Here’s an unpalatable truth for some businesses: there can no longer be a gap between what you say as an organisation and what you’re seen to be doing. In the age of social media, empowered consumers and approval marketing – in which companies must earn a tacit approval from consumers to sell to them – companies are under the microscope as never before.
Until recently, companies were used to a lot of control over the messages they ‘pushed’ to consumers. However, the general public is now exceedingly well informed, savvy and sceptical about ‘swallowing the corporate line’. Spin – as in, using a verbal sleight of hand to tell the public that ‘black is white’ – is now a leaky liferaft in a storm, and easily overwhelmed by a rising tide of opposing opinion.
Through social media, employees who feel disgruntled about how they have been treated at work, or consumers who have received poor service, are free to tell the world their woes. A carefully constructed corporate or brand reputation can quickly be undone by voices from inside or outside the organisation. HSBC (tax avoidance and money laundering), Apple (worker conditions at a supplier in China) and Starbucks (tax again) are just some of the businesses that have recently suffered brand damage from conduct that falls short of what their customers expect.
And woe betide the business that tries, Canute-like, to command the waves. The Broadway Hotel in the British seaside town of Blackpool was recently subjected to a global media onslaught when it applied a £100 post-visit surcharge to a couple who gave it a scathing review on TripAdvisor. The hotel’s policy was to charge guests for bad reviews, but this has presumably been changed following vocal condemnation and ridicule. We wonder how bookings are at the Broadway today.
There is, of course, still a vital role for corporate messaging. In fact, the need has never been greater: with huge competition for attention and sales – from customers, the media and other audiences – companies need to explain crisply and compellingly their position or value proposition. However, by itself, simply ‘trotting out the company line’ is no longer sufficient: the wisest companies are careful to match their words with deeds, or at minimum to avoid seeming hypocritcal.
In practical terms, this reality means that many organisations need to promote ‘PR considerations’ much higher up the decision-making chain. It no longer cuts much ice to try to explain away a poor decision taken previously; it is much better, instead, to consider the likely impact on your reputation before a decision is actually made.
Many companies also need to be quicker in recognising when the game is up, and when candour must form part of their communications strategy. Sometimes, the best thing to say is actually, “Sorry, we got it wrong this time,” and swiftly to make amends.
Doing the right thing is really just about implementing smart business practices. For example, retail colossus Tesco has long been criticised for its treatment of suppliers, a policy that did much to help its margins. However, now its business is beset from all sides, and an investigation by the grocery industry watchdog into alleged supplier abuse is just the latest development to erode public trust in the Tesco brand.
If the CFO or legal counsel argues that an ethical course of action would be too costly, there are now many examples of how taking the supposedly ‘inexpensive’ route winds up losing a company its market because of ‘bad PR’. For example, step forward Ryanair, belatedly understanding the importance of customer approval and forced to triple its marketing spend to 35m Euros to win back its passengers.
So, is spin dead? Of course not. Human nature means there will always be a temptation in business to minimise embarrassment, criticism and perceived failure. However, the risks of trying to spin your way out of a situation are now infinitely greater. To build a business of lasting value, it is much better to base as many decisions as possible on ‘doing the right thing’, and to reap the resulting rewards from an approving public.