24/7 Wall Street recently released its list of 10 most hated companies for 2011. Most are cases in mishandled customer communications. Two in particular, Netflix and Johnson & Johnson, saw a significant drop in customer satisfaction because of a lack of communication from their company, and each offers lessons for every business to keep in mind.
Issue: In July 2011, Netflix raised its monthly price by 60 percent with limited forewarning for its subscribers. Then, Netflix attempted to group DVD-mail into Qwikster but abandoned the plan 3 weeks later because of consumer backlash.
What happened: Netflix not only failed to properly acknowledge the price changes, but also failed to respond to negative comments and rants on all of its social media sites. It was not until September that CEO Reed Hastings sent out a brief letter about their regret in not communicating changes. Too little, 2 months too late.
Result: Netflix lost approximately 810,000 customers last year and saw a dramatic drop in its stock price and consumer satisfaction rating. Its second place rank on ForeSee’s online retail quality list fell to 18 place in the 2012 survey.
Johnson & Johnson
Issue: In November 2011, a story was published with the headline, “Johnson & Johnson Gently Poisons Babies with its Shampoo” on the blog Jezebel. The posting was an effort to convince the company to remove dioxide, a suspected carcinogen, and formaldehyde, a known carcinogen, from its products.
What happened: Johnson & Johnson issued a lengthy statement explaining that its products meet standards and regulations in the United States, but was very dry and lacked empathy toward the worries of parents and harmful effects of carcinogens on their young children.
Result: This long series of problems has diminished Johnson & Johnson’s once clean reputation and has caused ongoing public backlash, especially online.
What to Do When It’s You
The goal is to always be prepared in advance, but if you haven’t taken those steps yet and a crisis occurs, here are some tips to get you started.
•If you haven’t already, establish crisis protocol, including chain of command and spokesperson designation
•Remind or notify staff and stakeholders of crisis protocol, especially that the PR team and the spokesperson are the only ones who should communicate with media
•PAUSE and evaluate – it’s important to respond quickly, but it has to be accurate and thoughtful
•Tailor, add to or develop needed messaging
•Determine channels for communication, from a press conference to individual phone calls to social media posts
•Communicate, communicate, communicate ◦DON’T lie or stretch the truth, it will come out
What Not To Do
◦DON’T blame the customer, client, community or others, it will never help your case
◦DON’T promise things you can’t guarantee and avoid absolutes like “always” and “never”
◦DO accept responsibility, express emotion and provide genuine feedback when applicable
◦DO say you don’t know yet if that is the case – the important thing is to communicate, not magically have every answer right away
◦DO bring in communication experts if you’re in over your head
•Continue reevaluating and communicating