MICHELE NORRIS, host:
From NPR News, this is ALL THINGS CONSIDERED. I'm Michele Norris.
Oil companies have a problem, and I'm not talking about the price of crude. I mean an image problem. Many earned record profits last year, and that doesn't sit well when people are paying an average of $4 a gallon at the pump. That could explain a recent oil industry advertising blitz. One group that tracks ad spending says oil companies up their ad budgets by about 20 percent during the first three months of the year.
NPR's Yuki Noguchi reports on Big Oil's PR makeover.
YUKI NOGUCHI: Rashid Amad(ph) spends lots of time in his cab in Washington burning tanks of gas and listening to the news. He tuned in when oil executives testified about high gas prices last month.
Mr. RASHID AMAD (Cab Driver): I always listen to them. I always listen to them when there is any hearing on the Capitol.
NOGUCHI: And his conclusion?
Mr. AMAD: Oil companies, I think that they are making big bucks and that they don't have no mercy on poor people.
NOGUCHI: This is why Big Oil has a public relations problem. It's racking up record profits, which is great for business, but it looks really bad when consumers are also paying record prices. That's why the industry started running ads like these.
(Soundbite of TV ads)
Unidentified Woman #1: Do you own an oil company? Well, if you have mutual funds or a pension or other investments, chances are you do.
Unidentified Man: A recent study by noted economist and former Clinton administration official Robert Shapiro found 41 percent of company shares are owned by Americans like firefighters and teachers in pension funds and retirement plans.
Unidentified Woman #2: That is shocking.
NOGUCHI: Normally, ad campaigns sell a product or a brand. They don't apologize for making money. But Congress is now threatening to tax oil companies' windfall profits. And to defend its business success, the industry has gone on the offensive.
Robert Thompson directs the Center for the Study of Popular Television at Syracuse University. He said this campaign is clever for how it appeals to the person complaining about expensive gas.
Mr. ROBERT THOMPSON (Syracuse University): So I think that, as aggressive and kind of nasty as that commercial is, which is kind of a, you know, don't complain about us until you realize that you're a part of us, is also potentially effective because it really makes us partners with these oil companies.
NOGUCHI: Thompson says steel and chemical companies tried similar PR strategies. The goal here is to prevent a bad reputation from getting worse. And success can be hard to measure. Even the oil industry says it's not trying to look pretty.
Red Cavaney is president of the American Petroleum Institute.
Mr. RED CAVANEY (American Petroleum Institute): We don't expect the public to love us as an industry. And when prices are high, people are agitated against us; when prices are low they feel much more positively against us. So it makes no sense to conduct a campaign to like us if we don't have any control over that favorability.
NOGUCHI: He says it's wrong to equate high profits with profiteering. Much of the money gets plowed back into investments for the future and companies can't control crude oil prices. Caveney said the institute started advertising in earnest three years ago during a previous spike in gas prices. Hurricane Katrina and Rita dealt the oil industry and its employees a blow. But the company still supplied fuel to the region. And at that time, the industry expected to get kudos for their efforts.
Mr. CAVANEY: But the exact opposite happened. And the CEOs were called up to Congress to testify, they were sworn in; the accusations from every quarter were about price gauging and, you know, the various things we've done. And that served as a wakeup call.
NOGUCHI: So far, the marketing could be paying off. A Gallup Poll last month showed the percentage of Americans blaming oil companies for the high price of gasoline decreased from 34 percent last year to 20 percent. And more Americans say they now support the idea of domestic drilling in coastal and protected wilderness areas.
Yuki Noguchi, NPR News, Washington.
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