Why Big Oil Will ALWAYS Lose the High Profits-High Gas Prices PR Battle

Pity poor Exxon, "demonized" in the media for earning a record of almost $11 billion in profits in the first quarter of 2011.

Pity Ken Cohen, Exxon's embattled Vice President of of Public and Government Affairs, whose pugnacious response sought to decouple Exxon's profit from increasing gas prices at the pump.

Pity them, because no matter how logical, reasonable or well-parsed Cohen's statement was, the American public will always equate rising fuel prices with higher profits for Big Oil.

From a public relations perspective, it's easy to understand why Cohen sought to explain how the two issues (Big Oil profits and high gas prices) are separate: By providing a coherent, rational explanation, he wanted to get ahead of the story.

The problem for Cohen--indeed, Big Oil overall--is that when gas hits $4 or $5 a gallon, the American public isn't coherent or rational. It's angry. And trying to defuse raw anger with rational thought is like trying to douse a fire with... gasoline. It makes it worse.

And this, friends, is precisely what Cohen's statement has done.

Here's what he said in the lengthy statement sent to reporters: "We understand that it's simply too irresistable for many politicians in times of high oil prices and high earnings-they feel they have to demonize our industry."

He lashed out at the task force recently created by the Obama administration to crack down on speculation in the oil market, adding the fact that federal and state taxes make up 40 to 60 cents of the price for a gallon of gas, versus the 7 cents per gallon that Exxon Mobil earns.

He further argued that most of Exxon's profit comes from its overseas operations, and that earnings in its refining business, which converts crude into oil and diesel, make up only 6% of its earnings.

What did the public hear? "We made $11 billion in profit this past quarter, and as gas prices continue to increase, we're going to make even more money next quarter."

Better he had endured the momentary media excoriation, saying nothing until tomorrow, when the media's (and the American public's) attention will be focused on the Royal Wedding.

Simple Public Relations Advice You Can Easily Implement in Crisis Situations

In the past three months we have witnessed two massive, highly visible and uncomfortably humiliating public relations blunders: The first one, most obvious and exhaustingly covered by the media, involves Championship-Golfer-Professional-Philanderer Tiger Woods; the second, less obvious but significantly more alarming, involves the flip-flopping by Janet Napolitano on the effectiveness of our nation's airline security measures. While the former is entertaining in a lascivious manner, the latter is life threatening.

Both issues underscore the importance of having a clear and universally understood (at least within the organization) PR plan in place to deal with any crisis. Such a plan is based, simply, on telling the truth early and often.

As these two events have ruthlessly revealed, it's absolutely essential for highly visible public personalities to employ smart, experienced, and professional public relations experts and to let them work. The results of not doing so are embarrassingly public.

Let's address Tiger's situation first. We all know how this tragi-comedy has evolved. But let's go back to the uncertainty surrounding the confusing moments when this story broke. If Tiger himself had simply released a statement to the media (NOT via his website, but through a publicist) that he and Elin had had a domestic dispute and, in his haste to leave the house for "some air", he accidentally backed his Escalade into a tree, the entire story would most likely have had a sympathetic angle for Tiger. We all know how stressful the holidays can be; after all, hasn't each of us fought with family before, during or after Thanksgiving?

A strong, honest and direct statement immediately after the event would have placed Tiger and his team ahead of the story. Once the 24-7-365 media got the smell of blood in the water, the sharks began to tear apart the story and we all know the carnage that ensued. Still, one wonders what the outcome might have been had Tiger and his team told a simple, honest story with which the American public can identify. That would have at least established some sympathy for Tiger.

Before we examine in some depth Janet Napolitano's "the-system-worked-the-system-failed" flip-flopping, let's look at one of the consequences of her confusing media statements. Initially, President Obama (as is his modus operandi) allowed Napolitano to be the administration's lead spokesperson on the terrorist incident aboard Northwest Airlines Flight 253. That is, until Napolitano's statements revealed a inexcusable lack of clarity and reflected poorly on the administration's anti-terror stance--especially at a time of year when airline passenger traffic is especially high. Napolitano's confusing public statements (she obviously was not well coached on the appropriate messaging for this situation) forced President Obama to intercede.

Janet Napolitano made her boss look bad. As a PR pro, my job is to make my boss look good. I get him fully briefed and properly coached. I make sure he knows the facts and delivers them calmly. If "mistakes are made", I own them. Not my boss.

While President Obama didn't publicly rebuke Napolitano (as Chris Good clearly explains in his blog at The Atlantic, privately you can bet that he strongly encouraged her to henceforth leave the public statements to him. Need proof? What have you heard from her since the President's very strong and compelling statement a few days ago?

In contrast to Janet Napolitano's confusing statements about which aspect of the system did or did not work, the Obama White House has been aggressive in its press outreach regarding the Northwest Airlines terrorist incident.

The American public doesn't understand that one part of TSA's security measures worked and one didn't. You needn't be a PR pro to understand that the American public doesn't tolerate that kind of wordsmithing. As a PR pro, though, I know the news media doesn't have the time or patience to explain it. All the flying public knows is that a terrorist almost blew up a plane; it was only because the device failed that the plane and its passengers landed safely. A savvy PR professional would have understood that and coached Janet Napolitano on the appropriate media messaging to reassure our flying public.

Skilled Public Relations professionals understand that the best stance to take with the media and our news-saturated citizenry is to tell the truth, tell it early, and tell it often.