Wednesday, August 5, 2009

The customer is your wife, idiot

My ol' mucker Nathan over at the 'another advertising *bleep*' blog had a great post up today that I really enjoyed reading.

In it, he montiored the effect of social media 'disasters' on a organisation's market value.

He reckons, correctly, that we shouldn't overblow the short-term effects of negative press - generally the market shows tremendous apathy toward 'shocking', yet ultimately facile, stories. After all, news breaks today at such a high turnover that it's no time before another embarassment dominates the news agenda. Nathan covers:

  • Dominos (who could forget the pizza maker who farted on a pizza and stuck cheese up his nose?);
  • United Airlines (who broke the guitar of a man, who - quite honestly - should have taken his guitar as hand luggage IMO); and
  • Vile and Tacky O (who I had never, ever heard broadcast and now believe should be sent back to the adolescent borstal they we're dragged up in)

But think back to the UK jeweller Gerald Ratner who claimed he sold 'crap' and how that ultimately led to the freefall of their share price - and the downfall of the UK's largest high street jeweller.

And then there was the chief executive of Barclaycard who admitted he steers well clear on his own product because it was, well, too expensive. His customers were the type who didn't wear suits to work, he claimed in his down-to-earth way.

But the examples Nathan mentions haven't really had much of an effect at all. In fact, Dominos shares have grown in value as the recession increases demand for takeaway pizzas.

So ultimately what differs Nathan's three examples from the Ratners or the Barclaycard cases?

I think it's this: none of these controversies involve the figurehead of an organisation making a mockery of his/her customers.

Dominos responded on Youtube within a few days of the crisis, and - while it wasn't sophisticated - it did come across as genuinely concerned about putting things right. United Airlines won't suffer because one individual wrote a song; the intrinsic value of the UA brand is still strong, and the experience most people have is still positive.

Vile and Tacky O, I think, will likely suffer. One has crossed his arms over his portly frame and refused to apologise. The other has gone off to repeatedly put on and take off her blonde hair extensions in her country retreat (or at least that's what I imagine). They've failed to recognise and respond to what customers want - that they apologise and explain themselves.

In all of these tales, there's no player who's bigger than the team.

No player, except the customer.

1 comment:

  1. Great post - good to see examples of it going the other way as well with Gerald Ratner and Barclays. You've hit the nail on the head with respect to consumers. I think the amount that Austereo will suffer comes down to well they treat thedir listeners (will a 'recess' mean they are back on next month)?


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