1. CEO
SURVEY
2008
A struggling economy, a more informed consumer, and an ever-changing
media landscape are causing CEOs to consider many different
marketing tactics to effectively reach their target stakeholders

2. 12 CEO SURVEY
W
hen Sesame Street first that CEOs also have to realize that
debuted on PBS in 1969, [they] have to move a lot of their
it was one of only two public relations spend to online
programs geared toward preschool- and to word of mouth, in ways that
age children; the other was Mister they haven’t yet caught up with.”
Rogers’ Neighborhood. Fast forward Specifically, he says, PR firms have
nearly 40 years and more than 4,000 to show they are the ones most capa-
episodes, and today Sesame Street is ble to handle digital communications
just one of at least 47 programs on tactics, given the industry’s experi-
six competing networks, including ence in managing conversations and
Noggin, Disney Channel, Nickel- influencing the influencers.
odeon, and Nick Jr. “What we have to show is
But for Sesame Workshop, the the enormous cost benefits... of
nonprofit company that produces online public relations, and how
Sesame Street, it isn’t just about you really can be exhausting those
audience numbers; an equally benefits before you lay in your
important goal is fundraising. And advertising spend, rather than
like nearly every other company laying in the advertising spend
these days, to reach those influ- and then using what’s left over
encers – in this case mothers of on public relations,” Penn says.
preschool-age children – much of “In general, word of mouth and
the strategy involves digital tactics. other online activities are becoming
This past fall, to coincide with the so valuable and important to the
debut of Sesame Street’s 40th sea- companies that they’re not invest-
son, Sesame Workshop launched ing to the full ROI of both online
a new Web site, just one part of and traditional PR.”
a digital strategy that includes
webcasting, YouTube videos, and Digital meDia’s role
mobile marketing. Tom Kunz, CEO of Century 21, a
“It gives us the opportunity to Burson client, says he expects the
create a distribution platform that role of digital media in the com-
we never owned before,” says Gary pany’s marketing mix to increase
Knell, CEO of Sesame Workshop. significantly in the next year.
“In my opinion, it’s a huge oppor- “This type of media gives us
tunity to selectively reach your the ability to be proactive about
Sesame Workshop, the
nonprofit company that
audiences in much deeper ways by what’s going on, especially with
produces ‘Sesame Street,’ having multiple lines of distribution a marketplace like we’re dealing
recently launched a Web that you didn’t have before.” with right now,” he says. “One of
site that coincides with Knell isn’t alone in his thinking. the bigger issues really has to do
the show’s 40th season According to the 2008 PRWeek/ with consumer confidence. “We’ve
Burson-Marsteller CEO Survey, used all [digital] media to be able
67% of CEOs plan to spend more to go out and communicate with
on digital marketing in 2009 than the average consumer.”
they did in 2008. The survey, con- Digital media is particularly useful,
➤Faced with a faltering economy and a ducted by Millward Brown, polled he says, considering the different
200 corporate CEOs, half of which demographics the company is try-
constantly evolving media landscape, CEOs are use an external PR firm. ing to reach – from Gen Xers and
Mark Penn, CEO of Burson- Millennials to baby boomers.
increasingly relying on digital media tactics in Marsteller, says the results show a “As a company that works hand
huge opportunity for PR firms. in glove with consumers, we have
their marketing plans, finds the 2008 PRWeek/ “Obviously [CEOs have] moved to be very aware of all the different
a great deal of their advertising outlets that we can use to get our
Burson-Marsteller CEO Survey. By Erica Iacono spend,” he says. “Now, I think message out and/or to respond to
A higher pe
PRWeek • November 10, 2008 • www.prweek.com

3. CEO SURVEY 13
Community-based events like the “Social media is a grassroots angle.
ones this past March surrounding What we have to determine is the
the National Education Association’s
message that we want in our social
11th annual “Read Across America”
campaign are part of Sylvan media initiatives so that it reaches
Learning’s plans going forward the different strata of customers that
we have out there,” he says, noting
that while women ages 18 to 54 are
questions that potential consumers the company’s primary market, it
may have,” he says. “[So digital wants to make sure not to forget
media] has played a very large part men or teens. “We have to make
in our communications process.” sure that we’re putting together
Though the largest increase in a message that appeals to a vast
spending was reserved for digital majority of our [customers].”
marketing, 38% of respondents Even those companies that are
noted that they planned to spend heavily involved in digital market-
much more on PR in 2009. For PR ing, however, recognize that there
agencies, it offers an opportunity to is still room for traditional tactics.
seize some of the digital communi- Chip Perry, CEO of AutoTrader.
cations work, as PR pros have long com, notes that the site uses a com-
argued that they are the most quali- bination of digital and traditional
fied marketers to operate in that marketing tactics, estimating that it
space. Penn says over the past three is a 50/50 split. Because of the com-
years Burson has increased its digital pany’s unique position – it is used by
work for its clients by 400%. dealers who advertise cars for sale
“We are finding more compa- and buyers looking for automobiles –
nies receptive to communicating it has a vantage point into the overall
a particular type of message that shift occurring in consumer behavior,
they should be doing in all types which helps its marketing efforts.
of media, including digital,” he do the digital component. I think newer social media campaigns using “What’s interesting is the CEOs “We see our customers shifting
says. “While their online agency that we’ve seen companies be very Twitter, Facebook, and YouTube. are using it personally and then not dramatically this year to much great-
is appropriate for the task that the responsive to that message.” Though 23.5% of respondents sure that it has an application,” he er allocation into Internet advertis-
agency was hired for, in the middle participate in online social media says. “The fact that so many are using ing. Dealers, for instance, grew from
of a crisis or dealing with a cor- social meDia lag “a few times a week” and 18.5% it personally suggests that they’re
porate reputation campaign, it’s While CEOs surveyed recognize the do so “daily or almost daily,” the underrating its potential use and how information influence
important for the people who have value of digital marketing, they are survey indicates that they are not social media has spread to some of Which of the following information
sources has become more influential
been working on those messages to not yet convinced of the power of yet comfortable with using social the biggest executives personally. over the past three years?
media as a marketing tool. “I think it’s going to be our respon-
MARKETING SPEND Only 18% of CEOs surveyed have sibility, as the PR agencies,” he adds, Word of mouth 60.0%
used � Company Web site communicate
social media to “to... say, ‘If CEOs are using social Trade media covering my industry 54.0%
For which of these disciplines will you spend “much more” than this year
Blogs covering my industry 50.0%
in terms of 2009 spending? with stakeholder groups; 30% will
� Recent Press About A Company media, they have a larger role to play
The Wall Street Journal/Dow Jones 43.5%
� Digital marketing “definitely” orBlogs/Podcasts Room social
� A Company's Virtual Press
� Company “probably” use as part of the next frontier of where
100 � Sales promotions CNN 38.0%
� Public relations/corporate communication media to communicate with stake-
� CEO Or Executive Blogs public relations is going.” National evening news programs 28.5%
� Direct mail
� Traditional advertising
holder groups in the next 12 months; For those companies that are still The New York Times 26.0%
80
� Corporate social responsibility and 44.5% identify “lack of rel- on the precipice of using social Forbes 25.5%
67% � Mobile marketing
evance to target stakeholder groups” media, the concern is crafting the BusinessWeek 24.0%
60
as the key barrier to their company’s appropriate message. National morning news programs 23.5%
participation in social media. Yet, Scott Colabuono, president and Fortune 22.5%
38% 38%
40
71.5% believe online social media CEO of Fantastic Sams Hair Salons, Time 16.0%
outreach can be effective for cor- says the company has yet to embrace Newsweek 14.5%
24% 22.5% 20.5%
20
13% porate communications, indicating social media because of this reason. Base: 200
perhaps that what is needed most is The company is a franchiser of more
0
Base: 200
guidance and counsel, specifically, than 1,400 locations in the US, as
Penn says, by PR firms. well as a dozen in Canada. information importance
Which of the following information
rspective
sources has the most impact on business
these days?
The Wall Street Journal/Dow Jones 51.0%
Word of mouth 42.0%
Trade media covering my industry 37.5%
Blogs covering my industry 34.0%
CNN 31.5%
National evening news programs 22.5%
The New York Times 18.5%
National morning news programs 14.5%
Forbes 13.0%
BusinessWeek 10.5%
Fortune 6.5%
Time 2.0%
Newsweek 1.0%
Base: 200
www.prweek.com • November 10, 2008 • PRWeek

4. 14 CEO SURVEY
60%
12% to 17% [of their ad dollars] years. Not that it isn’t important to
online [from 106 to 107], and we get into a newspaper, but it’s a lot RESEARCH
How frequently does your company invest in market research
wouldn’t be surprised if it’s 25% less important today than it was to formulate its PR strategy?
in ’08,” he says. “Our customers five years ago.”
Of CEOs believe are making the shift. As an Internet One of the things that makes
Rarely
19%
word of mouth
Never
company, we’re heavily invested in digital media such an important
online media, but we also use offline target for companies like Sesame 26%
has become more media for brand building. There
aren’t many companies that have
Workshop, which has built a huge
community online, is the ability
influential in terms 50% of their ad dollars online. At for that outreach to build up word- 29%
50%, we’re putting our money of-mouth buzz. 10%
of a company’s where our mouth is, and we’re According to the survey, 60% of Sometimes Always
business than
encouraging our customers to do CEOs believe word of mouth has 16%
the same and respond to the... trend become more influential in terms Usually
three years ago of how people consume media.” of a company’s business than three
years ago. Others included trade Base: 200
meDia shift media covering their industry
51% Yet, for some companies, the growth
of digital media in the marketing mix
has made traditional media sources
(54%), blogs covering their indus-
try (50%), and The Wall Street
Journal/ Dow Jones (43.5%).
MEASUREMENT
How frequently does your company attempt to measure
the success of its PR programs?
Of CEOs believe less important than they once were.
For example, Sesame Workshop’s
Similarly, 42% of respondents
noted that word of mouth has the
Sometimes
19% 10.5%
that ‘The Wall Knell says while traditional media
still has its place, finding out where
most impact on business these
days, second only to The Wall Street
Rarely
Street Journal’ the company’s “intermediary” to Journal (51%). It was followed by
15% Never
its intended audience of preschool- trade media covering their indus-
currently has ers – in most cases, mothers or other try (37.5%), blogs covering their 26%
caretakers – are congregating online industry (34%), CNN, (31.5%),
the most impact is more important. and national evening news pro- Usually Always
on business “Going to so-called traditional grams (22%). 29.5%
media doesn’t guarantee you the For companies in industries that
kind of exposure you might have are dependent on referrals, word of
had in the past,” he says. “We’ve mouth has always been an impor- Base: 200
got to make sure that we under- tant – if not official – part of the
stand where ‘she’ is hanging out marketing mix. But the struggling
in a digital world and digital con- economy has reaffirmed the impor- ROI
Currently, how satisfied are you with the ROI from your company’s PR activities?
text. That’s something that has tance of word of mouth to CEOs.
completely changed in the last five Fantastic Sams’ Colabuono notes
that the beauty industry has always
“We see our
Fairly satisfied
relied on word-of-mouth referrals.
He stresses that encouraging word- 49% Not very satisfied
customers of-mouth marketing in the current
economy is integral to the business’
15.5%
shifting... to ultimate success.
“We don’t cut back in a tough 1.5%satisfied
Not at all
much greater
environment,” he says. “In fact,
we’ll probably be more active in Very satisfied
25.5% 8.5%
Extremely satisfied
reaching out to our guests, both
allocation current and new, because guests are
the lifeblood of a retail service com- Base: 200
into Internet pany. I believe the mix will change
a little bit away from traditional
advertising” [advertising] toward PR because SOCIAL MEDIA EFFECTIVENESS
How effective do you think online social media outreach can be as
the return... [is greater].” a corporate communications tool?
Century 21’s Kunz echoes the
– Chip Perry, CEO importance of word of mouth in Not very effective
Somewhat effective
AutoTrader.com a company’s marketing mix.
“[Word of mouth] has been the 23.5%
lifeblood of the real estate busi- 43%
ness almost since day one,” he
says. “Most consumers, when they’re 5.0%
ready to buy or sell... property, they Not at all effective
have to ask neighbors, friends, or
relatives [about who they’ve used]. 20% 8.5%
Extremely effective
“It’s always been part of our Very effective
business,” he adds. “Some of the
things that we look at is... helping Base: 200
our agents understand that the best
word of mouth you’re going to get
is from the quality of service you
provide to consumers at the time
when they’re making the biggest
financial decision of their life.”
Because Century 21 is a franchise-
based business, not only is word of
mouth beneficial for the brokers
PRWeek • November 10, 2008 • www.prweek.com

5. CEO SURVEY 15
62.5%
future social meDia use a love of reading in local commu- “always,” and 16% responded “Often times the advertising
how likely is your company to use social nities by creating reading events “usually.” Quite alarmingly, 26% budgets are so large compared to
media to communicate with stakeholder
groups in the next 12 months? as part of the National Education “never” invest in market research the public relations budget that it’s
Definitely will use
15.0%
Association’s 11th annual “Read
Across America” campaign, which
to formulate PR strategy, while
19% “rarely” do so.
hard to find the budget for the early
research and strategic research,” he
Of CEOs will be
Probably will use
Might or might not use
15.0%
26.0%
also fell on Dr. Seuss’ 103rd birth-
day. The company also has a Sylvan
“Uncertain times really require
more research to strategize in terms
adds. “As corporations become big-
ger and the issues become global in
more concerned
Probably will not use
Definitely will not use
29.5%
14.5%
Seminar Series, where local Sylvan of the response,” says Burson’s scope, it’s becoming easier to get that with ROI from
chapters host free events for parents Penn. “The kind of research that kind of research done. Clients that
Base: 200 on a certain educational topic. we believe in helps clients not just go through the process most often PR activities in
“Our business is one that is not measure things, but really pretest never want to go through a major PR
recession proof, but it does have the messages and strategies. That issue again without having applied 2009 than they
social meDia Barriers
Which of the following present serious
characteristics that suggest even in a
downturn, the need is always there.
kind of research, evidence based, is
critical to having an effective public
research as a companion to it.”
Century 21’s Kunz says the com- were in 2008
barriers to your company’s participation
in social media? We see that... families always put relations program. More and more, pany conducts a great deal of
their kids first. If your child is strug- companies are now getting used to research to ensure that all of its
Lack of relevance to target 44.5% gling in school, that comes before a applying research to their public marketing messages are consistent
stakeholder groups
discretionary item,” he says. “The relations issue the way they have and effective.
Concern about losing control 37.0%
of message demand is there. The challenge for become used to applying it to their “There’s no sense having any of
Return on investment 28.0% us is to adjust how we communi- marketing issues. But... it’s still way your marketing, advertising, or
Lack of knowledge and capability 22.5% cate with our customers so we meet behind the curve.” PR having different messaging,”
within the company that demand at a time where they’re Fantastic Sams’ Colabuono says he says. “It confuses the public,
Lack of knowledge and capability 19.0%
within the public relations, advertising,
going to be more careful about dis- his company does invest in pre- and more importantly, it confuses
and/or other marketing agencies posable income.” campaign research, though it’s our franchisees and confuses our
the company works with sometimes tough to justify. employees. We try as much as we
Other 9.0% research value “Allocating ad dollars toward possibly can to ensure that com-
Don’t know 8.0%
Certainly the economy is top research is always, in a franchise munications is consistent.”
Base: 200 of mind for every CEO today. business... a tough one,” he says. According to the survey, 62.5%
And in such an environment, “The view has always been that if of CEOs will be more concerned
judicious use of marketing dol- you research that means you’re not with ROI from PR activities in
and agents, but it can also impact lars becomes even more important, putting an ad out there, even if you 2009 than they were in 2008. It
franchise sales. Kunz was recently as does ROI. Though tools such might learn something as a result. is surprising then, that 25.5% of
at an international meeting of the as research and measurement We press on the research, if we have CEOs surveyed “rarely” or “never”
company’s top franchisees from have long been at marketers’ dis- a new initiative, to make sure that attempt to measure the success of
61 countries and participated in a posal, the survey shows that they it’s hitting well with the guests.” their PR activities. The survey also
panel discussion. are still not being used enough He adds that the plethora of shows that 55.5% of respondents
“One of them asked, ‘What do you in terms of PR. When asked how online free tools, such as Survey- “always” or “usually” attempt to
view as our biggest and best fran- often their company invests in Monkey, make research an easy, measure the success of PR.
chise sales tool?’ I know they were market research to formulate its cost-effective thing to do. “PR falls along with everything
thinking I would say the brand, but PR strategy, the largest percentage Penn says that the resistance is else,” Kunz says. “ If we’re going to
I told them, ‘Validation,’” he says. (29%) responded “sometimes,” likely because marketers simply spend the dollar, we need to have
“That’s nothing more than word of while only 10% responded aren’t used to PR research. a return on investment.”
mouth; it’s one peer to another say-
ing, ‘This company is good.’”
Jeff Cohen, CEO of Sylvan Learn- “We try as PERSONAL USE OF DIGITAL
How often do you participate in online social media (ie Facebook,
much as we...
� Company Web site
ing, which has more than 1,100 MySpace, LinkedIn, YouTube) for personal use? � Recent Press About A Company
� A Company's Virtual Press Room
franchise tutoring centers in North 50
� Daily or almost daily
� A few times per week � Company Blogs/Podcasts
America, notes that this propen-
can to ensure � A few times per month � CEO Or Executive Blogs
� From time to time
sity toward word of mouth ulti- � Never
40
that [comms]
mately means an increase in PR.
“Our business is a referral-based
30
business,” he says. “You may see
us on TV, you may think about us
when you hear that message. But
is consistent” 20 18.5%
23.5%
21.5%
24.5%
you are going to rely on talking to 12%
– Tom Kunz, CEO
someone, whether it is a teacher 10
Century 21
or someone you trust to... confirm
that decision to seek educational 0
Base: 200
assistance for your children. That
naturally lends itself to more word-
of-mouth type campaigns, more SOCIAL MEDIA IMPACT
public relations activities.” In which areas do you think use of social media can have a very large impact? � Company Web site
Part of Sylvan’s plan to encourage � Recent Press About A Company
� A Company's Virtual Press Room
word of mouth includes an increase 100
� A company’s overall reputation
� A company’s reputation around public issues � Company Blogs/Podcasts
in local community events. “When (such as environmental/labor issues) � CEO Or Executive Blogs
� Sales of a company’s products and services
you think about Sylvan Learning
80
Centers, you think about the one
in your neighborhood,” Cohen 61.5% 60.5%
60
says. “Our franchises are educa-
48%
tional resources in their commu-
nities. So, community outreach, 40
earned media, [and] public rela-
tions are critical for them.” 20
On March 3, Sylvan educators
across the country joined teachers, 0
Base: 200
students, and parents to encourage
www.prweek.com • November 10, 2008 • PRWeek

6. 16 CEO SURVEY
Fantastic Sams Hair Salons has
had a longtime relationship with CRISIS COMMUNICATIONS
the nonprofit Locks of Love, and In a crisis, which of the following channels are the most effective �
to communicate with consumers?
encourages local franchise owners to �
�
� Company Web site
participate in community events 100 � Word of mouth/viral campaign �
� Customer service representatives �
� Company blog
80 � Television
Penn says he has seen some cli- 70.5% � Newspapers
� Radio
ents invest more in research and � Paid advertisements
60
measurement during the current � External bloggers
� Magazines
economic turmoil.
38.5%
“During difficult times, peo- 40 37%
31%
ple will look to more strategic 27% 25%
research,” he says. “In an odd 20 16%
12% 12%
way, when it gets to good times, 7%
the first thing they cut out is their 0
Base: 200
measurement because they say they
don’t need it anymore.
“We’ve seen a number of people STAKEHOLDER COMMUNICATIONS
going through the current crisis Has your company every used social media to communicate
now have put in additional research with stakeholder groups?
to understand how their customers
are affected,” he adds. “Because
70.5% csr
Which of the following csr
initiatives does your company
currently participate in?
research is most useful in these
situations when you’re trying to
understand what customers and
No
82%
Of CEOs cited
Promote fair treatment of employees 53.5%
stakeholders are really thinking.”
their Web site Reduce environmental impact
Partner with the communities in
49.0%
43.0%
csr Benefits
18%
Yes
Though media coverage continues
as the most which we invest and operate
Contribute a portion of employee’s 40.5% to be a standard measure of PR suc-
time or company proceeds to charities cess, Kunz says he also values the
effective means Attempt to manage our supply
chain in a responsible way
31.5% internal rewards PR can bring.
Base: 200
of communication Other
Don’t know
6.0%
8.0%
“We also look at the amount of
good will that we get from our
with consumers
Base: 200
franchisees,” he says, adding
that the PR team will share media
“I think it does drive business,”
he says. “For myself, if I know that
crises. Yet Penn says that having
a plan set in place is essential for
during a crisis coverage with franchise owners.
“It gives them pride and gives...
I’m dealing with a company that is
doing something else in addition
all companies.
“You have to have a crisis plan
Benefits of csr something for them to talk to to whatever product or service in effect so that you know who to
Which of the following are the most their agents about.” they have... I’m more apt to want call to change things and get out
important reasons companies should
participate in csr activities? Engendering good will among to refer them or use them, and the information, and getting it
employees and other stakehold- I think that’s the same way with online and do things quickly and
It’s the right thing to do 72.0% ers has typically been the main Easter Seals and us. I know it is, efficiently,” he says.
It can build good will in 65.0% argument for participating in CSR because I’ve had customers tell us “For those companies on the out-
the community
It can increase customer loyalty 49.5%
initiatives. According to the survey, that they appreciate our efforts.” side, right now [they] are prepar-
It can improve the long-term 27.0% 72% of respondents believe the Good will among customers ing for potential downturn,” Penn
effect on their bottom lines most important reason to partici- and other stakeholders can be adds. “Now is the time to think
It improves recruitment/retention 27.0% pate in CSR activities is because “it’s especially useful during a cri- through the implications and not
in employees
the right thing to do”; other reasons sis, something that has become precipitously cut back on public
It reduces risks to reputation 21.0%
included, “it can build good will all-too common in the cur- relations when public relations may
It can reduce governmental/ 8.5%
external regulation in the community” (65%), “it can rent financial market. While be your most effective media, both
increase consumer loyalty” (49.5%), respondents differed vastly in online and traditional, in communi-
Base: 200
“it improves recruitment/retention their experience and prepared- cating with customers throughout
in employees “(27%), and “it reduc- ness for crises, overwhelmingly the unexpected. The unexpected
es risks to reputation” (21%). the survey showed that even in is becoming the norm.” n
the responDents Fantastic Sams’ Colabuono says a crisis situation, digital rules.
What was your company’s total gross on a national level, the company When asked which is the most The PRWeek CEO Survey was
revenue for the last financial year?
has had a longtime relationship with effective means to communicate conducted by PRWeek and Mill-
Less than $10 million 73.5% Locks of Love. In addition, local with consumers during a crisis, ward Brown using the ERI panel.
$10 million to under $50 million 7.0% franchise owners are encouraged to 70.5% cited the company Web E-mail notification was sent to
$50 million to under $100 million 3.0% participate in community events. site; 38.5% cited a word-of-mouth approximately 53,180 corporate
$100 million to under $150 million 2.0% “Especially when people know viral campaign; 37% chose cus- professionals and a total of 200
$150 million to under $1 billion 1.5% they have to spend money to go tomer service representatives; 31% CEOs (100 CEOs who have one
$1 billion or more 0.5% into a repetitive service, they want cited the company blog; and 27% or more employees at the company
Prefer not to answer 12.5% to know that the company they said television. who are responsible and/or take
Base: 200 work with is going to give some- “The most important thing in on full responsibility of all PR
thing back,” he says. “It burnishes the middle of a crisis is to get the activities and 100 CEOs that work
What is your company’s industry sector?
the image. It’s not the only thing facts, act very fast, and tell the with an external PR consultant or
Technology 18.5% we’re about, but it does add a little truth,” says Century 21’s Kunz, firm) completed the survey online
Consumer/Retail 22.5% bit of polish to what we do.” adding that executives and franchi- between September 24 and Septem-
Healthcare 6.0% Kunz cites the company’s longtime sees undergo crisis training. “You ber 29, 2008. The results are statis-
Financial Services 9.5% support of the Easter Seals Associa- have to be very responsive to your tically tested at a confidence level
Professional services 17.5% tion as something that is not only the customers and their customers.” of 90%. Results aren’t weighted.
Miscellaneous 26% right thing to do, but also something Obviously, in the current mar- Complete survey results can be pur-
Base: 200 that the company sees value in from ketplace, companies in certain chased for $150 by contacting Beth.
a business standpoint. industries are more vulnerable to Krietsch@prweek.com.
PRWeek • November 10, 2008 • www.prweek.com