Case studies


The end of PR as we know it

cliff

I usually dismiss people who say that social media “changes everything.” At least in marketing, it’s a variation on a theme of “listen, react, and serve your customer” that has served us well for generations.  But in a world where everyone is a publisher and critic — and can potentially be sued for it — this DOES change everything in the world of public relations!

I’ve been honored to explore this topic with Steve Farnsworth, Chief Digital Strategist of Jolt Social Media, who is absolutely one of the smartest PR and marketing guys I know.  On Monday I wrote a post describing a real case where a marketing firm, Low and Tritt,  sued a Knoxville pizza restaurant for $2 million over alleged libelous comments on Facebook and Twitter.  The fact is, this is just the beginning — we are going to witness more and more of this kind controversy.  The marketing firm’s reputation is now spinning out of control.  Once it goes viral, what can a company do?

Steve answers this for us in a guest post, his first ever!

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When Mark challenged me to respond to his post on libel lawsuits and social media, I was thrown for a loop. Crisis communications for a business who had sued a client or tenant?  Where do you even start on a self-inflicted gunshot wound like that?

It was a little like asking me to talk about safety to a young man as he recovers in the hospital burn ward, after he met the business-end of a Roman candle in a deeply misguided Jackass reenactment.   All you can really do is take pictures of the awkward injuries to show the other kids that it is just not a good idea.  You don’t want to try this at home.

Being a regularly reader of {grow} I couldn’t pass up a chance to work with Mark or his challenge.  To mix things up, Mark agreed to participate in a Twitter chat (#SM4B) with me on Wednesday October 7, 2009.  A sampling of the comments from the chat are included at the end.

Since I only have access to openly published details of the case, and lack internal insights of the cases Mark cited in that post, it is difficult to address those situations specifically. So, I am using this assumption:  The marketing firm realizes that as an unintended consequence of the lawsuit they risk potential irreversible damage to the firm’s long-term reputation, a reputation that they have spent years nurturing, and the very real potential of lost future business.

Situation Analysis

At risk for both parties

  • Loss of Money: court fees, attorney fees, and judgments against the loser by the court.  Also, vendors and banks see extending credit or loans to a business in litigation as potentially risky.
  • Bifurcated Mental Focus:  Cases can drag out for months or even years. Being involved in a lawsuit, even if you think you might win, is a drag.  It takes your mental focus off your business, family, and your life. With so much at risk you can’t think about building your business, taking care of your family, or health.
  • Time Sink: Meeting with lawyers, responding and filing court documents, and depositions all take your most valuable and limited resource: time.

Brand Impact Risk for Pizza Restaurant

  • You want people to think, “Hey you’re the guy who makes that fantastic Three-Cheese Pasta Bake.” Not, “Hey, you’re the guy who called your agency crooks and got sued for a million dollars.” Needless to say this is way off topic for your brand image.

Brand Impact Risk for Marketing Firm

  • Even if the courts decide that they are the clear victim in our scenario, the public is going to see the offending words calling them crooks and thieves repeatedly, and hear accusations that their work is subpar.  Public sentiment, as reflected by dozens of published comments, is establishing them as “That agency that sues its clients.”  There is absolutely no upside for their brand.  They could be a  very reputable agency, but this will impact new business development for years.

 My Suggested Plan Of Action

  • Make It A Non-Issue
    • News, and social media discussions, thrives on conflict.  Often when words have been said, and egos bruised, it is next to impossible to have a meeting of the minds, but that would be my first effort.
    • Both sides have a lot at stake in this case, and both have a great deal to gain by putting their differences aside and coming to terms. No one is going to be happy.  However, if they can agree on settling this matter quickly they can start repairing reputations and move on to building their business.
  • Create A Listening Dashboard
    • The train is off the tracks, but you still need to know where it’s going to land so you can be prepared to engage or adjust your efforts as needed.  Using an RSS reader like Google Reader, I would create several persistent searches for terms related to the case and save them as RSS feeds. At a minimum, sites I would include are Google Alerts, Twitter search, and Technorati. Probably Social Media Firehose (Yahoo Pipes), too.
  • Speak Once On The Topic and Shut-Up
    • I would write a very conversational, from-the-heart, brief blog post from the face of the company (owner, president, or GM) on the resolution.  I would have them acknowledge, in clear, but gentle terms, their mistakes, and I would do this without mentioning Pizza Kitchen by name. No need to beat a dead horse.  I want to capture the human nature of the situation, a genuine mea culpa, so that the public would connect with the people involved.  If the client had any believability on video I would do it on camera, and then post it to YouTube.
  • Create Positive Online Content
    • Diluting the negative online content with expert content is extremely important. Any time a new customer Googles L+T they will see the negative results. So, they should publish downloadable, no sign-up required white papers, case studies, and/or e-books.
    • Also, they need to start a blog hosted on their website (huge SEO benefits), and develop a videos series to post to YouTube.  All the content must be well crafted and targeted to potential client’s business concerns.  The blog and videos must provide great usable advice and demonstrates their marketing expertise.  This will help return some positive standing to search results, and likely shorten their sales cycle.
  • Show Your Face and Become a Resource
    • It looks like L+T primarily works with local businesses. I would create a few powerful presentations designed to help local business owners generate new clients, and then take it on the road. I  would talk to any group that could put 5 or more butts in seats.  Getting management out in front of potential clients will do a lot for rebuilding the company name by putting a human face on it, and great for generating new  business.

L+T  should continue to evaluate damage to new business, and decide how best to evolve their efforts.  Also, I would seriously consider rebranding the company and changing the name.  When I suggested this during the chat it met with a number of dissenting opinions.  The general sentiment was that the negatives would outweigh the benefits because people would see it as hiding behind a different name.  However, this does not track with the effects I have seen in the real world.

Names are very powerful. Johnson & Johnson rebuilt their very damaged brand effectively after the Tylenol tampering scare, but they were the victims and got out in front of the story. It is almost impossible to rehabilitate a brand that consumers see as the bad guy.  Blackwater Security Consulting knew this and changed their name pronto.  Now, if you ask a room full of people what Blackwater’s new name is, most would be unable to tell you. It’s Xe Services LLC.

For a full listing of comments, search Twitter for #SM4B.  Here is a sampling of some of the best insights:

@Dan_Holden: So even if they are right (win the lawsuit) they’ve damaged the reputation of the firm, perhaps irreparably.

@kimmolinkama: Maybe this is simply the first highlight case of ambulance-chasing turning into tweet-chasing?

@steve_dodd: the power of an apology… fix it and move on … would generate positive press that more than counteracts negative

@NitinGuptasays: I agree that BPB has risked its reputation and future business by sueing. .. but was PD justified in defaming the agency?

@Dan_Holden: My resolution would be to get the suit out of court and have a pizza and beer … maybe even sponsor a neighborhood beer bash

@markwschaefer: My take is that suing a customer is almost always a losing proposition.  And now under the glare of SM … wow.

What have I missed?  What would you do in the event of a social media PR crisis?

Twitter smack-down: Pizza joint hit with $2 million lawsuit

twittercase

Welcome to the world’s first hyper-interactive, cross-country, super-charged blog.

My subject today will serve as a case study to be discussed during a Twitter chat (#SM4B) hosted by Steve Farnsworth (@TheRealPRMan) Wednesday, Oct. 7, at noon Eastern time.  I will be his guest. Then on Thursday, Steve will contribute his own perspective in a guest post on {grow}.  I hope you enjoy this post and take advantage of the learning opportunity from every angle.

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Here we go again with another lawsuit based on a Facebook and Twitter comment.  And this time it happened right under my nose.

The Pizza Kitchen is a popular landmark in my neighborhood. They have funky Elvis stuff on the walls (It is Tennessee, you know!).  I’m not a frequent visitor but I did get a free meal once when their lasagna came out too soupy.

But that’s beside the point.  They just got slapped with a $2 mm libel lawsuit over comments made on Facebook and Twitter.  Apparently they retained marketing firm Low and Tritt to help them with advertising and promotions in a tough economy.  Business reportedly continued to go down and the restaurant’s owner, Travis Redmon, let the firm go.   A disagreement about fees and licensing rights ensued.

An article in the local paper reported what happened next:

According to the suit, Redmon defamed the marketing firm in two Aug. 17 Facebook entries that said, “Do not EVER use Lowandtritt mktg. firm!” and “CROOKS! – Stolen email list, and have tried to pressure me by threat of lawsuit to sign a ‘license agreement’ to use their mktg materials.”

The following day on Twitter Redmon posted, “Lowentritt mktg firm has done it again…” and “Can you believe that they have not only stolen my email list, but have now hacked Pizza Kitchen’s facebook page taking it offline?”

The posts were published to more than 300 Facebook friends of The Pizza Kitchen and 247 followers on Twitter, according to the suit.

I tried to find the latest legal opinions on libel and Twitter and, as they say in Australia, it’s a dog’s breakfast … a mess.  You could successfully argue both sides and it may take one of these things going to trial to determine a precedent.

However, the legal aspects of the pizza lawsuit seem secondary to the fundamental business issues at hand.

First, is it ever really a good idea to sue your customer?  Pizza Kitchen has one store and 247 followers on Twitter.  Even if the owner was really, really difficult, you just … don’t … sue … customers over something liks this.   Do you??

Low and Tritt’s website boldly claims that their company “foundation” is:  Client First, Always.  Hmmm.

OK, let’s put aside the messy “client first” thing for a minute.  What would they be trying to prove with a lawsuit like this?  Have they not been reading the papers?  This sort of legal action is so 2008.  This is a recipe for PR disaster.

There was a similar infamous case that went viral in July, as reported by the Chicago Tribune:

A Chicago corporate landlord set the Internet world abuzz by suing a former resident for a seemingly offhand remark on Twitter about her “moldy” apartment.

The libel suit by Horizon Group Management alleged that Amanda Bonnen “maliciously and wrongfully published the false and defamatory tweet, thereby allowing the tweet to be spread throughout the world.”

But Bonnen had only about 20 Twitter followers at the time of her allegedly libelous tweet. By the time the news of the legal fight spread Tuesday around the Web, however, “Horizon Realty” hit as high as No. 3 on Twitter’s list of trending topics and made the front page of Digg.com in which users rate the top news of the day.

One prominent lawyer said that the landlord was “inviting a PR nightmare” and “foolhardy” but the landlord is still pursuing the case.

Which brings me to point two.  These days, “word of mouth” does not take place at the water cooler.  This is an era where everybody has a voice, everybody has a global public platform.  A dissatisfied customer is a terrorist.  And Low and Tritt … seems to be in trouble.

How did the reporter find out about the lawsuit?  Probably from somebody who sympathizes with the restaurant.  So, now it’s in the newspaper.  And on TV.  Both online versions have comment sections providing more fuel to the public perception that Goliath is bullying David. As of this writing, there were 81 comments with stabs such as:

“They should change their name to low and trite.”

“Low & Tritt has conducted a fantastic gonzo marketing campaign advertising what the firm stands for. I wonder if they can sue themselves for stupidity? I’m sure the current clients splashed all over their web site are proud to be associated with such a professional organization.”

“I guess if you can’t make money by providing a quality service to your customers… then you can just hire a snake lawyer, and sue the customers that you FAILED for million$$$$.”

It gets worse. I didn’t hear about this from a newspaper.  I saw a link to the article on Twitter and so did hundreds, perhaps thousands, of others.  Now the news about Low and Tritt is going viral.

Although crowd reaction might go with the pizza baker, the lawyer for Low and Tritt claims in an interview that anybody with an audience had better be careful:

“The claim is that the posting on the Twitter page that was not accurate about the marketing company,” says Pamela Reeves. Reeves is partner of Reeves, Herbert & Murrian P.A., the office representing Low and Tritt in the case.

“It opens up lots of opportunities for defamation,” she says. Defamation – where a false comment damages the reputation of an individual or business – depends on the comment being untrue.

“If the statements that are made are accurate statements, you’re not defamed. It’s simply making an observation that’s true,” says Reeves. “Obviously our clients feel that that’s not the situation here.”

“Remember you always have the possibility of causing someone serious harm when you make those statements on the web,” says Reeves. “Unless you know you’re fully protecting yourself, you should be careful what you say.”

The Pizza Kitchen is caught in a maelstrom of legal uncertainty but has the benefit of public sentiment. Low and Tritt probably didn’t make the wisest business or PR move but might have the law on their side. Does that matter if their reputation is ruined?

So I hope you can all join Steve Farnsworth and I for the Twitter chat on Wednesday and then tune in for Steve’s blog on Thursday. In the mean time, what are your thoughts on this case?

Illustration: Chicago Decider

Is social media the new corporate star-maker?

bewitched darrin

A few months back I did a fun interview with Susan Wassel, the social media voice for Sharpie pens.  Susan made me a believer. If you can bring pens to life over Twitter, just about anything is possible.

So here is a debate I have with my customers: Do you have a real person (like Susan) represent your company on social media or a corporate logo with a rotating line-up behind the scenes (like most companies)?

Susan represents the ying and yang of this argument.  On the positive side, she has built a faithful following of nearly 4,000 who tune in to hear the latest Sharpie adventures of her friends and family.  She is an enthusiastic, charming woman who has come to personify the brand online.

Now the downside.  Some day Sharpie Susan will move on.  Remember the feeling you had when they replaced the first “Darren” on Bewitched?   That was hard to take.  There was a pretender in the role.  I don’t want a SharpieKim or SharpieFred or even (gasp) SharpieDarren.  I want my SharpieSusan dammit.

This is the ultimate two-edged sword of establishing your company’s voice online.  What happens when a solitary person BECOMES the brand?  Where do all those followers go when your spokesperson leaves … and joins your competitor for more money?  Sure, the company will survive, but why make the investment in developing the talent when you don’t have to?  Avoid the risk.

If you’re a talented communicator with a great personality interested in being a corporate social media persona, this is great news by the way.  Becoming your company’s social media rockstar may be the ultimate job security.  Or, you might be sentencing yourself to social media hell. Do you really want to be the company Pat Sajak for the next 20 years?  Any way, we will certainly see a growing number of popular corporate bloggers whose importance and value to the company will grow exponentially.

To close the loop, my recommendation to my customers is to provide a real face to the world. Nobody wants to relate to a logo.  But I don’t have answers to the hard questions I’ve raised here, either.  Let’s hear from you on the subject …

Flunkin’ Dunkin Donuts

donut

This is going to be one sweet blog.  It’s about donuts and ice cream.  What’s not to like?

Am I out of touch or does the following statement also strike you as deep-fried, chocolate-covered hooey?

“Customers will decide what our brand is about. And there is nothing we can do about it.  And that is a very liberating thing. In the end, you can’t control it. And that’s the beauty of social media.  And that means marketers have to let go – a little.”

This is a comment made by Dunkin’ Donuts Brand Marketing Officer Frances Allen during last week’s OMMA conference in NYC.*

I had a visceral reaction to this statement.  It hits all the popular social media buzzwords about the power of consumers and letting go of the conversation … but let’s not sugar-coat anything (yes, that was intentional) — this  just strikes me as so wrong.

I don’t know France Allen and I’m not that familiar with the history of DD, but I do know quite a bit about Ben & Jerry’s (a U.S. premium ice cream brand) because I teach a case about the company in one of my classes.  Seems like this is a similar, sweet, occasion-based treat, so for argument’s sake, let’s lump the two companies in the same product category.

There are so many ice cream brands on the grocery aisle, it can make your head spin.  But B&J stands out like no other brand by promoting three core values:

1)    Fun. Everything about B&J is playful: the names of the flavors, the packaging, the website, their crazy contests.

2)    Quality. It’s an expensive treat and B&J are fanatic about their ingredients and how they’re blended. One famous R&D innovation was developing the first real marshmallow stripes in an ice cream.

3)    Social responsibility. The founders of the company set out to show that you could create a company that can also take care of people and the planet.

The B&J marketing folks go to extreme measures to develop and market products that enhance this precious brand image.  And they have done a superb job, creating a powerful brand equity for the B&J name.

Who decided these three brand pillars – what the brand is about?  Consumers?  Perhaps indirectly, but no, a marketing team is responsible for the brand vision. No focus group handed it to them on a silver platter.

Are consumers in charge of the brand image?   No again.  While every nuance of their product offering is tested exhauastively, talented marketing professionals drive the image through brilliant products, strategies and advertising.

Have the marketers “let go” of their brand since the advent of social media?  I honestly don’t think anything has changed at all.  Sure, there are new tools to “listen” and “engage,” but marketers have ALWAYS listened and engaged. This is just a new way to do it.  I think it’s pretty arrogant of any marketer to assume they had control of a consumer conversation in the first place.

So how do you reconcile the Dunkin’ Donut position with my views of social media’s impact on traditional marketing?  Or can you?  Are we flunkin’ Dunkin Donuts?

Disclosure:  I would choose a pint of Ben & Jerry’s Cinnamon Bun Ice Cream over two dozen Dunkin Donuts any day.

*This comment was featured in a blog by Nitin Gupta, a regular contributor to the {grow} community.  I highly recommend his blog ‘Digital Marketing Today.” 

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