The growth process and challenges faced by local public relations companies

Moderator Zhai Qin:

Thank you, Mr. Sun! Ms. Sun Yuhong came to our forum without lunch. Let us express our gratitude to her again! The next guest speaker was Mr. Gao Peng, Managing Director of Zhiyang Public Relations. Gao Peng is also one of the founders of BlueFocus. He has been committed to the operation and development of local public relations companies, so he must have an understanding of the growth process and challenges of local public relations companies. He has his own thoughts and feelings about the challenges. Please!

Good afternoon everyone, thank you Mingdao, "Economic Observer", and "Chief Marketing Officer" for giving us such an opportunity. It should be said that it will take us about 10 years to build Blue Label and five years to build Zhiyang, and we will continue to do so unswervingly in the future. So I am very willing to share some of our feelings with you on such an occasion.

First of all, I would like to express my feelings after listening to what the previous experts said today. I feel that the public-private relationship may be facing a lack of recognition on the one hand, or it may not realize its value. So we now emphasize the strategic value of public relations or like big public relations, but on the other hand we can also see that public relations cannot be overemphasized. Like Mr. Sun Xianhong this morning, you can't go to public relations when dealing with the police. Therefore, some issues cannot be resolved through public relations. What problems does public relations solve? Let’s first look at a proposition, that is, whether it is a business or an organization, who determines its success or failure? It is often not decided by the organization or the business itself. To a large extent, it is decided by the public around it. It is others who decide the organization or business. Success or not. Public relations are an important means, which are used to improve his relationship with the external public. This is what we understand as a fair relationship. It is true that public relations are a marketing tool. At the marketing level, public relations may only be used to improve the relationship between this institution, this organization and its consumers, but to a large extent public relations Relationship is to build a harmonious external environment for organizations and enterprises.

This topic was given to me at the conference, and I made some noises in my mind. Everyone here is either the founder of a public relations agency, or a public relations practitioner, and some may It’s not Party B at all, it’s Party A, and there are many experts, so talking about public relations companies alone is a topic of niche interest to the founder of a public relations company and should not be discussed in a large forum. Later, I thought that the reason why the conference asked me to talk about such a topic may have several meanings. For some bosses, this must be the topic that you are most concerned about. For practitioners, through our sharing you can see whether your institution is the one you dream of and pursue. For Party A, if you are trying to find a "long-lasting marriage and long-term partner," I believe that you also need to know more about Party B.

We will probably talk about a few topics. One is what is the development trajectory of a public relations company, who are we and what do we do? This needs to be clearly defined. Second, what are the main challenges we face in this process? Finally, we mention some of our own feelings.

Generally speaking, public relations agencies should be said to be more and more respected by people, so they are respected because they do provide a kind of wisdom and ideas to their partners. In the broad concept, public relations agencies belong to the service industry, but the biggest difference between its services and hotel services and catering services is that it provides the food of wisdom. Therefore, this kind of service is generally called "professional service organization" globally. We are one of the professional service organizations. This area is actually subdivided into investment banking, financial consulting, business law consulting, marketing communication, management consulting, etc. This series is all in the PSF space. In the space segmentation of public relations, it may be more in the space of marketing communication.

(Picture) In fact, public institutions have sprung up in the past two or three years, which shows that their growth is very good. However, relatively speaking, its market share is difficult to compare with the overall intellectual industry consulting. occupies a relatively large share. From the perspective of the development stage of public relations companies, public relations companies like Hill & Knowlton are in the stage of global development. That is to say, they have developed to the fourth and fifth stages.

For many local public relations companies, they are still lingering in the first and second stages. At this stage, there are certain limits in terms of the number of people and services. If you want to break through these ceilings, you need not only courage but also wisdom. Therefore, if you really want to do it in the public relations industry, our sincere feeling is that "it is difficult to do it, but it is difficult to do it". Fortunately, for these regular things, we learn more from international public relations agencies that developed relatively early. Of course, there is also a very important learning object, which is to learn from our Party A. We have been fortunate to serve Cisco, Lenovo, Canon and other excellent companies in the past ten years. Their wisdom and thinking have improved our understanding of our own development. Some awareness. So in terms of development stages, for example, from 30 people to 100 people, this is a big threshold. Therefore, many companies have only one office in a region, and this department only has 30 or 50 people. It is not realistic to develop into a company with 100 people. We must think of cross-regional development, because we know that a good structure can support your development. to a certain scale. A small or wrong structure will definitely not be able to support your development. So first solve the development problem from the shelf. If you only have a hundred people and one or two offices, then your "ceiling is probably only 10 million US dollars." Only by making breakthroughs can you make it possible to grow further.

Similarly, at different stages of development of public relations companies, the management issues they face are also different. In itself, professional service organizations have their own unique issues, but they are essentially enterprises, and enterprises must abide by some general rules. We basically extract these general laws and they are some general management issues. The management issues faced by enterprises at different stages are also different. When you are a small company, a small company may basically rely on a boss and personal connections to develop, and you should face "grey income" frankly, because this is what a company has to face in the early stages of development. The main topic at this stage is like this, which means that if an entrepreneur evaluates that he does not have a wide range of personal connections, and you are not good at developing your personal connections in unconventional ways, then you may not be suitable to start a business. PR firm. But we must also clearly realize that if we only maintain such a relationship, this company will probably be a company of 30 people. To cross this threshold, we must face some important management issues such as marketing and the formation of method systems. These are also some of the important issues we are currently facing.

For example, for the fifth consecutive year, we have held job fairs in various colleges and universities every year, because at this stage, we need to solve problems in this way. Including some compensation systems. In the past, 20-30 people were under your eyes, but now there are 200-300 people. An effective compensation system has also become a key issue.

The fourth stage or higher stage is to form your own brand characteristics. Some of today’s guests may have a brand impression of them before they talk about it, so different institutions need to build brand characteristics at a certain stage, and the other is the operation at the capital level. We have seen that WPP, for example, operates like this. .

For our local public relations companies, they actually face different management issues at different stages of development. That is, when you reach a certain stage, you must solve the management challenges faced at these stages. Are there any other challenges?

When a public relations company is founded, the first question to answer is to decide whether your company will develop professionally based on customers or professionally develop products. Some companies use product specialization to develop. For example, we have seen that some public relations companies now serve as copywriting companies. Some of the services they serve are institutions, some are enterprises, and some are directly from the needs of public relations companies. They have made this One product provides services to customers from all walks of life, as well as public relations agencies. This type of product typically belongs to product specialization. If I develop a product, such as Tianxia Internet, it may also be in the direction of product specialization. There is another category called customer specialization, which is further subdivided into industry and cross-industry specialization. In fact, it is to answer me which direction each company is going? If you want to specialize in customers, one question you have to answer is whether you can specialize in the industry.

Because we know that there are no industry prohibitions in some areas in PSF. But this is a business rule in public relations and is not allowed. The problem that this does not allow is that it is not easy for professional institutions to accumulate knowledge and develop professionally in the industry. The basic premise for professional development in the industry is that you know better than your customers.

The second topic is how to balance the relationship between professional capabilities and customer relationships. We see that among the four quadrants in the icon, essentially, your company can survive and develop only if it falls under two quadrants. The other two quadrants are not your place to stay for a long time. That is to say, there are only two quadrants where you can live normally.

When we develop further, we will be faced with answering the third question: whether to become stronger or bigger. Our basic choice is to become stronger, that is, no matter what the scale, we only provide public relations services. However, we have seen that when some organizations achieve a certain level, they diversify and expand, such as training, advertising services, etc.

Another issue is when you reach a certain scale, "Should you raise your children by yourself or by others?" When your company develops to a certain stage, you will find that you are unable to do what you want. At this time, you need to hire professional managers. . Because a typical feature of Zhiye Services is that laymen cannot lead experts, so when it develops to a certain level, you need to hire an expert leader to manage your company.

Finally, what I want to share with you is that if you plan to be a public relations company and seek long-term development, then it must not rely on a cost leadership strategy to develop. A development model like Galanz is not feasible in the field of public relations, because the most important thing in the field of public relations is human capital, and the development of public relations companies is mainly formed by intellectual capital. of differentiation. Moreover, this kind of differentiation has nothing to do with scale. No matter how large a company is, the differentiation may not be obvious, but it is possible for a small company to achieve very clear differentiation.

Our experience can be seen from the entire development process of China. At this stage, when consumers are becoming more and more personalized and smart, the power of public relations is indeed getting stronger and stronger. If this is the case, from a purely marketing perspective, we believe that the public relations market is basically a "personality-led" market. If it is the advertising market, by now China's advertising market may be dominated by first-tier brands. Some 4A companies, but the public relations market is just the opposite. The rule here is that advertising mainly deals with images, and there are many sexual places. The pictures that Parisians like to see, Chinese people also like to see, so international companies It is easier to transplant globalization experience to the Chinese market, but corporate relations mainly deal with messages, and we know that language has strong uniqueness and cultural connotation. Therefore, in the field of public relations, local public relations companies are most likely to become bigger and stronger. Thank you all!

Netac’s five-year stormy history

An invention spawns an industry, and a lawsuit is likely to affect the values ??of a generation. Although Netac was founded in May 1999, it is not large in scale, but it is already destined to become a mysterious symbol in our era of knowledge economy.

The reason why it is mysterious is not only because this 5-year-old company has carried too much controversy, not only because its future is full of more variables, but also because it will endure The test is likely to mark that China's IT industry is at a great turning point, or will continue its past trend. Because of this, it aroused extraordinary curiosity from the outside world.

Purple air comes from the east, and the king comes

On the spring morning of 1999, under a lamp that stayed up all night in Shenzhen, a coastal city in southern China, two young people were still concentrating on each other. Staring at the computer screen, they tapped their fingers rapidly on the keyboard. One of them is responsible for the hardware and the other is responsible for the software. In order to invent a new product that is convenient for people to store and exchange computer data - flash drive (they named it "USB flash drive", and now "USB flash drive" is the registered trademark of Netac), they I have been working day and night like this for more than half a year, during which four computers were damaged.

The right way is a person who works hard, and God will not let him down. When problems such as how to draw power from the flash drive, how to store it stably, and how to make the system recognize the flash drive as a standard accessory were solved one by one, smiles finally appeared on their tired faces. This smile is different from the ordinary smile of relief after the work is completed, nor is it the ordinary joy after the success of the research project.

Because they know in their hearts that from this moment on, a floppy disk and floppy drive industry that has existed for more than ten years will be completely subverted and will never return; because from this moment on, a brand new industry will ——The flash disk industry has ignited its spark. It will spread from Shenzhen to Guangdong, and then quickly spread across the country and the world, shocking the world.

In addition, there is another thing they did not expect, that is, from this moment on, their names are destined to be recorded in the history of China's IT development - they are two Hunanese who once Deng Guoshun and Cheng Xiaohua both resigned from their high-paying positions after studying in Singapore and working for several years.

When the long-lost sunshine shone on Shenzhen through the thick clouds and fog accumulated by the continuous rain, both Deng Guoshun and Cheng Xiaohua breathed a long sigh of relief, and the fatigue of the past few months was swept away. And empty. After that, they made a decision-to set up a company to let all users who had a lot of inconveniences from using floppy disks say goodbye to their worries.

In May 1999, Shenzhen Langke Technology Co., Ltd. was formally established. At that time, there were only two employees and a registered capital of 300,000 yuan.

The more frustrated you become, the more excited you become, paving a high-speed track

At the beginning of the establishment of Netac, the most important thing for Netac was to find investment. In Deng Guoshun's view, flash drives are small in size, large in capacity, fast in reading and writing, use a universal USB interface, and do not require a driver. Such a brand-new product undoubtedly has great market potential. He believes that such an investment only costs two to three million. It should be easy to find investment for a project that is expected to pay for itself within two or three years, but this is not the case.

For nearly a year, Deng Guoshun and Cheng Xiaohua have been looking for investment. They initially found many well-known large IT companies in China, but found no hope; later they decided to try their luck in Silicon Valley, and met more than 10 groups of venture capitalists, but still came away disappointed. The registered capital of 300,000 yuan had already been used up, and at the critical moment when the two people were struggling to support it, they were delighted. They received a venture capital investment of 3 million yuan.

After finding the investment he had dreamed of, Deng Guoshun thought that the next steps would be smooth sailing, at least in an orderly manner. However, when the first batch of flash drives quietly rolled off the production line, what Deng Guoshun did not expect again was that because consumers had never seen a flash drive, they could not find an agent.

Deng Guoshun is trying hard to find the reason why the flash drive cannot reach the sales counter. During this period, he once set a record of negotiating with dozens of dealers in one day. As a result, only a handful of dealers expressed their willingness to give it a try. In the end, they did not cooperate with Netac because of their concerns. Flash drives are still the pride of the lab.

How can an IT invention get out of the laboratory and open up a new market? This is a subject that has not been studied for many years. Deng Guoshun had no time to think about it. Now he needed to practice it with action, which was far more meaningful and urgent than research.

Deng Guoshun, who graduated from Sun Yat-sen University, was obviously deeply influenced by the school motto and Mr. Sun Yat-sen's famous saying - "I will go forward indomitably toward my goal; I will persevere and become more frustrated the more frustrated I am." After thinking hard, Deng Guoshun finally decided to adopt " The three-pronged market operation method of "exhibition, bundled sales, and agent distribution" is used to try to promote flash drives.

Deng Guoshun’s logic is that new inventions and new products should have their own unique stage, and exhibitions are ready-made big stages; secondly, if new inventions and new products are difficult for ordinary users to accept at once, then mainstream manufacturers in the industry will The likelihood of acceptance will be much greater because they have a better understanding of technology development trends and product application prospects.

After everything was considered carefully, Netac began to frequently appear at the China High-tech Fair, the world's largest IT event CeBIT in Hannover, Germany, and the world's most prestigious COMDEX in the United States, causing a huge sensation at home and abroad. . During this period, major media reported Netac's major inventions with eye-catching headlines. The statement that "flash drives are the end of the fate of floppy disks" can be seen everywhere.

At the same time, after many contacts with IBM, a mainstream manufacturer in the industry, Netac also successfully obtained the generous support of this world-famous company in December 2000. IBM announced that Netac USB Flash Drive It is the only mobile storage solution among its mobile application solutions. IBM's foresight strengthened the confidence of the young Netac.

In addition, Netac has also recruited extensively from the IT industry and gathered some elites who are familiar with the operation of IT product channels under its command, thereby establishing a nationwide sales network in a short period of time. So far, Netac has paved a high-speed track for the expansion and development of the flash disk market.

Holding patents and persisting in safeguarding rights

Facts have proved that Netac's successful invention of flash disks is not an undue joy. In 2001, Netac achieved a significant jump in annual sales; in 2002, Netac continued its efforts and set a record of annual sales of more than 200 million yuan. Even when there was a serious shortage of flash memory chips in 2003, Netac still set a new record again.

“No gold mine in the world is more famous than the Egyptian pyramids, although the latter is not made of gold, but only made of stones. This fully illustrates the value of creative thinking.” Lanco The company's president, Deng Guoshun, made such a vivid metaphor when commenting on the success of the flash drive's launch.

At the same time as Netac, the flash disk industry also rose overnight. Driven by Netac, this industry, which was initially dismissed by people, grew from scratch, grew from small to large, and developed into an industry with an annual output value of nearly 1 billion yuan in just two or three years. Relevant reports predict that in the next five years, the flash disk industry is expected to grow to a scale of 5 billion yuan.

As the saying goes, good fortune lies ahead of misfortune. While Netac was delighted, it quickly discovered potential threats in the market. In addition to domestic large and small manufacturers entering the market in the form of OEM (OEM), foreign mobile storage manufacturers have also come to China - the battle for the flash disk market is about to begin.

How to resist the onrushing competitors? Deng Guoshun, President of Netac, made a decision that would shock everyone in the future. He picked up the patent sword in his hand for the first time. In September 2002, Netac brought major domestic flash disk "OEM" manufacturers such as Patriot and Fu Guanghui to the dock in court, demanding that they stop infringing on their "flash electronic external storage methods and methods used in data processing systems." He has the invention patent right for his device" (flash disk) and has accumulated a claim of 4 million yuan.

One stone stirs up a thousand waves. This patent dispute, called "China's first intellectual property case" by the media, not only triggered a major domestic debate on the development and maintenance of independent intellectual property rights, but also attracted widespread attention from foreign manufacturers. Among them, Ammon, a listed company in the United States, traveled thousands of miles to participate in the war.

A senior observer once commented that Netac’s lawsuit against Huaqi for infringement of patent rights not only sounded the alarm to individual domestic manufacturers with serious infringement, but also set the stage for China’s flash memory industry. A new Great Wall has been built in the disk market, which makes the dream of foreign flash disk manufacturers to "enclose" China with patents become far away.

In March 2004, Netac officially sent legal letters to the U.S. headquarters of SanDisk, an American storage manufacturer, and to its Chinese agents, claiming that SanDisk and its agents were suspected of infringing two invention patents of Netac. , and issued a serious warning about its behavior of recruiting people to sell flash drives in the country.

Although no response has been received from SanDisk's US headquarters, some analysts believe that Netac has applied for more than 100 patents and has already had three invention patents officially authorized. Netac's complete patents The protection system surprised many foreign manufacturers, but at the same time it also gave them a vague glimpse of the coming of a new era.

Entering the International and Returning with Honor

Although the domestic patent dispute has not been resolved, Netac's internationalization has already started. In March 2003, Netac and JMTek, the largest flash disk manufacturer in the United States, both appeared at the CeBIT exhibition in Hannover, Germany. What is eye-opening is that the two manufacturers are not tit-for-tat competitors at this time, but are jointly participating in the exhibition. People familiar with the matter revealed that the two companies have already jointly established a joint venture in the United States to jointly expand the international market. .

This is not the first time for Netac to establish international cooperation with JMTek. Previously, the company has also cooperated with IBM, DELL, HP, Logitech, Ingram Micro, McAfee security, NEC and many other world-leading manufacturers to sell Netac's flash drives in bundles or OEM.

Not only that, Netac also distributes its products to the United States, Canada, Europe, Japan, the Middle East, Southeast Asia and other countries and regions. An IT technology revolution pioneered by Netac spread rapidly around the world. Relevant statistics show that the total global flash disk sales in 2003 were close to 10 million pieces, an increase of dozens of times from two years ago, of which the Chinese market alone accounted for more than half of the total share. This is unprecedented in the history of IT product development.

According to a survey by Global Sources Ltd. (Nasdaq NM: GSOL), a well-known international trade magazine publisher and a US Nasdaq listed company, the flash drives exported by Netac have become the products they are rushing to buy. Target, Netac won the "2003 Chinese Enterprise Export Achievement Award" due to its remarkable export performance.

“Having a patent can at least ensure that we can sleep when Netac’s products are exported abroad.” Deng Guoshun, President of Netac, said lightly when talking about the industry’s “patent paranoia” about him.

Compared with domestic DVD, color TV and other companies, Netac Corporation, which has multiple invention patents, seems to have a much smoother path to internationalization. In the future, Netac Corporation will obviously not be satisfied with being able to sit back and relax at night. Get some sleep.