switching from PR to business language can both raise the company’s overall level of understanding about how import the PR function actually is while also elevating the level of counsel itself. For example, instead of just talking about brand and corporate reputation, talk about reputation risk management and economic value. For programming, it’s about the reputation impact of business moves as well as the risk and economic values of that impact. When it comes to measurement, metrics should focus on audience opinion surveys with an emphasis on opinions that impact the bottom line most. This information can also concretely demonstrate how output like media coverage can drive audience opinions. The important point is that PR professionals should be speaking the same language as the senior management team at the level they are operating.

3. Provide business – not PR – counsel
Similar to the switch from PR to business language, public relations counsel should move from being just communications counsel to becoming overall business counsel. Communications is simply one portion of the total means to an end – the end being a better-run business.

This strategic move can be accomplished in two key stages. First, counsel should revolve around measurements of the reputation impact of business moves. Not only should PR professionals indicate how specific business moves affect opinion, but they should also offer recommendations for alternative moves. For example, instead of simply showing how cutting customer service will negatively impact consumer opinions, counsel can show ways in which strategies such as improving customer service scripts and lowering online response times can neutralize those negative effects.

An active approach should also incorporate program measurement that reflects more than just reputation (awareness, opinion etc) impact. It should be forward-looking in terms of recommending next steps for the business. In the example above, this would mean not only measuring communications around the changes in customer service, but also providing input regarding ways potential additional changes in customer service can continue to impact reputation.

Management may not always take action based on PR recommendations, but the smart ones will get the message that reputation (the bottom line measurement of PR) is the result of a combination of business decisions and a variety of communications methods. They’ll also realize that the job of the public relations department is to watch, recommend, and manage the company’s reputation at the highest level, not just at a tactical – i.e., media relations or blogging – level.

A shift to a financial value focused effort is a major move, but it is not without big rewards.  Benefits include bigger budgets, greater respect, more influence and the lead communications role. PR practitioners can truly take charge of a company’s reputation and prove the program’s economic value. In the end, like we see with successful political consultants, you can gain not just a seat at the table, but the seat at the table – the one right next to the biggest chair at the front.