A New Definition of Media for CEOs
Last year Teneo’s Vision 2018 foresaw the larger role that CEOs would be compelled to take in public debates, and in policymaking.
The die was cast in the second half of 2017 as a polarized American society, and employees, began demanding this of corporate leaders, and accelerated in 2018 with CEOs taking strong stands on polarizing issues.
Following the Parkland High School shooting in February, Edward Stack of Dick’s Sporting Goods restricted gun sales despite, as he later acknowledged, the impact on Dick’s bottom line. In the wake of #MeToo and heightened gender pay concerns in Silicon Valley, Mark Benioff closed the gender pay gap at Salesforce with the stroke of a pen in April. And in September the CEOs of Nike and Columbia Sportswear came out publicly against the repeal of Oregon’s sanctuary city law.
Thus in 2018 we saw more CEOs taking public positions on social issues. We also saw more corporate leaders realize they do not need so-called “traditional” print and broadcast media to do this. In fact, they are realizing that they may already own the most effective communications channels. Elon Musk readily mixes corporate news and personal views on Twitter, while Lloyd Blankfein cites the ability to directly correct the record as a key reason he uses the platform. Ray Dalio is using LinkedIn every week to communicate with the public, and potential customers. And John Legere uses YouTube to communicate simultaneously with his fans, employees, customers, and investors.
President Trump’s use of Twitter is the elephant in the room for many CEOs. But after living in fear of a Presidential tweet in 2017, in 2018 a small but growing cadre of CEOs demonstrated they were more willing to risk drawing anger in exchange for public authenticity.
While these demonstrations are in most cases inspired by the CEO’s personal views of Trump’s actions, or the views of their customers and employee base, perhaps unwittingly they are also being inspired—and instructed—by Trump’s own disregard for traditional media.
These CEOs can now avail themselves of direct and measurable access to their key audiences in a way that did not exist 10 years ago. For this they must thank the wholesale implosion and reinvention of media which has taken place over the last 20 years. And what we will see in 2019 is far more criticism of CEOs who do not “own their own pipes” of communication or who misuse them for anodyne corporate purposes, and a higher bar for CEO authenticity given. In our view, somewhat counterintuitively, this actually lowers the stakes for CEO engagement on media. But let’s back up for a moment to explain why we expect this in the coming year.
The Media Landscape Has Changed
Two fundamental changes that have happened quite quickly to engender a secular shift in media.
First, trust centers in our society have decentralized and there are new hubs of credibility. Trust in institutions has eroded over many decades, declined at an accelerated pace following the 2008 financial crisis, and has accelerated further with the more recent rise in populism. Add to this the new digital tools that connect like-minded individuals, and we are squarely in the era of “micro-Cronkites” where trust is earned and distributed from the middle-out vs. the top down. According to Pew, our neighbors are our most trusted source of information. More than experts, such as the military or scientists, who are somewhat trusted, and far below them, more than media, business leaders, and elected officials. Of these latter three, media, lacking the economic power of corporate leaders and the policy power of elected officials, has received the most significant blow.
Second, individuals are consuming news in new ways, and as we work to prioritize a flurry of new information sources, new curation habits emerge. Digital feeds – whether a stream of email newsletters, or social posts, or search results – are customized, often algorithmically. These feeds have become the new front page. In the past, media consumers were told what was important by the printed front page and the top story on broadcast news. Today each consumer chooses their own journey to the news, and that changes the way agendas are set, and how news reaches people.
Companies and their leaders have been woefully behind in adjusting to the shift in power. Ninety-four percent of global executives say they get their news from e-mail newsletters — but beyond a handful of “celebrity” reporters and editors with credentials that pre-date the digital era, how many executives can name the editor who compiles that news? Ninety-six percent of journalists use Twitter weekly — how many CEOs follow their beat reporters on Twitter? A 2017 report from CEO.com showed that sixty percent of CEOs don’t have a single professional account or channel on any of the six major social media platforms.
Twenty years ago, the vast majority of us got up in the morning and read and watched the same newspapers and broadcasters. Today we wake and engage in much more personalized media consumption journeys. Some of us go right to Twitter; some to email; some to TV; some to Alexa; and some, still, to the paper on their doorstep. This decentralized landscape is unlikely to change and even the centralization of power in social media will not re-centralize the modes of news transmission.
A New Media Definition
The media landscape has changed so abruptly that we need to challenge some fundamental beliefs about how we approach it. And that starts with media’s definition. To free us from speaking with familiar, but antiquated terminology, we must consider a new definition of media, one that is channel-agnostic: one that allows media to be, quite simply, any channel that can transmit a message to an audience.
This dynamic is changing how CEO themselves think about building their reputation. Well-established media, with high standards of journalism and a track record of breaking stories, will still be important, but their impact is diminished amidst a wide variety of other sources. Corporate leaders need to complement earned media, or in some cases forgo it, to achieve the contemporary, authoritative reputation a top-tier feature once earned them. By taking an audience-centric approach, CEOs can implement more precise strategies, that are easier to measure, and can do so with more control of their message.
This does not mean that CEOs will move entirely to Twitter; rather, they require a communications plan for every stakeholder — down to the person. While this may initially sound quixotic, by studying the behaviors of important audience segments, we can identify common media habits across an audience and can construct custom strategies to reach each audience member directly.
For example, if you determine that your investors primarily rely on email, the best way to reach them is a targeted investor briefing e-mail. If a sub segment of your customers spend a majority of their time on Instagram, an organic/paid social media plan can be used to reach them consistently. If the data shows you that your policymaker audience in Washington, D.C. prefers getting their news via traditional media outlets, conduct online tests to determine if The Hill or the Washington Post reaches more of them directly.
CEOs must also be ready to adjust their communications based on audience feedback, because it ultimately increases effectiveness. Corporate leaders have quickly learned that social media talks back. Yes, this capability can be used by detractors to subvert a message (which incidentally scares many executives off of the platform), but it can also be used to improve how CEOs communicate. Digital media’s discreet feedback loop should be devoured by organizations, to take both the quantitative data and qualitive insights back to their strategy planning groups.
Where to Go from Here
Traditional earned media will continue to be the bedrock of most external communications plans. But CEOs must accept that in the coming year, they may be compelled to talk to a YouTube influencer as much as to a CNBC anchor or Wall Street Journal reporter. They may find a paid media specialist counseling them alongside their traditional PRs. And they’ll likely stop using the press release wires in favor of channels they own.
Owning your channel and owning your message with more intensity will come with new realities and new challenges. Without a traditional gatekeeper vouching for the newsworthiness of an announcement, CEOs will need to command attention on their own. In a crowded space, this is not easy. It will demand more transparency; both asking and answering the toughest questions; admitting fault and showing gratitude; being human and above all else, treating authenticity as the north star metric. A Twitter account with 1 million followers is vanity unless those followers trust the messenger.
2019 will bring the convergence of many media disciplines, and a rise in strategies that don’t fit neatly into a paid, earned, owned or social tactics. Here are some things we think will happen in 2019.
- Rise of the social CEO. There will be a significant rise of executives who join social networks and do a poor job. There will be a modest rise of executives who join social networks and do a great job.
- The decline of ‘brand’ channels. In a world where authenticity is currency, consumers will reduce their interaction with ‘logos’ - or brand channels – on social platforms and increase their interaction with leaders and employees.
- Owning pipes together. With Silicon Valley’s most successful companies as an inspiration, CEOs will want to own not only their message, but also their data and distribution. It’s hard to predict exactly how that will take shape, but it may look like a Players’ Tribune for CEOs. In this scenario, we see corporate leaders establishing a shared platform, to attract more eyeballs than they would on their own, receive meaningful data on their audience, and distribute directly.
- Big brand communications will start to mimic DTC innovators. Functions will aim to mimic political campaigns, then newsrooms, followed by mimicking the direct-to-customer approach of companies like Casper, Away and Harry’s. Successful companies will embrace the tight feedback loops, intense customer intimacy and digital nativity that have made these firms disruptively successful in their sectors.
- Investor relations will be the first place of media innovation. Almost every function in business has embraced digital and data – investor relations has not. A new generation of digitally native IROs see the value in using the internet to communicate with investors. New tools – such as Robinhood and SoFi – are making socially-active millennials more conscious of their investments. And if those tactical carrots don’t bring about change, the rise of activists – both social and investors – will push IROs to bring their function into the 21st century.