Saturday, August 26, 2006

Hill & Knowlton may acquire India’s Perfect Relations

Sir Martin Sorrell-led WPP subsidiary Hill & Knowlton is understood to be acquiring image and public affairs consultancy Perfect Relations, reports The Economic Times.

WPP’s Burson-Marsteller acquired Genesis PR in December 2005.

IPAN and Ogilvy PR are also controlled by WPP in India.

According to The Economic Times, Perfect Relations “has been in talks with several global potential buyers for some time now. When contacted Perfect Relations’ promoter & CEO, Bobby Kewalramani denied any such deal has been signed.”

“All the leading PR groups of the world have been chasing us and we are in talks with a few companies, but nothing has consummated so far,” he told ET. However, industry sources confirm the deal is through and the announcement will be made in a few weeks from now.

Perfect Relations had short-listed some four buyers, and has been in serious talks with them for the last few months. The New York-headquartered, Hill & Knowlton has been the front-runner in the race.

Who killed the newspaper?

The Economist reports:

“A GOOD newspaper, I suppose, is a nation talking to itself,” mused Arthur Miller in 1961. A decade later, two reporters from the Washington Post wrote a series of articles that brought down President Nixon and the status of print journalism soared. At their best, newspapers hold governments and companies to account. They usually set the news agenda for the rest of the media. But in the rich world newspapers are now an endangered species. The business of selling words to readers and selling readers to advertisers, which has sustained their role in society, is falling apart.

Of all the “old” media, newspapers have the most to lose from the internet. Circulation has been falling in America, western Europe, Latin America, Australia and New Zealand for decades (elsewhere, sales are rising). But in the past few years the web has hastened the decline. In his book “The Vanishing Newspaper”, Philip Meyer calculates that the first quarter of 2043 will be the moment when newsprint dies in America as the last exhausted reader tosses aside the last crumpled edition. That sort of extrapolation would have produced a harrumph from a Beaverbrook or a Hearst, but even the most cynical news baron could not dismiss the way that ever more young people are getting their news online. Britons aged between 15 and 24 say they spend almost 30% less time reading national newspapers once they start using the web.

Advertising is following readers out of the door. The rush is almost unseemly, largely because the internet is a seductive medium that supposedly matches buyers with sellers and proves to advertisers that their money is well spent. Classified ads, in particular, are quickly shifting online. Rupert Murdoch, the Beaverbrook of our age, once described them as the industry's rivers of gold—but, as he said last year, “Sometimes rivers dry up.” In Switzerland and the Netherlands newspapers have lost half their classified advertising to the internet.

Newspapers have not yet started to shut down in large numbers, but it is only a matter of time. Over the next few decades half the rich world's general papers may fold. Jobs are already disappearing. According to the Newspaper Association of America, the number of people employed in the industry fell by 18% between 1990 and 2004. Tumbling shares of listed newspaper firms have prompted fury from investors. In 2005 a group of shareholders in Knight Ridder, the owner of several big American dailies, got the firm to sell its papers and thus end a 114-year history. This year Morgan Stanley, an investment bank, attacked the New York Times Company, the most august journalistic institution of all, because its share price had fallen by nearly half in four years.

Blogs, communications and corporations

Stephen Armstrong reports in the New Statesman

Towards the end of last month a posting appeared on a web site called "Blog Republic - By the Bloggers. For the Bloggers". "Blog Republic is looking for bloggers who are interested in being paid per post," it said. "We're looking for motivated bloggers in the following areas: cellphones, broadband, travel, gadgets, health, stocks and blogging. We're looking for quality bloggers who can make insightful posts. The more you post, the more you earn."

This plea caused quite a flurry in the online world. After all, if blog culture has been about anything, it has been about sticking it to large corporations rather than taking their advertising dollars. Last year, for instance, Dell would not replace a faulty computer owned by the influential blogger Jeff Jarvis. He started chronicling the company's poor service on his blog under the heading "Dell Hell". His postings hit such a nerve that Jarvis was soon receiving 10,000 visits a day.

Sites attacking McDonald's, Starbucks, Nestlé, Nike and just about every oil company proliferate around the net. With a successful legal action against these vociferous individuals costing more in legal fees and bad publicity than the victory would be worth, blogs have been seen as an extension of consumer activism.

A poll conducted by NOP World Consumer in March last year found that 50 per cent of bloggers express opinions about a company or product at least once a week, while another survey, for Hostway, showed that 77 per cent of online consumers viewed blogs as a useful way to get insights into the products they were looking to buy. With all these opinions reaching their customers, companies felt like a boxer attacked by thousands of children -- staggering from tiny blow to tiny blow, unable to hit back but sure that, at some point, damage was being done.

This summer, however, something changed. In June, a disgruntled Land Rover customer called Adrian Melrose set up a site called to track the company's lack of progress in dealing with a complaint about his new Discovery. Melrose was soon attracting 700 visitors a day, which placed him at the top of a Google search if you typed in "Land-Rover Discovery". In July, the company caved in and sorted out his problem but then struck a deal to turn into a Land-Rover customer feedback forum.

Suddenly corporations are all over the blogosphere. Last year, BusinessWeek ran a feature, "Six tips for corporate bloggers", which highlighted a deal between the web services company Marqui and 20 bloggers who were offered $2,400 each to write about the company once a week for three months. At the end of June this year, the idea went pro with, a site set up by Ted Murphy, chief executive of the advertising firm MindComet….

Until now, the founders of the blogosphere have protected their online world. This was easy when blogging was a difficult and complicated business, requiring at least some working knowledge of computer code. Early blogs tended to be written by the highly motivated and technologically literate. They often argued that this was a new paradigm - "citizen-generated media", free from the restrictions of top-down "old media".

With the expansion in open-source software over the past 18 months, however, anyone can get involved. Many new bloggers are school or college kids just trying to get laid. For them, the purity of the blogosphere is irrelevant. The idea of getting paid to chat about a soft drink seems absolutely fine. Nicole Discon, a high-school senior from New Orleans, was paid by 7-Up to plug a new milk drink called Raging Cow on her blog She said the commercial connection didn't bother her and "now that I've delved into the whole advertising thing, it's something I really love doing". For youth brands, this teenage ambivalence is great news. After all, online is where their customers are.

Steve Henry, executive creative director at TBWA and the adman behind the "You've been Tangoed" and Pot Noodle campaigns, believes that in the next four to five years the accepted model of advertising will change completely. "You're only going to be able to sell in an opt-in environment like a shop or web site, somewhere people choose to be," he believes. "To get a customer there, you need to surround them - PR, stunts, ambient media, the works. Blogs allow your brand to become part of the culture, to become something that's talked about."

In June, the ad agency Starcom MediaVest recommended that its clients use conversation as an advertising medium. "Traditional advertising is not as effective as it used to be," says Starcom's research director, Jim Kite. "Word of mouth becomes more important, but we didn't realise how important it is. We are telling our clients that they should make word of mouth the focus of their ad campaigns."

Companies such as Procter & Gamble have started recruiting "brand ambassadors" - key social figures in a neighbourhood or community who will get paid to drop brand references into conversations or hold barbecues where they pepper the talk with praise for dusters or aftershave….

This month, the fledgling industry created its own trade body - the Word of Mouth Marketing Association. Now the hidden persuaders could be anywhere. You may not want to read ILikeCokeBlogger's views on soft drinks, but it's hard to turn away if your best friend recommends a soap powder. What's the price of free speech when opinions are suddenly for sale?

Tuesday, August 22, 2006

WPR, LEWIS PR form alliance

Strategiy reports:

Dubai-based WPR Limited and LEWIS PR, the global public relations consultancy with a wholly-owned network of 21 offices in 14 countries, have created a new alliance covering the Middle East.

WPR will offer support for LEWIS PR clients in the region. The latter will service WPR clients in countries where LEWIS has a fully-owned subsidiary. LEWIS’ network extends across the US, Europe, India, Far East and Australia.

WPR is already working with the LEWIS PR office in London on Orange Business Services, part of France Telecom.

The exclusive, renewable agreement is for an initial 12 months.

Andres Wittermann, Vice President Europe – LEWIS Global Public Relations, comments: “The Middle East is an increasingly attractive and important market for many of our multinational clients, and the relationship with WPR in Dubai adds a new dimension to our network and greater regional capabilities in serving the LEWIS PR client base. Our experience of working with WPR on Orange Business Services has been very positive, and we look forward to building on this.”

Jonathan Walsh, Managing Director of WPR, adds: “WPR is delighted to be working with a world-class agency with multinational clients who are attracted to the Middle East. The alliance with LEWIS PR creates a gateway through which business can flow in either direction, although we expect most of this to be inbound to the Middle East. The relationship will create another platform for the further growth and development of WPR whilst extending LEWIS PR’s reach into the region for its client base.”