reputation warfare
DESCRIPTION
Up to 13 cases of reputation warfare, split into preventive/defensive/offensive strategies; involving all the media for achieving their objectives of influence and supremacy.TRANSCRIPT
Repu @ ar a
Guy Debaux
Competitive Intelligence Consultant,Former CI Officer at Coface.
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Strategies & Methods through 13 cases
Reputation & war: what rationale?
Image crisis management
Image crisis prevention
“To fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting”SUN TZU, The art of war 6th century BC
Reputation, the fulcrum to move the world!
VS
Archimedes 230 BC.
The reputation’s fulcrums
LAWLAWRegulation, decrees, directives…
SOFT LAWSOFT LAWRecommendations, guidelines, labels, standards …
Infringement non-compliance
Infringement non-compliance Public
releasePublic
release
Reputationdamaged
Reputationdamaged
BRANDBRANDCompanies: Brand content & storytellingNations: Diplomacy, culture promotion, advert on tourism, sports events & medals, brand content-like FDIs (ex.Qatar on PSG, sport World cups, le Louvre etc.), granting passport to celebrities (Depardieu) …
Medias
The reputation warfare’s diamond
Impacts
GroundsOrigins
① Stock value② Revenue③ M&As, divestment projects④ Recruitments⑤ Partnership project⑥ Providers & customers ⑦ Operations opening⑧ New product⑨ New market⑩ Nation’s stakes
① Environment② Social③ Governance④ Product quality
① Company ② Providers③ Customers④ Others
① Newspapers② Radios & TVs③ Blogs④ Twitter⑤ Social Networks⑥ Forums
ESG criteria as Nations’ reputational weapons
Soft Law, field of influence & reputation warfare: the ISO example
To be involved in the ISO’s committees is critical, but does not suffice:
1.Half of the standards are yielded through the “fast track” procedure2.Key role of the NGOs, consortiums (ex. GRI), forums (ex. « Forum for the Future » on the « Sustainable Shipping Initiative-vision 2040 »3.In many cases, NGOs & companies precede or overtake the ISO (cases beyond)
Other standardization players:
International: CEN, CEI, UIT, Cenelec, Etsi, Codex Alimentarius
National: Afnor (F), ANSI (USA), DIN (Ge), JISC (Jp), SAC (Cn)
Top 10 countries for ISO 14001 certificates - 2011
1 CHINA 81 9932 JAPAN 30 3973 ITALY 21 0094 SPAIN 16 3415 UK 15 2316 KOREA 10 9257 ROMANIA 9 5578 FRANCE 7 7719 GERMANY 6 253
10 USA 4 957
ISO 14001 Growth 20111 China 122092 Italy 39453 France 25204 Romania 21395 Korea 12446 UK 8857 Singapore 6848 Canada 5509 USA 550
10 Thailand 465
© Guy Debaux 2013 7
ESG standards, national stakes
Environment: 267 457 certificates (+6.3%) Food safety: 19 980 certificates (+7.5%)Top food exporters: EU, USA, Brazil
Top 10 countries for ISO 22000 certificates - 2011
1 China 65262 Greece 12143 Romania 11004 India 9825 Italy 9456 Turkey 6657 Poland 5738 Japan 5129 Taiwan 502
10 France 460
ISO 22000 growth - 20111 China 9512 Italy 7193 Romania 4594 Australia 885 Netherlands 886 France 617 Czech Rep 458 South Africa 429 Korea 41
10 Finland 36
ESG standards, Asian supremacy
x1.7
X4.8
China: standards, a state’s priority
Key Political Triggers, see on the ISO 14000:2006 = 18,842 Chinese cies. 15% of the global (was #2, Jp #1, Sp #3)2011 = 81,993 “ “ 29% of the global, #1, X3 Jp (#2)
WhatHappened?
WhatHappened?
Feb. 2007: Hu Jintao’s visit to a Chinese mine in Zambia, welcomed by strikes and demonstrations against work casualties and social inequalities.
Political lead, through five state administrations:
1.AQSIQ (Administration of Quality Supervision, Inspection and Quarantine): market monitoring2.SAC (Standardization Administration of China): technical supervision on provinces, ministries and national committees, compliance with WTO3.CNIS (China National Institute of Standardization: standards’ census 4.SPC (Standards Press of China): nationwide news on standards5.CAS (China Association of Standardization): watch on the standards use
Chinese standards proliferation = EU x 7 !
ESG criteria as companies’ reputational weapons
- defense & attack cases
- some non-cases
Company’s mistakes (1)
Aftermaths:1- UA’s share price plunge by 10%, wiping $180 million off the company's value2- Dented image among customers; unknown lost sales linked with the event
Dave Carroll had his guitar broken by United Airlines. Non-helpful customer service: he posted a video song on July 6 2009 on Youtube
July 6 2009 July 9 2009 15 Aug 2009 Feb 2011 Jan 2012
150 000 500 000 5 000 000 10 000 000 11 400 000
Epidemic model
Youtube Radios & TVs Newspapers
12
Company’s mistake (2)
15/10/2010 13:00 France2 18/10/2010 6:15 F. Inter Audrey Pulvar 19/10/2010 CSA MeD
15/10/2010 21:30, PR through AFP on Mr Guerlain’ apologies.
Facebook wall gets 159 negative comments, calling for demonstration in front of the maison Guerlain Champs Elysées, and boycott 18/10/2010 15:00 Guerlain communiqué on Facebook wall
5/01/2011: AXA indemnifies >300K€ for operating losses
Google’s intuitive help 28/1/2011
Twitter week average = 200 tweets up to 1000!
TV Fact Radio Stickiness Delayed fixBuzz
Employee disgruntled at
① 2012 Nov 1rst: Twitter account born
② 2012 Nov 3: the Communication Manager opens discussion
③ 2012 Nov 22: Article from Slate.fr
④ 2012 Dec 16: Twitter account blocked, then resumed.
⑤ 2012 Dec 27: working contract suspended
⑥ 2013 Jan 3: Quick France takes @EquipierQuick to court
⑦ 2013 Jan 3: Huffington Post’s and Le Monde Blogs articles + BFM TV news + iTélé News…
To be continued…
260 tweets so far, and 2800 followers as on Jan 4(5600 on Jan 8 2013).
2 months
After spending a day in the number two "trending" spot in Twitter, H&M’s spokeswoman called the NYT “it will not happen again” said Nicole Christie, “we are committed 100% to make sure this practice is not happening anywhere else, as it is our standard practice”.
Jan 6 2010 - New York Times article: H&M in Herald Square has been destroying and discarding unworn, left over clothes instead of donating them. Jan 7 2010 - H&M’s NYC store stops trashing unsold clothes H&M
www.whatthetrend.com/trend/H%26M/detail
The non-case
The two day crisis !
Fact Press Stickiness H&M fixBuzz
Offensive: Greenpeace vs NestléYet often attacked (the babies’ powdered milk in developing countries), Nestlé had to cope with palm oil well known issues.
March 18 2010: Greenpeace warns that such popular chocolate bars as KitKat and Coffee Crisp use palm oil from Sinar Mas, which replaces rainforests by palm tree plantations that eliminate natural habitat and reduce carbon dioxide sinks that help keep the atmosphere clean and fight global warming.
Nestle tried to get the video censored from YouTubeTriggered 68 related YouTube videos that attracted 1.2 million views
March 17 2010, Greenpeace’s new report on palm oil
March 18 2010
Parody on Y
outube
Nestlé erased the comments on Facebook pages, threatening writters…
Offensive: Greenpeace vs Nestlé
Triggered thousands of posts on Twitter
1- a commitment delayed till 2015
2- censorship on Youtube & Facebook
a dented image, residual weaknesses
Offensive: Greenpeace vs Nestlé
Offensive: Greenpeace vs Mattel (Barbie)
June 7 2011, Greenpeace’s activists rappelled down the Mattel HQ and hung a giant banner "Barbie: it's over. I don't date girls that are into deforestation."Barbie arrives on a pink bulldozer, policemen, fire brigade, radios and TVs…
Ground: Packaging made from APP’s paper, said to destroy the Indonesian forest (tiger’s habitat)
Media: videos on Youtube (event + fake interview of Ken in 20 languages), Twitter 1rst post 18:44, followed by thds. On June 10, Mattel closed Facebook page saturated with negative comments.
Aftermaths: Jul. 7, Lego drops APP’s paper, commited to use recycled paper certified by the NGO FSCOct. 5, Mattel does the same…
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Offensive in washing powder (1) vs
Sept. 2010 Initiative « Future Friendly »
Commitments on manufacturing processes : to reduce its use of petroleum-derived materials by 25%, reduce its packaging by 20% and ensure 30% of the power in its operations is sourced from renewable energy by 2020.
+ Long-term partnership with WWF.
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Ogilvy & Mather, after Fallon
« Facebook, with 500 million users, is the third biggest nation in the world after China and India, and it can mobilise millions of people. We are just listening to consumers, staying close to give them what they are asking for. Social media’s power to punish, as well as to reward, is quite extraordinary. » Paul Polman, Unilever’s CEO
« Sustainable Living Plan » 15/11/2010, over 50 concrete targets that will:
Help more than one billion people improve their health and well-being Halve the environmental impact of our products Source 100% of our agricultural raw materials sustainably
Answers with its own comitments …
…and chose another com agency
…heading towards social CRM & influence on Facebook:
…was seeking an NGO to partner with
fuzzier
& later
Offensive in washing powder (2) vs
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ESG criteria & offensive: the EC’ role
A betrayed coopetion:EC fined P&G (€211m) and Unilever (€104m) in April 2011, but Henkel (the informer), for prices fixing cartel.
The EC aware of washing powder industry’s ESG issues:
①A coopetition case: Trade association by P&G, Unilever and Henkel for fixing environmental issues②EC’s decision for setting up environment-friendly criteria for detergents
28/4/2011 = P&G + 8 months
Offensive in chocolate:
March 4 2009: Cadbury (Kraft Foods) announces its Dairy Milk chocolate will be certified by the Fair Trade Foundation, the Social dimension being critical in chocolate farming (children work)Dec. 2011, Kraft Food releases its carbon print data and commitments, with third parties WWF and Quantis
April 1 2009: Mars states all its providers will be certified “sustainability” by 2020.Its Galaxy is certified in 2010 by Rainforest Alliance
Dec. 2011, Maltesers goes Fairtrade, for $1million/y
Oct. 22 2009: Nestlé announces its Cocoa Plan, commitments not certified by a third party.
© Guy Debaux 2011 23Copyright Guy Debaux 2011
Offensive in IT industry
“We’re working inside and outside to make sure they know they can grow without adding more coal or nuclear. A lot of companies are starting to get this, but we need to move a lot faster.” Greenpeace
Heavy investments in green energy plants (solar, wind…)
IT companies ranked by Greenpeace:
Fuming Facebook
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Offensive Greenpeace vs Facebook
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Offensive failure:
Objective: to dent Google’s reputation Ground:, Gmail’s Social Circle, for harming privacy Ways: to « commission » on stealth mode a wellknown expert: Mr. Soghoian. Baiting mail on May 3 2011. Results: expert refuses, who releases all docs on his blog. Hundreds of press articles beg. 11 Mai 2011… Burson Marsteller and Facebook’s public denials, then a « Communication » campaign for saving what could be saved…
from Mercurio, John <[email protected]>to Christopher Soghoian [email protected] Tue, May 3, 2011 at 10:38 AMsubject RE: Op-Ed Opportunity: Google Quietly Launches Sweeping Violation of User Privacy Thanks for the prompt reply. I’m afraid I can’t disclose my client yet. But all the information included in this email is publicly available. Any interest in pursuing this?On Tue, May 3, 2011 at 10:08 AM, Mercurio, John <[email protected]> wrote:Mr. Soghoian,I wanted to gauge your interest in authoring an op-ed this week for a top-tier media outlet on an important issue that I know you’re following closely.
Mails abstract:
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Defensive and prevention: Levi Strauss
1rst silicosis case at Atatürk University
2005
WHO Program Silicosis eradication
1995
sand blasted ban campaign
Weak or no answers from the competitors…
Sept 2010
Stop sand blasting
Nov 2010
May 11 2011 CERES’ conference: "We are proposing a new apparel industry standard of social, economic, and environmental sustainability that focuses on improving workers' lives. If our ultimate goal is to improve not just factory conditions, but to make a material difference to the people and communities in our supply chain, then we need a more holistic approach and a more human perspective."
LS& Co. committed to a nine-month advisory process with NGOs, other brands, labor unions and suppliers around the world. Levi Strauss & Co. will release a white paper for public comment and then will begin implementing the new terms of engagement with suppliers in May 2012. « New terms of engagement is not only the right thing to do, but is good for business »
May 2011
New CSR standards
A growing threat, an anticipated & timely response:
Followed by an initiative in the apparel inustry
Guide Eco-designing of apparel
20/10/ 2011Feb 2011WWF + ONG Yamana + EVEA + companies
© Guy Debaux 2012 27
Two cases under-process &
Shareholders Annual meeting April 2011: 4US NGOs ask the company to disclose its plans on the future use and possible phase out of bisphenol-A in beverage can linings (As You Sow, Domini Social Investments, Trillium Asset Management » : 26% voted Yes
“Coca-Cola does not sufficiently disclose the steps the company is taking to address shareholder and consumer concerns about the use of BPA in can linings”
Bisphenol A: requests for industrial processes changes
NGOs backed by
Jan 2010: FDA has concerns and "will support changes in food can linings and manufacturing to replace BPA or minimize BPA levels” March 2010: EPA will consider adding BPA to its list of chemicals of concern and requiring manufacturers to provide test data on BPA's potential impacts.
A growing minefield:
1- Manufacturing consent: to cast doubt on danger (tobacco-like model)2- To speed-up technical alternatives (top secret)
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Two cases under-process &
Environmental (pollution by Chinese providers) and social issues (Foxcon suicides)Recurrent Apple’s efforts to publish its Providers Responsibility Annual ReportsUS Media involved (ex. NYT “How the US lost out on iPhone work” Jan 21 2012
The Chinese providers’ compliance with the ESG criteria
History of attacks by competitors (patents infridgment), institutions (EU etc) and NGOs
A troubled context
1- Joined the Fair Labor Association on Jan 13 2012 (assessment & training)2- To speed-up manufacturing processes changes (providers)3- To master the Social Networks:
Reputational warfare:lessons learnt
Lessons learnt, recommendations (1)
Most of reputation-based accidents stand on ESG and product quality grounds
1.Prevention > crisis management2.To lead action towards standardization institutions
1. Directly: being member of the ISO’s committees etc. (or chairing them)2. Upstream: consortiums & trade association (ex. GRI etc)3. Surroundings: NGOs
3.To carry out a reputational S&W Audit (product, processes), which encompasses the providers, for protection & attack purposes
4.To benchmark reputational S&W with providers and competitors on detailed criteria (mapping)
5.To spot critical situations and periods of time: CEO change, new product launch, M&A…
“Supreme excellence consists in breaking the enemy’s resistance without fighting” Sun Tzu, The art of war
Lessons learnt, recommendations (2)
6. TIME is a KFS:
1. Long term for preparing an audit, choosing the best field of argumentation, a partner (attacker’s advantage)
2. To catch reliable information (witnesses, videos etc) in safe and secure conditions3. Precipitation leads to failures
4. Short term: for an attack, and its response. No over or under-reaction. Evidence-based transparency, no provocation, clear commitments, third parties’ involvement …
7. Communication plan: 1. Mapping of the stakeholders and influencers (and their positions regarding the
criteria) 2. synergy of radios, TVs, Newspapers, Social Networks
8. Attacks: 1. On a stealth mode: the hit done by a third party (unaware of its role)2. Evidence-based (reports, video etc), emotional fulcrum based on guilt (when
guilt>pleasure), derision & humor