A Big Risk for a City such as Little Rock?

A Big Risk for a City such as Little Rock?

Has your company ever seen a Request For Proposals (RFP) that you knew you likely couldn’t win? Your options might include ignoring it altogether, tossing the “Hail Mary” pass in hopes for a miracle result, or perhaps just doing the basics in order to keep your name out there.

This year’s Mother of All RFPs might be Amazon’s open competition for its second headquarters location. According to The Wall Street Journal, the company expects to spend $5 billion on the project over nearly 20 years.

The City of Little Rock, Arkansas recently made news by placing a full-page ad (in the form of an open letter) in the Washington Post, saying that the City would not be submitting a proposal to Amazon. The ad began with, “Hey, Amazon, we need to talk” and “It’s not you, it’s us.” This unusual message has subsequently received a lot of attention on social media and in the business press.

I live in Little Rock. The initial reaction I heard from most friends and business executives locally was decidedly negative. My view is quite different, based upon what I know about buyer psychology and promotional campaigns. I also see messaging lessons that could be valuable for not only other municipalities but any organization trying to stand out from a crowded space in a positive way.

Let’s stipulate that there is no easy, strictly empirical way to look at the risks and benefits of a scrappy promotional strategy. Still, we can make some educated guesses following financial, communications, and reputational criteria.

What is Your Money Buying?

One of the immediate objections I heard had to do with cost. The City had to pay for that Washington Post ad placement (likely around $100,000) plus the fees to an agency for creative and planning. For a small city such as Little Rock, that is a serious number. In recent days, a company which specializes in measuring returns on publicity campaigns estimates the City has received up to $1.7 million in media value. That’s because stories of Little Rock’s letter appeared in Fortune, Reuters, Bloomberg, Slate, ABC News, National Public Radio, and MarketWatch, among other major media outlets. From a short-time financial standpoint, then, advocates of the campaign can clearly claim victory. I agree, although a judgment based upon media impressions or awareness-building misses the larger strategic point.

Who Will Take Us Seriously?

The economic development/corporate location game is big business. There is intense competition among cities and states to woo executives, using a host of criteria. Potential buyers look at the worker base, demographics, schools, crime, infrastructure, transportation, tax incentives, and quality of life issues. It’s difficult for one municipality to emerge favorably across all (or even most) criteria, so they have to identify their strengths and focus on the best potential fits – moving beyond simple awareness and toward those prospects who will put the municipality in their serious consideration set.

Let’s face it–Little Rock was not going to win with Amazon, or even be taken seriously. The City did not meet some of the criteria that Amazon listed, such as close access to an international airport. Amazon reported that it had received bids from 238 cities and regions. That includes 43 of the 50 US states, cities including New York, Boston, Atlanta, Nashville, and Austin. Bidders also included Puerto Rico and several locations in Mexico and Canada. Little Rock would not have made the consideration set.

I heard several local friends complain that the City’s ad casts Little Rock in a bad light. One business leader told me, “Jim, it just makes us look like a sore loser.” Well, considering that Amazon received 238 bids, I guess that means that there are going to be 237 other losers who won’t ultimately get project. Taking a pass on Amazon might instead show Little Rock to be confidently self-aware, and to use a media opportunity to showcase its strengths for less-massive projects it might actually win.

Which Audience Really Matters?

That letter was not a message to Amazon—or to Jeff Bezos or even to most Washington Post readers. Rather, it was a big media blast to a very narrow audience.

Let’s take an example from an entirely different area. A few weeks ago, the University of Alabama’s head football coach Nick Saban was speaking to reporters after a win against Texas A&M. The Crimson Tide are again the consensus favorite to win a national championship, and praise for the team is everywhere. But Coach Saban ranted that positive coverage of his team is like “rat poison.” That comment sparked a lot of conversation (mostly critical) on social media and other sports-media outlets—but I doubt that Coach Saban cared much about that. Although he was technically talking to reporters, he message was not meant for the media, the Alabama fan base, or the university community. He was using his media megaphone to speak to the 85 players on his football team. He was letting them know that he’s not buying into the praise for the Crimson Tide, that he thinks it’s a distraction, and that things might even get tougher in practices.

Little Rock’s message, to some degree, reached several hundred million pairs of ears and eyeballs over the course of a few days. The ultimate success of their provocative message probably depends upon the reaction of a few thousand corporate executives and economic-development experts. Do they tend to evaluate Little Rock a little differently? And will more of them place the City in their consideration sets for expansion or relocation plans?

What I like about the strategic value of Little Rock’s message is that it gives the City a fighting chance to stand out, to be considered differently and more seriously for the more moderate project and relocation opportunities that it can deliver on and can win.

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