The Summer of Our Discontent: PPA Anniversary Hits Unimagined Retirement Landscape

The following is an excerpt of my article, "The Summer of Our Discontent: PPA Anniversary Hits Unimagined Retirement Landscape," now available on PLANSPONSOR.com.

As the Pension Protection Act (PPA) celebrates its fourth anniversary this month, it seems like a time of reflection is in order. Four summers ago, Congress passed a landmark piece of legislation that sought to make sweeping changes to the American retirement system. When then-President Bush signed the PPA into law, it outlined more than 900 pages of bold changes to employer-sponsored retirement plan options in both the DB and DC worlds, as well as nonqualified plans. From allowing plan sponsors to auto-enroll employees in DC plans to defining “at risk” funding levels for DB plans, the PPA felt revolutionary. For those of us who clearly remember August 2006, it seemed like the dawn of a new era. There was a sense among those who worked to shape the legislation that this was historic and the start of something big.

At the time, I was working with the Business Roundtable’s Pension Coalition, a group of employers, service providers and trade associations working to advance retirement security through voluntary employer-sponsored plans. It was an impressive coming together of blue-chip employers, including Dow Chemical, The DuPont Company, Ford Motor Company, General Motors, IBM, International Paper, John Deere, Kodak and Xerox, as well as industry-leading partners such as the American Benefits Council, The ERISA Industry Committee, Financial Executives International, the National Association of Manufacturers and the U.S. Chamber of Commerce. These Pension Coalition members lobbied members of Congress. They wrote letters. They gave media interviews. They were tireless, and they did not agree on everything, nor did they get everything they wanted in the final legislation. Still, there was this sense of the greater good. When all was said and done with the PPA, the feeling was that there was more right than wrong.

Over the next two years, there would be bumps in the road. And then came the financial crisis of 2008. The world changed, and the concept of retirement in America changed in a way that the PPA could never have foreseen.

Looking back to 2006, the retirement communications of the PPA era have taken on a museum-like quality as the use of social media and interactive tools has the power to change and rewrite the communication rules for retirement plan providers, sponsors and participants. In response to the economic collapse, expectations related to financial transparency have increased and social media is one channel to help plan participants feel more empowered.

In 2010, retirement plan providers are beginning to leverage social media to provide their points of view on industry issues and beginning to consider using social media to reach their participants in ways that would have been impossible in 2006. From LinkedIn, Twitter and Facebook to social media-optimized news releases, some providers are beginning to use social media to share content.

The Obama Administration now appears to be turning its attention to retirement and the Department of Treasury and Department of Labor’s jointly issued Request for Information (RFI) Regarding Lifetime Income, which drew more than 800 responses during the public comment period. The RFI specifically asked for public comment on the necessity of participant education and how it should be provided, which seemed to be yet another acknowledgement of how the world has changed. Thankfully, plan sponsors have more tools and communications channels available than ever before, which is essential since they will be on the front lines of meeting this enormous challenge.

A Pension Coalition ad from 2006.

Did Consumers Run for Cash During the Financial Crisis? Why Reassurance is Key in Financial Services.

As we approach the two-year anniversary of the financial crisis, many will be asking again if the U.S. government needed to act so aggressively to prevent a widespread panic. Was the average consumer concerned about the safety of his or her investments and bank accounts? In the old days, a financial panic was marked by long lines of depositors seeking to empty out their bank accounts and get cold, hard cash. Did a more modern version, with consumers flocking to ATMs, take place in the early days of the financial crisis?

One clue is contained in recent Congressional testimony by Fed official Louise Roseman, who oversees the central bank’s currency operations. The Fed provides currency to financial institutions in response to demand by bank customers. Roseman notes that demand for U.S. currency at home and abroad increased significantly starting in September 2008 as a result of the financial crisis. Currency circulation in the U.S. and overseas increased by about 16 percent—from $775 billion at the end of 2007 to almost $900 billion by year-end 2009. In comparison, currency circulation increased by about 1 percent annually in the years before the crisis.

It appears the increase in FDIC insurance limits and other government actions helped to reassure U.S. citizens. There was a spike in currency demand in September 2008 in the U.S., but the demand quickly returned to normal following government action. Overseas was a different story as there was continued strong demand for U.S. $100 notes through 2009. The overseas demand accounted for much of the growth in U.S. currency in 2009. So even though the U.S. was the so-called originator of the global crisis, its currency was seen as a safe haven by overseas citizens.

What are the implications for banks and other providers of financial services? Even with deposit insurance, some consumers were scared enough during the early days of the crisis to stock up on cash. Consumers want the best interest rates or returns, low service fees, and sophisticated services, but they also need continued reassurance that their money is safe, secure and protected. Aggressive government action can help reassure consumers. But financial service firms — perhaps now more than ever — still need to continually communicate the old fashioned values of safety and stability to retain consumers’ trust.

What the Census Could Show Us — Gen Y Will Push Financial Services to Deliver Advice in New Ways

Looking ahead to the portrait of America that will be unveiled in 2011 based on the results of the 2010 Census (client), researchers are putting forward predictions on how the population will change over the next decade.

John M. Eade, of Argus Research Corporation, discussed the possible results of the census in Forbes.com. Eade foresees growth of the echo boom generation or Gen Y, those between 16- to 35-years old. He projects the echo boomers will become the largest generational segment in the U.S. population in the next 10 years. “We could end up with 85 million echo boomers versus 81 million baby boomers.”

This generation, which claims more monikers than any other: echo baby boom, Gen Y, Generation Net, NetGen and Millennials, will push financial services firms to take a hard look at their approach to marketing, advice and relationship development if Eade’s projections are accurate.

A recent poll by Capstrat revealed how much Gen Y relies on online advice for financial decisions:

“43% of Millennials used online forums and 48% considered Google as their most influential financial adviser. By comparison, only 10% of respondents over the age of 65 used online forums for advice and just 6% considered Google to be the most influential.”

Jorgen Ericsson, of Cisco’s Internet Business Solutions Group, spoke to Bank Systems & Technology on recent research that echoed the strong need among Gen Y for financial advice online. “More than a third of Gen Yers think they need assistance managing their financial affairs.” The heavy financial burdens of young adults, with many carrying a crushing load of college debt, and the recent economic turmoil are making Gen Y very aware of personal finance and planning. Cisco’s consumer survey shows many Gen Yers will consider automated advice, including video conferencing (40 percent) and are four-times as likely as older generations to be interested in virtual-community-based advice. Nearly half (40 percent), indicate they would like their bank’s website to be the hub for a virtual services community, over general financial services sites such as Mint.com.

How is your company preparing for the impact of Gen Y?

Counting on Public Relations: Lessons from the 2010 Census

As the 2010 Census wraps up, we wanted to share recently published insights from our client, the U.S. Census Bureau, on the value of public relations as part of the overall 2010 Census Integrated Communications Campaign. According to the July 1 issue of Public Relations Tactics, the Census Bureau credits public relations with moving the needle significantly in its effort to count every person living in the United States and its territories.

Weber Shandwick partnered with the Census Bureau to plan and execute the largest integrated communications campaign ever undertaken by the federal government. Campaign results have exceeded expectations by meeting and slightly outpacing the 2000 mail return rate of 72 percent, a very difficult task considering several barriers to participation today that did not exist in 2000, including an increasingly diverse population, a wave of foreclosures, a stagnant economy and distrust of government at the highest level recorded in the last 50 years.

In the video below, Raul Cisneros, Chief of the 2010 Census Publicity Office, U.S. Census Bureau, discusses the impact of public relations on the 2010 Census during the Public Relations Student Society of America (PRSSA) Bateman Competition judging in May.

Ten Trends Transforming Public Relations

I recently joined about 50 Weber Shandwick client relationship leaders (CRLs) – essentially the leaders of Weber Shandwick's largest and most global accounts – for a meeting designed to discuss the transformation of our profession and how CRLs can leverage Weber Shandwick best practices with our clients.

I joined a panel of other Weber Shandwick practice leaders – Pam Jenkins, public affairs; Micho Spring, corporate; William Brent, clean tech; Dr. Leslie Gaines-Ross, thought leadership; and Carmen Lawrence, multicultural – to discuss trends we're seeing in the industry and the implications for our clients.

The panel's Ten Topline Trends included:

• The "Era of Engagement." Perhaps the single strongest trend is a very deliberate and conscious effort to engage constituents in ways that are mutual and interactive, and not just via social networking, although it's certainly one key enabler. The panel agreed that it's not only new technology and social media that have changed the game. Perhaps even more importantly, it's that the mindsets of constituents and consumers have changed. Everyone now wants to be a participant, not just a recipient of information. It's no longer just a monologue.

• Government as a key activist stakeholder and important audience for most clients. We discussed the implications of healthcare reform and financial services reform, particularly the communications requirements, digital being the new grassroots, the need to integrate a public affairs strategy into all communications, and the consequences of greater regulatory scrutiny on a company's ability to tell its story. Employee benefits communications – both about healthcare benefits and personal finance – will expand significantly in the years ahead, as a result of these reforms.

• The 2010 Census will serve as a catalyst for a national dialogue about the implications of the new demographics, specifically for Hispanics and Asian-Americans. Topics we covered included minorities being the new majority, multicultural audiences influencing mainstream trends, and implications for corporate social responsibility and, really, for all global companies.

• The evolution of "green." Specifically, the panel talked about the implications of the green movement for virtually all clients and their CSR initiatives. William Brent also pointed out that water is the "new carbon," and the rising importance of the greening of clients' supply chains.

• The implications of marketing and public relations fusing and how we make sure we retain the strategic lead as these disciplines merge. The reputation of the company and brands will no longer be siloed into who manages which stakeholder (CMOs as customer-centric and CCOs as all other stakeholders including media, investors, regulators, employees, influencers, general public, communities, NGOs-centric, etc). As Advertising Age questioned, is the day coming when internal corporate PR departments will be steering the marketing ship full time and when advertising and communications are one and the same? As companies recognize that word of mouth is more critical to sales than advertising, will PR take charge? Some of our clients already manage both functions.

• The rising importance of corporate reputation to success of broader corporate objectives, including products and business units.

• The importance of the publishing role and driving a compelling corporate narrative (content development) and of being prepared for unavoidable reputation assault (Digital Defense).

• Crisis preparedness is more important than ever. As Leslie Gaines-Ross pointed out, Andy Warhol once said that, “In the future, everyone will have their 15 minutes of fame.” Today we can say with certainty that “Every company, brand and leader will have their 15 minutes of shame.” Crises – based on fact, rumor or hearsay – will be an everyday occurrence for our clients around the world.
  

• CEOs are the new “content providers." Despite their low approval rating, CEOs are going to be called upon to humanize the company and brands and to engage. They will be the ultimate spokespeople or advocates and the perfect vehicle to communicate the storyline.
  

• Social reputation matters. A leading driver of corporate reputation – in addition to CSR, quality products and services, talent, financial metrics, globality and innovation – is now social reputation or, Social*ID as we call it at Weber Shandwick. How “socialized” are companies, brands and leaders? What drives social reputation/ID?

Have thoughts on these trends or others to share? We welcome your feedback and comments.

Strategy is Key to Success for C-Suite Speaking Engagements

As a communicator working with clients in the public and private sectors, I hear the word strategy every day. I’m always looking for the best strategy to tell a client’s story, to expand reach or to garner coverage. So when recently released research from Weber Shandwick and executive communications journal Vital Speeches of the Day found that 44 percent of communications professionals have no process – no strategy – for placing senior executives at conferences, I was floored.

The study, “From Business to Planning: Placing C-Suite Executives in the Most Strategic Forums,” examines how executive communications professionals evaluate the leadership forum landscape, stay ahead of trends in thought leadership, and ensure they put their executives in front of the best audiences with the right messages.

• Nearly three-quarters of study respondents (73 percent) believe senior executive interest and participation at business leadership conferences has held steady or grown since the start of the global economic crisis – even though most organizations also have looked to reduce spending and minimize travel.
• Respondents also believe that CEOs and other C-level executives continue to place a high priority on speaking engagements as key ways to communicate thought leadership platforms (61 percent), attract new business and cultivate customer relationships (58 percent), and define/redefine brands (52 percent).

While it’s true that not all communicators lack a speaking opportunity placement strategy – 56 percent of communications professionals do have a process in place – only half of those are confident they have the best process.

So what is the best way to choose conferences? Communicators should follow these four steps:

• Audit where their own company and competitors are speaking.
• Rate conferences on performance criteria (overall reputation, audience composition, past speakers, topic affinity, media opportunities).
• Score conferences on clearly defined strategic criteria (Will new or current clients be present? Will business and positioning be advanced?).
• Assess whether conference opportunities are extendable to other audiences and third-parties.

I often hear from clients, “But what’s the business case for attending?” Following these four steps will help ensure you can answer this question – that the conference audience, objectives, size and focus align with business priorities and support the bottom line.

The study also explores the use and effectiveness of online communications for conveying C-suite messages to external audiences, and shows that online channels are not being used as effectively as they should. While Twitter, Facebook and other social media platforms are viewed as effective, they’re underused by the executive staff. Just 6 percent of C-suite executives use Twitter to communicate externally. Tweeting from industry shows, and sharing links to videos, handouts and other materials related to your own session, is an easy way to utilize these channels and share information about your organization, products and services.

More information about Weber Shandwick's study, "From Business to Planning: Placing C-Suite Executives in the Most Strategic Forums." Learn more about VOICEBOXX^TM, Weber Shandwick's high-level executive conference identification and placement services.

Weber Shandwick’s Barb Iverson Named IR/Financial Communications Professional of the Year

Barb Iverson, president of Weber Shandwick’s financial services industry practice, has been named Bulldog Reporter’s IR/Financial Communications Professional of the Year. Weber Shandwick was named Large PR Agency of the Year.

Bulldog Reporter recognized Barb’s leadership in working with offices around the world to provide seamless service to clients, ultimately growing the financial services practice despite the difficulties caused by the 2009 financial crisis. Iverson also accelerated Weber Shandwick’s focus on financial education and financial literacy, which involved a number of high-profile clients, including the FDIC, the U.S. Department of the Treasury and Federal Reserve Banks.

The 2010 Bulldog Awards for Excellence in Media Relations & Publicity are the highest awards for public relations in the press — and the only industry awards program judged solely by working journalists.

Congratulations, Barb!

Read more about the winners in Bulldog Reporter’s Hall of Fame Magazine.