Econoblogosphere challenges financial PR
Journalists like to complain about how press officers for financial institutions have restricted access to bankers and enforced more message discipline in recent years. This has made it harder to dig up interesting stories, develop insightful sources and maintain a necessary amount of skepticism. But today, there are enough plugged in, sophisticated bloggers tearing through the industry’s defenses that press officers need to rethink their strategies altogether.
These bloggers (comprising the “econoblogosphere”) are often former industry insiders who have longstanding relationships and great access to information. Unlike some bankers, many journalists and even more press officers, they understand the business. And, unlike most journalists, they have no qualms about expressing their opinions [click to tweet]
A number of these blogs has become required reading for those seeking real insight into the financial markets – Naked Capitalism, The Big Picture, Calculated Risk, Zero Hedge and a handful of others.
The contrast with mainstream journalism is stark. For example, on April 6, the Wall Street Journal ran, “Stock Buybacks Abound, But Come at a Price,” about how companies have bought back shares at increasingly inflated prices to boost their EPS and do something with all their excess cash. This has driven the bull market.
Blogger Ed Yardeni pointed this out over a year ago. Yves Smith at Naked Capitalism has been banging on about this since at least 2007. And Zero Hedge’s Tyler Durden wrote in January that this trend has reversed itself already.
All these loose – yet often terribly accurate – cannons raise a host of problems for press officers seeking to control a firm’s message. The easy solutions that work with mainstream reporters – force them to go through the press office, check quotes and get anyone who speaks to a journalist without authorization in trouble – don’t work with the top econobloggers.
Lots of mainstream publications have attempted to create blogs or blog-like sections – there’s Bloomberg View, the relaunched Heard on the Street, Reuters Breakingviews and the granddaddy of them all, Lex. Most of these adhere to the conventions of their parent publications, so press officers’ traditional bag of tricks works reasonably well with them.
But the new breed of blogs is another matter entirely [click to tweet]. As they become increasingly influential, financial PR will not be able to ignore them. The econoblogosphere is a chaotic, ungovernable place. Press officers will have to screw up their courage and marshal all their skills as they plunge into it.