You Should Go into Brand Management

May 15, 2008

BY MICHAEL KRAUSS

“You should go into brand management,” I told Richard Edelman when we first met 30 years ago over lunch in Cathedral Hall, the grand dining room at the University Club of Chicago.

As a hyper-charged brand manager touting Butterball products, I arrogantly urged Edelman to eschew the family business of public relations his father founded in 1952. I thought branded turkey beaks and feet had it all over the public advocacy role and press agentry of public relations.

“Public relations is no place for a guy with a Harvard M.B.A.,” I said at the time. I was wrong.

Today, Edelman, 54, is president and CEO of Edelman, the world’s largest independent public relations firm, with 3,000 employees in 50 offices worldwide. He was named Advertising Age’s 2008 Agency Executive of the Year. The agency he leads has grown spectacularly under his guidance.

“When I joined the business it was $6 million in revenues,” Edelman says. “We’re going to finish this year at $440 million,” he adds.

Edelman turned down a glamorous job offer to work in brand management at Playtex in Stamford, Conn. to help run programs for his father’s company.

“My dad had an offer to be acquired by DDB in 1978. I was set to go to work at Playtex. I was 24. He called and said, ‘I don’t want to sell the agency. I want you to commit to one year. I’ll pay you whatever the average starting salary is for Harvard Business School graduates.’ So I did it,” says Edelman. The rest, as they say, is agency history.

Whenever I encounter Edelman he’s always a step ahead. He was going global and counseling clients on the importance of non-governmental organizations (NGO) in the 1980s. In the 1990s he alerted me to the importance of green programs. In the new millennium, he’s been focused on studying the issue of trust. In its ninth year the Edelman Trust Barometer is a powerful tool for C-level executives.

Edelman thinks the splintering of media and changing nature of consumer trust are crucial parameters for marketers to consider.

“It’s an interesting, changing time,” Edelman says. “It’s more than the evolution to digital media. There’s a dispersion of authority. People used to go home and watch Walter Cronkite and the CBS Evening News. Now the average, informed person is reading or watching seven media outlets a day and getting news throughout the day,” he says.

Edelman’s Trust Barometer shows CEOs aren’t very trusted and perhaps make bad spokespeople. In contrast, collaborative vehicles like Wikipedia are very trusted and highly used resources. The study shows people trust authentic sources—people who are in similar circumstances to themselves. That finding explains the huge success of the Dove Real Beauty campaign that relies on everyday people rather than fashion models to pose in the ads.

Independent experts are highly trusted whereas the U.S. government lags badly in the trust barometer. Most importantly, the study finds a strong correlation between trust and corporate financial performance. Companies that are trusted—companies that understand and rely on the four drivers of trust that Edelman has uncovered—deliver better financial results.

The four drivers of trust in business are:

• Customers: Delivering quality products, top notch service and good value
• Reputation: Paying attention to your corporate reputation, having a strong position on social issues and being known as a good place to work
• Leadership: Being known in your industry for delivering on promises, taking leading positions
• Local Familiarity: Having a local presence, proximity and connection

To Edelman’s point, today’s brand managers need to worry about more than delivering a superior product that benefits customers. That’s simply table stakes. Corporate reputation, leadership and local engagement need to be to considered to assure your brand and your products will be preferred. Otherwise you’ll lose trust, competitors will gain share and your sales will lag. That makes the public relations agency’s role more important than ever.

“There is an evaporation of what used to be an orange-striped line between corporate reputation and brand,” Edelman says. “It used to be customers separated Procter & Gamble, Head & Shoulders and Crest, but not any longer. Brands are taking certain aspects of the corporate reputation. In the Dove Real Beauty campaign [from Unilever] the product managers are concerned about the appropriate sourcing of raw materials and making sure the women that work in their factories have decent conditions,” Edelman adds.

That’s why Edelman’s agency was at the table with the product managers developing the Dove Campaign for Real Beauty. “It was the Dove product people’s idea, not Edelman or Ogilvy’s,” he says.

It is clear Edelman believes he made the right choice to go into the family business. And he believes more marketing graduates will enter his field.

“I think it’s a thrilling global opportunity. We already have more than 200 people in China working on the Beijing Olympics,” Edelman says. “It’s also a complex business. You’ve got NGOs, all kinds of other voices and online bloggers. I think we’re in a growth industry.”

The Internet and social media make public relations more important and a challenging profession for new recruits. Because of the Internet, there can be a near permanent, searchable record of almost everything we say and do. If you are rude in public, someone may blog about you. As Edelman’s colleague, Laura Deal says, “Google never forgets.” That makes Edelman’s counsel and advice more relevant and important than ever.

Yet Richard Edelman remains as practical and down to earth as he was 30 years ago. He’s authentic. He’s real. I guess that comes from growing up in the Midwest.

“I’m just a guy from Chicago,” says Edelman, “That’s how you behave.”

Michael Krauss is president of Market Strategy Group, based in Chicago, and can be reached at Michael.Krauss@Mkt-strat.com or news@ama.org.