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September 2003 |
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A New Perspective on Brand Editor’s Comment: Being accustomed to our own Chinese perspectives, it is time to expand our horizons to include some Western ideas. Let’s hear what this foreign expert has to say – Public Relations Elevates EuroAmerican Companies Above Their Japanese Counterparts By Lou Hoffman Let’s establish one point right from the start. The best product does not always win. The product that is the smallest, runs the fastest, does the most for the least money, etc., is not always the product that ends up with the largest market share. Among the factors that influence the success or failure of a given product is company name and reputation. Buyers of technology (consumers and businesses) gravitate toward known companies that stand for something. This is where public relations enters the picture. You can think of public relations as a discipline that shapes and elevates a company’s image. Japanese IT companies consistently make world-class products, but they often do not use public relations as a strategic tool that ultimately hinders their ability to compete for customers. Why don’t Japanese IT companies embrace public relations like their Western competitors? I’d like to share a few observations that address the question. For starters, it’s interesting to look at Japanese society where it’s viewed as rude to boast and bring attention to one’s self. Instead, the culture values being modest and blending in with heart to heart communication style "Ishin-Denshin." This way of thinking in Japan conflicts with public relations in the sense that PR by definition brings attention to a company. This dynamic truly surfaces when analyzing the visibility of CEOs from Japanese and Western IT companies. Study after study shows that the actions and decisions of a company’s CEO play a huge role in shaping the image of a company. In fact, some believe that as much as 50 percent of a company’s image comes from the actions of the CEO. The point is, a company’s CEO provides a valuable tool in not only generating media coverage but also in shaping the desired image of a company. Yet, Japanese CEOs often don’t make public relations a priority. The CEOs of Western IT companies have been known to allocate as much as 25 percent of their time for public relations. Think about this for a moment. These CEOs are devoting roughly a quarter of their job to public relations because they recognize that the company’s image plays a crucial role in competing for customers. Illustrating this point, a search on a worldwide publication database called Factiva over the past 12 months shows the number of mentions for Apple’s Steve Jobs at 3,726, Oracle’s Larry Ellison at 4,788 and HP’s Carly Fiorina at 3,517. For contrast, a search on the Factiva database for the same period indicates a mere 206 mentions for Tadashi Okamura who heads up Toshiba. Even CEO Nabuyuki Idei of Sony, one of the strongest brands in the world, only has 678 mentions. Now to be fair, the Factiva database is dominated by English publications but still, one would expect Mr. Idei to enjoy a higher number of mentions. I also think it s noteworthy that the IT PR industry in Japan has not expanded like it has in the United States and Western Europe. Even a market like the UK with a fraction of Japan’s IT buying power and few homegrown IT companies has still cultivated a long list of IT-focused PR agencies. But it seems like the number of IT-focused PR agencies in Japan can be counted on one hand. Why? Part of the reason goes back to the CEOs and other senior executives who simply don’t view PR as a strategic tool. As a result, they don t invest in the discipline with the same rigor as their Western executives. I think a second reason comes down to control. Japanese executives tend to believe if the PR function is kept solely in-house, they can control PR, and more importantly, control their image. This means the modest investments allocated to PR typically go toward in-house resources, which limits the growth of the IT PR industry in Japan. Again, compare this with Western competitors who deploy significantly more funding to PR and greatly depend on outside PR agencies for counsel. Even IT companies such as Microsoft, IBM and HP who have in-house PR departments also hire outside PR agencies to supplement their internal resources. Such an approach comes from the belief that an outsider’s perspective enhances the overall PR effort. Plus, Western companies understand that the PR function cannot control their images. Every time a customer, prospect, partner, potential employee, etc. touches your company, that person makes an assessment about your company based on the interaction. Needless to say, the PR function cannot control these interactions. In sharing these observations, I appreciate that there are exceptions. A CEO like Masayoshi Son of SoftBank enjoys a very visible public position and clearly spends a fair amount of time to PR. A company like Sony has made tremendous investments in PR to build equity in its global brand. But I believe most Japanese IT companies are missing an opportunity to build their image and ultimately sell more products by not fully capitalizing on public relations. In short, the marketplace
wants to know what you stand for.
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