I was reading a post in a technology bulletin board that was raving about how much business they get out of the site and how they get nothing out of news releases. The comment were pretty indicative of why start up companies, as a whole, can't seem to get their message out to the market and end up crashing and burning. I agree that most news releases aren't very valuable. I agree that word-of-mouth is a very valuable selling tool. The problem is that most companies view news releases as a sales tool and that's why most of them are crap.
News releases are not supposed to be sales tools. They are supposed to be a way to give valuable information to the news media. The media, in turn, filter the content of the release to eliminate hype. Occasionally, a news release can be a leave-behind for a salesman, but that's a secondary use. Its more important to make sure it works for it's primary purpose.
The web has compounded the problem because now, companies can bypass the press filter and splash their crappy release everywhere and even the news media are posting crappy releases without review.
A news release is not the be-all and end-all of a communications program, but a part of a larger strategy and the result of hard work. A well-done news release can establish your credentials as a serious player and gets you beyond where you think you can go. How does it do that? Because if it is well done, it means you've put the effort the filter out your marketing hype and ego and just stick with the facts, ma'am. It means you've put on your objectivity hat and looked beyond sucking a few more dollars out of your customer and are putting his concerns first. All that other stuff can go in your brochure.
But most news releases don't do that. Most are the entirety of a company's communication effort and are a verbal bucket for every empty marketing statement a committee can cram in. Rather then get to the information that differentiates them from the pack, the news release demonstrate that they are just the same as everyone else.
Word of mouth is a good thing and gets you attention within the technology clique, and many companies are content to stay in their little world. They don't need anything else. They will go after C and D rounds of financing, lose their management team, and get parsed out by the VCs in a fire sale. Word of mouth is good, but it won't make you successful.
Some companies have leadership that is both technology, business and media savvy and can utilize word of mouth, media and just plain chutzpa to make a business successful. You need all three to be successful. But few are willing to invest effort in more than the first. That's why their news releases are crap, and why most of them fail.
If you want your news releases to actually do something for you, get someone on your team that at least has a rudimentary understanding of mass marketing, the media and how to not write in clichés. You might actually be surprised at what it does for your bottom line.