.jpg)
This is the next installment in the Digital Reductionism series. In it, PayPal’s Franz Paasche reiterates several key points that connect to conversations we’re having with leaders across the industry. Some of the most important insights from Franz include:
-
‘Holistic Communications and How Integration Takes on Many Meanings
Without using the oft-cited word ‘integration’, Franz continually reinforces what he calls a “holistic” approach to stakeholder communications and the importance of integration to success in modern communications.This transcends the notion of digital tactics, mixing with traditional and internal comms as well as with external, to also include things like combining the many voices and inputs that an organization listens to, in order to drive what Franz calls “full engagement” based on a comprehensive and unbiased perspective. He also acknowledges the important integration that is happening between traditional media and what he terms, “the magnifications that occur around a compelling narrative,” which includes influencers, but also the added reach through social media, search engines and the realities of globally connected messaging channels. -
Listening with Intent to the ‘Mosaic of Sounds’
Several years ago, Social Listening boomed into a major market that flooded companies with new information about how consumers view them. Today, leading brands are considering this as one input, but also have to understand what Franz calls the “mosaic of sounds” that surround a company. Some of these sounds may come directly through digital channels, but others need to be intuited through stakeholder engagement, customer service, interpreting cultural shifts, absorbing media or content, and good old fashioned conversations and market research. More than anything, listening “with intent” is more important than the channel you’re listening on. Franz says this allows PayPal to, “put ourselves in the position of our stakeholders, so that we really understand them and what they are seeking from us.” -
Connecting Stakeholders with the HOW and WHY of the Mission
As with many Communications leaders, Franz sees a critical role for his Corporate Affairs team in not just explaining or “pitching” things the company is doing, but actually being the connective tissue between the strategic purpose of the company and its stakeholders – internally and externally. It’s a bold mission that PayPal has laid out (democratizing financial services and improving the financial health of both individuals and businesses), with many diverse, global stakeholders. In a Jack Welch-ian way, Franz admits needing to talk a lot about this strategic purpose so that everyone understands and aligns around it (the WHY), but goes on to describe the role of Corporate Affairs being the connection between stakeholders and “HOW we are fulfilling the mission of the company.” -
Values and Value Creation Make the Best Narratives
Narrative is a word that has taken on many meanings in our business, and yet somehow always seems to remain in vogue.When thinking about what constitutes a great narrative, it has nothing to do with creative platforms, manifestos, or all the trappings of modern Communications planning.Instead, the two things Franz came back to repeatedly were the values of the company (things like inclusion, which is core to the mission of democratizing financial wellbeing) and the things a company is doing to create value (things like Venmo – which changed how people send money to friends, split bills, etc.)Franz explains this as, “great storytelling is always at the core of strong communication and I mean it in the best sense of credible narrative that really demonstrates values, great research and the excitement of a new product or service that provides value to customers… those kinds of narratives will always be an important part of the way great communications are done.”
-
Partnerships are Evolving and Becoming More Important to Brands
The days of monolithic brands making unilateral decisions and communicating “from the center, out” are all but over.Partnership was a word that came up in almost every facet of our conversation, as Franz used it to refer to B2B partners (who can help PayPal achieve its mission in various ways), as well as media partners (who have a responsibility to report with clarity), regulatory partners (it takes partnership with policy makers and regulators to move the digital economy and Fintech sector forward), internal employees (“when senior leadership really thinks of the corporate affairs team and all of the elements within it as true partners, it adds a strong sense of responsibility”), and even with agency partners (it’s not about outsourcing responsibility, there has to be a true sense of what the internal team is best used for and what the agency is best used for).All of this emphasis on partnership is creating an interconnected ecosystem that enables PayPal to better serve customers and, ultimately, to bring financial services to the widest population of people.It also provides a chorus of credible voices who bolster the brand’s reputation, so long as the company is adding value and pursuing its mission.Those same voices can of course cause reputational harm in the inverse, which is why true partnership is necessary for long term success.
These insights and many more are further elucidated in the abridged copy of the interview, as well as via the complete audio file from the conversation below.
Interviewer: Paul Dyer (PD), President, Lippe Taylor
Brand Leader: Franz Paasche (FP), SVP, Corporate Affairs, PayPal
Paul Dyer: Franz, welcome!
Franz Paasche: Thank you, glad to be here.
PD: And we’re very happy to be hearing your thoughts. So, the premise of the digital reductionism series is that leading brands are no longer focused on the transformational disruptive impact of digital on their business and are now, in fact, just thriving in a more digitally impacted world. What do you think?
FP: I think that all of us who are thinking about stakeholder communications and about how to reach all of our audiences in the current environment are living and breathing digital. Digital is simply part of how we communicate. I can remember the days when people would have a digital group or a digital team; that’s no longer the case. Throughout our group of professionals, we include digital strategies and tactics as part of every strategic communications initiative.
PD: At PayPal, your entire business model exists in the digital world; you’re a digitally native business. Do you think that has impacted the way you view the modern communications landscape and the capabilities that you’ve been developing for the broader corporate affairs function at PayPal?
FP: As with most global companies, we have a wide range of stakeholders, and we have structured our corporate affairs team to include the government relations team, external communications, internal communications, and reputation risk management, as well as our social innovation group. We live in the digital world as a company, and our business relies on great digital communication, and of course the business across our platform, but that doesn’t mean that we don’t think about the way our audiences want and need to receive communication from us. I’ve always been a great believer that the most important thing is to understand how your audiences receive information, how they hear you and how they want to engage. You can’t just drive communication from the center out; it’s got to be full engagement. And that means really listening, understanding and using a full range of channels.
PD: When you say “listening” in the social media sense, that can be interpreted in a very specific way of using tools and listening to online conversations. Maybe you were also intending that in a more traditional sense of hearing your stakeholders one on one. Do you find that those two things are often brought together, or is social listening something that perhaps lives elsewhere in the business?
FP: Well, I meant the traditional sense of listening intently so you can really hear and understand; but I think to do that in today’s communication environment, it’s a mosaic of sound. We hear from our customers through our customer service channels, by email, on social media. We’re also working with nonprofits, with our partners, with government and regulators, and we need to be aware of all the channels in which these audiences communicate with us in an affirmative way, but also where we are in the global conversation as a global company. That requires really being attentive to the full range of communication and be able to engage where our audiences are engaging.
PD: When PayPal split from eBay, our understanding was, you built the global communications/corporate affairs function by integrating all of these different disciplines, things that had been previously siloed like external and internal communications, government relations, etc. Of all the things on that list, social media innovation is the one that companies all seem to have varying opinions of where it fits. Is it marketing, research, product development, communications? So, do you believe that it has a natural home within the corporate affairs or communications function?
FP: Yes, for PayPal it made sense to bring together our social innovation team within our corporate affairs team. The social innovation team is responsible for supporting all the ways we deliver against the core of our mission to democratize financial services and work to improve the financial health of our customers, including individuals, families, small businesses and large businesses; so our social innovation team is an integral part of how we think of our corporate affairs and how we communicate to our audiences.
We feel strongly that our corporate affairs team has to be an engine for the mission, vision and values of PayPal. And part of the way we express our values is to think about our social purpose, our social impact. So, for us it makes perfect sense to bring social innovation together with public policy, government relations, and communications, both internally and externally. Internally, that includes volunteer and philanthropic activities. Externally, it involves partnerships with non-profits and our “powering giving” platform, and thougth leadership on financial health: the challenges that those who are not well served by the financial system face, and how Fintech can really make a difference. And so, going back to that original concept, we talk a lot about our strategic purpose, but also about how connected we are to fulfilling the mission of the company and the way we communicate with our stakeholders.
PD: That’s great. And it sounds daunting. You have a pretty big mission: democratizing the financial system, reaching people outside of the established or traditional financial system. When you think about how you keep your communications/corporate affairs function on the cutting edge so that they can continue to pursue that mission, to “connect the communications efforts back to the business strategy” as you so eloquently described it, what are the keys in making sure your team stays sharp? Educational initiatives? Training requirements? How do you do it?
FP: Let me answer that with a few components. One of the things that’s really important for our team to stay at the front edge is to stay close to our customers and our audiences and put ourselves in the position of our stakeholders, so that we really understand them and what they are seeking from us; how they receive information, and also how we can most effectively help to support the mission of the company and fulfill its strategic objectives. So, part of it is staying close to the customer and to stakeholders.
The other aspect is staying very close to the business. We think of ourselves as always working to be the best partner we can to the business units and functions that we serve within the company. That dynamic is really an educational one. PayPal is filled with innovators and committed professionals, and it’s incredible to be partnering with them, whether they’re part of the engineering team or the sales marketing team or business leaders who are involved in our partnerships with other institutions, or with the leaders of our business who are working with government and with big non-profit institutions. So again, being close to our partners in the business and then providing interdisciplinary growth within our function.
One of the cool things that evolved as we brought our teams together is that we have communications people who are really excited to be working on social innovation and adding that to our capabilities, and we have professionals who have been working on government relations for years but are now developing and teaming with great communicators, and it helps them to be better in their core discipline but also opens up professional interests and engagement for them.. We very often field what I would call ‘interdisciplinary teams’ when we think about a big initiative or strategic push.
We are a pretty close-knit team and so when people go through an important initiative or experience, we try to be sure we share their learning. But I also think we all have to be challenged, as corporate affairs professionals, to stay on the best practices, to look for what we admire in our peer companies, and to really think globally and across regions.
So, the final element that I think drives great professionals is personal learning. To grow, you have to take responsibility for your own learning as well as be prepared to partner and engage with those around you. I’m learning every day from my colleagues on this team and from my partners throughout the business. It’s part of what makes it exciting to work for a company that is in many ways pushing the envelope as a fintech leader in a world where digital financial services and commerce are significant secular trends that are crossing borders and across the full economic strata.
PD: That’s great, and I think one of the other things that I heard in your response there that will maybe get a lot of people excited was not just respect for people who have more of the experience and heritage of the foundational skillsets and corporate affairs, but also the ability of those people to learn from people who have a more digitally native skillset; and that if you get those people together, then you learn from each other. That, I think, is a really strong message. One of the things that I heard you say again and again was to be close to the business and be tied in to the business. In the PR industry, sometimes we can spend too much time focusing on what’s right in front of us. You’re involved at the most senior level of PayPal, which is, of course, one of the most important companies in Fintech in the modern economy. So, I would imagine that you’re involved in a lot of senior executive-level conversations that have a broader view than the way that we think about communications or digital or things like that. How does that change or influence the way that you think about digitally defined communications?
FP: Yeah, that question requires a bit of thought. I do think that when you are working as a communications professional inside a company, or even as an outside advisor for a company where the CEO and the senior leadership really think of the corporate affairs team and all of the elements within it as true partners, it adds a strong sense of responsibility, and a strong inspirational aspect. Particularly, in the digital era, we have so many ways of being able to support the business both by understanding and really hearing our stakeholders in all the ways that they’re expressing their views and their needs, and also by using the full spectrum of communications and stakeholder management channels and tactics. I think it’s a really exciting time to be doing the work we’re doing, and when you can do that work with business partners who really value the professional insight you can bring and the strategic value you can provide, that’s a great place to be.
PD: It is, and your executives sound like they believe that communications can help achieve a business mission at PayPal. So, let’s talk a little bit about trust and reputation. Obviously, they’re two things that we talk about a lot in our industry but have certainly been under shifting definitions over the last two or three years. We read that PayPal checkout converts at 88.7% which is 82% higher than a checkout without PayPal and 60% higher than other digital wallets. Obviously, we’re talking about money. So, trust has to be involved here, right? What is the role of PayPal’s reputation in delivering or maintaining those business results?
FP: I’m a great believer that reputation is part of the core value of a company that has to be protected and respected across all dimensions. Reputation can be both built and grown, and so we think a lot about this and how important our credibility is where we are involved in the movement and management of money for our customers. We honor the trust that our customers place in our reputation; that trust is so important to all of us and also very important when we think about how we innovate, how we grow, and how we work with our partners and government regulators. We are intent on really maintaining that trust and continuing every day to earn a reputation that reflects the seriousness of our mission and our values. We haven’t talked as much about that, but one of the things that’s really distinctive about PayPal is the focus we bring that derives from our values. For example, one of our values is inclusion, both inside and outside the company, and that informs both the way we engage with our stakeholders, the way we treat each other professionally within the company, as well as the way we seek to walk in external communities.
PD: That’s great. If your mission is democratization then your value system is naturally built around inclusion, and all of these things are interconnected with trust and reputation. I appreciate hearing you use the word “seriousness” about those things. So, what about the other end of the spectrum? PayPal was the initial disruptor of online payments and now there’s a whole slew of other disruptors. Sometimes it may be that you have to make judgement calls as to whether you want to be competing head to head with the disruptors or taking a high road; do you maintain (as a market leader) the disruptor mentality, or is it a different way of thinking now that PayPal is the established leader?
FP: We always need to be innovating and looking at how we can provide a great end-to-end experience for our customers and continue to find ways that we can meet all their needs. Technology is changing quickly. The way in which customers engage with digital commerce and with their own finances is changing, and we want to be at the front edge of meeting those needs; that often involves innovation and full-out focus on how we serve our customers, but it also involves partnerships and thinking about the overall financial services ecosystems and bringing financial services to the widest population of customers. There’s so many people in the world who are still underserved by the financial system and we think we have a role to play in enabling those people to have affordable access to financial services, or if they’re small businesses, to ecommerce. It’s something that we’re focused on, but we can’t do it all alone; it takes partnership, both with other companies and with policy makers and regulators. And we try to communicate that partnership approach because it is such an important part of the current progress, in the digital economy, and within the Fintech sector, in particular.
PD: And I’m sure it’s no accident that it feels very closely aligned with your mission and values of democracy and inclusiveness. Working with partners and doing it in tandem with other entities or organizations, it makes sense. Innovation seems to be a core piece of the puzzle, because you’ve brought it up a number of times. So how important is it for PayPal to be the first to try a new approach, while still delivering ROI to the business?
FP: It’s very important to us that we continue to serve our customers and continue to provide them with great value and develop with them as their needs evolve. If you look at some of the services that PayPal offers, like Xoom, which is a service that provides a digital remittance channel enabling people in the United States to transfer money to their loved ones and families in other countries directly into financial institutions using their smartphones, it was a service that completely changed the way that money is transferred--it saves time, it saves money, it’s safer and that’s really something that changed the lives of families across borders. Or Venmo, which is a remarkable product that brought together social media and transaction services. It has really captured the imagination and the affection of millennials but it’s also filling a need. People wanted to be able to see, share and split bills and to find ways to share costs among friends and it’s really become a phenomenon. Again, it’s something that met a need, a customer-driven innovation. And that’s something we think about all the time: staying close to the customer and staying close to the business, so that we’re in a position to really facilitate the communications and the engagement in both directions.
PD: That’s great. Xoom and Venmo are two amazing examples of innovation that really created customer value. What about when it comes to (I don't know any other way to put this) getting credit for it? We all know reporters are getting more and more communications every day--are they naturally finding these great things that you’re doing and talking about them in the right way, or are you finding that it’s still important to really prioritize getting in front of them and “pitching the media”?
FP: I’m a believer that the media has a really important role to play in communicating stories and news, and providing thoughtful analysis and research. We have to ensure that our messages come out clearly and with credibility and that we are being seen as we are. So, we have a responsibility to communicate and engage with clarity, and the media has a responsibility to report accurately and with clarity. It’s really a two-way dynamic.
In this digital age, traditional media still plays a very important role. When you look at how a great story can travel across the internet and across the world and all of the magnifications that occur around a great piece of writing or research or a compelling narrative, traditional media, I think, has increasingly been integrated into the digital communications economy.
We also believe there’s an important role for our own channels.. Social media and our own direct communications are both an important part of that dynamic, and we increasingly see that there’s a role for both. So again, going back to that notion of a mosaic, corporate affairs or communications functions have to really see all of these channels, and understand and be knowledgeable enough about the audiences that you want to communicate with, that you’re able to reach them.
PD: That’s great, and it kind of connects back to that concept from the beginning: the knowledge of the audience, what matters to them, and listening to them. The other thing that I really liked in what you were saying there, is it does feel like there’s a lot of emphasis these days on magnification in stories and what you’ve called the communications economy. But there’s not necessarily as much emphasis on the storytelling itself, and that really is what’s most valuable. In this communications economy, what are some of the trends that you think are the most exciting or that you’re interested in experimenting with when it comes to channels or technologies or formats or capabilities?
FP: Well, I do think that great storytelling is always at the core of strong communication, and I mean it in the best sense of credible narrative that really demonstrates values and great research and the excitement of a new product or service, the value that it provides to customers; that will always be an important part of the way great communications are done. Part of what has been exciting for me is seeing the corporate affairs structure really start to take hold of both PayPal and other companies, and I think it holds the promise of producing a much more holistic way of thinking about reputation and stakeholder management, and also enabling institutions like ours to really better understand their stakeholders. And I also think it’s an exciting opportunity for professionals to really build their capabilities across disciplines.
We’ve been talking a lot about what’s different in the era of digital communications. We certainly have much more data to draw on--what’s available publicly in the media and our own experience with stakeholders--and so we have a better understanding of the communications landscape, and that’s very different than what it was years ago. People were focusing on click counts and impressions, whereas now, one can understand engagement and how people share information and what is compelling enough that people chose to re-share it with their communities.
It’s exciting to have a better understanding of the work we do and the impact that it has. It’s also exciting to see how many great professionals are coming into corporate affairs and communications from other professions. Our profession, as a whole, is becoming more diverse and interdisciplinary and more closely tied to the business and to institutions. And when you meet communications or corporate affairs professionals who are working at institutions that value their work, they really are strategic partners, and that’s an exciting thing for this profession.
PD: It is. It’s a theme that you’ve come back to a couple of times now, the strategic connection between corporate affairs function and the business, and the ability of corporate affairs to drive business impact because of that. You also mentioned peer companies a couple of times, looking at what other companies are doing. You’ve brought us back to engagement when it comes to the wave of evaluating the impact we’re having, and that we’re driving engagement, so let’s loop these things together. What are some examples of companies that you think are doing a great job of driving that stakeholder engagement? What are brands that you find inspiring or that you like to look at as leaders?
FP: I think there are lots of different areas to admire, but one is that we’re seeing more and more companies step up to take leadership on their values. One example of that would be Salesforce, another would be Microsoft. There are many others, but when you see how those companies are expressing the values of their leadership and employees, they do a really good job.
Another scenario that we haven’t discussed as much is how employees and colleagues across institutions are really an important part of the communications equation. There’s increasing seamlessness between external communications and internal communications. Years ago, there were separate dimensions of how communications were conducted internally and externally. But in the seamless digital world, external communications can sometimes be the most powerful internal communications, and vice versa. Employees who are active and engaged in the digital communications world are very important advocates for brands and their companies and each other. I think that’s an area where there’s a huge new potential for a more holistic approach to communications and corporate affairs.
PD: That’s great, that holistic seamlessness seems like an important mindset shift for brands to be successful today. As you think of the brands that are going to be successful in the future, what are the mindset shifts that you think are going to be important? Maybe even something that maybe you’re really driving adoption of within your team today?
FP:, I think we have to always be learning and really paying attention to our reputation and our customers and constantly thinking about how we can add more value. I also think bringing information from the outside to the inside is part of our role--we are engaging with the world on behalf of our institutions. We learn a lot, and we’ve got to share that learning and those insights. Corporate affairs and communications functions that fulfill those principles will be able to add great value.
PD: There’s a professional benevolence buried in there that I think will inspire a lot of people. What about the agency landscape? It has changed a lot over the last couple of years, and some people have even proclaimed the death of the agency. What are the agencies of the future going to need to be able to provide to clients like PayPal and other important companies, as the landscape continues to evolve?
FP: I think that agencies can provide really valuable external perspectives and help to enable proactive learning. The best agency relationships are real partnerships where there’s an open recognition as to what can best be done by an internal team and what can best be done by an agency. As communications and corporate affairs become more strategic within institutions, those of us involved in leading those functions take more responsibility for those partnerships. There’s not that sense of outsourcing of responsibility--it has to be true partnership.
PD: I love that, that’s great--not outsourcing responsibility. We’re getting close to the end of the hour here, is there anything else that you think is important for people who are listening to this to hear?
FP: Actually, we had a chance to go farther than I expected with this interview. It’s been quite thought-provoking.
PD: Well, I absolutely agree, and I think that our readers and listeners are going to greatly appreciate your insights here, Franz, so we thank you for your time and look forward to what additional dialogue this sparks once it goes live on the Holmesreport.com.
FP: It was really a pleasure, and I have a feeling I’ll be thinking about this conversation for a while afterwards because it raised some interesting issues for me as well, so thank you.
