I heard a very wise statement today about keeping things in perspective.

There are really only two hard days in life, and they both provide contrasts and growth points.

The day you are born, you cry because you leave the warmth of your mother’s womb, and everyone around you laughs and smiles at your arrival.  The day you die, you smile at the thought of entering the world to come, and everyone around you cries.

If one takes these statements at face value, even during these difficult economic times, everything can be seen as an adventure and every day can be seen as a growing point.

It’s important to keep a positive focus on life.

Ronn Torossian

5WPR

Today we held a press conference for a client, and we were very pleased with the amazing turnout, about 10 reporters or so.   Our client was thrilled as well.  Press conferences are always so much fun: they’re risky because you never know how many reporters will show, but they have the potential to be hugely rewarding.  They’re also a lot of fun to set up.

During the press conference, one very young looking “reporter” from a major news outlet was present.  Although he had credentials around his neck, he clearly wasn’t of drinking age.  I was concerned he might be a fraud.  He asked questions during the press conference, and afterwards, my clients’ first question was, “Who is that?”  I had the same question, and sure enough, the “reporter” was, in fact, an intern, who was reporting on the story.  Budget cuts?

A reporter’s accuracy is very important, so I was surprised that a leading news outlet would send an intern to cover a major story.  Especially for a major publication.  Food for thought.

Ronn Torossian

5WPR

This week, I had separate lunches with two colleague CEOs of Public Relations firms.  Both firms are larger than us, and I respect both CEOs.  I can’t say I often dine or spend time with industry colleagues. Generally, my time is spent with clients, employees, journalists or hunting for business.  Given the pure chaos which exists in the market, it’s necessary to hear (and share) with industry colleagues.

An interesting topic that came up was the definition of Public Relations in 2009.  Not the textbook definition, but the actual definition vis a vis what clients will pay for and what agencies can ask to be paid for.  (As I often say, it’s easy to say, much harder to do.  Running an agency isn’t an experiment or concept – it’s reality).  Particularly in times like these, agencies need to be clear on what they do.  Clients rightfully demand responsibility for every penny spent, and PR firms need to know what they are tasked to deliver (and what can they deliver).

A key question for agencies remains: Do we define Public Relations as PR/marketing, or is PR centered around media and media relations?  Or a combination of the 2 ? I ask this question not as an academic, but more as a practicality of running a business.  It’s very challenging to charge a media relations client $50K a month, whereas agencies who look at PR primarily through marketing eyes can often charge that and more.  Conversely, it’s often a challenge to find senior talent who will call the media (as we at 5W PR expect). The skills to succeed at creating PR marketing programs are often antithetical to the skills required to thrive in media.

It is very, very much unknown just how small the PR agency world is.  There are fewer than 200 independently owned PR firms in the US, and that number is sure to shrink in 2009 with the recession.  Of course, the above list doesn’t count the many 1 or 2 person “PR” businesses, which I really wouldn’t characterize as agencies.  And there are also the 20 or so mega agencies owned by publicly traded holding companies.

As the CEO of the 21st largest independent firm in the US, I am often amazed at the small size of PR retainers.  As I often state, a $1M (or even $500K) PR client is one that any PR firm in the US would chase endlessly, whereas a $1M advertising client is one that very few top 100 ad agencies would pay a minute of attention to.  It’s a disparity that I very much hope will change in the future.  But for now, PR simply remains the overlooked bastard step child. 

While reading about the recent scandal surrounding Brunswick, a highly-specialized financial public relations firm, I wondered why PR firm employees don’t earn what bankers earn, despite the fact that PR professionals shape messaging, create public perception, and move stock markets en masse.  It’s because the fees corporations pay PR people simply aren’t in the millions.  (Although a firm like Brunswick does charge a stiff hourly rate, compensation doesn’t come anywhere near to what a top lawyer or banker makes).

Despite The New York Times’ statement that financial PR agencies “are often as deeply embedded in deals as the bankers and lawyers who negotiate them,” PR firms simply aren’t huge businesses like banks or law firms.  For anyone who wants to work at a PR firm, there simply aren’t more than a handful of options.

Ronn Torossian

5WPR

Friday morning, as part of our ongoing speaker series, 5WPR hosted Rev. Al Sharpton.  Although I disagree with him politically, Sharpton has influence and access, and he brought a new view to our conference room.  He’s clearly a messenger with a voice in politics and the media, and someone we can learn from.

As a PR agency, we host a speaker series for our clients, friends, contacts, and the media.  In the past four months, our speakers have included Hank Sheinkopf (a friend and very smart political consultant… daily on CNN), Roger Stone (political genius), two Israeli MK’s, including Gilad Arden (a probable Minister in a Netanyahu administration) and Yoel Hasson, a longtime friend and Chairman of Kadima (current ruling party), among a slew of others.  It’s beneficial for our clients, interesting and exciting.
 
Sharpton’s topic was Race & Business in the Obama Administration.  He spoke quite eloquently, acknowledging that while a significant glass ceiling has been broken, there is still a ways to go.  “We’ve made a lot of progress, but I don’t think we should stop until we make it all the way,” he said

When asked how far he thinks he has moved the Civil Rights movement, he responded, “We have made enormous progress, [but] Martin Luther King used to say ‘you gotta measure things from the bottom to the top.’  So we made a lot of top progress, but the bottom has to be on the same progressive curve as the top.  You can’t just have Tiger Woods, Oprah Winfrey, Barack Obama, but double unemployment in Harlem and act like it’s not important.  That’s where the challenges still remain.”

Sharpton’s entire presentation can be heard at 5W Public Relations’ YouTube page. 
The presentation is broken into three segments:
Part -1:
Part -2: 
Part -3:

Sharpton’s most resonating words for me were, “This isn’t the end of grievance politics.  There will be grievance politics as long as there are grievances.”  Working with a ton of politicians on PR issues, I agree that as long as there’s politics there will be grievances.

It was an all around exhausting week, so I’ll end with a quote from an investment banking friend, who said: “Most people DON’T have a clue what they’re doing and the ones that do work their asses off – right?”  I concur.  It’s not easy being a business owner.

Ronn Torossian
5W PR

Owning a PR agency makes the second half of December an incredibly busy and difficult time for me.  Every year, the last few weeks of this month are absolutely hectic, without fail.  I admit that this year I thought it might be different, with the economy what it is.  But the week is barely three days old, and I haven’t left the office before 10 p.m.  Exhausting.

Separately, I had lunch yesterday with a colleague from the Public Relations industry at a well-known, mid-tier midtown restaurant.  When the bill ($100 for lunch for two) arrived, we were surprised to find a simple $10 gift card along with it.  No explanation – nothing other than the card.  It’s a very clever marketing tactic to use during a time when many are cutting back on dining out.  Essentially, for the price of an appetizer, this lunch venue may secure my repeat business.  Smart marketing (and both of us noticed it).

Ronn Torossian

5WPR

One would think from the state of the recent global media reports that capitalism has become a four-letter word. What has become of simple entrepreneurship?

This weekend, I spent an evening with a nightlife impresario and after we visited a number of nightclubs, was simply amazed at how packed they were. (I haven’t been spending much time out in the past few months; I need the extra minutes at the office.) I made a note of the crowded spaces especially because most of my closest friends are similarly young and successful entrepreneurs — people who generally spend a lot of “leisure” money but, like me, have cut back tremendously on leisure spending due to the state of the economy. As I looked around the clubs, I instantly noticed that almost all of the patrons were “millenials,” members of Generation Y – a young age group that has recently joined the workforce. Even stranger, these clubs, which I generally frequent, are usually filled with people in their 30s and 40s — the men, at least. I will admit that one of the few people I saw of that “older” generation that evening was Jay-Z.

Throughout the work week, I often marvel at the millennial generation’s behavior, which is so much different from my mentality even though I missed the age cutoff by only a few years. The millennials seem to make freedom a number-one priority and are always searching. It’s almost like a generation of young Europeans. I found this article educational.

And, separately, to quote this Forbes.com post.

“Morley Winograd and Michael D. Hais, who co-wrote Millennial Makeover: MySpace, YouTube and the Future of American Politics, have observed that millennial “mellowness” can be traced to child-rearing patterns marked by feel-good toddler shows like Barney (“I love you, you love me”, etc.) Moreover, they add, millennials seem devoid of an impulse to fight and prove their superiority over others — not a surprising outcome when everyone gets a trophy.”

Owning a business is a constant adventure – a continual learning process that never ceases to be fun and different.  Millennials, huh?
Ronn Torossian

5W PR

When you own a PR agency and are pitching clients to the media on a daily basis, obviously there’s a need to read the papers and be up on current events. But I admit it’s become much harder to read the papers in light of the continuous stream of depressing news. The fear that erupts naturally as a result of negative media is palpable.  Whether it’s the madness of Marc Dreier (whom we represented in the past), or the madness of $50 billion scammer Bernard Madoff (do we have any clients who invested with him? And what will the tremendous repercussions and fallout be for businesses everywhere from his dishonesty?), these are incredible times we are in. With the terrible state the publishing industry is in, is it possible that a major magazine or newspaper focused solely on good news during this time period could actually thrive and benefit, similar to how Fox News changed the name of the game 10-plus years ago? I state this in a serious manner: They’d succeed, I believe.

This environment is most dangerous because it creates a sense of paralysis, which inhibits any sort of growth. I am someone who believes tremendously in the power of positive energy, and in this environment, it’s impossible to absorb any positive energy whatsoever from watching TV or observing the news. I especially noticed this during a near-two-hour run on the treadmill today. I just kept flipping channels — nothing good.

As the rabbi I follow says, there are Jewish teachings that say that every effort we make, every word we speak, every good deed we complete gives birth to an angel. It’s a sophisticated Jewish mystical view that all of our efforts are energy, give birth to energy, and set into motion energy (malachim in Hebrew), also known as angels. I believe very much in the power of energy for all — in business and in life — and during times like these people need to find their positive energy because it’s just not around. If you don’t want to run away or be paralyzed, you need to act and move. Positive energy allows you to succeed and focus. It’s all about mindset.

Ronn Torossian

5W PR

Yesterday’s New York Times article, “A Good Power Broker Is Getting Harder to Find,” was an interesting read.  I believe tremendously in the value of continually leading people to people.  Today, the best PR firms are often hired because of access to a certain community or decision maker.  Of course, access doesn’t guarantee the “right” answer, but in the best cases, it does mean a “straight” answer.

I think the point that the NYT missed is that the world today is much more divided, yet much more open than it ever was before.  It’s a new world, in which someone can be immensely successful in a certain field or arena, but not need anything in the city where they live, because the decision makers are thousands of miles away.  And of course, instantly blackberry accessible.

Every industry has its own power brokers.  With ethnic, racial and age lines so different than they used to be, it’s harder for anyone to be a “universal” power broker.  So many more relationships are required today, and so many more doors are available.  The game has changed.  It’s not just Harvard MBAs changing the world, or old money; it’s immigrants with dreams, HS dropouts and simple hardworking folks. 

Years ago, I don’t believe there were many people like Goldman Sachs Chairman Lloyd Blankfein, whose father was a postal worker, or people like Phil Knight, who sold sneakers out of his car for years, or the many multi-millionaires throughout the world who came from nothing and are now power brokers.  The world has changed in so many ways.

It’s why I hold my own networking meetings at least two times a month, with 20 high-level attendees from a variety of industries.  The purpose is to introduce everyone to each other to talk business, with the premise of: “Put smart successful people in a room together, and they will figure out a way to make money.” To me, it’s one of the keys to winning at public relations.

Ronn Torossian

5W PR

On a few occasions today, I witnessed the difference between a person who owns a business and one who works at a business.

Even employees should have the attitude of caring, passion and emotion.  Certainly, my best employees do.  It’s about taking ownership, right or wrong, and caring.  Passion shows, especially in the service industry (like a PR agency).  Even employees can take ownership and think like a business person.

The following article (which I found randomly on the Internet) is a great read on the subject. http://www.synarticles.com/entrepreneurialism/business-owner-mentality.html

Ronn Torossian

5W PR

I have a major client who buys significant advertising space in a slew of magazines and newspapers.  He insists on telling the reporters we deal with on a daily basis about the ads he purchases in their publications.  He refuses to accept (from them and us) that the newsroom is independent from the advertising department, and insists on increased coverage based on his buys.  With all of the layoffs in the media business recently, and tremendous advertising cutbacks, will there be a further blurring of “church” and “state”?

I write this in the midst of reading The Oligarchs: Wealth and Power in the New Russia by David E. Hoffman, an amazing book about the rise of oligarchic wealth in the former Soviet Union.  (We represent a number of oligarchs and have a joint venture with a Russian/Ukrainian company).  In many countries throughout the world, the concept of a “free” media isn’t held as highly.  I remember trying to explain to a billionaire oligarch that hiring us meant paying us a monthly retainer, but that we couldn’t guarantee him positive media coverage.  He simply couldn’t fathom it, as he kept saying, “I don’t care what it costs….”  He couldn’t understand the concept of not being able to buy positive media coverage.

In the midst of this recession, will the scarcity of advertising dollars lead to an increasingly blurred line between ads and PR?  At what point does protecting shareholders take precedence over “independent journalism”?

Simply food for thought during fascinating financial times.

Ronn Torossian

5WPR