Perception Drivers Blog

It’s an exciting day at FoleyFreisleben LLC (FolFry). Today, we are proud to announce the launch of Captivate Public Relations & Marketing, an entirely new agency incubated by FolFry.

In conceiving and co-founding, Captivate, a partner agency of FolFry, our objective is to more seamlessly integrate the corporate and marketing public relations functions. In these trend- and brand-conscious times, FolFry is regularly contacted by enterprises that seek help targeting and breaking through to consumer audiences. Clients are furiously trying to navigate a fast-changing media landscape and need solutions—traditional, digital marketing, launches and activations—to captivate consumers by illuminating and elevating their products and services. (Hence, the Captivate tagline: Illuminate. Elevate. Captivate.)

FolFry already provides corporate and financial relations, reputation management, and crisis communications to many of these same type consumer companies—our firm’s 20-year association with Calavo Growers, Inc., the world’s largest avocado marketer, is a client case-in-point. However, we have historically turned away from the product and services marketing to stay focused on our areas of specialization.

Without diluting FolFry’s focus, we seized an opportunity to seamlessly integrate a new agency—with its own dynamic leadership team and culture—and capitalize on excellent cross-marketing potential between the partner firms, offering our clients a broader range of services.

It brings many of us at FolFry, as well, closer to professional roots in consumer public relations. Our team’s credentials include implementing branding campaigns for clients such as Pepsi, Chrysler, Michelin and Burger King, as well as destination and travel programs for Hilton, Singapore, Republic of Ireland and LVMH Moet Hennessy, too.

As our colleagues at Captivate pondered: does the world really need another consumer-product and services public relations and marketing agency? While the word “need” is relative, we believe there is always room in the marketplace for fresh, creative and captivating ideas.

In the early days of rock ‘n roll, radio disc jockeys decided which songs got the airplay that would make them hits. To make sure DJs played their tunes, record labels used “payola” in the form of cash or other goodies.

When listeners learned about these payoffs to style-setters they admired, the resulting scandal triggered Congressional investigations and ended a number of careers.

The Wall Street Journal reports that today’s investors have reason to wonder if the opinions of securities analysts about a company’s shares are distorted by a modern form of payola.

With declining stock-trading commissions, brokerage firms increasingly rely on fees they charge institutional investors for arranging private meetings with the top executives of publicly traded companies. Those fees total about $2 billion annually, the Journal estimated.

The CEOs and CFOs of these companies know there’s a high demand for face time with them. A number of them have decided to grant this access only to analysts who publish positive reports about their companies.

Analysts who rate their stock a “buy” get to bring in their institutional investment clients. Those who rate it a “sell” get shut out – and forego the hefty fees they would collect for arranging these meetings.

According to the Journal, success at pulling in access fees can determine a third of an analyst’s annual income. That provides a strong incentive for analysts to write upbeat reports on the companies they cover.

In addition, investment funds are likely to steer stock trades, and their accompanying commissions, to brokerages that are able to arrange private meetings for them with corporate executives.

Companies that acknowledged granting or denying access based on analyst ratings include Coach, Inc., Sprint Corp., Walt Disney Co., Dollar Tree Inc. and many others.

Individual investors and small funds may still value the opinions of analysts. But that seems to be less true for institutional investors. One analyst says he was sometimes told to sit outside the meetings he had been paid to arrange.

The powerful financial incentives on brokerage houses and their analysts to provide upbeat reports about the companies they cover has put them on a path that is very likely to erode investors’ perception of the value of the advice they provide.

What does this mean for a company’s investor relations program? If institutional investors are willing to pressure analysts in order to get direct access to CEOs and CFOs, why not focus your IR efforts on reaching out directly to these funds? Think about a non-deal road show to communicate your well-presented story to an audience that clearly wants to hear it.

Each day, we are deluged with messages—digital and social media posts, as well as e-marketing blasts, which blur indistinguishably, sap our attention spans, and fall flat in their intended purposes of capturing mindshare and being memorable.  

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We at FolFry have always advocated that corporate citizenship begins in the C-suite. 

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MILAN--A visit here this year is not complete without checking in on the Expo Milano 2015, which runs through October 31. Other than the Olympic Games--and possibly World Cup--there is no greater coming together of countries.  

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There is an axiom in the public-relations profession that products and issues—political and nonprofit causes or social-impact initiatives, specifically—do not truly “arrive” until they have a celebrity name attached to them.  

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Everyone knew the news was coming—albeit not precisely when. Yet, the “digital wildfire” that accompanied Caitlyn Jenner’s public debut on June 1 via tweet of her upcoming Vanity Fair cover story and pictorial took even the most Internet savvy by surprise. 

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One of our staff members is a docent at the Skirball Museum and Cultural Center in Los Angeles, which hosted the exhibition “Houdini: Art and Magic” As a result of her participation, we learned that Harry Houdini was an early, and very effective, practitioner of marketing.  He was so successful, in fact, that he remains an American icon – as famed as Babe Ruth or Charles Lindbergh-- 85 years after his death on Halloween, 1926.  

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Today’s trend toward political correctness can be a bonanza for public relations experts when corporations or their spokespersons take actions that blossom into PR disasters. Witness the dust-up over the president of Chick-fil-A’s anti-gay marriage statements. A trip back in time to the accompanying ads of the 1950s and 60s provides a reality check on how muchtimes have changed, certainly for the better with respect to religious, racial, gender and sexual-preference inclusion (a certain chicken sandwich purveyor's remarks notwithstanding).  

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Never underestimate the ability of a powerful message to influence public opinion and to achieve specific goals. Time Magazine piece on Downtown L.A.’s renaissance illustrates the benefits of staying “on message”—in this case for more than a decade.   

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