· News media is a source of information for those in the nonmarket environment of business
- Plays role in setting a firm’s nonmarket agenda
- Alerts players outside the firm to the firm’s issues and activities
- Can be used as part of a nonmarket strategy, though ideally media stays neutral
· Managers must assess the issues news media is likely to cover
- Coverage and treatment of issues governed by intrinsic audience interest (AI) and societal significance (SS)
- Extensive coverage likely on topics that are both high in audience interest and societal significance*
- Sample topics:
- High AI/High SS: Health Risks, Individual Rights*
- Low AI/Low SS: Most Business Issues
- High AI/Low SS: Weather, Sports
- Low AI/High SS: Poverty, Politics
· On many issues, business is the best and lowest cost source of information for the media
- Opportunity for managers to cultivate relationships with journalists who cover business on a regular basis
- Managers should be aware of nonmarket issues and be prepared to address them
· Business issues tend to be too complex for television and the general media to cover
- Given the media’s incentive to report on stories with intrinsic audience interest, complex issues are sometimes oversimplified and over dramatized
· Media is guided by professional standards, but a tension exists between those standards and corporate and individual incentives
- Companies motivated by profit considerations
- Subscription and advertising revenues depend on audience size
- Journalists motivated by professional recognition
- Need to be published/air in order to receive recognition; pressure to present newsworthy stories
· Discipline for the news media comes in three forms:
- Professional standards
- Self-imposed controls established by media organizations
- Lawsuits
- Defamation suits: difficult and costly to win
- New York Times vs. Sullivan: media well protected in cases of lawsuits involving public figures; public figure must prove intention of malice
· News media is a principal source of information in a democracy
- Principal role is to transmit information, not draw conclusions/advocate a position
Be the first to comment on "Business and the Media"