Ronn Torossian Update

News and Updates from 5WPR CEO Ronn Torossian

Amtrak’s Crisis PR Is Off The Rails

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Days after the deadly Pennsylvania Amtrak crash while investigators are still trying to sort out what happened, the rail line is trying to pick up the PR pieces. The crisis PR has not been good – and that will continue to be an uphill battle. Already tiny factoids are popping up on social media comparing airline travel and rail travel.

The main question being asked by investigators is “why did the train speed up when it was supposed to be slowing down.” According to reports, when approaching a curve rated for no faster than 50 mph, the train, which had been traveling at 70 mph, sped up to more than 100 mph. At this point, investigators say they are unclear as to whether or not the train speed was increased manually by the engineer.

To this point, investigators have found no issues with the track or the mechanics of the train. But that is not the question the general consumer public is asking. All they can see is that a train was going too fast and killed at least eight people and sent 200 more to local hospitals. “Why” is a secondary concern. They want to feel safe, and they don’t, regardless of what caused the issue.

And, because they don’t feel safe, speculation rules. Despite the fact investigators have already released the information that the engineer was not using his cell phone and had not been drinking or using drugs, people are still – loudly – asking “what went wrong” with the driver.

Spokesmen have said that no “common sense rational person” would think it okay to travel at that rate of speed in that turn, but this is not comforting.

In point of fact, there’s no evidence to prove the engineer is a “crazy person.” But now that this idea is in the head of the public, it’s not just going to sit down and die. It may fester and spread.

Amtrak has a multifaceted PR nightmare. They are dealing with the facts of the case as they are revealed, AND they are dealing with countless speculations and outright rumors that are being generated by all the PR missteps. Every mishap leads to crisis PR – and those who handle it well have less damage than those who do not.

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Marketability: Winston vs. Mariota

marcus vs jameis public relations
A recent USA Today article compared the two top picks in the 2015 NFL Draft, Marcus Mariota, and Jameis Winston. The comparison was not about on-field skill, however. Ronn Torossian says this head to head matchup is even more important to the business of football. That comparison? Marketability or, to put it more bluntly, which QB can bring more cash to the organization and himself by way of sponsorships and merchandise sales. With untold hundreds of millions on the line, this is a vital PR consideration. And, even with the draft over, this aspect of the quarterback competition is still a raging debate.

In order to gain some semblance of the upper hand in this debate, prognosticators use something called the Celebrity DBI. That is an index that purports to measure consumer perception of celebritiesto determine market worth. Given that it’s only based on a 1,000-person survey sample, the results are easy to question, but still provide a starting point for understanding athlete marketing potential.

According to USA Today Sports, the index places Mariota above Winston as the better potential celebrity endorsement candidate. The report ranks Winston on the level with names like Johnny Manziel, Donald Trump and Bill O’Reilly … in other words, in the bottom 2 percent of the list. In the “trust” factor, he is also in the bottom 7 percent along with Vanilla Ice and Mark McGwire. The verdict, then, at least according to the prognosticators who use this index, is that Winston is going to struggle to find strong endorsement deals and advertising opportunities.

The future, though, is reportedly much brighter for new Tennessee Titan. Mariota. Marcus is in the top 7 percent in endorsement potential, That is on par with names like Staubach and Aaron Rogers in a category called “aspiration,” which measures the desire of respondents to “be like” a certain individual.

While this index could be just another form of sport-related hocus-pocus prognosticators use to get in the media and create points to argue about for the talking heads and radio callers. It could also serve as, at least, a rough starting point for each player’s PR team in the coming days and months. Who will get the last laugh? Time will tell…because, no matter what, the best PR team almost always wins the battle of public perception.

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Pope Working on Vatican Bank PR

pope vatican bank public relations
When you think about public relations in the banking industry, you might think of patriotic commercials, earnest-looking tellers and clean-cut guys in pinstripes waiting to “earn your business.” But, would you expect any of those folks to wear the robes and crown of the Supreme Pontiff of the Roman Catholic Church? Probably not. Well, Ronn Torossian says, think again because the Pope is now in the game of banking PR.

Recently, Pope Francis gathered with a host of cardinals to discuss the financial health of the Holy See. There were—flowcharts, spreadsheets, graphs and PowerPoint presentations. PowerPoint in the Vatican? Yep. Congrats Microsoft, you have papal approval.

While it’s really no secret that Vatican finances have been growing through a rough patch in recent years, the extent of the issue was not well known because the Vatican kept their books locked up tighter than the gold at Fort Knox. Need to know only. According to Bloomberg, the meeting last February was the very first time that many cardinals were ever given the opportunity to see the church’s financial picture in such detail. Moreover, many of the presenters were not even clergy. Several lay experts were also present, breaking things down for the assembled holy men.

While this is hardly the first time Pope Francis has made headlines for breaking with church tradition, previous popes have challenged church practicum and theology. However, financial disclosure on this scale is virtually unprecedented. The lesson here is one of deft public relations. Underneath all the discussion about the church’s role in global culture and politics, is a steady current of dismay and outright revulsion related to both the institutionalized privacy and the abhorrent sex-abuse scandals. In opening the books, the pope is doing something so relatively drastic, which no one can look at it and not begin to rethink their position, at least on the church’s privacy issues.

The message is clear: this pope is not just changing the way the church deals with its people. This pope is changing the way the church operates internally, at the most basic of levels. When you open the books, you invite criticism of previous mismanagement and potential catcalls of corruption. The gesture, then, communicates a willingness to address any potential issues and a dedication to a new level of openness. At least, that’s the message being conveyed. Whether or not the faithful – much less the general public – buys it is an entirely different story.

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Sainsbury Chief Headed to Jail

sainsburys
Things just went from bad to much, much worse for Mike Coupe, head of British supermarket chain, Sainsbury’s. Coupe was just handed a two-year jail sentence in Egyptian courts for “attempting to seize checks from Egyptian businesses sixteen years ago. At the time, Sainsbury’s was trying to break into the region. According to reports, Egyptian courts said they convicted Coupe because he is the most senior employee of the company. When Coupe chose to skip the trial, he was convicted in absentia. The conviction won’t mean much as long as Coupe steers clear of Egypt, but, even still, the conviction is a prime example of how unfair both legal and public relations issues can become.

Unfair? Yes, definitely. How else can you describe being convicted of a crime based on the actions of a company that, at the time did not employ you. That’s right, Coupe was convicted even though he had not met the complainants and he was in London – not employed by Sainsbury’s – at the time of the incidents.

Sainsbury’s PR team has fired back, calling the claims – and the conviction – groundless and promising to appeal. Of course, from a PR perspective, the conviction just pushes more pressing business into an unforgiving public light.

First, Sainsbury’s foray into Egypt turned out to be a disaster. The company tried to find a place in the market but failed, at a cost of 111 million pounds and a loss of 100 stores. Of course, that was sixteen years ago…but it gets worse. Amidst falling sales and dropping stock value, the company was expected to cut hundreds of jobs across the board. Even the most frivolous lawsuits bring these other very real and very painful items to the surface.

That’s the PR lesson here. Nothing happens in a vacuum. If something goes wrong while something else bad is happening or on the heels of another PR crisis, the whole is always worse than the sum of its parts. The two negative stories – if not stopped – can feed on each other, creating a self-sustaining wave of negative PR that is difficult to stop. The earlier your PR team can get out ahead of the story and stop it, the better it will be. Wait too long, and it may be too late to do anything at all. At that point, your brand is at the mercy of the news cycle and your customers’ attention spans. Don’t ever let it come to that.

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Will Facebook’s Focus Shift to Mobile Ads?

facebook mobile advertisement

Has the whole world gone mobile? Apparently. Fresh off its app split – remember all the controversy over the FB messenger app? – Facebook has announced a move toward more mobile advertising.

The move comes on the heels of less than stellar first quarter revenues. When Wall Street hemmed and hawed, the folks at Facebook decided to look at a fairly bright silver lining. User engagement and mobile ad revenue were both up, indicators that user habits are shifting…and so is the profit center. How skewed is that shift?

Well, according to reports, mobile accounted for about 87% of Facebook’s active user base. That’s up 24% over the same time last year. More people going mobile? A lot more apparently. Try roughly 1.25 BILLION users. That’s a lot of clicks.

Given this massive shift toward mobile use, it’s not surprising that Facebook’s mobile revenue is also on the rise. Nearly three-quarters of Facebook’s total advertising revenue came from mobile ads in the first quarter of 2015.

More importantly, daily user numbers are up. 936 million users access the site daily, a massive number that is both driven by and driving the shift to mobile, as well as mobile profitability. These markers fit well into Facebook’s ongoing strategy to reach more users across the world, specifically in places where the Internet is only or primarily accessible on a mobile device.

But to truly tip the scales, Facebook needs more major marketers to invest in mobile. While that trend is promising, it isn’t quite there yet, creating some tentativeness in the company’s approach to the not yet fully tapped mobile market. When that happens, expect the Internet’s social media Big Dog to telegraph a sea change in the way everyone uses and profits from online content.

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Playoff Time For The NHL

nhl playoffs public relations

It’s playoff time for professional hockey, and NHL officials are hoping for some major ratings. Despite the fast pace, interesting personalities, and cool culture, hockey still lags behind several other sports in the hearts and minds – and wallets – of many Americans. While the NFL and MLB fight for the top spots in sports marketing, the NHL, and the NBA both want to be number three. And both have been rocked by lockouts, work stoppages, and other issues in recent years.

Back in 2012 the NHL experienced a work stoppage – it’s fourth in 20 years – based on how to split the approximately $3.3 billion in revenue. Since then hockey has tried to bounce back, but it faces some of the same issues that caused the previous disputes. Mainly, the massive disparity in brand popularity. Ask any fairly attuned American sports fan, and they could likely name three or four NHL franchises. Ask for ten, and the numbers would thin. Name them all? Forget about it. And the revenue numbers back up this disinterest. During the season prior to the most recent lockout, 18 of the 30 NHL teams lost money.

A few managed to scrape together a meager profit, but the three tops teams in the league practically printed money. The Maple Leafs, Rangers, and Canadiens enjoyed huge operating profits or more than $170 million. The other 27 teams, combined, only managed $44 million. The Canucks and Oilers bring the profit tally up to $212 million. Without these five teams, the total revenue is a loss of more than $86 million.

While the top teams in the NFL make huge margins, they only represent a third of all league profits. The NHL situation is mirrored by the NBA, where the Bulls and Knicks regularly pull the majority of the freight for the league. However, subsequent to the NBA’s most recent collective bargaining agreement, the league tripled revenue sharing to keep small market teams in the black. But the NHL has struggled to reach that level of cost-sharing parity.

The only other solution is to bring in a lot more paying fans to each and every “on the bubble” NHL team. There will always be a few that struggle, but some of the better teams can charge into the playoffs with the opportunity to bring in fans that will stick around, at least for a while. Without that bump, the NHL will have to go back to the negotiating table sooner rather than later.

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Microsoft at 40 – Where will the Brand go from Here?

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A recent report by CNN released an email sent by none other than the godfather of the computing age – Bill Gates. Apparently, the Microsoft co-founder sent the email as a way to connect with Microsoft employees and celebrate four decades of changing the world, one computer at a time, since 1975.

According to CNN, here’s what the email said: “Early on, Paul Allen and I see the goal of a computer on every desk and in every home. It was a bold idea, and a lot of people thought we were out of our minds to imagine it was possible. It is amazing to think about how far computing has come since then, and we can all be proud of the role Microsoft played in that revolution.”

It really is incredible when you think about how things were when Gates and Allen made that goal compared to what the world is today. Back then, no one saw much need for this upstart idea of the “personal computer,” but now billions across the globe are carrying computers in their pockets. From crazy idea to individual necessity in a generation. That’s the power of an idea whose time has come.

But Gates was not just looking back. In the same message he praised the leadership of current Microsoft CEO Satya Nadella, saying, “In my role as technical advisor to Satya, I get to join product reviews and am impressed by the vision and talent I see.”

But do you see what he did there? Gates is not only offering support and approval, he is tacitly revealing his current role in the company. Never one to shy away from making decisions, Gates is seen now as the face of his billion-dollar international charity and less the face of Microsoft, but his shadow still looms large in every way that matters. Far from the hands-off godfather, Gates is still a major player in the present and future of the company that helped make him the richest man in the world. And, even in a celebratory email, he is casting vision and defining the company.

“I hope you will think about what you can do to make the power of technology accessible to everyone, to connect people to each other, and make personal computing available everywhere.”

That may sound like a happy thought, but coming from this source, it’s more like marching orders.

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Target Rebounds After Breach

target data breach

These days it seems like news of major retailer data breaches has become weekly events. But even the frequency of these breaches does little to calm the public outrage when they happen. Surviving to re-engage and thrive after a breach is a tough hill to climb, and no company seems to have managed that obstacle better than Target.

Back in 2013 Target experienced a massive data breach, compromising the credit card records of a huge number of customers. Business, as expected, took a serious hit. Sales stalled as customers began opting for cash – or not shopping at Target. Since then, Target and new CEO Brian Cornell have been working hard to bring the business back from the brink. According to CNN, their efforts have yielded a steady rise in sales and a stock price at an all time high.

Since Cornell took the helm, Target stock has jumped 40% while Walmart stock has only risen 11%. There are several reasons for this, including cost cutting measures that made Wall Street investors smile. But these internal measures were only the beginning. Cornell has also instigated a focused marketing campaign that highlights four categories in which Target has seen continued success.

In addition to a massive marketing push involving kids fashion, Target is also doubling down on messaging related to its baby products, children’s products and wellness. These retail segments have proven steadily profitable, and Cornell is wisely doubling down on his fastest horses.

This – ahem – targeted PR allows the company to focus on highly profitable growth areas while other product lines play catch up. Buried just under the surface of this approach is a return to Target’s winning message: “We are stylish, yet affordable.”

That message quickly and effectively separated Target from its closest competitor, Walmart, making it the choice of a hipper, trendier segment of the consumer market for whom Walmart had been both a necessity and a punchline. Target became a status definer. “Poor” people went to Walmart. Chic people – with similar bank balances – shopped at Target. The company rode that distinction to massive market success, ripping market share away from Walmart in market after market. The massive data breach stalled that juggernaut. But now Target’s decision makers have found a winning message to recapture that position…as long as they keep hitting the mark with the right audience.

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Maserati Takes Aim at Porsche

maserati vs porsche ronn torossian

When it comes to high-performance coupes, both Porsche and Jaguar have legions of loving and dedicated fans. But now, according to Ronn Torossian, there’s a new player on the scene that should create a rather interesting automotive love triangle. Maserati recently introduced the Alfieri coupe, a 2016 model that seems clearly aimed at stealing market share from Porsche’s vaunted 911 and Jag’s adored F-Type. When Maserati presented a version of the Alfieri at the recent Geneva Motor Show, high-performance car fans ignited.

Some of the reasons to love the Alfieri include 404 horsepower right out of the gate, with options that can crank that power up to either 444 or an asphalt boiling 510. Fortunately, the standard all-wheel drive will allow the Alfieri to hug that scorched asphalt every inch of the way. Not that long ago, Maserati pledged to move 75,000 cars a year by 2018, but brand reps insist the Alfieri is not the car to make that happen. Instead, their new performance coupe is slated to be a low-volume model, more of a shock and awe campaign to illuminate the entire Maserati line.

Take note, brand managers. This is an excellent strategy when you are repping a brand with a perennial seat on the outside looking in. Yes, Maserati has a dedicated core of fans, but not nearly the raving and raging fan base of its closest competitors. This is partly because Maserati has always been about “exclusivity and luxury.” It’s the brand that doesn’t want to be popular with all the people…just all the right people. Still, those “exclusive” people tend to have the cash to be very selective, and they often buy with flash and panache in mind…at least as much as performance. Given that market reality, Maserati has to step out of its We’re For the Select Few mold and aggressively go after those coveted “few.”

The Alfieri should get them looking, more than once, not just at the Alfieri but at the entire Maserati line. Exposing the “right people” to all that you offer can help raise the water level across your entire brand. You will attract potential customers who may not want your “grabber” product, but might fall in love with something else you offer…something they would not have otherwise given a first, much less a second, thought.

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AOL Founder: Now is the ‘Pivotal Point’ of the Internet

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Speaking to a crowd of thousands of tech junkies and industry entrepreneurs at the annual South By Southwest (SXSW) music, film and interactive technology festival, keynote speaker and former AOL CEO Steve Case stated that the world is at a “pivotal point” of the internet as the Web enters its third wave.

The first wave, of which Case’s AOL was at the forefront, ran from 1985 through 2000 or so and consisted of the internet’s rise in popular culture from a closed-off network used by governments and educators to a utility-like commodity billions depend on every day. When the internet hit its second wave around the turn of the millennium, large companies such as Google, Amazon, Facebook, Twitter and eBay rose to power, further incorporating the Web into everyday life.

Now we are at a crossroads, Case says, as the third wave begins. This new era will be characterized by new disruptive companies tackling more areas of daily life: food, healthcare, transportation and energy, among others. Those entrepreneurs who are successful will need to “understand the battle ahead.”

Fueling the transition will be a greater access to capital than even in Silicon Valley’s high-flying “bubble” days. Crowdsourcing platforms such as Kickstarter and Indiegogo have democratized the funding of new tech companies and products, allowing developers to connect directly with those interested in a new idea. Meanwhile, venture capitalist firms and large companies have embraced the idea of activist investing, using the commercial sector toward the public’s greater good. Case used the examples of Toms and Etsy as two cutting-edge for-profit companies who have managed to help communities worldwide through activism and giving back.

Finally, Silicon Valley, today’s worldwide center of the tech world, will no longer have a monopoly on the brightest minds and most promising companies as new regional hubs in the United States and elsewhere pop up to serve an expanding industry. In Kansas City, Pittsburgh and the North Carolina coast, as well as regions in the Middle East and Africa, this process has already begun. A decentralized tech industry will encourage innovation, competition and a reformatting of tech culture that has become somewhat dysfunctional, Case says.

AOL took 10 years to reach 1 million users, a feat today’s most-successful social networks and smartphone apps accomplish in a period of days or weeks. The Web as a communication medium has come a long way since the U.S. government legalized its commercial use in 1992, and Case says the new era is just getting started.

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