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Back in the Internet glory
days of the late ‘90s, investment decisions and business
strategies were dictated by headlines. Venture
capitalists threw dollars at business plans that were
dominated by buzzwords instead of logic, and entire
businesses were built on rubric. Today’s executives
would be well served to apply a measure of caution to
making decisions based upon media coverage of new
technologies and business fashions.
In a world of instant news
and media craving for the next “hot story,” we are
seeing more cases of runaway stories than ever. While
the Internet craze created new magazines, new
businesses, new investment portfolios and even a “new
economy,” once the hype died, so did many of these
businesses and ideas.
Witness the incredible
investment in broadband – companies spending literally
billions of dollars building capacity that today sits
unused, with many of these companies either broke or out
of business completely.
Gartner Group has proposed a
theory of the “hype cycle of emerging technology,” which
states that media coverage of a new technology fuels
interest, which feeds more media coverage , which leads
to inflated expectations. This is followed by general
disillusion when the technology doesn’t live up to the
hype - leading to a loss of interest, declining stock
values and finally a return to normal expectations. At
this point, both media coverage and the technology
become stable and more mainstream.
Outside the business world,
the same thing is happening. Today’s example
can be Kobe Bryant, yesterday’s O.J. or Martha Stewart.
Media hype is inexorable and can roll over even the most
well-thought business strategy if given a chance.
Swedish researchers Tomas
Uppgard and Roger Wallis of the Royal Institute of
Technology in Stockholm put this theory to a test,
analyzing the frequency of keywords in the media against
businesses connected to those keywords. It turns out
that the dotcom bombs rode a media frenzy to
unsustainable heights, while less ballyhooed technology
companies attained a steady growth pattern. The
researchers believe it may be possible to develop a hype
detector that can correlate media hype with actual
technological advances.
Blogging is a possible new
tool for businesses to gain grassroots exposure (Click
here to see our article "Pitching Blogs".) This topic is
gaining popularity in the press, and with each new
mention more companies and executives are adding Weblogs
to their business strategies.
Wireless is getting huge
headlines. McDonalds, for instance, has instituted wi-fi
– once the exclusive province of Starbucks. We are
approaching a chicken-and-egg point, one in which it is
hard to decide whether business events are driving media
coverage or vice versa.
It is interesting to note
that while the hype of the Internet has died, the number
of people using it, the amount of business being done
over it, and the opportunities provided by it are larger
than ever.
When developing your next PR
strategy, consider the effects of media hype – not only
on your public image and brand perception, but also on
your long-term business objectives.
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