Renzi Stone, CEO, Saxum
Like all of you, I'm also curious about what the bottom is for sliding oil prices. As the CEO of a marketing communications agency that has built a dynamic practice group focused on the complicated energy industry, I know low energy prices trickle down to everyone; including us.
At Saxum, we believe that energy companies, both exploration and production as well as the entire supply chain all the way to the pump, long ago lost the public opinion battle and have been attempting to catch up ever since. Additional emphasis must be placed on how they interact with their stakeholders.
Historically, I understand the game plan—don’t say anything more than what’s required. Legally (which is how most conversations started with our clients until recent years), energy companies were not compelled to do anything other than follow the letter of the law. Of course, the shale boom has changed all that. It started with drilling programs that increased ten-fold and brought heavy industry to neighborhoods. Then, historic and new foes of “anything fossil fuel” have been successful in using social media to promote their causes and drive wedges between stakeholders, which has caused many energy companies to up their communications game, although they’re still playing catch-up. Some are better at it than others. All should take notice and participate in a more meaningful and engaging way.
Perhaps most interesting, Americans have gone through the past five years unconsciously oblivious to the incredible economic story that from 2007 to 2012, the total annual average employment in all U.S. industries decreased by 3.7 million, or 2.7%, while U.S. oil and natural gas industry employment increased 31.6%. The energy sector almost single-handedly propped up job and economic growth. Why doesn't the industry get more credit?
I came to understand this phenomenon a little better last week when a millennial friend told me, "I know I'm not supposed to say this, since I live in Oklahoma, but I'm really enjoying the low gas prices and hope they stick around for a while." She knows her economic best interests are tied to a growing, robust energy economy, especially in Oklahoma, but low gas prices are an immediate, real benefit to her pocketbook. How do you compete with that?
That moment crystalized the challenge our American energy sector faces today. It needs to convince the general public that high commodity prices drive economic opportunity in all areas of the economy, including schools, social services and even public relations agencies.
The major communication issues facing energy companies are close to the number of active U.S. plays. The big ones are transportation, exports and environmental. These are not engineering or geologic issues and deserve a large commitment from companies in relation to their investment in other areas. Other issues that impact most of the industry are basics like a functional website, clear internal communications, crisis planning and even branding. Social media is a bonus. With the influx of private equity into our sector since 2008, companies that stand out with smart, effective marketing and communications will arguably drive value to investors and shareholders.
So what can the energy industry do to improve communication during this downturn? A good start would be acknowledgement that a larger, more serious investment in all forms of internal and external communication must be adopted by individual companies in all areas of the energy supply chain.
The industry faces many issues—many of which are related to communication. Let's use the downturn to better communicate and educate various audiences about the many benefits of a strong energy economy.
Renzi Stone is CEO of Oklahoma City-based Saxum, an integrated marketing communications firm.
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