played the business media like a fiddle this week, and it was a sight to behold. Those who teach the dark art of public relations should use the way the company redefined the discussion in the space of several days as a case study. But business journalists should have done a better job connecting what happened on Tuesday to what happened on Thursday. Since they didn't, let The Business Press Maven pick up the slack and explain. Such is always my burden.
On Tuesday, Pfizer announced some grim news: It was cutting 2,000 salespeople, about 20% of their force. While Wall Street can greet news of cost cuts warmly, there was also recognition that a real change was afoot here. A growing sales force was always a big part of a drug company's bread and butter. They'd push product, which would raise profits. The addition of salespeople to a drug company employment roll was historically a sign of coming profits.
In this case, though, the cutting of the once-vaunted sales force was also seen on the Street as a turning point. Pfizer, struggling with dearly departed patents and their inability to push revenue higher, was starting to throw in the towel on what was once an industry strength. Its story had become one of cost cuts, not progress.
And as The Business Press Maven noted, it was not pressed for a backup. In lieu of a fully staffed sales force, are you going to sell by direct mail? Email? Smoke signal?
Then Thursday rolled around. Pfizer cleverly invited analysts and investors to its research facilities in Groton, Conn., and sang (at top volume) the praises of the drugs in their pipeline. It also raised estimates a tad, but without meaningful higher revenue growth -- that's no big deal long term, so let's ignore that.
Pfizer, a true blue pipeline? Speaking of blue, this is a company whose last big bang came with the rise of Viagra, about eight years ago.
Nevertheless, chief executive Jeffrey Kindler prattled on and was quoted widely about "significant scientific breakthroughs" and how the company was "hungry for more."
Well, hunger and a quarter won't shine your shoes, but who am I to quibble? It is extraordinarily hard to predict what is going on with FDA approval on any given Thursday, but the business media was not so cautious. This was a company that said it was "hungry."
A string of laudatory articles followed Thursday's meeting, including one from
titled "Six Pfizer Drugs to Watch" about "intriguing" drugs that "bear watching" and another from
titled: "Pfizer Fights Back."
I guess it was fighting back ... quite possibly, against the bad coverage earlier in the week. But even those media outlets willing to give credit for what may come down the pike did not relate Tuesday's news to Thursday's or, importantly, ask if they were mutually exclusive.
In other words, if things were so great in the pipeline, then why did the company lay off 2,000 salespeople? Are these drugs so great that they will sell themselves? Could be, but do tell. Do they cure ills and give good phone to impressionable doctors? Can they sprout feet and walk from office to office, offering up golf junkets?
There may be reasonable answers to all these questions. But they should be answered in print. The Business Press Maven is always low-lighting how bad a job the business media relates a current event to one in history. But investors are done a special disservice when the event was Thursday and history is Tuesday.
Speaking of history, let's flash back to
last weekend's column. The Business Press Maven wrote about how Black Friday coverage was thin and useless, in large part because it focused on crowds and sales. And if crowds and sales come about because of an abundance of discounts, retailers won't have a good month and investors will be hurt, doubly so if they chased the positive coverage about sales and crowds.
Well, guess what?
Results came out on Thursday and November's sales were not great. That probably indicates that Black Friday was not too profitable.
all disappointed pretty well.
came in roughly the same, but
and a few others did well.
But for investors, despite all the talk of crowds and sales, profits are all they care about. I still think, incidentally, that we are going to have a decent Christmas season. Despite the Black Friday coverage, I think holiday sales are much more spread out across the month-long holiday period than they used to be.
And before leaving to rest instead of doing some holiday shopping myself, I want to point you to
current cover story. It's about the big commitment toward flex-time at
Flex-time occurs, in this computerized world, when a company says that what counts is what you produce and you can do it from home. It has advantages (naps, lack of accountability) and disadvantages (naps, lack of accountability).
But the business media should begin to look at -- and you should begin to think about -- the larger picture. More specifically: Are flex hours leading the lower growth in wages? In other words, in exchange for more time with family, are people effectively getting paid less? It could help explain lower growth in real wages without stepping on the economy's biggest strength and politician's biggest bogeyman: globalization. And can flex time also actually be contributing to the productivity increases? Speaking of which, it's time for The Business Press Maven to nap.
A journalist with a background on Wall Street, Marek Fuchs has written the County Lines column for The New York Times for the past five years. He also contributes regular breaking news and feature stories to many of the paper's other sections, including Metro, National and Sports. Fuchs was the editor-in-chief of Fertilemind.net, a financial Web site twice named "Best of the Web" by Forbes Magazine. He was also a stockbroker with Shearson Lehman Brothers in Manhattan and a money manager. He is currently writing a chapter for a book coming out in early 2007 on a really embarrassing subject. He lives in a loud house with three children.