Businesses buy adds to get favorable news stories

July 30, 2008

19% OF SENIOR MARKETERS - OR ONE IN FIVE - SAY THEIR ORGANIZATIONS HAVE BOUGHT ADVERTISING IN RETURN FOR A NEWS STORY, ACCORDING TO MS&L/PRWEEK SURVEY

A rather sizable number of senior American marketers - 19 percent - say their organizations have bought advertising in return for a news story, despite growing criticism of these "pay-for-play" practices, according to a recent survey conducted on behalf of PRWeek and Manning Selvage & Lee (MS&L) by Millward Brown. The sixth annual Marketing Management Survey polled 252 U.S. chief marketing officers, VPs of marketing and marketing directors and managers about digital media and marketing ethics.

The survey also found that 10 percent of senior marketers said their organizations have had an implicit/non-verbal agreement with a reporter or editor that anticipated favorable coverage of their company or products in exchange for advertising. And 8 percent, or about one in 12, said their organizations paid or provided a gift of value to an editor/producer to place a news story about their company or one of its products.

Questionable marketing practices such as those explored in this survey have generated controversy in recent months, raising questions about the deterioration of news coverage, as well as broader questions about industry ethics.

"Any kind of undisclosed paid placement spells trouble for consumers, the media and the marketing industry," said Mark Hass, worldwide chief executive officer of MS&L. "Without full disclosure and transparency, media lose credibility and their value as an unbiased source of information for consumers. That a substantial number of marketers - about one in every five - engage in 'pay-for-play' year after year is even more troubling, and that much more damaging to the credibility of news media."

The results from this year's survey are consistent with results from previous years: Last year, for example, 17 percent of senior marketers said their organizations bought advertising in return for a news story, 7 percent said their organizations have had an implicit/non-verbal agreement with a reporter or editor that they expected to see favorable coverage of their company or products in exchange for advertising, and 5 percent of marketers said their companies had paid or provided a gift of value to an editor or producer in exchange for a news story about their company or its products.

The issue of paid placements in news media raises serious implications for the marketing industry. Marketers and advertisers often say they view this type of activity as an extension of product placement in entertainment, no different than featuring a car in an action movie or a movie star drinking from a particular brand of soda. But with those programs, the stories are fictional, and their purpose is to entertain. The news media, on the other hand, need to operate by a different set of editorial guidelines, to ensure that trust is at the core of their message delivery.

Marketing efforts in the online world are subject to the same rules of disclosure and transparency that consumers expect with traditional news media. But despite widespread criticism of online ethical breaches such as creating fake blogs and cloaking bloggers' identities, there is little indication that marketers plan to stop trying to engage with consumers in these ways. When asked whether the marketing industry as a whole is following ethical guidelines in new media more than they did a year ago, 53 percent of the survey respondents said no.

"The online world creates a whole new unsettling platform for marketers who are willing to engage unethically," said Hass.

The 2008 PRWeek/MS&L Marketing Management survey was conducted in partnership with PRWeek by Millward Brown. Survey results were collected between May 1 and May 19, 2008. Results are not weighted. Based on the sample size, the results are statistically tested at a confidence level of 90%.

About PRWeek Magazine

Launched in November 1998, PRWeek is the first weekly magazine to offer nationwide coverage of the public relations business. Over the years, PRWeek has established itself as a vital part of the PR and communications industries in the US, providing timely news, profiles, features, techniques, reviews of campaigns, and groundbreaking research in print, as well as on its companion Web site, prweek.com. This research includes annual salary, CEO, and cause surveys, as well as key industry sector rankings and forums. The magazine also launched the PRWeek Awards to showcase and recognize the best practices in the PR industry. Its aim is to provide essential daily reading for every US public relations professional and to champion the cause of public relations as an essential management discipline in the business community at large. Visit www.prweek.com for more information.

About Manning Selvage & Lee

MS&L (mslpr.com) is one of the world's leading global communications firms. Headquartered in New York, MS&L has 54 offices throughout North America, Latin America, EMEA and Asia-Pacific, as well as an extensive global affiliate network. The agency meets the needs of global and local clients by providing best-in-class services in consumer marketing PR, healthcare PR, corporate communications and technology communications, as well as industry-leading work in digital communications. In 2008, MS&L was named CRO's #1 PR firm in Corporate Responsibility, won PRWeek's Promotional Event of the Year award and the Holmes Report's PR Product of the Year award for Innovation in Influencer Marketing.

MS&L is a member of the Publicis Groupe (Euronext Paris:

FR0000130577), the world's fourth largest communications group, and a global leader in digital and online advertising, media consulting, and healthcare communications. With some 44,000 professionals in 104 countries, the Groupe's activities cover advertising through three global advertising networks: Leo Burnett, Publicis, Saatchi & Saatchi, as well as through its two multi-hub networks Fallon Worldwide and 49%-owned Bartle Bogle Hegarty; media agencies with two worldwide networks ZenithOptimedia and Starcom MediaVest Group; and marketing services, including digital and interactive communications through Digitas, relationship and direct marketing, public and media relations, corporate and financial communications, multicultural communications, and event communications. The Groupe is also the world leader in healthcare communications. Web site: www.publicisgroupe.com.

SOURCE: Manning Selvage & Lee