Scenario 18-5
An old adage states that all publicity is good publicity. However, Professors Jonah
Berger of the Wharton School, and Alan Sorensen and Scott Rasmussen of Stanford
found that there is such a thing as bad publicity. The colleagues studied the relationship
between bad publicity and its impact on music albums, books, and movies. In 2010,
they published their findings in a journal called Marketing Science.After studying cases
involving the late Michael Jackson, Russell Crowe, and various authors; the colleagues
concluded that negative publicity can increase product sales. Michael Jackson sold
more albums after receiving negative media attention, and films starring Russell Crowe
received higher rankings following an incident in which he allegedly threw a cell phone
at a hotel employee. These high-profile stars actually thrived after receiving substantial
amounts of negative publicity. However, in many low profile cases, negative publicity
hurt sales and product reception. The three colleagues conducted an analysis of The
New York Times“reviews and book sales, and found that negative reviews hurt sales of
books by well-established authors, but helped sales of books by relatively unknown
authors. After conducting the study, the authors found that conventional wisdom is
wrong: not all publicity is good publicity. But they did show that negative publicity can
sometimes be positive; it all depends on existing-product awareness.
(Ned Smith, “Can Bad Buzz Be Good?” BusinessNewsDaily, November 1, 2010)
One way to help firms implement a reactive public relations strategy, and prepare for
possible negative publicity is to:
a. prepare a public relations audit.
b. promote goodwill.
c. prepare internal communications.
d. increase corporate advertising efforts.
Which of the following is an example of a fixed fee system of compensation?
a. 15 percent of the total amount billed by XL Inc. was retained by Tesco advertisers as
compensation for all costs in creating the advertisement.