Monday, March 23, 2009

Power of public relations and the rise of celebrity hype

This week has brought about an interesting news item in terms of marketing thinking. On almost every mainstream daily newspaper in the UK this week the sad demise of Jade Goody has appeared to be on the front page. While it certainly is a sad event, when I saw this news item grabbing 2 of the top 5 read news on website two things clicked in my mind with regard to celebrity hype and the pr strategies and marketing.

Firstly, I remembered one of my colleagues at Liverpool who researches into the area of celebrities and their impact on masses. He is a fanatic football fan and I remembered him telling me that he had read more than 50 celebrity biographies (including many footballers and entertainers) and had concluded that there was hardly anything inspiring in those memoirs (BTW, jade goody had one!). It was just one skill which had put most of these people in the mainstream media and once they are there we know the human struggle to be there.

The second thought which arrived in my mind related to the power of high tech public relations (PR). I might be completely wrong but even the BBC obituary of Jade Goody notes "...she hit the headlines as a young woman with shockingly poor general knowledge, who was often the object of her fellow housemates' derision" (BBC, 2009). However, when you just type Jade Goody in Google it turns up with 5,130,000 results. These include a wikipedia which is several print pages long, official website, news (obviously in terms of celebrity gossip), a perfume website and a FAN website (yes...)!!!

Thinking about this I ran another google search for Prof. Amartya Sen (yes, yes, the 1998 nobel prize winner) and it returned with 659,000 entries. Pardon me Prof. Sen for even comparing.

However, this demonstrates the power of public relations and how pr firms exploit it.

I am amazed to see that society as a whole what do we really look for and how our thoughts can be manipulated. Reminds me of Edward Bernays - the father of public relations and the newphew of Sigmund Freud - who believed in manipulating society and resultant public opinion. In one of his seminal works 'the propaganda' he argued that the manipulation of public opinion was a necessary part of democracy. He successfully used it in 'breaking the taboo against woman smoking in public' and even helping United Fruit Company (today's Chiquita Brands International) and the U.S. government to facilitate the successful overthrow of the democratically elected president of Guatemala, Jacobo Arbenz Guzman.

Today's, high tech public relations firms have honed their skills with such a finnesse that a 'Miss Piggy' who reportedly thought a ferret was a bird, an abscess a green drink from France, that Pistachio painted the Mona Lisa, that there was a part of England called East Angular and that there was a language called Portuganese (Jeffries, 2009) gets 2 out of 5 top news items on BBC and gets coverage on all the world media. I have hardly ever seen that being achieved...

Something has surely going wrong at the macro societal level or I guess Bernays was so right when he said "The public has its own standards and demands and habits. You may modify them but you dare not run counter to them." This is what we demand as news today, don't we?

Saturday, March 14, 2009

Customer satisfaction: Is that what we should measure? Really?

While discussing with some of my MBA students the issue of customer satisfaction measurement (especially customer satisfaction surveys) cropped up. Over these years, when talking to managers about market research the issue of satisfaction measurement, customer satisfaction survey and employee satisfaction survey are among the top five issues. However, I always ask the question as to is that what we should measure? Is satisfaction really a reliable indicator of (a) future customer purchase intentions and (b) loyalty among other things?

Last week I was talking to a senior executive from a credit card company about one of the research study we have just conducted focusing on role of satisfaction in financial services industry. Instead of revealing the results to the executive I asked him about what was his view on the role of satisfaction of existing customers on generating positive word of mouth which in turn may convert in higher number of credit card applications online as well as offline. The executive suggested that satisfied customers would be highly inclined to suggest others. This led me to ask another question as to what was the role of product related characteristics (APR, Speed of transaction, Acceptability etc.) and information related characteristics (Availability of information from the market, consistency of information etc.). The executive suggested that there would be balanced impact of both the factors.

The idea was not to test the person but to see if the managers' understanding of market factors matched with customers when looked through the satisfaction perspective. In one of the earlier posts about customers, I mentioned there was hardly any difference between the behaviour of satisfied and dissatisfied customers. A recent study carried out by us which had a sample of 340 customers revealed that there was hardly any difference between the satisfied and dissatisfied customers with regard to influencing future customer purchase intentions. Furthermore, we observed stronger influence of information related characteristics rather than product characteristics. This I believe is because of the nearly me-too nature of the product related characteristics in this market.

There have been two camps in literature with regard to the impact of satisfaction on purchase intentions and loyalty. While many researchers have observed the significant positive impact of satisfaction on purchase intentions and loyalty, others have argued against it. In two of my studies I have found two different results. This leads me to suggest that consequences of satisfaction (i.e. purchase intentions and loyalty) are highly situation and industry specific. A rich area of research indeed!