(MENAFN- PRovoke)
While in São Paulo last week for our 2024 LatAm SABRE Awards, Provoke media and Burson gathered regional PR leaders to discuss the state of the business, covering topics from international companies' sparse knowledge of the region to the maturity of the industry across Latin America. Participants included Brian Burlingame, CEO Latin America, Burson; Patrick O'Neill, founder and managing partner, Sherlock Communications; Karina Barcellos, chief strategy officer, another; Juliana Damigue, market development director, Porter Novelli; Claudia Daré, founding director, LatAm Intersect PR; Laura Chiavenato, VP consumer & health practices, Weber Shandwick; Fábio Santos, CEO CDN Comunicação and president ABRACOM; and Juan Carlos Gozzer, CEO Latin America, LLYC. Provoke founder and chair Paul Holmes moderated. More information about this year's SABRE Award-winning campaigns, some of which are mentioned in the transcript below, is available here .
Paul Holmes : I've been writing about public relations for nearly 40 years. I'm assuming I started before many of you before, sorry about that. But I do, in fact, love this business and reporting on it, and one of the reasons is that get to sit around the table with people who are leaders in their markets, and find out how public relations business differs around the world. I set this up with the help of Brian and our friends at Burson and the Jeffrey group, because I wanted to get a real sense of how public relations in Latin America is developing, and what the business climate for public relations is in this market. I wanted to come out
with a greater understanding of sort of what the important issues are that you're facing.
Those of you who were with us last night will have gotten a sense of just how much really good creative work there is in this region right now. But what is the economic climate like for public relations? The last few years in Brazil, for example, have been somewhat politically tumultuous, let's say interesting. The same is true in many other Latin American markets. Give me a quick sense of how you see the market right now, in terms of the business conditions and the level of seriousness with which companies are taking it.
Patrick O'Neill:
My clients are all from outside Latin America. We have clients who come to us looking to enter or grow with in the market. Generally, I think we are all very influenced by the political views of certain countries from outside of the area. And if there is negative coverage, for example, of Brazil then we have less inquiries about Brazil. Colombia was huge about two years ago. Everyone wanted to go to Colombia. And sometimes there is a lack of knowledge, believe it or not, about the economies of Latin America. We get people saying, I want to do Argentina and Brazil. But why? Have you done any research? Generally, they say no, but they want Brazil and Argentina.
Are they picking markets based on the World Cup final? I mean, no, though I'm only half joking. But the reputation of your country internationally impacts on how many people simply want to enter into your market is what I found.
Karina Barcellos: Another is based in Mexico. Our office here is very small, we have 15 people. But we have offices in eight countries, so I think our operation is very similar to Sherlock in a way, and the kind of clients that we have. In terms of challenges, I think that there are many. One challenge we see is having to deal with clients that want more for less. I don't know if everybody can relate and actually find a path to profitability in that scenario and considering the high number of competitors that we have - and not just the competitors here at this table, but smaller agencies that are jumping in.
Laura Chiavenato : And even advertising agencies that are starting to do PR work. They're starting to own the PR sense, and they don't really understand what
PR is so how are they doing it?
Claudia Daré : I think that there is a lack of knowledge about the region when we work with international clients. Clients didn't know that Brazil would speak Portuguese. It is something of a challenge, of course, because you need to give this knowledge and make them understand the differences among the countries. Another challenge that is the competition with marketing, which is so complex. We are in the middle of what clients want to pay for and what the newspapers and media are asking for. We have to be very creative.
PH : One of the things that's happening globally, it seems to me, is that the divide between PR consulting firms and PR agencies is getting wider. So the consulting firms, the firms that are offering not just communications advice, but in many cases, business advice from a communications or a relationship management viewpoint are very different, or are in a different competitive landscape and are able to charge very different fee levels than those firms that are taking orders and doing publicity. Most of us are on a continuum and most of us actually are at one end of the continuum for one client and the other end of the continuum for the other client. But how is the market in this region shifted in that respect over the last few years?
Laura Chiavenato : I feel that we have matured a little bit, but we're still very immature when it comes to the US and Europe, in general. But one thing that I have to say is that what makes us different is that when you're PR consultancy agencies is that you have to earn value to get value. So when you really understand the landscape of the market you're in and understand what is culturally relevant, you get the value that you want and, therefore, you get business value for your client. I feel like we have to always understand our clients' business challenges to provoke them to do what is next and not just serve whatever is going on at the moment.
Brian Burlingame : I agree with that and I think we all know the challenges, the economic challenges in our region, in our markets. Our clients are always under this intense budget pressure, which trickles down to us, obviously. So I think everyone here is trying to make that progression to the consultancy side and raise the value of our services. The traditional services have been driven down to the lowest cost, so where it's not even possible for us to make good profits just doing those services. We have to expand. We have to drag the clients along with us down the value chain. But they're under this big pressure that obviously makes us have to be more creative, right? So we can look for those solutions. But I think there's so many different factors, economic factors, pulling on us here. One of them is this mentality of I'm buying people, so clients are not coming for the agency consulting experience. They're coming for, I need hands, arms and legs, and ears and eyes, and I need four dedicated people. And this is not something that really is good for them, and we know it's not really good for us in most cases.
PH: We could spend a whole meeting discussing this, right? But this business walked into what I think of as a billable hours track long before I started writing about it. And people are like, OK, I'll pay you for the hours that you spend doing things, not for the solution that you come up with when you're thinking about my problem in the shower in the morning. You're not being paid to think, you're being paid to do. And people do what they're paid for. That's the incentive system.
Fábio Santos:
And now we are dealing with procurement, not only with communications. And I feel that there's a lot of clients that they are not mature
enough to discuss the importance of PR for their business. They want media relations, a commodity, and we have a lot of smaller agencies deliver that service and with very low budgets's very difficult for us to be optimal and to have this kind of delivery.
PH: But Fabio, you're primarily in the financial communications, public affairs side of the business. Does any of what you're hearing resonate with you? I'm assuming you're not competing to quite the same extent with ad agencies, but is there the same sort of market pressure and competitive pressure on firms like yours?
FS : Yes, it's the same, completely the same. I believe that the Brazilian market is not mature enough and we are going through a very big and deep transformation in the market, in the agencies and also in the clients. We are in a crisis that's going on all over the world without being mature enough to get through it. So what we see is a lot of agencies, small agencies, wanting to play the game, the price driven game, because they have very low costs. And we have clients that don't see the value of what we do. We have to educate them. But sometimes we see that the whole process is given to procurement, and they are contracting with us like they are buying cell phones or glasses. It's price not value. And you don't always see at the board level of companies the conscience, the knowledge that the kind of services we provide are fundamental for their businesses.
Juan Carlos Gozzer : The main problem in Latin America is inside the companies, inside the clients, and the perception of communications. You talk with the director of communications about data, you talk with him about creativity, you talk with him about all this stuff, and he'll say, that's cool but let's let's do the PR because my boss wants to see the brand in the media. We need to prove to them the value of our work. The challenge is to show how we will impact the results. On the other side, you have CMOs who are saying they have all the KPIs, that their work directly impacts the business of their companies and therefore asking why they have to share the communications budget with the PR team.
LC: They take the budget from PR because the paid media budget is for sure that they're going to get the results. And that's something we have to shift.
PH:
To push back slightly on that, that depends on how you define results, right? If by results you mean that if you pay for an ad, the ad will appear, yes. If you mean if you pay for the ad, people will do what you want them to do, advertising is no better at that than we are and actually, does a really shitty job of proving it, because they say, hey,“You gave me $5 million for an ad, I bought a $5 million ad, that's my job, right?”
Juliana Damigue: But I think things have changed, to be honest. I think things have changed when you're spending that money, and we have to face who we're competing with. And you're 100% right, the marketing officers, the chief marketing officer, can say,“I put $1,000 into this, I can see $1,000 in sales if I do an online ad, I can see reactions, I can see engagement, I can see this, I can see that.” The whole game has changed. And that is our responsibility to deal with. We can't just say, oh, it's the companies. If I was a CMO, I would probably do the same, if I've got a board screaming at me.
PH : I want to come back to the director of communications topic because I want to make sure that my inference from what you said is correct, that part of the problem we have in this region is that the director of communications is not always at the sort of C-suite level, that they're not seen as an equal to the CMO, that they're not seen as an equal to legal and human resources. Is that true and what needs to change to elevate the importance of the director of communications here to that kind of level?
KB : We are all very lucky if we get to interact directly with a director. When you look at the head and the persons that are in charge of the decisions on how they hire an agency, we can see that usually it's a younger person, which is not a problem, but it's a much younger person who wants to please their bosses but who does not have the knowledge or the influence in the organization to be able to negotiate the budget that they need for funds. We probably have people who have worked for us that went on to be heads of communications for our clients and we probably wouldn't have made them directors at our agency.
PO : I would 100% agree. And I think one of the things is as well that often communications is it's seen as not really a serious job. It's not considered too important. And that's the problem for them. But I think it again comes back to us to try. We have to accept that there's loads of shit agencies and in part of our business, there's what I call used car salespeople. You know, that tradition of people talking, saying I'll do this, I'll do that, and not doing anything and it damages our industry. So, we have to accept that as one of the things that we need to deal with. Clients will say they can find an agency cheaper than us. Well, go and find it. Not a problem. And you're wasting your money. I had a German company who came to me recently and said, we want to do this work cheaper. So I told them to go and spend the money in Germany - don't come here if you're going to do it on the cheap - but you'll be wasting your money. They came back to me. And they gave us a contract.
PH : Let me ask you about this question of the status of the senior communications person inside the company. Is this a reflection of CEOs in this region don't care about the company reputation enough? Or is it that they don't believe that the CCO can help them with the reputation?
FS : Let me tell you, sorry, it's not very good. We have done a study about the curriculum of MBAs, the courses that provide education for CEOs and C-levels. None of them have communications as a discipline. They have marketing as a discipline
but not communication. So these guys are being formed without a complete vision of what reputation means. Of course they know, they value it, they take care of it, but they don't see it as a business leverage and it's really a business leverage.
BB : The people at director level, or CMO level, or CCO level, are the people who get it. They understand that we're dealing with an intangible asset here. We're dealing with corporate reputation, an intangible asset, it needs to be taken care of,
it has a big impact on business from a financial point of view, in terms of all the stakeholders that are involved in this. And I think it's up to us to really reframe conversations. And this is a long-term proposal. We've been trying to do this, I know, for many years. And so you go and you have the same conversations all the time, but each time, you're making a little bit more progress, because you're reframing the conversation, using anything you can such as data and best practices in the industry and things like that.
And then we have partners, things like the Center for Reputation Excellence, which is a think tank that we work with. And these people are measuring how much reputation matters to the CEOs and to the CMOs and CCOs. So we try to partner with them in order to elevate that conversation. And that's when we have more success.
CD: I believe that these changes also depend on the countries that the clients are from. There are countries where companies include the person in charge of communications, but you see in other countries where they consider this person on a lower level.
JD : I have a more optimistic vision about it. I think things are starting to change, especially in Brazil, when we talk about CEOs and communications. Societies started watching very closely the companies and their impacts in the market, the real impact. And the CEOs, they are realizing that they need to tell the real story and we are the storytellers in this case. We have a lot of clients, a lot of CEOs as clients working to become thought leaders in different areas and segments. So, they are starting to worry about communication.
PH: So just a couple of observations from somebody who's been here for two days, okay? That's how much this is worth. But, certainly, in terms of the winners last night, there were reputation-driven campaigns for indigenous Latin American companies. Vale
was a winner last night. Itaú, right, was a winner last night. Pan American Energy was a winner last night. They seem to be quite focused on reputation. But I had a conversation with your friends at Weber Shandwick earlier this week, and they were telling me the story of a CEO from an education company who went on television and was asked, would you like your wife to be a CEO? And he basically said, she can't be a CEO. She doesn't have testicles. I mean, how would that even work? I'm paraphrasing, clearly. The sentiment was, God forbid a woman CEO. And that seems to me to be a teachable moment for our business, right? To say, this is what can happen to your reputation overnight if you don't have a good public relations person if you don't have a good director of communications, If you haven't been properly media trained your reputation can go like this
CD: I have something to say about this guy. He used this strategy to put himself in the conversation. But this time he was unhappy because he went so far. The companies are looking to position the executives. It's about position, not only of the company but who works in the company. And this is a trend across the region.
JCG : I feel more comfortable talking to a CEO about reputation matters issues as a whole, about the business, about the work. The community relationships are about what is good.
So when we want to talk about reputation and the business and the value for the business, the communications is a big thing, they see you understand better.
FS : Sometimes (communications) people inside companies don't see themselves as part of the business. They don't see their work helping the business to grow. But I had a client at one point that said that no big decisions in the company were made before consulting the PR people because everything you do at a company causes worries about reputation concerns, even where you decide to have your office. I had a client who said they couldn't have an office in a fancy area in town because they have a reputation of a company that's very spartan. And that's the ideal client for all of us.
PH : The big trend that we've seen in North America and Europe, and it's been the theme at Cannes for the last four or five years, I would say, is that everything today is earned first. That, and it's this idea that any great PR idea can be turned into a 30-second ad, but not every great 30-second ad has the potential to become a great PR campaign, right? So we're all talking about earned first. In that environment, why are PR agencies not getting the opportunity to lead marketing campaigns? Why are we still too often seen as sort of backfilling the great idea that the ad agency came up with?
LC: My point of view is that in the Brazilian market most CMOs still believe that the advertising agencies are the most creative ones because they have the creative team, they can show the results. When they go into a pitch, they will have this huge video case and everything else that they have spending 10 times the money we do. They can showcase a lot of the different things that we can't. But the results don't actually turn into a great PR campaigns, like you said. What we have is to shift the concept, is to show them, start to play the games at the same level as the advertising agents. The case that we won for last night, for Mortal Kombat, was entirely thought up as a PR campaign There was no advertising agency with us. We looked at what the brand needed for the launch of this product. We sat down, we had the idea and we asked for a lot of money. The whole concept was to get media attention, press relations attention, but you don't do it for free. We have to start thinking like the advertising agencies and put ourselves in that place where they will give us the money. We are at the same table.
PH: So you raised two, I think, really interesting issues about the PR business. The first is creativity and one of the things that I've been hearing forever - and I hear PR firms use this terminology, which is worse - is there are PR firms and then there are creative agencies. Are we not creative? We talk about advertising agencies as if they are the only ones. That's insane.
BB : Our creativity comes with credibility as well, which is, at the end of the day, what people respond to - the authenticity, the credibility.
PH : The other thing that you mentioned, which is part of this arc I think, is data analytics. And I have a very simple view of this. The person with the best data will have the best insight. The person with the best insight will have the best strategy. The person with the best strategy gets to tell everybody else what to do exactly, and we have traditionally been two steps behind at the data stage, which means that we may have a great insight, we may have great strategy, but we can't back it up. Where are we now in data? How much are we all around this table investing in and using data and analytics to make ourselves more compelling?
LC : I believe there is no good PR campaign without data. You can't back your argument if you don't have facts. You have to have the whole picture. One of the things that we're doing at Weber Shandwick is we're training everyone to understand data and analytics and how they're going get insights and how they're going plan perfect strategies for our clients. The idea that we were showcasing yesterday wasn't developed by an analytics and strategy team.
It was the person who's doing the media relations on a daily basis with the client, because that's the person that knows the client the most. That is the person that understands the client's business the most. So that's the person who has to have the insight.
JD: We have to make it available to everyone like AI, which is the new Microsoft Office package.
PH : One of the things that I loved about the avocados campaign which won last night was that there was so much data in the front end. It was really rigorously researched.
PO: Part of our business is just research and insight because of the lack of knowledge and insight some of our clients have about the different economies of Latin America. We have to ask them who their customers are and explain things like not everyone in Brazil can access their product just because it's online. We tell them that they have to talk to Brazilians and ask if they even want your bloody product. This idea that you're the number one selling app in Germany so it's going to be relevant to Brazilians: no. Where's your insight on it? And then they get scared, because you tell them things like half the people can't have that app on their phones here. I'm not an engineer. But I know if people download it, they're going to dump it off their phone in two minutes because it's using up too much of their memory. And because we've done the insight, I can say I know the audience you're looking for. I know how to reach them.
BB : Coming from a background of a medium-sized agency, I think when you have smart people that know how to ask the right questions, you can mine data and bring these insights. But I think what Juliana said is very interesting and is pointing to the future. AI is going to become like Microsoft Office. And if you don't have it, if you don't understand it, if your people don't know how to use it, then you're going to be behind. And so I feel extremely fortunate to have so many tools as part of a large group that I think there will be AI democratization as well. Thing's move so exponentially fast I think it's going to become what the clients are expecting.
PH : I think that what your panel was saying yesterday was absolutely right: that generative AI is not really terribly interesting. Cognitive AI is fascinating. If we can use AI to predict to what in America we call red teaming, to sort of set up the opposing point of view so that you can have an argument with AI that is pretending to be a critic of your company, that's the interesting part of it.
BB : We're starting to train our cognitive AI for special use purposes, for health care, for example, so that you can dive deeper into understanding your audiences on a massive scale a lot faster. I don't think that we're going to lose talent, we're just going to make talent more talented. They have to understand it's this is okay. We were all educated in the system of going out and find the answer. You don't have to find the answer anymore. What you have to do is ask the right questions. And to do that, you need to have the wealth of experience that's necessary to ask an informed question.
PH : I spent some time in the US two years ago asking every agency how many of their people have never spoken to a reporter. And it's about 50%. About 50% of the people who are public relations people today are doing something that has no connection with the traditional mainstream media whatsoever. They're doing research. They're doing data and analytics. They're doing measurement and evaluation. They're creating TikTok videos. They're reaching out to influencers. We can argue about whether influencers are media or not, but they're not typical media. How willing are clients to give you the opportunity to do all these other things, or do they still come to you primarily and say, get me magazine coverage, get me newspaper coverage, get me a pile of clippings?
LC : I think that we started by talking that the Brazilian and Latin American markets are still very immature when you compare them to the US and Europe. So most of my clients come to us for media relations.
FS : They're looking for the clippings, the pile of news articles that we're going to get them. And what we have to do is actually change this shift to show them that we are not just media relations. We can provide a lot of other services. We have to show them that talking to an influencer is helping you with media relations.
JD: But I guess this is about asking the right questions, because clients come to us and say, I want to be the cover of that magazine. And then we say, why? And then, ah, because I want this kind of result. OK, so you don't need this, the cover of this magazine. You need a newsletter because your stakeholder is not reading that magazine.
LC : Or what you need it probably a better company LinkedIn page.
PO : I had a client who came to me and said, I want to be on the cover of that publication. I asked, why? And he said because you got my son on it. So nothing to do with your business, right? It's because you have family competition with your son.
FS : You want the front page of the newspaper, the press, because you want to show it to your mother.
PH : But this is an old story, right? Because this is the CEO who says, yeah, I know that my customers are all working class football fans, but I want to sponsor a golf tournament because I love golf. I mean it's the same thing, right? It's vanity.
KB : The fact is that media relations is an open door, it really is, but it's our job and sometimes we don't do it well enough to take advantage of that. Something we're doing at another is really pushing proactivity from the account directors to really every month (to come up with) a new idea that has nothing to do with the service that we are providing, which is usually media relations. And we're getting good results.
PH : This brings me back to a topic that I promised about half an hour ago that I would come back to, which is measurement. So again, companies were rightly or wrongly - wrongly, obviously - very comfortable counting clips or counting impressions or translating it into ad value. We still see that. We still see that in award entries. So my question is how successful have we been in moving clients, first of all, in delivering meaningful metrics?
The cat campaign that won last night was number one in my mind primarily ... because it actually achieved both social objectives, we got more cats adopted, and it made a huge impact on sales, right? There were measurable increases. This is measurement, right? 50 million media impressions is not measurement.
JD : I guess we have to start making, again, the right questions when you understand that the cover of the magazine is not the real objective of your client, and you understand that sometimes the client doesn't know their real objective. It's our job to ask why, why, why.
JCG: I think that's something we need to fight for. It's about the RFP not focusing on the pain. It's focusing on the delivery. You see the requests for proposal here in Latin America and they say, I need three press releases, I need four people, I need two or three interviews. Why do you think you need three press releases? Do you have things to say? Maybe not three, maybe 10, maybe one, I don't know. And they say, no, let's do the three press releases. And after that, all the work is focused on delivering the three press releases because the client would say, ah, this month we did it. We need to focus on the pain. And it's quite difficult, but often you have to say no for these kind of requests.
BB : Well, Paul, when they send me the case studies for the entries for SABRE, and they only have clips, I send it back. You need to frame this in a way that's important for the client. And if you don't know what our work did, then we have a problem because we're not able to show our value. And a lot of times it's not our team's fault because they're working with the information and the remit that the scope that they've been giving. They're also trying to work around internal silos at the clients, things like that. But I think to your point, we have to keep pushing to understand. I would rather see, I think, a result of a thousand inscriptions or something like that or even driving traffic or, you know, things that, you know, cats saved or whatever. These are metrics that actually mean something for the business rather than seeing some kind of ridiculous impressions number that we know doesn't
LC: But I think it all starts with what you said, that is, asking the right questions to the client so that the client understands what they need to understand, what their need is, because most of the time they don't know. They're going to ask for the clips. They're going to ask for ad value. And then we have to tell them, okay, so if this is what you need, clips are not going to do it for you.
PH: And I'm wondering what your thoughts are on the quality and quantity of available talent, both at the entry level and as you move up the sort of value chain. We have a tendency in our industry to cannibalize each other, though I'm sure nobody at this table would ever do that. So, what is the talent situation? Are there people who want to come into the public relations business and really understand what it's about and have the skills? How are we developing all of these new skills in AI and data and analytics and creativity to make sure that we can compete?
KB : I think that this is a very, very important question. Working within the region, primarily we all need trilingual people in our teams, right? And it's very, very hard to find these people. And we need to do a better job of making PR a sexier opportunity for those people. Because there are the Googles and there are the Netflixes competing for those same people so it's something we really need to do. I think there's a new factor that makes it even harder now to find talent, which is that you need people who have the right profile to operate AI, which might be the solution for our efficiency problem, getting our job done in less time using the resources. But then you need somebody who has the right questions. You need more analytical profiles. We are not known for having the analytical skills we would require for this to be widespread in our teams.
PO : There's an issue for me now and it's the idea of not being in the office. When I trying to work in public relations, I did not have a communications degree, I didn't have a journalist degree. I used to be a chef. And I ended up in a great department, just doing basic admin stuff and I was listening to people. I was listening to a person chatting with a journalist, and then discussing how do we deal with this crisis, and I learned from that. You can train someone to do all the technical stuff but people working at home in the bedroom are not learning and understanding what we should be aware of and how to answer a question appropriately, how to deal with a journalist. I don't want anyone in my office who doesn't meet journalists regularly. Every month, people are bonused on my team to meet at least two new journalists a month. We've never had a rule that we had to be in the office, but now I'm really concerned for younger people.
CD : We are 100% remote. It works very well. We developed a very fun way for work. We have weekly meetings, virtually. We have happy hours. We celebrate the birthday of everybody. We send cards, we congratulate them. I have never worked in a place where they do this, even if they work together physically. So we just have very close relationships, even being remote. And now we are completing five years.
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