Media Relations 2.0 – Brand Reputation Management
From Throwingsheep
The Web 2.0 revolution has transformed the way corporations must manage their external communications – especially through the media. The main reason is that the “media” no longer exist, at least not in the establish socio-professional sense of that term.
Before the Web 2.0 revolution, organizations focused their communications strategies on “media relations”. Corporate communications and investor relations managers cultivated media contacts and spent a great deal of time crafting “messages” aimed at journalists. But journalists no longer have a monopoly over their traditional function as information gatekeepers. They have been challenged by the Web 2.0 explosion of horizontal networks in the blogosphere. Information consequently can no longer be “managed” according to standard practices. The dynamic of information flow has not only become horizontal, but information is now transmitted and received in real time, instantly, and globally.
For corporations managing their reputations and brands, these Web 2.0 realities can be a daunting challenge. They must learn the new dynamics of what can be called Media Relations 2.0.
eBay learned this lesson the hard way. When the auction giant was facing a barrage of criticism and lawsuits in the courts alleging counterfeit goods sales, the most damaging onslaught came from the blogosphere. A New York Times’ technology blog, for example, drew up a devastating list of eBay’s problems: its customer service was broken; its PayPal payment system was inefficient (Amazon’s system was judged much better), its auctions were awash in counterfeit goods; it had failed to focus on unique merchandise; its business model was greedy; its management had made poor strategic decisions, notably eBay’s $2.6 billion purchase of Internet-based telephone system, Skype (on which it later took a $1.4 billion writedown).
There was more. Gary Sattler, who writes the online BloggingStocks column, observed: “eBay’s brand image is tarnished, its reputation is trashed, its competition is mounting.” Henry Blodget, the former Wall Street dot-com evangelist who now writes the Silicon Alley blog, disclosed that he had a long-term position in eBay before declaring that, in his opinion, it was time for CEO Meg Whitman to go. Virtually every other blogger following eBay’s tribulations agreed: Whitman was toast. Meg Whitman was apparently listening. She soon decided that, for eBay to steer through its crisis, she needed to make an exit before things got worse. In late January 2008, she announced that, after a decade in the job, she would step down at the end of March.
As eBay discovered, corporations don’t have the luxury of indifference towards the blogosphere’s viral influence. Bloggers react much more quickly than traditional media like newspapers and television – their postings are not only instantaneous, they’re ubiquitous. Bloggers moreover don’t feel constrained by customary pressures -- deadlines, space limitations, self-censorship -- that shape old media content. Perhaps most importantly, the sociology of the blogosphere is, at least in this early phase, radically independent. Most bloggers sound off without fear or favor. That’s a big change from the pre-Web 2.0 days, when major corporations could rely on a sophisticated PR and “spin” machines to cultivate influential media figures and react pre-emptively to potentially negative stories. Reputational risk was manageable in the closed “media elite” governed by tacit codes of mutual trust and practices of reciprocal favors. The blogosphere, by contrast, is more difficult to co-opt because entry into its ranks is democratic. The blogosphere is an open network, not a closed clique.
But are bloggers credible? The answer, it seems, is an ambiguous yes and no.
Those who claim that bloggers don’t enjoy high-trust reputations can validate this assertion with empirical research. Surveys indicate that people overwhelming put more faith in their close friends and family than in bloggers and MySpace “friends”. According to findings published by Forrester Research, when consumers are looking for credible information about a product or service, 83% would trust a “friend or acquaintance”, 63% would trust the opinion of a “known expert”, while only 30% would put faith in the views of a blogger. Those results confirm Edelman’s “Trust Barometer” whose study covered the 2003-2008 period. Edelman found that 58% of respondents said they would trust a “person like me”, while only 14% would trust a blogger. The Canadian polling firm Pollara arrived at similar conclusions. Pollara found that 80% of people using social networking sites were “very or somewhat more likely” to consider buying a product recommended by real-world friends and family members, while only 23% said they would trust the opinions of bloggers.
The most famous example of the blogosphere’s power is the so-called “Dell Hell” saga triggered by Jeff Jarvis on his BuzzMachine blog. In 2005, Jarvis bought a Dell computer which, he quickly realized, was a lemon. He subsequently became even more frustrated when dealing with Dell’s poor customer service department. To register his voice protest, Jarvis resorted to online shaming. He banged off a blog post titled: “Dell Lies, Dell Sucks”. His anti-Dell rant included the following remarks: “I just got a new Dell laptop and paid a fortune for the four-year, in-home service. The machine is a lemon and the service is a lie. DELL SUCKS. DELL LIES. Put that in your Google and smoke it, Dell.” Jarvis followed up with a blog post in the form of an open letter to Dell’s CEO, Michael Dell. The letter began with this reminder: “Your customer satisfaction is plummeting, your market share is shrinking, and your stock price is deflating. Let me give you some indication of why.”
Jarvis’ blog posts unleashed a “Dell Sucks” shaming blaze that spread virally throughout the blogosphere. As Jarvis later recalled: “There was a method to my mad rant: I learned some time ago that you can search Google for any brand, followed by the word ‘sucks’, to find out just how much ill will is attached… All I wanted to do was warn off other unsuspecting customers by joining in Google’s wisdom of the crowds, adding just one more critical consumer opinion. But my post snowballed into a saga, a weblog miniseries. Scores of readers left comments with their stories of Dell hell and scores more bloggers linked to my post with their wails of woe.”
Dell at first ignored Jarvis’ online rants. The democratic groundswell of outrage became so overwhelming, however, that the company soon found itself sinking, in Dante-esque fashion, into a Dell Hell public relations nightmare. Dell finally had no choice but to squirm frantically out of the quicksand by shifting into damage-control mode. Michael Dell even gave Jeff Jarvis a personal interview that was published in Business Week under the title, “Dell Learns to Listen”. Jarvis, taking care to ensure that his readers didn’t form the view that he’d been spun by Dell executives, continued blogging about his experiences with the company and its products. He kept the discussion going in the blogosphere while he was dialoguing with Michael Dell. Jarvis, to his credit, scored two major victories against Dell. First, the company ended up hiring its own “chief blogger”, Lionel Menchaca, to engage the blogosphere about the company and its products. Second, Dell announced that it had decided to give its customers a social platform, called IdeaStorm. The Dell Hell saga, when it was finally over, was a major triumph of open-ended network dynamics over the impenetrable vertical logic of corporate hierarchies.
We would like to build further case studies about attempts by companies to manage the message in a Web 2.0 environment of blogging and tweating and YouTube posting. Are there any notable examples of corporate communications disasters, and if so what caused them? Are there examples of corporations intelligently managing the message in the new realities of Web 2.0 social platforms?
