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Tuesday, 14 February 2012
A recent study found that social media is more addictive than drinking wine. That in fact, people are more likely to give up a glass of bubbly for an opportunity to check their Facebook account. Probably not a surprise to many but got me thinking about what this means for the social media industry in general.
In a few years’ time, will we have institutions trying to cure the social media addiction? Will we see, in the future, some kind of ‘social responsibility’ programmes from Facebook, for instance allowing only grown-ups to sign up and use the sites and have little note ‘use responsibly’ on social media adverts? Is it time for the social media industry in general to start thinking more about how they could prevent this from happening and avoid their reputation being torn down by health, privacy and human rights activists?
Well, some say the fault lies with people themselves. That people are too weak and just too lazy to build willpower to resist temptation. For instance, Jon Henley wrote in the Guardian last week how people with strong willpower in general grow into wealthier and healthier adults and are more likely to achieve success in life (hence, less likely to fall to any kind of ‘weak’ addictions). He brought examples of several studies that have concluded the same, the most amusing one conducted by a sociologist Walter Michel who studied children’s’ behaviour by offering them a marshmallow immediately or two, if they could wait for 15 min. Tracking down the children years later, Michel found that those who had the patience (and willpower) to wait, had become more successful. And there is no chance of accusing bad genes here – apparently willpower is something you can train and become better at.
So, the social media industry, if accused of causing addiction, might just not do anything about it and accuse people of being too weak (although this attitude didn’t work for the tobacco industry). We’ll wait and see…I’m looking forward to seeing some social responsibility campaigns from the social media industry before their reputation gets damaged by those who accuse them of causing addiction.
Friday, 10 February 2012
By Anastasia Chernoivanova, Consultant, ReputationInc
I am a voracious filmgoer. After booking the usual weekend treat at my cute local cinema I realised that I bought tickets for the wrong date. ‘No need to worry’ I thought. They are a small business and therefore will probably be quite flexible about these things, I am sure there will be no problem in exchanging tickets - So I told myself.
How naïve I was! Three days, four phone calls, and five pounds of expense later, what should have been a simple process of changing my ticket was finally completed in accordance with “the company’s policy”.
The whole episode reminded me of my three-year-old nephew who is rushing to ‘grow up’ by foregoing the benefits of being young and nimble, and wants to wake up the next morning as a grown-up so that his parents could not tell him what to do. In the mean time he acted the part by copying his parents’ actions.
The question of why small businesses voluntarily forego their potentially ‘natural’ advantages, such as better and more personalised customer service, over their much bigger competitors is puzzling to me.
There are several reasons why small businesses are likely to deliver better customer service than a large company.
Being small means better customer knowledge. A small company is closer to its customers and requires fewer resources to learn what people want to meet their expectations. There is simply no need for complicated CRM systems that holds millions of customer records, nor in-depth knowledge of Mosaic classification to identify your customer segments to ‘unlock’ their hidden desires.
Being small also often encourages flexibility. For small businesses, the costs of adapting to volatile market demand and changing consumer preferences are much lower. They could spot a new trend earlier and have the rare luxury of applying common sense over standardised operating procedures.
Last but not the least, being small can facilitate trust. Trust is probably the most valuable asset that a business can possess. At the times of large businesses’ failures and corporate governance scandals, customers lose their faith in huge conglomerates and instead tend to empathise with local companies that have a stake in their community.
While small companies may have ‘natural’ advantages in these customer service areas, it doesn’t mean that they are not facing customer-related reputational risks. In recent years, small businesses have been confronted –most of them unprepared- with the imperative of reputation management. And some have already paid a heavy price for it. Think about small restaurant owners who have seen their bottom line directly impacted by a few bad Tripadvisor reviews.
On the other hand, larger corporations that have more insight on their own reputation might benefit from reconnecting with the strengths of small businesses. Some big companies, such as First Direct, O2, Dell and John Lewis have already successfully managed to cultivate and preserve a ‘small company mindset’ when it comes to customer service. They win consumer trust through understanding their needs and staying flexible.
The lesson for big and small businesses is clear. From the vantage point of customer service, try to preserve and consolidate the advantages of being small, however think big when it comes to your reputation.
Tuesday, 7 February 2012
By Maita Soukup, Account manager, ReputationInc
Despite being regarded as the lifeblood of many industries and the backbone of transportation in the UK, the road freight sector is never far from a green politicians’ cheap shot about oil dependence and industry’s resistance to a low carbon economy.
I was reminded of this last week in Brussels as I listened on while a senior member of the European Commission’s Transportation Cabinet lambasted a room full of fleet owners for their failure to act definitively to reduce CO2 emissions.
The audience, full of success stories and innovative programmes to “go green”, was unsurprisingly disheartened by the Commission’s robust dismissal of its programmes as “piecemeal” and “not strategic”.
So why is it that when it comes to sustainable business, certain sectors’ reputations have been buoyed by their response to the low carbon agenda, while others continue to be painted as fossil-fueling consuming dinosaurs, unwilling or unable to adapt to a new world of declining oil reserves and ambitious carbon reduction targets?
In a word, reputationmanagement. Industries must confront their not-so-pretty reputation legacies in order to grow, maintain favour with stakeholders, and ultimately maintain their licence to operate.
Let’s look at how other sectors have tackled similar regulatory challenges, and then conclude with some advice for how road hauliers can think differently about their reputation in order to secure greater understanding and support from government and environmental activists.
Supermarkets & the environment
Savvy retailers across Europe were amongst the first to recognise post-Copenhagen that they would be on the chopping block once public concern about the environment began to influence consumer purchasing decisions. While such a shift has yet to be documented, Marks & Spencer’s Plan A is a shining example of a genuine, well-thought through initiative that positions the business as part of the solution, not contributing to the problem. From simple operational changes to wider supply chain commitments, all initiatives in Plan A makes good business sense as well as demonstrating low carbon leadership.
The alcohol industry & binge drinking
The alcohol sector is perpetually under attack from public health officials and NGOs bemoaning a culture of binge drinking. In the UK TheWine and Spirits Trade Association, working with the support of the country’s alcohol makers, recently side-stepped further regulatory intervention by contributing proactively to the government’s Responsibility Deal.
The Responsibility Deal aims to tackle public health concerns without heavily regulating industry, and was only possible because alcohol producers were willing to acknowledge their role in the problem, and to become part of the solution. A commitment to further self-regulation, including tightening marketing restrictions, continuing to fund successful Drinkaware campaigns, and improve server training initiatives all resulted in an alcohol sector which is no longer a scapegoat for politicians trying to explain away binge drinking concerns.
So, what can road hauliers learn from their retail and alcohol counterparts?
First, act early. The EU is expected to tax trucks based on their carbon output in the next five years. To avoid this punitive tax policy, fleet industry associations should be looking to find their own version of M&S’s Plan A. Agreeing a self-imposed CO2 reduction target that is feasible for the industry to meet, would demonstrate goodwill to regulators, and put fleets on the front foot when it comes time to lobby against any crippling taxes the EU might suggest down the road. Like Plan A, a shared commitment to reducing CO2 emissions in fleets will result in cost savings for the sector.
Second, formalise informal practices and commitments. The alcohol sector was already following the majority of commitments it made in the Responsibility Deal long before Andrew Lansley took up his role as Health Minister. When the time came to collaborate with Government, the trade association had a number of ongoing initiatives to package up and present them back to government as an industry-driven “vision” for responsible drinking. Road hauliers must now do the same thing, and at an EU level. For instance, the UK the Freight Transport Association’s LogisticsCarbon Reduction Scheme is already yielding successful outcomes, as are programmes across the continent aimed at reducing empty drive time, improving fuel economy, and training drivers to use minimum energy when on the road. Collecting these shining examples, and presenting them back to the European Commission, will prove the sector’s willingness, and possibly open up new channels for collaboration or funding.
Finally, stop being defensive. Given the amount of finger pointing and scapegoating the trucking sector endures, it is little surprise that road hauliers may have developed a feeling of healthy animosity when dealing with regulators. However, as the alcohol and retail experiences demonstrate, changing your reputation with policy makers calls for re-aligning the industry’s aims and objectives to match those of the public good. In the case of fleets, this means translating business objectives, like reducing fuel bills, into shared objectives, like reducing overall carbon emissions.
Whether battling fat taxes, fuel taxes, or marketing restrictions, demonstrating shared commitments and setting out timelines to deliver on those commitments is a necessity for any industry looking to improve its reputation and survive periods of heavy regulation and market change.
Friday, 27 January 2012
By Gauri Mahtani, Consultant, ReputationInc
Re-reading my colleague Jonathan’s fascinating insight into the world of Eastman Kodak, I cannot help but smile at the thought of a global business head convincing his audience that he was going to “drive [digital] back into the sea”.
Admittedly, it’s much easier to snigger with hindsight firmly on my side. That global leader was not alone in articulating a prophecy which would eventually prove to be completely off the mark.
In 1943 for example, Thomas Watson, then chairman of IBM, predicted a world market for five computers.
Even more bizarrely (in my opinion at least), in 1962, Decca Recording Company rejected the Beatles, claiming that guitar music was on the way out.
I could go on, but if your interest has been piqued, Wikipedia probably has an entry on incorrect predictions. If you’re really interested in the subject, there’s Facebook, Twitter, YouTube and a plethora of other social media platforms for you to share your views on fallible futurists. The myriad of possibilities which digital technology and the internet have opened up – from the personal to the political – are relatively well known, well understood and well documented.
Which is why last week’s virtual protests against the Stop Online Piracy Act (SOPA) and the Protect Intellectual Property Act (PIPA) didn’t surprise me. It’s one thing to be prepared for future challenges and opportunities (more on that another day), but what if the future is NOW?
Digitally mobilising grassroots support, in the manner seen last Wednesday, is far from a weak signal or emerging trend. It is a current reality which has major implications on corporations and legislators alike. Which is why proponents of SOPA and PIPA should have seen the protests (and its potential impact) coming.
Thanks to the protests, I spent a very enjoyable lunchtime on Wednesday doing the following:
• Following Guardipedia, the Guardian’s tongue-in-cheek antidote for readers suffering from Wikipedia withdrawal symptoms
• Congratulating myself on figuring out how to circumvent the Wikipedia blackout
• Skimming through countless Facebook posts and Twitter feeds (The most scintillating of which are too rude to repeat)
But I digress. Beyond being gleefully distracted and amused, the protests testify to the changing dynamic of lobbying and campaigning processes, and the increasing role of social media in galvanising grassroots support.
Don’t get me wrong here – I’m not for a moment advocating that legislative processes have previously operated in a vacuum, or that public sentiment and scrutiny or consumer-led activism have not figured prior to the digital revolution.
However, new technologies have undoubtedly amplified the speed, scale and impact of getting one’s message across, reaching out to key influencers and opinion-formers, and galvanising grassroots support in general, with its attendant risks and opportunities. A multitude of new terms have been coined to describe this phenomenon (ranging from social lobbying to e-campaigning and e-activism) and with them have emerged an equally diverse range of perspectives on the effectiveness, ubiquity, cohesiveness and longevity of online activism.
One thing is certain though. Last week’s ‘watershed moment’ could have easily been anticipated, and even prevented. The signs were all there – in the here and now, and not even in a remotely distant future.
Questioning whether the drafting of SOPA and PIPA is well-intentioned is a moot point. Online piracy is a serious issue, and demands a serious solution. And in today’s environment, it is more important than ever to craft such solutions by listening to multiple stakeholders, engaging in constructive dialogue and engaging experts. No matter how sophisticated one’s traditional lobbying tools may be, antagonising and excluding key players is no longer a viable option. As a contributor to Forbes tellingly noted, after last Wednesday, “the time for constructive dialogue, which Congress and industry groups had overtly snubbed all year, was over”.
Friday, 20 January 2012
By Jonathan Chandler, Partner, ReputationInc.
Jonathan was Communications and Public Affairs Director Europe at Eastman Kodak EMEA from 1998 to 2000.
Rochester, New York, 1999. We weren’t sure if the world was going to end with Y2K or we were going to finally realise Prince’s promise of the party of all-time. Or both.
Certainly those 80,000 of us working at Eastman Kodak didn’t have bankruptcy on our minds. The future looked scary. But filled with possibility. Some analysts predicted the stock would hit a $100. Other's were more sceptical.
A year earlier at the bi-annual photo-fest in Cologne our CEO Dan Carp took a brave view into the future. It was a critical moment for me in the business of forecasting and risk.
He boldly and correctly predicted that we were entering an “explosion” of picture taking. How right he was. He described (first time I'd heard of it) a strategic inflexion point. The chart showed how our business would either accelerate upwards as part of this revolution... or decline at an exponential rate if we didn't ride the curve.
That’s what the chart said. It was an honest forecast of the unknown future.
He rightly described how digital would transform the way we use, share, relate to pictures. And that was even before anyone dreamed of Facebook.
There was excitement about a digitally-created photo book for....say $100. A photo CD for £15. A 2 megapixel camera for $200 (check your phone, that "free" camera you have in your hand has at least twice the power of the brick you could have bought back then).
This was not a leader afraid to confront the future or indeed to predict it.
So what was Kodak doing about it?
At the same show the stalwarts from "consumer imaging" division were lauding the breakthrough of an APS camera (the one with the little film cartridge) that could actually allow you to see the shot you had just taken. On a tiny digital screen. And if someone blinked, take it again, and expose another ray of light on your silver halide film until all 24 frames were exposed. Progress along the curve?
Across the hall the "digital and applied imaging" crowd - West Coast dudes recruited from silicon valley hot-houses - were offering gear that you needed a PhD to operate. Billions of dollars were being poured into the loss-making digital business.
But it seemed they were either chasing the "golden age" by grabbing the camera business back from Japan at "any cost" or driving people back to the 60s and the joys of "home processing", when my Dad was developing film in the bath (not at the same time, that would be dangerous, although I wouldn't put it past him.)
It was the active disruption and confusion of a consumer pattern that Kodak itself had established...9 times in a year in Japan, six times in the US, 3 times a year in Europe, and half a time a year in China... People "on average" would take a roll of film, drop it off and come back in an hour or a day and enjoy. Not that fast moving, in the overall pattern of consumer consumption. I created about 50 facebook albums last year (processing cost, nil) but spent a whole lot more with Moonpig.com doing greetings cards, than ever did on Kodak film.
I always felt if we had just called the chip an "e-film" and encouraged people to take it to Boots or Wal-Green rather than convert their loft into a digital darkroom... We might have bought some more time.
The tragic conclusion to the "strategic inflexion" presentation - which was otherwise spot on - was that silver halide would continue to grow. Because as more people use pictures, film and photographic paper will be a smaller but still growing part of the mix. But what if not? Who was going to fund the (good or bad) investment in digital?
The Rochester campus was about six miles long, has its own coal-burning powerplant, and then "only" employed 35,000 people. Hard to accept a different future without film when you sit in the citadel at the centre of all that.
Forecasting future scenarios takes more than vision. That is arguably the easier part. For an organisation, the challenge is to see itself. To accept that the assumptions on which its franchise, its future, is based are by definition fragile. Be it technological, environmental, regulatory.....no fortress is unassailable.
One of the most powerful reasons to conduct a serious forecast of future issues is to give context to "weak signals" of change. The one's that inconveniently don't fit into the business plan but become a tidal wave a few years later. But even if the signals are loud and clear organisations demonstrate an amazing resilience to change. Visionaries throughout history tend to get short shrift from the status-quo-ers. So anyone serious about future reputation or policy challenges in a major corporation needs to exhibit equal resilience and an adventurous mind. We're proud to work some clients who have just that.
At Kodak, the vision had been set as early as 1998 and surely now we were all pulling together to "inflect" in the right direction.
We even had a booth at the eery void called the Millenium Dome to demonstrate our participation in the brave new world. Assuming there was one when the clock struck twelve.
Back to Rochester, 1999. IT analysts were getting filthy rick fixing our clocks, Prince was limbering up for the big show and Francois Mitterand was asking "what's it for?" (it's the best concert venue in Europe now, stupid).
At a gathering of the PR community, we were addressed by the various global business heads. The Yamamoto-clad cyber gurus made us feel intellectually bankrupt by describing products that you clearly needed to be cleverer than us to find a use for.
Meanwhile the Brooks Brothers consumer suits told us about exciting new yellow boxes, but nothing - at all - that mentioned digital.
I turned to my "digital and applied" colleague for clarity. "Oh, they're not interested", she said.
So I dared to ask the question: "You haven't mentioned digital once, I just wonder what your...opinion is?"
The gent looked at me with some surprise. He consulted with his colleague who was sharing the podium. I presumed he was going to straighten up the "narrative" on the partnerships with the "greats" of the era like AOL or AT&T.
But instead, he delivered a line that could have been a straight from "Sands of Iwo Jima"....
"We're gonna drive 'em back into the sea."
Friday, 13 January 2012
A lot has been written on how companies can leverage social media to enhance their corporate reputation, but there is currently little thinking around the emerging topic of reputation management for social media themselves. Online social platforms are a particular breed of business, where one of the reputation pillars – the ‘product’, i.e. online content – is generated by its users, be they merchants, website owners, or members of the public.
Facing increasing reputation risks such as regulatory scrutiny, media criticism and consumer activism, social media platforms will have to grow and defend a reputation of their own if they want to continue to operate their business unimpeded.
Reputation risks of online platforms
Most user-generated content platforms have already learnt the importance of reputation management the hard way. In the past years, the sector has suffered various attacks, which fall under three categories:
- The debate around inappropriate content. Online platforms need to wage a permanent war on illegal or inappropriate content, as any content is likely to be noticed by both traditional and online media, and lead to a reputation crisis. An interesting example is the issue of counterfeits sales on Ebay, which posed a serious threat to the company’s licence to operate.
Conversely, online platforms need to be very careful about what they consider inappropriate to avoid accusations of censorship. In several instances, Facebook’s extremely strict policy on nudity has attracted flak from its users. For example, the group Hey Facebook, breastfeeding is not obscene!, has attracted nearly 260,000 members. The complicated arbitrage between what is inappropriate and what isn’t still has to rely the company’s deep understanding of its user community.
- Lifestyle issues. Social media have changed the way we live, which has lead to increased scrutiny from all sides. Researchers and NGOs send warnings about health and addiction, while businesses, concerned about confidentiality and employee productivity, are banning them in the workplace. In addition to these ‘sectoral’ threats, social media are often held responsible for the conversations happening on the platform, as traditional media and the general public tend to ‘blame the messenger’. For instance Facebook and blogging platforms have been said to encourage eating disorders amongst young girls.
Building reputation for online platforms
In this difficult context, and with little or no content of their own, how can online platforms build their corporate reputation?
In the past year, social media have explored some interesting avenues:
- Using data for the greater good. Social media’s role is now recognised as crucial in tracking epidemics. Just a few days ago, Twitter has been praised for yielding data that helped authorities manage the cholera outbreak in Haiti, while Google mines its search data on an ongoing basis to monitor flu trends.
- Owning an issue. In the UK, Google has launched the "Good to Know" campaign on internet safety, in partnership with the Citizens Advice Bureau, which tells internet users how to choose a strong password, recognise phishing emails, amongst other basic safety tips. Doing so, Google harnesses its activity to a major societal concern, and it positions itself as an authority regarding online security, giving the company a credible vehicle to engage with its stakeholders and telling them how Google is handling personal information.
- Maintaining trust by improving transparency on personal data usage. Important progress has been made in this regard. Facebook made considerable efforts to make it easy for its users to know what type of data they are sharing with whom amongst their friends. However, information on the way personal data will be used for commercial purposes is still fuzzy, basically coming down to one, tautological point: “you are allowing us to use the information we receive about you”.
While these initiatives may have reached their objective and delivered some reputation benefits, major online platforms will have to much more if they want to demonstrate a positive societal value, maintain user trust, and preserve their licence to operate.
This means: growing and diversifying their portfolio of initiatives, and getting them more publicised.
Friday, 6 January 2012
The eyes of much of the world will this coming year be on the US presidential and congressional elections as Democrats and Republicans fight it out for control of the White House, the US House of Representatives, and the US Senate.
The 2012 US federal ballots will be the most expensive in history, with some anticipating that Barack Obama might even become the first presidential candidate in history to raise more than 1 billion dollars for his re-election effort. Overall, it is estimated by the Center for Responsive Politics that the cost of the presidential and congressional campaigns could be a mammoth 6 billion dollars.
Given the vast amount of money spent on campaigns in election years, a significant mini-industry of US political consultants has long existed. However, what is less widely appreciated is how common-place it has become for many of these same people to work behind the scenes in other countries, including here in the United Kingdom.
Indeed, it is estimated that US political consultants have already worked in more than half of the countries in the world supporting campaigns and elections. This year, that tally will only grow as US consultancies reach out to more uncharted international territory.
In early 2012, key potential targets for new ‘work’ will include: the Egyptian legislative and parliamentary elections in January and March respectively; the presidential elections in Turkmenistan and Yemen in February; and potentially the Russian presidential election in March.
While the success of these internationally-mobile political consultants is mixed in terms of electoral outcomes, they have nonetheless had a lasting effect, prompting what some have called the ‘globalisation’ of the political communications industry. Or, in the eyes of critics, the international triumph of spin over substance, which has tended to promote more homogenous campaigns with a repetitive, common political language.
As James Harding, the editor of The Times of London, documents in Alpha Dogs, the origins of what has become a mini-industry lie in the 1970s. It was then that US political consultants (at the vanguard of which was the Sawyer Miller agency) began exporting US political technologies and tactics into Latin America and ultimately across the globe.
A key underlying premise of the industry is that such technologies and tactics can achieve political success just about anywhere. Thus, many foreign countries are sometimes deemed as mere international counterparts of US election battleground states like Pennsylvania and Ohio.
What started as international elections and campaigning work soon branched out into providing more foreign governments, leaders and bodies such as tourism and investment authorities with international communications counsel and ultimately what is now known as ‘country branding’. Country branding is founded (like disciplines such as public diplomacy) on the realisation that, in an overcrowded global information market place, countries and political leaders are, in effect, competing for the attention of investors, tourists, supranational organisations, non- government organisations, regulators, media and consumers.
Some countries may only get a few opportunities a year to make a favourable impression and get their ‘side of the story’ across. In this ultra-competitive environment, reputation can be a prized asset (or potentially big liability) with a direct effect on future political, economic, social and cultural fortunes:
• In some cases, a single highly damaging episode can fundamentally damage a country's standing - as China found following Tiananmen Square. In such cases an approach involving a long recovery time to rebuild what is lost is often required.
• A country may simply wish to promote an opportunity based on a specific single goal, such as wanting to attract more foreign direct investment or increasing tourism -- as the current ‘Incredible India’ campaign illustrates.
• Other states, for example Georgia, Rwanda and the Maldives, may want to establish a presence in the public mind because of fears about a specific issue (such as Russian preponderance, building sympathy amongst donors and investors and tourism in the short term, and/or climate change in the long-term respectively).
In general, the most effective country strategies align all key stakeholders (across the public, private and third sectors) around a single powerful vision for global positioning. A good example here is New Zealand which, since the 1980s, has transformed itself from earlier perceptions of being a relatively remote backwater which, despite its scenic beauty, was not a major global tourist destination.
Especially in the midst of a difficult economic climate in the early 1980s, partly caused by the country's loss of preferred trading status with the United Kingdom (one of the nation's then major export markets), the ‘New Zealand Way’ initiative recognised that a strong country reputation for quality would be hugely beneficial if the nation was to compete in global export markets. Here, the massive untapped potential of the country's natural environment was recognised, not just in terms of natural produce exports, but also for building a destination brand for tourism and outdoor sports.
The New Zealand example underlines how a simple, unified cross-sectoral vision can be enormously powerful. To be sure, the country is not unique in having an unspoilt natural environment and quality produce. But it has managed to capture the world's imagination with its consistent branding that has put natural values firmly at its core.
Today, of course, it is not just US political consultants who are blazing a trail in the industry. London, for instance, has become a major country branding centre fuelled by its favourable European time zone between Asia, the Middle East, Africa, and North America; and the headquartering within the city of key global publications such as The Economist, Financial Times, and the Wall Street Journal Europe.
Looking to the future, demand for country branding is only likely to continue growing given the increasing complexity and overcrowded nature of the global information market place. Indeed, in Asia, Africa and the Middle East, much of which remains unchartered territory for the industry, globe-trotting firms may be on the very threshold right now of some of the most challenging work they have yet encountered.