Tuesday, October 30, 2007

More on the Service Tax

Matt Harlow of the Perry Ballard agency sent out this email today regarding the service tax and its impact on public relations, advertising, and marketing agencies....

"Confused about Michigan's new sales tax on services? Learn more about how the
tax affects you as a marketer and how you can help to fight it by watching this
online video.

In the meantime, here are a few things you should know:

1) While advertising agencies, media outlets and other marketing oriented
firms are not specifically subject to the tax, certain marketing related
services are, regardless of who provides that service. Some of the services
include:

* Marketing consulting
* Desktop publishing
* Design
* Packaging and labeling

2) It is a use tax, not a sales tax. This means that if either the buyer or
the seller is in Michigan, the transaction will be taxed.

These two facts combine to create three major problems for our industry:

1) All Michigan marketers' budgets are instantly 6% smaller in the
taxed areas.

2) All Michigan agencies and vendors are now 6% less competitive when
offering the taxed services out of state.

3) The ambiguity of what specific services are and aren't taxed is, to
put it bluntly, an audit waiting to happen.

The American Advertising Federation-District Six
has joined the Ax the Tax Coalition with over 50
other professional associations to stop this tax. We are also staying in
touch with the several Michigan lobbyists and the American
Advertising Federation
in Washington. We'll make
every effort to keep you informed and tell you how you can help to defeat
this tax. In the meantime, we urge each of you to join the fight as
actively as possible."

Stay tuned...and share your thoughts by commenting on this blog.

Monday, October 29, 2007

Taxing Quote

Must be Halloween week--we have axes and vomit in the news.

In an MiBiz article about the "Ax the Tax" Coalition press conference, there is this gem of a quote from Tim Wondergem of Wondergem Consulting Inc., a local PR firm with lots of public issue experience:

“The businesses that are being depended on to create a new economy in Michigan are getting screwed here, folks,” said Tim Wondergem of Wondergem Consulting. “The next time I hear the Jeff Daniels’ commercial about Michigan’s Upper Hand on the radio, I am going to pull my car over and have a vomit moment.”

But Tim. how do you really feel? :)

Seriously, this is an issue PR consultants should watch. Should our services be taxed, and not those of other professionals? I'd agree with Wondergem, though I'll try not to launch my lunch for now.

Friday, October 26, 2007

Magna Doing It Right

It's not a good thing to announce plant closings and layoffs. But Magna Donnely's announcement of a plant cosolidation and layoff of 50 employees reported in the Holland Sentinel today reveals a good way to handle bad news.

First, company spokesperson Tracy Fuerst doesn't mince words. The PR rep says what's happening and why--two plants will consolidate because of a decrease in product demand. Refreshingly honest and clear.

Second, and more importantly, the article reveals that Magna is trying to honor relationships (remember, that's what PR is about) with those laid off employees by offering to find other positions within the company.

Things are tough in the auto industry. It's good to see one of our major auto industry companies doing PR right in such tough times. Of course, few media will call this "PR"; they save that for when it's done poorly. All the more reasons for me to point out the good stuff.

I only wish there was more detail for employees, community and media about this consolidation on the company web site.

Friday, October 19, 2007

Selling NonProfit Status

A local non-profit executive director emailed me about the current Blue Cross campaign touting their nonprofit status. While it's a tagline in some ads, it's the main message in a billboard I saw recently.

Apparently the execs feel the nonprofit status is an important message to folks who may feel insurance co-pays and premiums are too high. They want to stress they are not profiting from health care dollars.

But, I find it hard to believe folks who are upset will feel better jjust knowing the organization is nonprofit. There have been financial scandals at nonprofits before--Red Cross, United Way, etc.

People don't get well merely by talking to a doctor. They don't change their attitudes only by knowing an organization is a non-profit. This current campaign should address the fee structure head on, and if the rates are justifiable, justify them.

Go Gravity!

It took a while for me to get caught up on work after being gone, recover from jet lag and a cold, and read the pile of papers and mail. I was most excited to see the launch of "Gravity Six Alliance," a group of local ad agencies collaborating to land national clients. If you missed the local coverage, read the original PR Newswire release.

I've said it before--West Michigan has talent and shouldn't take a back seat to anyone from Madison Avenue to Madison, Wisonsin and points further west.

Here's hoping Gravity takes flight.

Sunday, October 14, 2007

Quixtar Sues Bloggers

Interesting item in the AP business wire today about Quixtar suing bloggers.

At first blush, I'm against this from a PR standpoint. We should allow people to state their opinions and offer our responses publicly as part of a dialogue. Suing those who criticize you would seem to contradict that "two-way symmetrical" model of PR, not to mention garner negative public opinion about a big company snuffing the voices of individuals.

However, when you read the article, it does seem that these bloggers aren't so innocent. Quixtar alleges that the bloggers (apparently from Ottawa County since that's the court where the suit was filed, unless they feel it is a more receptive venue) are actually an organized group of ex-distributors who are posting items anonymously to Utube. If these allegations are true, then the critics of Quixtar are engaging in setting up a 'front group,' which is clearly derided in the PRSA Code of Ethics (scroll down to "disclosure of information"). I guess we can all watch to see what the courts say about it. It could be a landmark case of free speech for bloggers.

Friday, October 05, 2007

WSJ Blog on Countrywide

The Wall Street Journal returned the favor and mentions me and others in their Marketbeat blog.

Wednesday, October 03, 2007

Parley VooDoo

Even though France is home to Havas and Publicis, two of the biggest five Ad/PR holding companies, they still need humble ol' moi to come teach PR over there. I'll be in Angers next week at a school called ESSCA (French acronym; link is to English version of site) trying to work my magic (parley my voodoo) on some French business students.

The school is a partner of Grand Valley, and teaches marketing, but not PR. Hence the arrangement with me. I taught there two years ago thanks to the initial legwork from my now retired colleague, Betty Pritchard. We didn't screw up too badly, so they asked me to do it again::)

I'll to upload a few posts of my experiences, but those French keyboards are challenging. If not, I'll share thoughts when I'm back in the USA October 15.

Au revoir for now.

Countrywide HIts Home

Update on previous post. Local media reports carry story (see TV 13) about Countrywide closing its Grand Rapids office. Locks changed suddenly. Calls referred to another office.

Yeah. Pep talks are nice. PR is what's needed here.

Countrywide Mouths

The Wall Street Journal (online subscription required) has a great article on B1 about Countrywide Mortgage and its PR plans to handle the current crisis of reputation.

They do a couple things right--they get a good PR firm in Burson Marsteller to help out. They start internally with a conference call for employees.

However, there's a difference between doing something and doing it well and effectively.

You can read the speaking points for that employee conference call on WSJ's site--an interesting inside look. I come away feeling like it's mostly a pep rally with the theme "we're tough, we're great, we're getting a bad rap in the press, and trust management."

Hmmm. Wonder if any employees ended up at Countrywide after losing their jobs at ....Enron, where the same theme was used by management.

Perhaps, in an enlightened "two-way symmetrical" PR model, Countrywide could LISTEN to their publics instead of launching this loud mouth screed. They might find their reputation is a result of people feeling deceived, exploited, cheated etc--never good words to use in PR reputation objectives. Rather than cheerleading for continuing such aggressive behavior, perhaps the company could change its tone and behavior (see my GRPR: Countrywide and Outside post on this subject from late August). Otherwise their reputation will continue to be suspect, not only by employees, but country wide.

UAW, GM, and PR

The UAW-GM agreement is interesting and significant for a host of reasons. It's a landmark concession by the union to take responsibility for its own health and retiree benefits program, thus removing a great weight from GM. GM in turn has promised more job security for workers. How either change and promise will be sustainable is yeet to be seen.

But the PR aspects of this interests me as well. It's not just about the public opinion on the matter. I look at the relationship between line and staff, management and worker, in such a dichotomous environment. Such agreements are usually comprimises, where each side gains only by losing. It's virtually impossible in a union environment to gain or even seek win-win solutions.

I know unions are important--Samuel Gompers and labor history and all that. But, as Thomas Friedman eloquently points out, the world is flat. Stomping feet and trying to get what you want isn't really the best posture for either unions or management these days. Radical, wholesale, systemic change is in order if auto companies are to create an environment where the PR mantra of "mutually beneficial relationships" can exist.

Rather than heralding their agreement as a good one because both sides caved and benefitted in terms of contracts and benefits, they should take a square one approach that considers the front line of the battle not union-management, but American-foreign autos. If GM makes better cars, competes on quality vs patriotism, and sells more of them at affordable prices.....well then, the company will prosper, jobs will be saved and created, there will be mutual benefit.

BBut such a "we're in this together" mentality is prevented by the union vs. management culture. I'll be impressed when that changes. It can happen. Davenport University in Grand Rapids dissolved its faculty union a few years ago because they realized it made no sense to pay dues and fight when they were on the same page with administration.

Blog Busy

You know you live in a new media environment when you repeat phrases like "I've been too busy to blog." I never would have said that a few years ago.

But I have lately. Apologies to regular readers who wonder if I left the planet, or at least the blogosphere. It's just that sometimes meeting client needs for advice, media kits, position papers, as well as all the academic demands, seem to eat up time and energy for blogging.

But i'm back with a few posts.....