No discipline is as dynamic as marketing and public relations.

It requires not only constant monitoring of performance and results but also market and trend analysis.

Following are observations about the latest developments and trends.

Please note that all the complete contents of this page (and the rest of the website) is protected by copyright.

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Oh goody! Swag as a marketing tool

We all heard about it – lavish gift bags are handed out to celebrities at trendy (and therfore newsworthy) events.
Attending art show openings, Broadway premiere parties, Emmy/Oscar/Golden Globe award shows enables red carpet attendees to leave with heaps of great products – free of charge.

The difference between these gift bags (also called "swag") and regular merchandise is that its purpose is not to make a profit, but to promote the product, and reward its endorsers by giving them something cool and unique. It’s a form product placement.

Chosen celebreties are also invited to gift lounges where they can carry off any product that tickles their fancy – without paying of course.
And if you are an A-list star, you can even demand that the organizers (e.g. the Motorola lounge at the Sundance Film Festival) supply you with your favorite product.

Companies want to put their products in front of celebrities and then create a photo opportunity with those stars.
Once the likes of Paris Hilton are photographed with a certain product, the company expects demand and sales to increase.
Therefore, the goodies are not transferable.
As Nathalie Dubois of Diamond Lounge puts it:
"We don't do agents, publicists or celebrity assistants.
We gift everyone well, but they have to be there with their talent."

Celebrities are expected to wear the jewelry in public and announce how great it is.
A good example of this kind of trade-off is Hilary Swank, wearing Chopard to the Golden Globes and several other events declaring:
"I’m so glad that I wore Chopard earrings, they brought me good luck."

But how effective it?
It has now come to a point that celebrities are not only expecting, but are demanding freebies – often adding up to thousands of dollars worth of merchandise.
Goodies include jewelry, perfume, sunglasses, cosmetics, cosmetic treatments such as Botox, massages, vacations and electronics (anywhere from cell phones and iPods to 103-inch plasma TVs).

As a result, the whole gift bag/lounge industry is over-saturated.
It has lost its strength as an advertising tool.
Companies such as M.A.C. cosmetics, Palm Pilot and Roomba are cutting down or opting out.
It also doesn’t come cheap.
Needless to say, companies have to pay for the privilege to be included in the gift bag.
Lash Fary, owner of Distinctive Assets, charges up to $20,000 for firms to be included in his gift bags.
This fee doesn’t include the value of the “gift” itself.
To give you an idea: the Grammy gift basket was worth about $ 65,000; the Oscar’s one about $ 100,000.

Another problem: some megastars just will not play the game.
"The real big celebrities are more concerned about privacy than getting free stuff," says Jen Mayer, spokeswoman for the Frederic Fekkai suite.
"And they can get all these (stylists) to come to their homes."

Some celebrities also don’t want it to be known what they will get free of charge.
"It has become annoying to some people that we give out these baskets," says Academy spokesman John Pavlik.

"So we don't talk about them."
Mmmm, that doesn’t seem to play the PR card very well.

And then there are the celebrities who refuse freebies.
Glenn Close attended the 2005 Golden Globes in her own dress and not in a designer donated one.
Keanu Reeves turned down his freebies (including a plasma TV screen) at the Sundance Film festival.

The gift bag industry tried to save some impact by having a charity element.
It gives it a nice ethical touch and ensures that celebrities look more favorably at the freebies.
The latest trend: auctioning off your swag bag for charity.
Oscar winner George Clooney has donated his 78th Annual Academy Awards Oscar gift bag (including a BlackBerry 8700c, a Kay Unger kimono and a cultured Tahitian-pearl necklace) to be sold in an online auction to benefit the United Way Hurricane Response and Relief Recovery Fund.

But most importantly, the public (including the target group the company wants to reach) gets fed up with six-figure salary stars receiving free gift bags worth thousands of dollars in jewelry, travel, clothes and other goodies.
According to experts, a savvy celebrity can rake in close to $1 million in gifts and prizes in the week before the Oscars.
(This may come with its own price tag though - according to Lee Shepperd, contributing editor to the journal Tax Notes of the New York Times, the IRS might view these items not as "gifts," but as "income".

And to top it off, some celebrities have the nerve to snub the contents of their gift bag.
Paris "that's hot" Hilton labeled her $6,000 VH-1 2004 goody bag (that included Cartier sunglasses, an Avita cashmere poncho and a Surly girl clutch) as “lame”.

What started in 1988 as an effective marketing and PR tool has lost is impact.

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Marketing Milk- A case of agri-marketing

 

One of the most successful marketing campaigns ever is the American “Got Milk?” one. 

 

Since the 1960s, the consumption of milk had dramatically dropped, having its impact on national health.

The number of osteoporosis cases, bone density loss, broken bones and hips were increasing.

In 1994, the nation's milk processors, Congress and the Secretary of Agriculture decided that it was time to educate the public about the importance of milk in their diets. 

 

The goal was clear: the thirty-year milk consumption decline had to be reversed.

The mindset and attitude of consumers had to be changed – milk had to become “cool”.

Competition had to be overcome – soda manufacturers spend hundreds of millions a year to promote soft drinks.

 

The first step was to educate the public about facts.

 

Apart that milk is good for the body, the information campaign stressed to little known facts:

1) fat-free and low-fat milk have the same calcium, vitamins and minerals as whole milk;

2) women need the calcium in milk for constant bone mass replacement to prevent bone density loss, fractured bones, or osteoporosis later in life.

 

The “got milk?” campaign was first launched in October 1993 by the California Milk Processor Board (CMPB).

The ad was developed by longtime CMPB advertising partner Goodby Silverstein & Partners and directed by Oscar-nominated Hollywood director, Michael Bay (Pearl Harbor and The Rock).

 

The spot opened on an American history buff stuffing a huge peanut butter sandwich into his mouth and listening to a classical music radio channel.

The DJ announces a $10,000 trivia question, “Who shot Alexander Hamilton?”

The camera pans an apartment filled with memorabilia from the famous duel, including a portrait of Burr and the actual bullet preserved in a glass curio.

Mouth crammed and unable to respond, the pitiful history buff reaches for the milk only to find it empty.

Desperate, he can only mutter “Aaaawon Buuuuhh.”

The spot ends with the now familiar “got milk?”

 

“Aaron Burr” was the first in a series of remarkable ads that introduced “got milk?” to audiences nationally and helped resuscitate milk sales.

“Aaron Burr” also turned the ad world upside down and earned the advertising industry’s most prestigious accolades, including three Gold CLIOs and a Gold EFFIE. In 2002, “Aaron Burr” was named 1 of 10 best ads of all time by a USATODAY.com poll.

It has been featured in numerous books on advertising and is being used in case studies at top-flight MBA programs around the country.

 

The public also quickly took to the “Milk Mustache” – the printed ads that show celebrities sporting milk on their upper lip.

 

The impact of the campaign is a marketing and PR dream: over 90% awareness nationally.

The tagline has been licensed to dairy boards around the country as well as to wide range of consumer goods including Barbie dolls, Hot Wheels, baby and teen apparel and kitchenware.

 

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How to make a quick million using PR and creating pixel marketing in the process

All of us (with the exception of the well-heeled among us) could do with $1 Million, correct?

Many of us come up with concepts and ideas that unfortunately need (serious) funding.

All those great ideas are often shelved – it would just take too long, require too much time and money.

Once in a while, there is a bright person who comes up with a quick, low cost way of making a cool million  - legally.

One of those persons is the enterprising British student Alex Tew.

He came up with the idea to create a homepage (www.milliondollarhomepage.com) and turn it into a billboard, made up of a million pixels.

He then divided the screen into 10,000 small squares of 100 pixels each, and sold them for $1 a pixel to anyone who wanted to put up their logo.

He was able to sell a few to family and friends for a total of $ 1,000 - but not to anyone outside of his circle of acquaintances.

So how did he reach his target audience?

Since word of mouth would not generate more business, Tew sent a press release to national newspapers in the UK such as The Daily Telegraph, The Guardian, and The Sun.

Due to the unique angle (the most expensive website in the world) it was quickly picked up by the news media (Reuters, ABC, CNN) around the world.

It also spread around the Internet; many a blog mentioned the website.

 

As a result, advertisers for everything from dating sites to casinos, to real estate agents, to The Times of London, were putting up real cash for pixels, with links to their own sites.

Advertisers discovered that they were receiving actual valuable Web hits for a fraction of the cost of traditional Internet advertising.

One example is engineseeker.com, an Arizona-based company that helps clients’ websites to appear at the top of worldwide search engines.

They bought 6,400 pixels as soon as they heard about the Million Dollar Homepage.

As they put it:

“It was ingenious. It’s easy to make money on the Internet, but it is very difficult to have a unique idea, and this one was.

We immediately knew that this website was going to attract huge numbers of visitors so we bought pixels there and then.

The results for us were amazing. We used to get 40,000 visitors a day to our site — that’s now up to 60,000.”

 

By the end of 2005, Tew had sold 999,000 pixels and demand outstripped supply for the last thousand.

Giddy prospective buyers pushed him to open a second page, but Tew had pledged to close the page when his goal of one million dollars was reached in order to protect its originality.

Tew auctioned off the last 1,000 pixels on eBay for a whopping $160,109.09.

He donated part of it to The Prince's Trust, a U.K. charity for youth that once helped him.

 

What were the key success factors?

• Originality
• Marketing
• PR

He also started a new trend: pixel marketing.

There are now charity sites; sites devoted to erotica; straightforward financial sites - all using pixels to raise funds.

While none of these seem to have replicated Tew's success - the sheer volume of attempts and creativity takes pixel marketing seriously indeed. Time will tell how it will catch on. Once the dust has settled, we will know what works, and what doesn't.

 

Ironically enough, Tew did raise enough funds to finance his study (the reason he started the website in the first place) but since he has been bombarded with job offers and caught up in managing his site, he dropped out for now.

 

A classic example of victim of his own success?

 

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Marketing Birkenstock - from hippie to hipster

 

In 1971, Margot Fraser became the founder, CEO, and sole distributor of Birkenstock sandals in the US.

Fraser used non-traditional marketing to sell - she introduced the sandals to Berkeley CA, in 1966, where liberals picked them up since they were directed at a different target group and “weren’t affected by traditional thought.”

As a result, Birkenstocks have been associated with Woodstock participants, save-the-whale activists and tree huggers.

 

Over the years, Birkenstock relied on the general trend and demand for craftsmanship and renewable products to help promote their footwear.

For promotion, the company didn’t have any formal national advertisement and only also used unknown models.

As a brand, they were seen as “family-friendly, natural.”

As a result, their highest appeal was with the non-traditional consumers again.

This image was enforced by the “Birkenstock Green Team,” a US Birkenstock institution, that consists of a “small group of employees who meet voluntarily to monitor, research, and resolve environmental issues in (our) workplace, and to educate fellow employees about sound environmental practices.”

 

As a result, the general public saw Birkenstocks as ugly shoes for hippies, granola munchers, and environment activists.

In the late 1980s, Birkenstock got a boost from Generation Xers and baby boomers that embraced casual wear.

In 2001 however, Birkenstock USA posted its second profitless year due to over  $1 million in lost inventory and projected sales and costs for new computer equipment.

Birkenstock realized that it was time to reposition and rebrand.

 

It started its repositioning with marketing more than 400 styles of clogs, dress shoes and other “closed-toe” footwear for men and women in colors and patent leather more suitable for fashion runways.

As Birkenstock USA CEO Matt Endriss phrased it:

“The challenge is getting beyond the hippy image. There's a huge opportunity to increase our position in the marketplace.”

Birkenstock needed to rebrand itself, and be perceived as a manufacturer of glove-leather, designer footwear.

 

The company’s strategy was to broaden its image to edgy and fashionable footwear that shoe-obsessed, ultra-cool Carrie Bradshaw might wear strolling down Madison Avenue in HBO's Sex and the City.

Birkenstock marketing strategy also included expanding its fledgling children’s market and its “professional” shoes aimed at surgeons, chefs and others who stand for long hours.

However, sales are driven largely by hype, celebrity endorsements and big marketing campaigns. Companies such as Nike spend five times as much on marketing and PR alone than Birkenstock sells in a year.

 

The repositioning of Birkenstock worldwide paid off.

In 2004, Birkenstock got lucky when a suddenly trend emerged throughout the world when European girls were all over the glossy colorful sandals. French Vogue showed a pair of shimmering silver Birkenstocks.

The Japanese market followed – in the summer of 2005, Birkenstock successfully launched its footwear to the Japanese hipster crowd.

As are result, Birkenstock has rich and famous American fans, from Gulf War general Norman Schwarzkopf to Oscar-winning actress Gwyneth Paltrow.

 

For celebrity endorsement, Birkenstock invited several celebrities, including Cindy Crawford, Robin Williams and Whoopie Goldberg, to mark the 30^th anniversary of its bestselling Arizona sandal to design their very own version of it.

The company also signed actress/model Heidi Klum to both model Birkenstock sandals and to develop a limited-edition Birkenstock line. It resulted in excellent media exposure, and branded Birkenstocks as hip and trendy.

To reach the profitable exercise and fitness market, Birkenstock engaged Tony Little, America’s exercise guru and informercial pioneer, to promote its exercise sandals.

 

Birkenstock also changed its advertising, including full page ads at the back of  NY Times magazine.

In December 2005, Birkenstock selected Duncan/Shannon as its PR agency.

 

Where will small, privately-owned Birkenstock end?

It extended its brand into athletic shoes, hiking shoes and apparel, taking on companies such as Nike (which offsets sluggish sales of athletic shoes with casual crossovers and hybrid styles), bootmaker Merrell (which pioneered sport footwear such as moccasins), Timberland (which turned to sandals), competitor Teva, and designers such as Perry Ellis (who has his own footwear line).

One thing is for sure: Birkenstock made a promising start.

• It spiced up its product offering by adding dress shoes and other “closed-toe” footwear to its existing lines of sandals and clogs.
• It changed it distribution channels, adding ecommerce. Apart from its stores, Birkenstock are now also available online.
• It repositioned itself and is now perceived as fashionable.
• It put emphases on marketing, resulting in a clear picture who their customers are and why some of its markets are stronger than others.
• It identified fashion trends, which enabled it to enter new markets such as Japan and children's wear.
• Its promotion efforts included celebrity endorsements that branded the company as fashionable and trendy.
• It was able to maintain its image as a quality product manufacturer and is endorsed by testimonials on websites and blogs.

For the full case study, click on the pdf file    

 

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Ford Motor is finding its  marketing way

 

The Ford Company has always been more sales-driven than marketing-driven.

Ford’s legacy (the invention of the auto assembly line) has been overshadowed by its “creative marketing.”

If we look at its branding, Ford went through the following slogans: “No Boundaries” which lasted less than 2 years;

 “If You Haven't Driven a Ford Lately, Look Again” which lasted 2 years and the current “Built for the Road Ahead.”

 

Ford changes or tinkers with its ad slogan and brand strategy every 18 months or so, as executives change jobs in and out of finance, operations, sales, and marketing.

But that is not the only reason – to quote the newly appointed President Mark Fields: “advertising and even brand strategy at Ford has been viewed as somewhat disposable.”

 

This resulted into one of Ford’s main problems: customers don’t seem to get what Ford passenger cars are all about anymore. Especially the Ford Five Hundred sedan and Freestyle crossover SUV/wagon should have substantially replaced the Taurus. These cars should have successfully competed with the Honda Accord and Toyota Camry, which have been the best selling four-door sedans in the U.S. for several years.

The failure of the Five Hundred and the Freestyle was not only due to poor branding, but also due to poor product quality.

As the independant marketing consultant Dennis Keene (who works with consumer-product companies) phrased it:

“These cars were exercises in packaging rather than design, and precisely reflect why Ford's designers need sustained brand strategies to guide them”.

 

Ford paid a hefty price for its poor marketing and branding – it affected the bottom line. Year-over-year sales declined 9% in December 2005 - its fourth consecutive monthly drop.

For the first time in 19 years, Chevrolet outsold Ford in 2005.

Ford saw its domestic market share fall to 15.6%, down almost five percentage points since 2001.

As a result, Ford stock closed at $8.01 a share on Jan. 4, almost half what it was when Bill Ford took over four years ago.

 

Ford realized that it had to shape up and get back on track. The company had lost touch with its customers, more specifically its car customers.

Marketing cannot provide the proverbial silver bullet, but it can formulate and implement a strategy to revitalize Ford's main brands of Ford, Lincoln, and Mercury, and a stronger emphasis on development of new products.

 

On January 23, Ford will announce a detailed plan for growth, dubbed “The Way Forward”, which will include positioning and branding the Ford Company as “American and innovative”.

The company wants to capture American “values, culture, and optimism” in its designs.

On the product level, Ford is planning to launch new models in segments where the automaker has been largely absent.

 

Sales-driven Ford is smart to realize that marketing is its answer.

By analyzing its customers’ needs, adjusting existing products and developing new ones in accordance with the customers’ demands, iFord will (re)position and brand both the company and its products.

 

If Ford will be able to execute its new positioning, and put emphasize on marketing and branding, it will see its sales increase and (ceteris paribus) its stock go up.

 

Royal warrants have existed for several hundred years in several European countries.

Originally, it was a “formal recognition” for tradesmen who supplied goods and services to a royal household.

It has developed into an effective marketing tool – a special version of endorsement.

Companies such as Steinway and Harrods successfully use the royal warrant as a unique selling point.

Unlike traditional celebrity endorsements, brands that are warrant holders are associated less with the royalty to which the crest belongs, and more to the traditional way of life and luxury in that particular country.

Royal warrants are predominantly issued by royalty in the United Kingdom, Denmark, Sweden and the Netherlands to local and foreign companies.

How does it work?

A warrant links a product to a royal household.

Since advertising the warrant in any way is forbidden, it cannot be actively promoted.

Its power lies in the fact that the small crest “speaks for itself.” It is perceived as a “quality guaranteed” label, with the added cachet that goes with a royal family.

 

How effective is it?

A small ad hoc survey of British customers confirmed the image of quality and prestige the warrants add to brands.

British customers perceived a royal warrant as a quality assurance sign.

Especially luxury items showing a royal warrant are perceived as reassuringly British, of fine quality and traditional.

The price tag can be higher than the price of similar goods.

 

In order to apply for a royal warrant, a company must take the following into consideration.

1. Does it fit the target audience? Are potential customers interested in the attributes royal warranty products stand for? Do potential customers like heritage and tradition?
   
2. Does royalty work as a unique selling point? How are the royals perceived by the target audience? Do they only like their own royalty or also foreign royalty?
   
3. Will the royal warrant work for the brand? Will it help the brand to develop? Will it create brand recognition and loyalty in both domestic and foreign markets?
   
4. Does the company meet the criteria for the royal warrant? In general, a company must show that it has existed for some time (in the Netherlands, over 100 years), have an impeccable reputation, and follow a stringent procedure in order to qualify. The process is most of the time difficult, inflexible, and sensitive.
   
5. Is the company willing to invest time and part of its PR budget into this unquantifiable endorsement?
   

There is one group for which royal warrants work very well: the “business royals.”

 

Queen Margaret of Denmark sells 150,000 bottles of her own vintage wine yearly to french restaurants.

Britain's Prince Charles is manager of organic products food brand Duchy Originals, which makes US$ 77M. in annual sales.

Prince Carl XVI Gustaf of Sweden and his wife are marketing their fragrance Solliden worldwide, hoping to sell one million bottles per year.

 

The success of these brands lies in production and promotion of good-quality high-end products that match the royal’s own stature.

 

Displaying a royal warrant can be a powerful marketing and PR tool.

But companies must be aware of the following:

1. Compared to other celebrity endorsements, it’s much harder for royal brands to attract consumers than “common” brands.
   
2. Celebrities gain their attributes through achievement and behavior and thus tap into the target audience.
   Royalty exists purely through position.
   
3. Customers seek brands that they can identify with.
   
4. Celebrities can match the aspirations of the target audience.
   
5. Achieving royalty endorsement is harder to get than celebrity endorsement.
   
6. Royal warrants have a limited lifespan.
   In some countries, there is a renewal procedure every 5 years.
   In all cases, a royal warrant expires once the royal is deceased.
   
7. Royal warrants cannot be actively promoted.

Celebrity Endorsement in the Pharmaceutical Industry

Celebrity endorsement is a powerful tool to reach and influence the target audience.
From buying soft drinks to electing politicians, celebrity endorsements have a powerful impact.

No wonder that manufacturers and organizations love to land a celebrity to promote their product or cause.

One industry that has an ongoing love affair with celebrity endorsements is the pharmaceutical industry, which is not without complications.

As we all know, pharmaceutical companies routinely hire celebrities to attract attention to the latest drugs and the diseases that go with them.
Celebrities become an integral part of the drug marketing strategy.
Supermodel Lauren Hutton was hired to promote Wyeth’s hormone replacement therapy and menopause. GSK contracted Football star Ricky Williams was paid to create awareness of social anxiety disorder, making Paxil (briefly) the world's top-selling antidepressant.
Celebrities don’t come cheaply - according to celebrity brokers, the star's remuneration package may range from $20,000 to $2 million.
This kind of promotion is part of the drug marketing strategy, normally consisting of paid advertising and aggressive public relations campaigns.
It often results in the celebrities' media appearances on Oprah, the Today Show or, as in the case of Former Texas Governor Ann Richards who blatantly promoted one of Lilly’s drugs during an interview, on CNN's Larry King Live.

What are the main rules to enlist a celebrity for product endorsement?

1) Research which A-list celebrity goes down well with the target group
2) Hire an A-list celebrity that the target group considers trustworthy
3) Find a news hook to link the celebrity to the product
4) Develop some simple (marketing) messages
5) Ensure that the celebrity delivers them at every appearance

But especially celebrity endorsement of pharmaceutical product has its downside.
One big problem: the public doesn’t always realize that the celebrity is paid for advocating a cause (and its remedy).
A good example is the promotion of irritable bowel syndrome on top-rating TV shows by Kelsey Grammer (of "Frasier" fame) and his wife. Viewers thought that they were speaking on behalf of an independent foundation.

However, GSK, producer of Lotronex (a drug with side effects, including possible death) paid the couple for their endorsement.

There is also a legal aspect to it. When producers state benefits of their products, they have to back it up with hard data. Every advertisement must include warnings about side effects and possible dangers.
Celebrities, who are no experts whatsoever, can emphasize the benefits of a certain drug without the need to point out the downside of its use.
Lauren Hutton stated in magazine articles read by millions of readers: “My No. 1 secret is estrogen.”
Nor Hutton, nor the magazine is (legally) obliged to mention possible side effects or dangers.

Even well-meaning celebrities, who are not being paid for their efforts, and fight for a worthy cause, have the cloud to influence health issue debates and policies.
Camilla Parker Bowles chose to make an important public statement about the bone condition osteoporosis at an international conference funded by the pharmaceutical company Lilly.
For years, Camilla has been a champion for early intervention and greater use of expensive tests and technologies for the primary prevention of osteoporosis.
By appearing on the Lilly-sponsored conference, she unwittingly promoted biochemical solutions to health care problems. By doing so, the overall health care debate about equitable distribution of health care resources, including non-biochemical ones, was ignored.

And last but not least, pharmaceutical marketing using a celebrity has its own pitfalls:

1. The campaign may oversell the celebrity and undersell the product.
   Using an icon might result in high recognition of the person, but no recollection of the product endorsed.
2. There could be a discrepancy between personality and product.
   The target audience must believe that the celebrity uses the product for his/her own benefit.
3. The celebrity should not be associated with too many (similar) products.
   Once a celebrity is promoting too many products or a similar product, the message becomes too cluttered. As a result, the target audience gets confused about the exact product that the celebrity is promoting.
4. The product should be legitimate as a stand-alone.
   Even without any (celebrity) endorsement, the product should be sound, functional, and fitted for its target audience.
5. The product should meet its expectations. After the media hype, the product should meet all the expectations that the celebrity created.

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For sure you have heard about post-Enron legislation such as the Sarbanes-Oxley Act (SOX) that regulates the accountability for corporate compliance and risk.

Until recently, it made the upper echelons of a company or organization accountable.

However, it is now making its way to the marketing department so marketing professionals must be prepared.

Marketing takes a sizeable chunk out of the company’s budget, marketing and PR activities that have an enormous impact on customers and shareholders alike.

It makes sense that Sarbanes-Oxley forces every marketing executive to ensure that the processes that they are responsible for have security, integrity and financial accountability.

Nearly every department and/or function within a company or organization is subject to a severe Sarbanes-Oxley audit.

Until recently, marketing has remained fairly unaffected, resulting in highly inaccurate financial reporting by most corporations.

But marketing departments are now also forced to become financially accountable.

This makes sense: the marketing communication budget is often quite substantial - with corporate management being responsible for the procedures for financial reporting.

Therefore, accurate and quantitative measurement of the marketing performance is required.

To improve SOX compliance, a CEO or VP Marketing will demand that marketers use a chosen technology that forces marketing to tightly integrate with the company’s financial reporting.

How does SOX impact marketing and PR performance?

From "SOX on", marketers will play an instrumental role in the corporate compliance of the company.  

The internal communications between marketing and the rest of the company or organization will improve, thus avoiding severe compliance risks, legal implications, and monetary risks.

The risk of erroneous representation will be reduced. This is important for those companies where marketing interacts with many different departments, such as R&D and Testing. Misrepresentation of a product or company, both internally and externally towards the public and the press, can lead to severe brand and company image damage, with legal and financial consequences.

Most importantly, it will put a stop to significant ad-hoc, unplanned operating expenses – no matter how justified.

These expenses are normally not accrued accurately, resulting in an error margin up to 10% in corporate profit & loss statements. Adequate financial reporting by marketing staff will solve this problem.

For now, marketing and PR professionals might feel that they have to act "like accountants" and that their creativity will suffer, but in the long run the whole marketing discipline will benefit - ensuring a high level of professionalism.