Bloggers beware: Corporate image can soar or plummet in blogosphere

November 23, 2005

A recent study by CMO magazine found that 43 percent of survey respondents cited "customer influence by word-of-mouth" advertising as a marketing technique they planned to use in the next six months. Blogs are likely to be tapped in that effort, since 22 percent of those surveyed indicated plans to showcase their company and offerings in the blogosphere. But this medium is not without risks, and even big kids in the marketing sandbox can make detrimental blog blunders. Just ask the folks at McDonald's and Dr Pepper/7Up. They learned the hard way that blogging mistakes can bring uproar or even outrage -- and misleading corporate postings can do more harm than good in building a positive brand image.

When raging cows are bull

The term "blog" is short for "Web log." Blogs started in the late 1990s as online diaries or cyber soapboxes filled with teen angst and geek insights. They've quickly gone mainstream, however, and have been adopted by news outlets, celebrities, politicians and more. Their frequent updates and interactivity -- readers can post opinions, too -- make blogs a way to reach out to target populations and build a community. By 2003, corporations were dipping their toes into the blogging pool and, as it happens, one of the earliest corporate blogs turned out to be a public relations nightmare.

According to James Ward, professor of marketing at the W. P. Carey School of Business, the "iconic example" of a blog gone bad is the Raging Cow site launched to introduce a flavored milk drink from the Dr Pepper/7Up team. "They wanted to achieve a realism and immediacy to young adults, so they had their online advertising agency create this blog and enlist teenage bloggers to mention the site and link to it." Ward says. "When news got out that Dr Pepper had told the teenagers not to mention that they had an official relationship to the Raging Cow campaign, it generated a firestorm of controversy in the blogosphere." One prominent blogger, Kim Ireland, started an online boycott of Raging Cow, and his punitive postings are still online.

Ward explains that consumers "rely on word-of-mouth advertising" from online chats, blogs, product reviews and other online resources because they assume the posting are from people, not corporate shills paid for endorsements. "If you think about ways people can learn about a product, almost all are marketer-controlled," he says, adding that the "private talk" found in blogs is perceived to be credible. "When that trust is undermined, consumers feel a sense of moral outage."

French fry faux pas

"You don't need to be surreptitious in your blogging behavior to wind up with a marketing fiasco. Even innocent omissions can incite blogster wrath. Such was the case with the Lincoln Fry blog produced by McDonald's Corp., says Andy Sernovitz, chief executive officer of the Word of Mouth Advertising Association. Spotlighting a french fry that had the same profile as Abraham Lincoln, the Lincoln Fry site and blog were two McDonald's ventures that "people took the wrong way," Sernovitz says. "It was supposed to be a joke," he maintains, explaining that if an online surfer found the Lincoln Fry through one site, it was clear that the site was created by McDonald's. The fry's blog was another story, and when bloggers found the blog first, "they thought McDonald's was trying to do something deceptive" by not disclosing Lincoln Fry's corporate origins.

 "It was silly," Sernovitz says.

 Vincent Blasko, a W.P. Carey School of Business marketing professor, would agree, although perhaps not for the same reasons. "Even my students thought it was ridiculous," he recalls, which is probably not good news for McDonald's, a company known -- and sometimes criticized -- for targeting youth in its marketing. "I talked to a McDonald's franchisee, and he didn't see how the blog would positively affect his business," Blasko says. He maintains that effective advertising should convey "some inherent benefit" for consumers, thereby justifying why the company is communicating with would-be customers in the first place.

 Blasko says he often sees marketing communication done simply "for the sake of putting something out there," not necessarily for persuading consumers to buy or offering information that aids the buying decision. "Blogging for the sake of blogging is a waste of marketing dollars," he says. And, it could be downright detrimental to marketing success. "Any time you do something to mislead consumers or be purposefully dishonest, it's bad business," Blasko says. Consumer reaction to even the smallest blog deceptions supports his claim

Cleaning up a mess in the U.K.

Consumers in the United Kingdom may love Cillit Bang household cleaning products in the kitchen, but online, the company has been getting plenty of angry action since Sept. 30 of this year. That's when blogger Tom Coates uploaded a heartfelt posting about his father, whom he hadn't seen for 30 years. In response, he received an avuncular note from "Barry Scott," who encouraged Coates to make contact with his estranged dad and even admitted, "I hadn't seen my father in 15 years until two years ago."

The problem is this: Barry Scott is a fictional character. "He's a marketing vehicle for a brand called Cillit Bang, and his weblog is a barely disguised viral marketing platform for the product," Coates wrote in his own blog when reporting the ruse. (Viral marketing is a phenomenon that facilitates and encourages people to pass along a marketing message. It depends on a high pass-along rate from person to person. If a large percentage of recipients forward something to a large number of friends, the overall growth snowballs very quickly. If the pass-along numbers get too low, the overall growth quickly fizzles.)

"Shame on you, Cillit Bang. I won't be cleaning with your product again, no matter how amusing I find the name," wrote Mike H., one of the people who reacted to the trickery by adding a comment to Coates' blog. "This is absolutely reprehensible. Good for you for chasing it down, Tom," wrote Joshua Marshall, another blogger joining the discussion. Other words consumers used to describe the Barry Scott posting were "tacky," "disgusting" and "corrupt." One writer said marketing is "totally out of control." 

In the United States, such marketing misdeeds may eventually wind up getting a corporate blogger in trouble with the Federal Trade Commission. Commercial Alert, an Oregon-based consumer group, recently filed a complaint against "stealth marketers" who put paid -- but undisclosed -- spokespeople into situations where they can demonstrate or talk up a product. The complaint doesn't specifically mention misleading blogs or phony blog entries, but Commercial Alert's executive director, Gary Ruskin, says, "If a shill posts a blog entry and doesn't disclose that they're a shill, I'd argue that the FTC should investigate the company paying that shill."

Ruskin notes that there is "plenty of good case law indicating online ads must be disclosed." He should know. In 2001, his organization successfully went after search engines for highlighting advertising listings without notifying consumers that those links at the top of the search results were bought and paid-for ads.

In response to Ruskin's complaint, the FTC sent a stern letter to search engine providers. Heather Hippsley, then acting director of the FTC's Division of Advertising Practices, wrote: "While many search engine companies do attempt some disclosure of paid placement, their current disclosure may not be sufficiently clear."  Citing a survey that found "60 percent of Internet users had no idea that certain search engines were paid fees to list some sites more prominently than others in search results," Hippsley instructed search engine operators to make sure paid placement results were "clearly delineated."

According to Ruskin, the same case law that protects search engine users should protect blog readers, as well.

A place for business blogs

Despite the risks, Ward says maintains there is a place for blogs in corporate marketing. "Blogging has big advantages," he says. "It establishes a channel of two-way communication with customers and can guide advertising or product development with customer input."

Ward identifies the "well-run blog" as one where "companies really engage in honest dialog with posters." He says the sites allow corporations to address concerns and build trust, provided they're done correctly.

Unfortunately, blogging is a new enough game that many are still trying to figure out its rules. Word of Mouth Marketing Association's Sernovitz maintains that many companies are still climbing the learning curve on this one. "You'll see a lot of marketers trying it for the first time, not doing it well, and getting called on the carpet."

He encourages fledgling bloggers to check out the code of ethics followed by members of his association. It includes an "honesty ROI," which Sernovitz explains is the return on investment corporations get from being honest about business relationships, opinions and identity. "Always disclose who you are," he says.

Blasko offers the same advice and adds that even if marketers could get away with deceptive blogs or phony blog postings, they need to think about what it will do to their relationship with customers. Whether they're thinking about ethics, budgets or advertising effectiveness, marketers "need to be responsible about how they get the message out," he says.

This advice is especially true online, where many view revelation of misdeeds as sort of a hobby. "Fake blogs will instantly backfire," Sernovitz warns. "Who owns the domain … how blatantly promotional they are … in the end, someone will always figure out a fake blog because that's what bloggers do."