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Chick-fil-A: The Fourth Estate

Updated: Aug 20



“Is Chick-fil-A anti-gay marriage? ‘Guilty as charged,’ leader says.”


In the summer of 2012, that headline enraged millions of Americans. Chick-fil-A Chief Executive Officer Dan Cathy had long supported what he would characterize as the “biblical definition of the family unit.” That was old news. But by standing Cathy’s deep religious beliefs on end -- by characterizing a longstanding support for heterosexual unions more explicitly as an opposition to homosexual marriage – the Los Angeles Times ignited a national media firestorm.


The Los Angeles Times story, based on an interview Cathy gave to The Baptist Press, was picked up by news outlets around the country. Within days, a fast-food restaurant with deep Southern roots, national ambitions, and a killer chicken sandwich was the target of viral protests.


Carly McGehee, an LGBT activist, staged a nationwide kiss-in at the company’s then-1,600 restaurants. Mayors in Boston and Chicago took steps to block Chick-fil-A from expanding into new locations. College students at New York University and Northeastern sought to banish Chick-fil-A restaurants from campus. By the time the protests were over, about three in ten of Americans had heard what they considered to be negative news stemming from Cathy’s personal beliefs.


On the other hand, more than four in ten Americans reacted positively to the news. These were people who had read the same stories, and watched television footage of the same protests, and had a polar opposite reaction. In a show of support for the embattled restaurant chain, more than 600,000 supporters subsequently RSVP’d to an online invitation from former Arkansas Gov. Mike Huckabee to join like-minded people for dinner out.


The “Chick-fil-A Appreciation Day” event was scheduled on a Wednesday evening, code across the South that taps into a strong tradition of attending midweek church prayer meetings and Bible study. By the end of that August evening, Chick-fil-A had posted its largest single-day sales ever.


In a word, the Los Angeles Times Chick-fil-A gay coverage was polarizing. Wherever you may find yourself on the gay-rights spectrum, reactions to those headlines exposed a dynamic that is reshaping U.S. news. A media landscape once dominated by three network TV newscasts and two metropolitan dailies -- a morning paper for white-collar workers and afternoon paper for blue-collar workers -- has been widely disrupted.


For Public Relations practitioners, this widespread disruption of the news media is reshaping how organizations communicate through the mass media, the most influential channel available to companies, causes and candidates. And the changes come as these same corporate, philanthropic and political organizations are increasingly taking stands on social causes. For PR, the ability to effectively communicate will hinge on the ability to navigate dynamic changes reshaping the Fourth Estate.


The News Business

In the news business, advertising has always been the lifeblood. While newspaper subscriptions – now paywalls -- produce a relatively small income stream, ads pay the bills and generate the profits, marginal as they might be. That business model works great if you sit on the business side of the newsroom. But it’s always been a source of tension for reporters. Even though subscribers bought newspapers for, well, the news, reporters were not credited with generating that revenue. And marketers bought ads hoping to distract readers – even if just for a moment -- from the news they were reading or watching. Reporters had no claim to that revenue either.


To be fair, most reporters are generally oblivious to the economics of the news business. Many consider news a calling. Some of the best reporters are bulldogs on a deeply personal if not somewhat Quixotic quest to uncover deep truths, expose fundamental wrongs, and defend what’s right. In a democratic-capitalist society, news is a social good, vital to informing voters, protecting consumers and elevating discourse. Cue a reading of the First Amendment.


Other reporters are brilliant writers who found an outlet for their muse in a medium that offers access to limitless stories and the ability to cash a regular paycheck. Others still are hacks, able to gather facts quickly and string them into serviceable copy [Guilty as charged]. And for some – especially since the advent of television -- news is a star turn, a chance to stand in front of the lights and the camera, with a new show premiering every night.


Cue Don Henley. “Well, I coulda been an actor, but I wound up here / I just have to look good, I don't have to be clear.”


Still, at its core, news is a business. And like any other business, if you are not budgeted as a revenue line, you are a cost center, an expense, a liability. In newsrooms, especially at smaller papers where news desks sit on the same floor as the business side of the paper, that can become painfully obvious. It doesn’t take long for a reporter to sense the business pressures when an editor orders up a story about a new store in town – the age-old publisher’s must is a thing -- or spikes an idea for an investigative series about local car dealers, or Realtors, or any other major advertisers.


If reporters aren’t in the business of selling newspapers, and to some extent are resistant to the pressures that can be tied to ad revenue, what business are they in, exactly? Let's think that one through. With no claims to revenue generation from paywalls or advertisers, the role of reporters is to generate the raw materials that are used to make the final product. That means producing stories people are interested in seeing or hearing.


Those stories, in turn, are aggregated into a newspaper, an online feed, a newscast. In the digital media, paywalls can be erected to generate revenue for the most credible news outlets – The New York Times, the Financial Times, the Wall Street Journal. Paywalls also go up for specialized news outlets – Bloomberg, Politico, the local Business Journals. The remaining media outlets – the network and cable news programs, the marginalized local newspapers and the myriad start-ups like Vice and Huffington Post, generate revenue by building audiences that advertisers can target.


There you have it. In pure economic terms, reporters are in the audience-generation business. The news organizations they work for, by extension, are in the audience-delivery business.


Considering the widespread digital disruption that is reshaping the media landscape, how is this business dynamic affecting the state of the news media? In a 2020 study, University of North Carolina-Chapel Hill researchers characterized the local news landscape as "transformed and diminished." A quick glance at the landing page of online newspapers clearly shows the transformation. In this Baltimore Sun screenshot, news accounts for barely 20 percent of the page, which is largely cluttered with subscription offers and click-bait ads.


Despite the desperate attempts at revenue generation, more than 300 newspapers have closed, about 6,000 reporting positions have been eliminated, and newspaper circulation has declined by about 5 million readers over just the past two years. The industry consolidation also has been fueled by failures of local newspapers, creating “news deserts” in economically disadvantaged areas of the country. At the same time, hopes that start-up digital news sites would fill the void are fading, with local online news sites going dark as quickly as new ones go live.


Struggling to recapture classified and traditional advertising revenues lost to online media – and hurt by a decline in ad spending during the COVID-19 pandemic -- surviving local newspaper companies continue to aggressively cut costs. Tribune Publishing in May 2021 agreed to an acquisition by Alden Global Capital, a buyout firm whose playbook involves slashing editorial expenses to boost earnings of newspapers it acquires. in the latest acquisition, the nation's second-largest newspaper publisher added the Chicago Tribune, Baltimore Sun and New York Daily News to its stable of about 200 news outlets.


Even the next-gen digital news feeds have begun to sell out. BuzzFeed this year was awarded its first Pulitzer prize for international reporting, using satellite images, architectural insights and interviews with dozens of former prisoners to identify massive facilities built by the Chinese government to detain Muslims. Succumbing to revenue pressures, though, BuzzFeed is cutting newsroom expenses and instead forging a reputation as an e-commerce shopping site, a "digital mall."


“People go [to the mall] even if they don’t know what they want to buy. They shop as a form of entertainment and I think BuzzFeed has figured that out on the digital side,” BuzzFeed founder Jonah Paretti told the Financial Times. “A lot of e-commerce is about utility. BuzzFeed has figured out how to make it fun."


For journalists, this race to build audiences online has fed into an erosion of trust that threatens to undermine both the news and the news business. In a recent Pew Research poll, journalists ranked below medical professionals, military officers, school principals, police officers, college professors and religious leaders in terms of public confidence to act in the public interest. The news media is on par with business leaders, and ranks above elected officials as groups that have lost the stated confidence of a majority of Americans.


In turn, this erosion of trust feeds into the dynamic of what is widely derided as fake news. In yet another Pew Research poll, half of Americans would characterize "made-up news" as a big problem in society today. So who do people believe should be on point to address that problem? Journalists. Do you see any flaws in that logic?



PR gets down to business

It's not difficult to see how that fake-news dynamic plays out when you consider the Chick-fil-A gay marriage coverage. Depending on your social and religious beliefs -- and to some extent, your affinity for the Chick-fil-A chicken sandwich -- the same fact set laid out in news coverage elicited polarizing perspectives. Those perspectives, to a great extent, were reinforced by reliance on news outlets that largely reflect existing perceptions of their audience. That's how audiences are built and maintained, after all.


So how did this play out for Chick-fil-A? The chart below tells the story. In the two full years preceding the Los Angeles Times coverage, more than one in four U.S. consumers would say they heard something positive about Chick-fil-A. That positive buzz doubled at the height of the news cycle, and in the two full years afterward settled in somewhat lower, at about one in five people hearing something positive.


On the other side of the coin, 3% of U.S. consumers would say they heard something negative about Chick-fil-A before the story broke nationally. At the height of the same news cycle, there was a tenfold increase in negative buzz, which in the two full years after the coverage settled in at a significantly higher 10% negative buzz.



For PR, there are a few takeaways to all this. For one, of all the media that companies manage -- the Paid, Earned, Shared and Owned -- national news is far and away the most volatile in terms of reach and resonance with people. Keep in mind, in both the two full years before before and the two full years after the Los Angeles Times headline, Chick-fil-A was spending hundreds of millions of dollars on television commercials and highways billboards featuring their iconic cows urging people to "Eat Mor Chiken." Chick-fil-A buzz in those years was consistently, statistically, flat. That's not a knock on advertising. Brand-building, after all, is an incremental growth business. PR manages variance and volatility.


Two, the Chick-fil-A story exposed longstanding vulnerabilities in traditional media metrics developed to measure the reach and resonance of news with people. Natural language processors are widely used to score the tonality of news coverage. Based on assumptions about how people interpret words used in the coverage, the tonality of the Chick-fil-A coverage was by any measure highly negative. But in the daily polling, a significantly higher number of people interpreted the Chick-fil-A news as positive.


And finally, news coverage impacts extend well beyond the news cycle. Most companies rely on media monitoring to gauge the reach of news. But media monitoring cannot reliably measure how many people saw or heard news coverage. And -- more critically -- traditional and social media monitoring cannot track recall. In this case, after the Chick-fil-A gay marriage news cycle, it took about seven months for buzz to revert to pre-coverage levels.


This is where PR has a compelling opportunity to get down to business.


In the Chick-fil-A saga, the PR challenges were largely tactical. Following the national coverage, Chick-fil-A media relations fielded calls from reporters seeking comments on the latest campus protests. Company officials responded to those local politicians in Boston, Chicago and San Francisco who were threatened to block the company’s plans to open new restaurants. Internal communications were drafted to ease concerns among employees and restaurant operators.


The business challenges for Chick-fil-A were more strategic. The privately held company still had revenue and growth targets to meet. At the time, Chick-fil-A was preparing for a continued expansion beyond its deeply Southern roots. How would the polarizing coverage impact the business? What would the seemingly negative news coverage mean to sales? By year-end 2012, that verdict was in. Chick-fil-A had posted $4.6 billion in sales, up 14%, The company also did not skip a beat in its expansion, opening 96 new stores, the hometown Atlanta Journal-Constitution reported.


Today, Chick-fil-A maintains a website espousing its culture and values. And right at the top of that website, the company makes no bones about it. Having weathered a polarizing news event, the Chick-fil-A corporate purpose remains grounded firmly in the founding family's Biblical values -- with a nod to the diversity of their broader team.


"At our restaurants, we're known for being closed on Sunday, to allow Operators and their team members to enjoy a day of rest, be with their families and loved ones, and worship," the company says, "if they choose."



Assignment:


Read through the comments posted to this New York Times coverage about recent consolidation in the newspaper business.


What stands out to you?

Why?



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