Nations Use U.S. PR Firms For Global Positioning

When Saudi Arabia decided recently that it needed to sway U.S. public opinion, the country launched several PR and advertising efforts. The U.S. responded with the “Shared Values” campaign, courtesy of Charlotte Beers, undersecretary of state for public diplomacy and public affairs, which presented the U.S. “brand” to the Muslim world.

Countries have long enlisted PR and ad agencies to help sell their sun-drenched beaches or centuries-old cultures. But today many of the nation’s largest PR firms are landing government accounts that have less to do with promoting tourism, values or even policy than with winning the good old American dollar. Nations as diverse as El Salvador, China, Vietnam and Great Britain have hired American PR firms to woo U.S. investors and bring home marquee events like the Olympics.

“Countries have to position themselves like companies and promote their competitive advantage,” said Jack Leslie, chairman of IPG’s Weber Shandwick in New York. Leslie’s shop has worked on campaigns for Colombia, China and several other countries. “Globalization really has brought the need of strategic positioning to the fore,” he said.

Accounts from foreign governments, especially assignments to increase investments, represent a small portion of revenue for most major shops: only about 4 percent at Edelman Public Relations, for example, said Michael Morley, Edelman president and deputy chairman. But the governmental market is just emerging, and insiders say the high-profile accounts yield a return in prestige.

“It’s a huge area and a growing one,” said Morley. “It’s hard to measure directly, [but these accounts] raise the level of seriousness of what you’re doing. You’re representing important organizations, and so are becoming a more important source to the media.”

Edelman has worked with the governments of Mexico, Japan, Korea and Singapore, among others. The agency was recently retained by Invest UK to attract investors to Great Britain by promoting the country’s economic stability, low inflation and low interest rates. Edelman’s strategy includes educational and networking events, workshops and a Web site, as well as scouts to assist entrepreneurs with logistics.

The challenge for most of these assignments is to change Americans’ perceptions of countries plagued by poverty or instability in order to get inside investors’ deep pockets. “A good PR campaign introduces you to the human side of a country,” said John Verret, associate professor of advertising at Boston University. This could mean raising awareness of a nation’s educational levels, natural resources or inexpensive labor, according to Verret.

That’s how El Salvador played it. Fleishman-Hillard, owned by Omnicom, launched a campaign last July to promote investment opportunities in El Salvador through the Central American country’s investment agency, PROESA. Themed “El Salvador Works,” the campaign used advertising and PR media kits to highlight its educated workforce and young population. The effort sought foreign investment in agribusiness, call centers, electronics, manufacturing and textiles/apparel.

Two months after Fleishman’s program began, pharmaceutical giant Bayer invested $20 million to expand production facilities in the Salvadorean city of Llopango. PROESA expects to secure an estimated $8-10 million in new investments this month alone.

Hill & Knowlton, which last month won an assignment to develop an investment campaign for Vietnam, is taking a different approach. Its plan is to host investment seminars in the U.S. featuring Vietnamese officials and to generate awareness via Web sites and newsletters that focus on businesses seeking to invest in foreign countries, particularly Asia. Its program will target the oil and gas, pharmaceutical, biotechnology, information technology and agricultural industries.

Whatever the tactics, governments are turning to investment campaigns because of the increasingly competitive environment.

“Countries looking to attract investment dollars and promote tourism are in competition with other countries,” said Nicholas Carr, executive editor of the Harvard Business Review. “If they’re trying to reach out to the U.S. market, it makes sense to use U.S.-based companies.”

And it isn’t enough just to sell the country’s national resources. “Governments, like corporations, have found it’s important to draw on public relations and public affairs initiatives to support their marketing efforts,” said Vivian Lines, COO of Hill & Knowlton, Asia-Pacific in Singapore.

Weber Shandwick developed a campaign that helped win the 2008 Olympic Games for Beijing. Weber’s media relations campaign included e-mail media kits and press conferences targeting journalists around the world. The effort was to show the International Olympic Committee—and the world—that China has the necessary infrastructure and workforce to build facilities, the commitment to make progress on human rights issues and the ability to host a “green” Olympics.

Beijing’s victory in the host-city competition was a matter of great pride for the country, of course, but the economic benefits will likely be even more impressive. According to a study by Chicago-based Jones Lang LaSalle, four recent Olympic host cities—Sydney, Atlanta, Seoul and Barcelona—brought in between $3-17 billion each.