CHAPTER 19
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FOR STARTERS: Consumers & Investors
Why has dealing with consumers and
investors become so important for public
relations?
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Tyco Toys, Inc.
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
Toy Fair Breakfast

Media Day at Sesame Place
Theme Park

Elmo sent to Rosie O’Donnell

15,000 media mentions
Source of Elmo character: http://www.geocities.com/~chicky-ma-ma/elmo.htm [accessed 6/16/2000]
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Let’s Discuss
Consumer Movement History
1872 – Criminal Fraud Statute
1887 – Interstate Commerce Commission
1900s – Muckrakers
 The Jungle
 Food and Drug Act
 Food, Drug, and Cosmetic Act
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JFK’s Consumer Bill of Rights
Right to Choose
Right to
Safety
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Right to Be Heard
Right to Be
Informed
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QUICK QUIZ
Federal Consumer Agencies
What does each of the following federal
agencies do?
Federal Trade
Commission



Regulates television and radio advertising
Covers areas not included in national
advertising (general litigation division)
Enforces consumer credit program (fair credit
reporting, truth in packaging)
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QUICK QUIZ
Federal Consumer Agencies
What does each of the following federal
agencies do?
Justice
Department

Enforces consumer protection measures such
as the Truth in Lending Act and Product
Safety Act

Runs anti-trust division (Microsoft suit)
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QUICK QUIZ
Federal Consumer Agencies
What does each of the following federal
agencies do?
Food & Drug
Administration

Protects consumers from hazardous items:
foods, drugs, cosmetics, therapeutic and
radiological devices, food additives, serums,
and vaccines
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QUICK QUIZ
Federal Consumer Agencies
What does each of the following federal
agencies do?
Office of
Consumer
Affairs
Consumer
Product Safety
Commission

Publishes literature informing the public of
recent developments in consumer affairs

Oversees product safety (seatbelts, strollers, etc.)
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QUICK QUIZ
Name some consumer watchdog
vehicles or groups.

Consumers Union (publishes
Consumer Reports)

The Consumer Federation of
America

The Internet
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Business’s Consumer Relations
Division Duties
Handling Complaints
Developing Guidelines to
Evaluate Products &
Services
Developing Consumer
Programs
Developing Field-Training
Programs
Evaluating Service
Approaches
Evaluating Company
Effectiveness in Showing
Concern for Customers
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Chrysler Corporation’s
“Customer’s Bill of Rights”
Every customer has the following rights:
Quality
Long-term
Protection
Satisfaction
Service with
a Smile
Grievance
Opportunities
Safe
Vehicles
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Consumerist Objectives
Let’s Discuss
Explain how each would benefit a company:
Keeping Old
Customers
Attracting New
Customers
Marketing New
Items / Services
Reducing Costs
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Handling Complaints
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



Investigate complaints
made against the firm
Provide a central
location for customers
who seek redress
Monitor difficulties
customers have with
products
Influence organizations to improve service
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DEFINE:
Timely and valuable
communications that
gain and maintain
shareholder support
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What is a company’s
CURRENCY?
Its STOCK
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PRICE
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DEFINE:
Any fact that would be
important to an
investor making an
investment decision
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Examples of Material Information:

Proposed mergers or acquisitions

Changed dividend policy

Determination of earnings

Acquisition or loss of significant business
contract

Major management changes

Significant change in capital investment
plans
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Examples of Material Information:

Purchase or sale of a major asset

Incurring a major debt or selling a
significant amount of equity annuities

Pending significant legislation

A major discovery or innovation

Marketing a new product
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OVERVIEW:
Annual Reports:

Company description

Letter to shareholders

Financial review

Explanation/analysis

Management/marketing discussions

Graphics
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OVERVIEW:
Quarterly Reports:
Comparison of current
performance with
previous year’s quarter
performance
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Annual Meetings:

In-person meetings

Q&A sessions

Speeches

Stockholder voting
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OVERVIEW:
Conference Calls:
Follow-up quarterly
reports to answer
questions
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Media Contact
& Monitoring:

In-person meetings

Q&A sessions

Speeches

Stockholder voting
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OVERVIEW:
Internet Investor Relations:

Homepage / Web site

SEC documents online

FAQs

Links to financial data
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