The Measurement Standard: Blog Edition

Time for Nokia to Make the Right Call

How social media can be both the cause and cure of a corporate crisis.

by Stephen Dodd and Terry Foster

• Is Nokia's Iran crisis a sign of things to come?
• Can a damaged reputation be repaired?
• Is anyone really protected?
• Is social media Big Brother?

These are tough questions, prompted by increasingly frequent social media-related corporate crises, including the recent ones of Domino's Pizza, Horizon, United Airlines, and Amazon. In particular, Nokia's recent problems in Iran illustrate the new realities of corporate reputation.

Nokia: Caught in the middle

Nokia supplied Iran with technology that could be used to manage, intercept, and interpret digital traffic. After the recent hotly disputed elections, the Iranian government used this technology to identify and locate those it felt were fanning the fire against their perceived interests.

The result was a global consumer backlash against Nokia. Twitter and other social media rapidly spread negative comments. The commercial consequences were and continue to be significant, with consumers canceling services and switching to alternative devices. (See this article in last month's Measurement Standard for more details.)

Talk about being caught between the consumer and an abusive user!

Is Nokia really to blame? The technology in question is not, in and of itself, dangerous or harmful. It is likely that Nokia or its competitors have implemented the same technology in other countries as well as Iran. Although they supplied the technology, they cannot control, influence, or be responsible for how it is used once it's in the client's hands.

But that's not the reality of social media-driven public opinion.

How can Nokia resolve this?

In response to criticism, Nokia tried traditional crisis control, explaining carefully what it did and did not do. But, as for the other companies mentioned above, standard corporate protocol was not effective.

A key lesson here is that when people become passionate about an issue, opinions quickly polarize and reason rarely alters their stance.

The social web: Crisis cause and cure

The social web's ability to facilitate mass dissemination of information -- good, bad, positive, negative, right or wrong -- forces companies to take a new approach to addressing this kind of situation. Social media's ability to eliminate standard corporate-speak is the key to its ability to defuse crisis situations.

As Amber Naslund of Radian6 states, "So many of us have been waiting for years for a communication approach for business that doesn't feel contrived and scripted."

The power of the apology

People generally seem to be able to accept issues created by uncontrollable consequences when they are offered an apology. They typically will not tolerate corporate belligerence and deflection. That just creates further polarization.

If done correctly, an apology will not only stop further damage to your brand but may even increase its value in the long run. Rieva Lesonsky's blog post persuasively addresses the power of the apology: "...many entrepreneurs think they're somehow above apologizing. That attitude can easily drive you out of business."

Nokia could have avoided the deepening crisis by initially -- carefully, tactfully -- apologizing, rather than taking the standard defensive approach. Recent Ford, Pepsi, Southwest Airlines, and Coca-Cola experiences are terrific examples of how and why the apology approach can be very effective.

In a crisis situation like Nokia faced, the best course of action is to take Amber and Rieva's advice and apologize, before the crisis escalates further and irreversible damage is done to your business.

Human nature is such that is it not difficult to get a positive and empathetic reaction to a tactful apology. Therein lies the new power of the social web to redeem your company as a good corporate citizen.

Steve Dodd is a Consultant with Muirfield Consulting.
http://www.twitter.com/steve_dodd

Terry Foster is CEO of SignUp Media.
http://www.twitter.com/terry_foster

PR Measurement Research Provides Crisis Control Tips

Crisis Measurement

 

Three New Measurement Studies Provide Crisis Control Tips
Research presented at the IPRRC has practical results.

by Katie Delahaye Paine

We've been saying forever to anyone who'll listen that PR measurement is not just about demonstrating ROI or proving value, but is really about having data on which to make better decisions. Never was that more evident than in the plethora of papers on crisis communications presented at this year's IPRRC in Miami. I personally listened to a dozen papers on the topic, and there were a other dozen or so more that I didn't even get to.

IPRCC researchers studied the impact on crisis communications of everything from involvement to intimacy. A lot of the findings fell into the "duh" category (as in "we professionals probably knew that already"), but it's always useful to have solid data to back things up. Here are three studies with some results that will come in handy.

1. The More They Know, the Angrier They Get

Yoonhyeung Choi and Ying-Hsuan Lin of Michigan State presented a paper on the Mattel product recall that has interesting implications for any consumer company under fire that is trying to manage customer expectation. Choi and Lin compared what moms and mommy-bloggers had to say about the toy recall to how the daily newspapers reported it. As it turns out, the four major newspapers studied blamed the Chinese manufacturers more than twice as often as did the consumers. The consumers were twice as likely to point their collective fingers at Mattel than at China.

As the crisis unfolded, and recall followed upon recall, the media's portrayal of China was consistently negative, and the reputation of Chinese manufacturers declined over time. However, among consumers, anger was more frequently directed at Mattel and its sister company Fisher Price. What this tells us is that even though consumers may be getting their information from the media initially, their long term opinions are formed less by the media and more by people like themselves. The bad news is that your customers are likely to ignore any of the mitigating factors that the media reports on, but the good news is that if you have highly engaged consumers, they may also ignore the pounding you're getting in the media.

Another conclusion from Choi and Lin is that engaged consumers are more likely to dig deeper than the media into a crisis, looking to go beyond the headlines to find the real issues at hand. And the more they know, the angrier they get. "Consumers with high involvement are more likely to scrutinize and elaborate crisis information and generate more counter arguments as they process the crisis information, as covered in newspapers."

The important conclusion the authors draw is that monitoring media in a crisis is no longer enough. You need a clear understanding of how your stakeholders are responding to the media, particularly as consumer generated media continues to increase in awareness and credibility. More importantly, success should be measured by the speed with which one's headlines go away. Essentially what Choi & Lin found was that the more media exposure a crisis got, the angrier the consumers got at the company. Lesson learned: Get the story out of the headlines and into the back pages as fast as you possibly can.

2. Good Relationships Mean Fewer Bad Rumors

An equally intriguing paper was presented by Hun-Jim Kang from Pennsylvania State, with co-authors Karina Garcia Ruono and once again, Ying Hsuan Lin of Michigan State. This study examined the manner in which rumors were spread, specifically the impact of relationships on the rumor mill. The authors started out with the premise that there were two kinds of rumors: "dread" rumors, which foretold of something bad about to happen, and "wish" rumors, which foresaw something good happening. The study compared the speed with which dread vs. wish rumors circulate, as well as the credibility of the different rumors.

Their hypothesis was that the spread of rumors was closely tied to the health of the organizational public relationships (OPR) behind the entity under discussion. OPR was defined according to the standard Grunig terms such as trust, control mutuality, satisfaction, and commitment. Each participant rated statements on a 7-point scale. The study was conducted on the campus of Michigan State among 109 undergraduates. With a mean age of 22, it may not be relevant if your target audience is senior citizens. Nonetheless, the findings were fascinating.

Not surprisingly, the propensity to spread dread rumors was significantly higher than that to spread wish rumors, and the credibility of dread rumors was also higher. But the most telling information was on the impact of relationships: The health of your relationships has a great deal to do with the likelihood of people to spread nasty rumors about you. People with low relationship satisfaction were more likely to spread dread rumors than people with good relationship satisfaction. Additionally, people with good relationship scores were more likely to check out the validity of rumors before passing them on. The clear lesson is, if you want to squelch rumors, keep your relationships healthy and strong.

3. If You Are Innocent, Act Indignant

Then there were the really surprising and interesting findings of someone (I'm sorry, I've forgotten your name) who studied communications in the military. He concluded that when you are in crisis and you are in the right -- i.e. your organization has not done anything wrong -- the public position that is most likely going to generate a positive response from your target audience is an aggressive, proactive response. So if you need ammo to keep those lawyers quiet, you got it. Again, something we always knew, but it's nice to have it verified.