Why the PR guru sees an upbeat story

By Candice Krieger, October 10, 2008

If image really is everything, then Richard Edelman is a useful person to have on side. Mr Edelman, 54, is the president and chief executive of Edelman - the world's largest independent public-relations firm. The company helped turnaround around ailing Wal-Mart - the world's largest retailer - which reported a surge in quarterly profit in August, topping Wall Street's expectations, and conducts work for heavyweights such as Microsoft, General Motors and Starbucks. It was recently drafted in by the Abu Dhabi United Group to provide support for their take-over of Manchester City football club.

"We are well ahead of anybody else who is not part of a Sorrell-like advertising holding," he tells JC Business, referring to WPP boss Sir Martin Sorrell (one of our Expert View columnists).

"It's an exciting business because it's no longer communications dominated by advertising. People recognise that PR has a unique and growing role in policy, as well as to communicate."

How would he market Israel? While acknowledging that focusing on the holiday opportunities is great as a consumer model, he says: "Israel has done a very good job with technology and bio-science. It would be good to have a few more hero faces, like technology entrepreneur Shai Agassi. Make the Israel story less  about politics and more much more about all the people who are making real breakthroughs in technology - a business-focused image as opposed to consumer."

Edelman was founded in Chicago in 1952 by Mr Edelman's father Dan Edelman, now 88. He remains an active chairman. Mr Edelman junior, who lives in the United States, joined in 1978, and the company has grown from a $6 million to $450 million business. It has offices in 52 cities and employs more than 2,700 people. Last year, the firm grew 26 per cent globally to a $376 million revenue.

He says the firm has not been too affected by the economic downturn. "We are performing much better than in earlier times of economic stress. First of all, the dispersion of media and the acceptance that there is a multiple-stakeholder model: it used to be that you could just talk to consumers. It doesn't work that way any more.

"I don't think it's going to be a buoyant year, but I think it's going to be OK.

"There's cyclical and then there's secular. The secular trend is away from advertising and towards things like PR."

He acknowledges that businesses are cutting their advertising budgets, but not necessarily their PR budgets.

"PR also has the effect of being an incredible multiplier. If you get it right, it can have a ten-times kind of influence, whereas advertising might have a three- of four-times influence.

"I think the order has changed. You have to have some buy-in to a proposition before the advertising can really work and there is such cynicism and distrust of institutions right now."

According to Mr Edelman - who cites research carried out by the company - the number-one trusted source of information is peer group, not the government or establishment media.

"That's a huge change. Whether it's Northern Rock or dodgy dossiers in politics, people just don't trust institutions to tell them the truth." He says trust in chief executives is around 25 per cent in the UK.

The firm has crafted many key campaigns, such as the Dove Campaign for Real Beauty, which Mr Edelman cites as one of the company's top five. Other memorable ones are Persil's Dirt is Good and working with Heinz on dolphin-safe tuna in the early 1990s.

Why are these so successful? "Because at their core they have a purpose and they are not just trivial." The firm also alerts consumers to products or problems and successfully promoted landing rights for the Concorde supersonic jet in the early 1970s.

Still, it has not always been easy. In 2006, Edelman was at the centre of controversy in 2006, when the firm was exposed for creating fake blogs on behalf of Wal-Mart.

On a personal level, Mr Edelman, was recently diagnosed with prostate cancer. Last month, he successfully underwent surgery at Memorial Sloan Kettering Hospital in New York, where he lives. He is keen to return to work. An active blogger - 16,000 people read his blog every month - he has been chronicling his experiences online at www.edelman.com/speak_up/blog.

As for the main challenges facing PR today, he notes: "We still have to get beyond the stereotype that PR means media relations, PR as spin-meister creating reality, and that PR is about attractive young girls holding parties. So, either we are the genius manipulators of the world, or idiots who send out press releases. And I reject both of those."

Edelman makes much of its claim to be committed to ethical behaviour. In 1999, the company dropped ties with any tobacco-related business.

"I felt very good about that, because it was the right thing to do.

"We have really tried hard to have good relations with civil society, and by and large we have succeeded with that. We are a family business and we take our responsibility to ethical behaviour further than the written rules of the law. Our family has been at this for 55 years. Nothing is worth reputational damage."
A Harvard graduate, Mr Edelman is proud of his Jewish roots and those of the company. Prior to establishing the business, his father had been in service in World War Two in psychological warfare. He was trained to analyse Nazi radio broadcasts.

Following the war, he went to work for CBS News, before moving into PR and starting his own agency.
Many of their initial clients Jewish entrepreneur, including Charles Lubin, the founder of the Sara Lee cakes range.


Last updated: 10:40am, October 10 2008