Monthly Archives: September 2011

Engagement is critical but it’s no longer enough. In 2012, social media success will depend on building and empowering your community and giving back.
September 26, 2011

Not too long ago, the use of social media by corporations was considered a novelty. Visionaries such as Morgan Johnston at JetBlue and Frank Eliason, then of Comcast, were among the few who responded to customers online early on, and customers were pleasantly surprised to get a response. (Disclosure: JetBlue is an MWW Group client.)

Today, any company that doesn’t actively monitor and engage with consumers online is seen as a dinosaur that doesn’t care about its customers. But social media pioneers know that while this basic “blocking and tackling” of customer engagement is now essential, it’s no longer enough.

To build trust in this new world, companies must understand the new challenges they’ll face:

  • An empowered public – Craigslist founder Craig Newmark has called writing online reviews a patriotic duty. New technologies and social media are catalyzing a great power shift in society from large institutions to individuals. The same technology that enabled citizens in the Middle East to organize and overthrow their governments are allowing consumers to band together and speak out against corporate practices or products they don’t like. As David Kirkpatrick recently wrote in a great article in Forbes, “We have entered the age of empowered individuals, who use potent new technologies and harness social media to organize themselves.” Unhappy customers, who once would tell a handful of friends and family members about their bad experiences are now able to broadcast to the world as part of a permanent online record.
  • A cynical public – Thanks to the financial crisis, a growing skepticism of the media, corporate and political scandals, trust in large organizations, from governments to corporations, is at an all-time low.
  • Less control of brand – Until a few years ago, companies owned their message and their brand. Today, brands still spend billions of dollars pushing out carefully packaged, focus-tested messaging points. But customers no longer believe or put much stock in these messages. A recent Nielsen study found that 76% of consumers believe recommendations from friends are the most trusted form of advertisement, and increasingly, they’re sharing with their friends using social media.

So what can your company do to be successful in the social media space?

Unless you’re about to come out with the next iPhone model, customers on social media likely aren’t interested in your canned marketing messages. If you think of social media as another way to advertise, you’ll only be tuned out.

To be relevant and part of the social conversation, your messaging must reflect and reinforce that social media is all about community – and that you are an essential, beneficial member of that community. Old-style corporate philanthropy – writing six-figure checks without any engagement – is seen as buying good will (or political favors) rather than building it. Tellingly, many leaders of the biggest web and social media sites – Craig Newmark of Craigslist, Chris Hughes of Facebook, Ev Williams and Biz Stone of Twitter, Pierre Omdiyar of eBay – are now focusing on efforts that benefit the community.

Here are a few ways your company can do this and generate social media buzz:

  • Show how your daily operations are important to society. As one example, with the continued employment crisis, any company that is currently expanding its workforce should actively use social media to recruit candidates. Of course doing so will not only help show the important role you’re playing in the community by creating jobs but will also help find top candidates.
  • Adapt your business to benefit society – but be genuine. Though Wal-Mart has received much criticism in recent years, many environmentalists recognize the enormous positive impact of the retailer’s move to stop selling incandescent light bulbs and switch to more environmentally-friendly packaging for their products.
  • Use your company’s unique skills and resources to help. In the immediate aftermath of the earthquake in Haiti, Google’s scientists worked with the State Department to build a “People Finder” database. The company also released Google Earth satellite images to help rescue workers. Similarly, my former employer AT&T as well as Verizon and other U.S. phone companies made all calls to/from Haiti free in the weeks following the earthquake. Two other examples just announced at the Clinton Global Initiative that are sparking positive online conversations are Pepsi’s public-private partnership in Ethiopia to increase chickpea production, and Microsoft’s “Shape the Future” 3 year initiative to bring computer hardware, software and internet service to 1 million US students from low-income families.
  • Find ways to help your community. While a number of companies encourage employees to volunteer, more companies can do well by developing programs that help their customers volunteer and reward them for doing so.
  • Don’t think you’re the exception to the rule. As management guru Gary Hamel said in the Kirkpatrick Forbes article, “I don’t think it’s crazy to ask if your CEO is the next Mubarak…. The elites—or managers in companies—no longer control the conversation.”

Your company can be a part of the social business revolution – or get left behind.

About the Author

Richard Robbins, MWW Group Vice President, Senior Digital Strategist, provides senior-level expertise on using digital and social media as an integral part of any successful communications program. He can be reached at rrobbins@mww.com or @rich1.

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Next Up in the Netflix Queue: Communications Expertise
September 23, 2011

As Netflix suffers from consumer backlash of price increases and the division of its DVD and online streaming services, communication from CEO Reed Hastings with Netflix’s customers have been just as big a problem.

Will Netflix survive despite its communication woes? MWW Group’s CEO Michael Kempner explores this in his latest blog post on MWW Straight Talk.

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How Trust and Relevance Can Restore HP’s Reputation
September 23, 2011

If you are planning to rob a bank, don’t ask anyone from HP to drive your getaway car…that company leaks live a sieve. In what may be the worst kept secret in America (including no fewer than three articles in the New York Times about the rumor yesterday), HP has named Meg Whitman as its 4th CEO in six years. Thanks to those articles, they already know what the concerns are about Whitman – she has no turnaround experience, her background is in consumer tech, she’s built a company – not fixed a company, eBay was a simple, straightforward business – HP is a complex, multi-business company.

All three of her predecessors have been fired. How can Whitman avoid that fate? Give the communications leadership a seat at the strategy table. Sources say the board supported the company’s strategy, but didn’t have confidence that leadership could communicate it effectively (aka “sell it” to stakeholders). It doesn’t get clearer than that.

Whitman’s first communication to employees was a miss. In that e-mail, HP failed to define any specific course of action, the board didn’t address the perceived shortcomings of Whitman or provide a compelling rationale for her selection, and contradicted themselves calling Leo Apokother’s “resignation” his decision, then later classifying it as a difficult decision for the board.

How can effective communications help Whitman, and HP succeed?

  1. Building Internal trust — HP needs a culture change. Reportedly each business is a fiefdom, jockeying for control. This is one explanation for the leak du jour (or multiple leaks du jour) at HP. When confidential information is constantly reported in the news, that’s a clear indicator of a trust problem…employees don’t trust leadership to tell them what they need to know – which is only exacerbated when they’ve read about something all day and then get communication from the Company.
  2. Creating external relevance — HP’s needs to be more relevant. They’ve got no real skin in the game in the tablet wars (even though they had one of the first tablet PCs out there, albeit a different take on tablet than the wildly popular touchpad tablets like the iPad and the Galaxy). The reputational boost they enjoyed from the photo printer wave is long gone. Right now, the most interesting thing about them is the board level drama and the leadership revolving door.
  3. Establishing credibility – stakeholders need to see HP define a course, establish interim benchmarks of success and then deliver. It’s simple and old fashioned, but it works. Thus far, Whitman has defined her course as “stay the course” – including proceeding with an acquisition that reportedly played a role in Apotheker’s ouster. It’s hard to say if that is a meaningful validation of the strategy, or a belief that the same old thing, with some Celebrity CEO pixie dust thrown in, will make it more palatable to stakeholders.
  4. Re-define success, at least for the short term. Specifically, stop defining success solely by share price. The turbulence and tumultuousness of the capital markets, especially these days, can hardly be considered the benchmark of success. I’d start with the ability to preserve confidential information as a sign of confidence in leadership and the company’s direction internally. Build customer relationships…and ultimately sales. Innovate and bring the right products to market – and grow market share. Provide stability and predictability for your stakeholders. The share price will follow.

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Advice to the HP Board of Directors
September 22, 2011

If you are planning to rob a bank, don’t have anyone from HP driving the getaway car…this company leaks like a sieve. If the volume of news reports today is at all indicative of truth, HP is poised to fire its third consecutive CEO and name a new one, reportedly Meg Whitman. I’ll leave the opining about whether she is a good choice to the experts, but regardless of the choice, HP’s new CEO has a tough road ahead.

What can the board do to enable this 4th CEO to be successful?

1. Choose a great communicator. Sources say the board supported the strategy currently in place, but didn’t have confidence that it would be “sold” properly to the stakeholders. That’s a problem. Great leaders tend to be effective, even inspiring, communicators.

2. Take control of the story…name your CEO, emphasize the reasons for the choice (hopefully someone with turnaround experience) in a first step to restore trust and confidence in the board. Make sure to highlight relevant skills and experience…one of the big criticisms of Whitman is that eBay is a consumer tech company, and built a company but never fixed one.

3. Align third party support for the new CEO, and balance all of the negative quotes with some positive or at least neutral ones.

4. Make the new CEO’s first priority to fix the culture at HP. Many describe HP as multiple fiefdoms fighting for control…which explains frequency and volume of leaks that’s high even for tech companies. Build trust internally first, and external perception and performance will follow.

5. Give your Corporate Communications leadership a seat at the table. A great PR strategist would likely have predicted most of these issues, and offered guidance on preemptive strategies, and remedies.

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Will Netflix be the next TiVo?
September 22, 2011

Like many in the entertainment business, Netflix, with its iconic red envelopes and game changing subscription model, is struggling with digital delivery. This is not a new problem…the old fashioned “record stores” (who by that point were selling CDs) cursed the advent of iTunes. And then video rental stores didn’t have much affection for Netflix, whose convenient, affordable approach caused significant disruption in their business.

It isn’t called a category killer for nothing…and what is good for the goose is good for the gander. Digital delivery, primarily from the providers, is threatening to dethrone Netflix, in much the same way that they unseated TiVo from its seat of power. It’s cheap, provides instant gratification, and eliminates the need for a DVD player at all. And while Netflix struggles for a solution, they face an issue that TiVo and others like them never did: the power of social media. Social media’s amplification of Netflix’s stumbles in strategy were exacerbated by some questionable choices in communications…which appeared rushed, poorly planned and perhaps the gravest error of all…inwardly focused emphasizing their CEO’s opinion, rather than customer focused.

It would be hard to believe that the decision to migrate Netflix customers to the Quikster brand and apply the Netflix brand to a different business was likely made carefully, and thoughtfully. Unfortunately, the communications cluster that followed made it look like a desperate, knee jerk reaction. And even if it were a quick decision, fast and well done aren’t mutually exclusive. We’ve been hired by clients the night before they file for Chapter 11, and still managed to communicate effectively. The difference is that those clients understood that communicating well is key to preserving stakeholder trust. This may be just the opportunity Amazon needed to capture the streaming video market

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The Government Saved The Airline Industry 10 Years Ago – And Should Save The Economy Today
September 16, 2011

Like all of us observing the 10-year anniversary of 9/11, I found myself facing a flood of emotions and memories this week that I didn’t necessarily want recalled. I know my friends in the airline industry felt the same way.

As the lead airline reporter at Reuters at the time, I was closely covering not only the human aspects of the tragedy, but the financial ones as well. In addition to coping with the terrible loss of life and the almost constant anxiety that another attack was imminent, we all knew that there was a serious financial crisis underway that could have caused many airlines to simply go out of business. The situation was incredibly dire.

I remember being amazed and yes, proud, that our government reacted incredibly quickly – just 11 days after the attacks – to set up the Air Transportation Stabilization Board.

Almost immediately, the government was able distribute $5 billion in cash and up to $10 billion in loans to all of our nation’s airlines as they faced a major cash crunch when people simply stopped flying. It was the right thing to do.

Now, a decade later, United Airlines and American Airlines – two of our national icons which had absorbed the remnants of early pioneers Pan Am and TWA – are still flying strong. I remember vividly the almost poetic moment when President George W. Bush traveled to O’Hare airport in Chicago on September 27, 2001, to honor the airline employees and spoke with the backdrop of two jets behind him from both of those airlines.

The photo remains a powerful symbol that we prevailed in the face of horror. Everyone who was at that high-security event – including hundreds of journalists like me – was incredibly moved and many wept. I later went to work at United as the company faced ongoing financial pressures and was forced into Chapter 11 bankruptcy, a situation that no one wanted to happen. But once again, it was also very fitting that another one of our American treasures, our legal system, enabled United to fix its balance sheet in an orderly way, saving the jobs of roughly 80,000 people.

The airline industry that was born in this country continues to enable commerce all around the world, thanks in large part to the actions of our government and the airlines themselves in the immediate 9/11 aftermath. While flying might not be a lot of fun these days, we should all be grateful and proud that we can still go about our business as we always have.

We should also use this example of leadership in Washington – in partnership with one of our major industries at a time of incredible duress – as proof positive that our government can and should step up to the plate during this current time of economic turmoil. Where there’s a will, there is definitely a way.

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CEO at the Negotiating Table: Sending a Message? Or Painting Yourself into a Corner?
September 15, 2011

To use your CEO, or not use your CEO? A much debated topic in the crisis communications circles. But an equally valid question when it comes to other high stakes situations, such as the contract negotiations between the UAW and GM, where GM’s CEO has been actively participating in the negotiations.

It’s not typical for the CEO to sit at the bargaining table, until the deal is pretty much done – when the leaders of both sides can come together for a nice photo opp and a few quotes about working together. But then again, what has been typical about GM, or the automotive industry lately?

The automotive makers have struggled with remaining competitive; with the labor cost structure cited as a major driver of Detroit’s decline….and ultimate government bailout. This is a mistake that the automakers can’t afford to repeat.

As a general rule of thumb, it’s always smart to have an escalation plan. An opportunity to bring in a bigger gun if communication, or in this case, negotiations, start to go south. Once you’ve engaged your CEO – you can’t “downgrade” to another executive. On the flip side, leading with your CEO sends a strong message that the situation is serious, and that all resources are being deployed to resolve this issue.

In the case of GM, this contract (the first that’s been negotiated since the bailout agreements) is the pace car for the rest of the industry for the foreseeable future. If that isn’t important enough to warrant CEO attention, what is?

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Will Promoted Content Damage Twitter’s Reputation?
September 14, 2011

It’s hard to believe that five years ago there was no twitter. In a society where we are uber-connected, but task saturated and inundated with content, the simple 140 character format provides the ability to make a statement…quickly. If its beauty is simplicity, its relevance stems from the access it gives us to celebrities, luminaries and thought leaders outside our normal sphere of influence. You can follow Ashton, Queen Noor, the White House and Bill Gates. It provides a feeling of equality and accessibility to all.

The other key to twitter’s success, in my opinion, has been its authenticity. It’s why characters like Captain Morgan never took off…and why parody twitter handles need to be defined as such.

Twitter’s unprecedented success lies in its adherence, thus far, to a simple formula – trust + relevance = action. It applies to pretty much every business – and in this case, the millions of people who opened, and use their accounts is the kind of action most brands only dream of.

Yesterday, twitter changed its approach to promoted tweets. Getting a promoted tweet from a brand or cause I follow is one thing. Yes, making it stick to the top of my timeline might be a little annoying – but if I’m following you, I’ve pretty much invited your marketing. But inserting unwelcome, promoted tweets from whomever the twitter algorithm thinks I should hear from seems like crossing the line. It violates the trust twitter has worked so hard to build – and puts those tweets into the same category as spam. Will people do the equivalent of an inbox “delete all?” Too soon to say.

No doubt many brands will be rushing to get in on the action, and fill twitter’s coffers to access a new marketing channel that might prove to be effective. But at what price to twitter’s reputation?

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