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Shel Holtz
Communicating at the Intersection of Business and Technology
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Edelman cited in top dumb business move of 2006

I like Edelman. I really do. I like Richard and think he’s a smart guy who understands the social media landscape. I like the people I know who work there. I like some of them a lot. But it seems that the hits just keep on coming for the world’s largest independent PR agency. Business 2.0 has just unveiled its 101 Dumbest Moments in Business for 2006, and topping the chart is the Wal-Mart campaign that turned the smiley-faced icon into a political candidate. Edelman’s involvement is noted in the very first sentence:

In an attempt to put a smiley face on its tarnished image, Wal-Mart hires heavy-hitting public relations firm Edelman, which sets about using tactics derived from political races to reverse public perceptions of the giant retailer.

Wal-Mart is cited a total of six whopping times on the list, and the fourth (ranked #54) relates to the “Wal-Marting Across America” debacle; again, Edelman is cited.

Will these guys never catch a break? There’s a point at which you wonder whether having the billables from the client are worth the reputational hits it’s causing the agency; all the bad publicity Edelman has experienced has been generated by mistakes made on that one account.

Northwest Airlines’ suggestion in official collateral given to laid-off employees that they turn to dumpster diving came in at second place, and McDonalds came in third for distributing MP3 players in Japan, some of which included a Trojan horse that distributed sensitive computer information to hackers.

01/23/07 | 7 Comments | Edelman cited in top dumb business move of 2006

Comments

  • 1.Isn't it a nice bit of perspective for us all? That what seemed a catastrophic event - the WalMarting Across America Flog - only registered enough to be placed at #54 in the top 101, not of all time, but just one year!

    Nonetheless, it's still incredibly useful as a case study ;-)

    maggie fox | January 2007 | toronto, canada

  • 2.Never underestimate the sheer power of publicity and the perverse thinking of business mgmt. I was reminded of this a couple of years following Tony Franco's fall from grace in 1986 (then PRSA president indicted for insider trading of a client's stock) when I was talking to one of his firm's execs.

    I was asking the exec what affect the impact of Franco's indictment, the national publicity surrounding it, and his resignation as prez of PRSA had had on business. He said the within a day or two of the story breaking in the WSJ, the NYT, USAToday, etc., on Detroit TV and other mass media outlets, the phone started ringing from other Fortune 500 companies inquiring about their services.

    He said he wouldn't necessarily recommend an insider trading scandal as a busdev strategy but for them it worked out quite well. Go figure.

    Craig Jolley | January 2007

  • 3.Shel:

    Edelman is not only taking a reputational hit because of the Wal-Mart questions, also because of the Microsoft laptop giveaway (no matter how you feel about its ultimate ethical execution) and Richard's failure to address these ethical questions in an open, timely, and even handed fashion.

    I like Richard and what he's done and you do take hits when you pioneer new turf, as he is doing. 2007 will be a pivotal year for him and his agency. I am sure we'll all be watching closely, learning lessons.

    Mark Rose | January 2007 | New York City

  • 4.We don't know that the bad publicity has affected Edelman's bottom line. It doesn't seem as if the agency has been having a new business problem.

    Mike Sacks | January 2007

  • 5.I guess it depends on the definition of "bottom line," Mike. I subscribe to the Charles J. Fombrun theory that suggests your reputation is PART of your bottom line, that it has intrinsic value that can be calculated and its rise or fall can be directly linkeded to your revenues. Ultimately, the impact of all this could be longer-term.

    Mark, you're right -- especially about Vista. Forgot about that one!

    Shel Holtz | January 2007

  • 6.I don't know for sure but I would guess the publicity helps, not hurts, his bottom line. Edelman seems to be the big agency in front of PR 2.0. I don't see any other big global agencies making that kind of aggressive, high-profile move in the space.

    Mark Rose | January 2007 | New York City

  • 7.Valid point, Mark. Of course, it's the light Edelman is shining on itself that exposes the firm to so much criticism when they misstep.

    Shel Holtz | January 2007 | Concord, CA

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