Marketers say every company is now a media company because it can use online tools to publish and broadcast to the world.
These rapid advances in communication and technology have created significant, new opportunities and risks that affect a company’s brand and reputation.
Zoe Clapp, chief marketing and communications officer of UKTV, the owner of TV channels including Dave and Good Food, says: “There is now a great opportunity for business owners to tell their own story, in their own words and in real time.”
It means that, theoretically at least, a brand can talk to its target audience without its message being “mediated” by journalists, publishers and other traditional media owners.
In the dream scenario, customers and employees become advocates of the brand, sharing their positive experiences on social media with their network of friends and contacts.
But Ms Clapp warns: “Brands really need to practice being adept online conversationalists, understanding what audiences want and will tolerate from different industries and brand categories. Companies come unstuck when social and online channels are used as one-way sales funnels, instead of platforms on which to truly listen, as well as to converse, inform and sometimes even to entertain.”
Nicola Green, director of communications and reputation at O2, the UK’s second biggest mobile phone company, says getting the tone right can offer business advantage.
“As a brand, the rise of online participation has meant there is absolutely nowhere to hide,” she says. “That is a great thing for customers and the state of British business as it separates the genuine customer champions from the pack.”
However, Ms Green adds: “It is also a challenge for communications teams as the swathe of sentiment creates a confused and sometimes even polarised picture. The unpredictability of the online environment is testing.”
BP’s Gulf of Mexico oil spill in 2010 was a watershed moment as other businesses watched how a reputational crisis could spiral out of control, driven by the speed of social media and lasting for months.
Neil Bennett, chief executive of financial public relations agency Maitland, says corporate reputation has become a boardroom issue.
He explains: “Initially, business leaders did underestimate the reputation risks in an online world. But that has changed rapidly as they survey the wreckage of others who were similarly blasé.”
Ms Green says: “Members of the board now witness reputational issues playing out in front of them. Progressive board directors are even on Twitter personally, which means they face the good, the bad and the ugly themselves. In the past, communications teams had a job to convince the boardroom to take note of the reputation agenda, but it’s not as difficult any more.”
It is still rare to find a vocal chief executive on social media, according to Ms Clapp, but most people expect an organisation’s leader to be its natural spokesperson.
She concedes: “Being an online CEO does take a little humility and bravery. Who relishes the idea of having their door open to the comments of employees, consumers and the media at any time of the day or night?”
However, Ms Clapp says the rise of the “social CEO” is a growing trend. The next generation of business leaders are familiar with technology and can draw on better public relations counsel about how to speak in a voice that feels authentic, she says.
Indeed, it can be an advantage for a business leader to broadcast a message that is unmediated by journalists, especially to address key audiences such as shareholders and employees.
While it is self-evident that a company needs to be vigilant and speedy in managing its reputation in the 24/7 mobile era, some businesses continue to get caught out.
Cyber crime and security is a prime risk, cited by 70 per cent of 300 board directors in a global survey by Deloitte this year.
Recent examples include the breach at Tesco Bank, when small amounts of money belonging to thousands of customers were stolen, and the hacking of the Democratic National Committee’s e-mails during the US presidential race.
So-called hacktivists don’t just conform to the stereotype of criminal gangs and teenage hackers. Now foreign states are suspected of being behind cyber breaches such as the hacking of Sony Pictures’ e-mails, a worrying and unpredictable trend because a corporation cannot compete with a rogue nation state.
Self-appointed campaigning groups, such as Stop Funding Hate, which has put pressure on advertisers in right-wing tabloid newspapers because of their editorial stance on immigration, have proved adroit at using social media. Parody online corporate accounts are another trend, challenging the public relations-driven “guff” that emanates from some companies.
Politicians have also become more outspoken, even before the rise of Donald Trump. MPs on House of Commons select committees have used live televised hearings to flay business leaders from former BHS owner Sir Philip Green to errant bankers and the bosses of tax-avoiding corporations, a legacy of the global financial crisis of 2008-09.
Managing the news agenda promises to be even more demanding with the rise of fake news, stories that are skewed or even wholly invented to drive web traffic.
Responding to crisis
Experts agree that the key in all these situations is preparedness, good intelligence and careful judgment.
“With traditional media, organisations had hours even days to agree a response to a hostile challenge,” Mr Bennett says. “Now they have minutes. That means agreeing responses and protocols in advance and keeping decision-making processes quick and streamlined. Rehearsing various crisis scenarios is also important.”
Ms Green says: “Having a set of principles to apply and a process to follow in every situation is key. Businesses should commit to responding within a certain period of time and hold themselves to it.”
Service businesses in telecoms and financial services are under particular scrutiny because often an unhappy consumer’s first response now is to complain in public on social media. Ms Green warns more crises are inevitable. “I don’t think we’ve seen the worst from the banking sector,” she says.
You need to be able to distinguish between a vacuous rumbling in the Twitter echo-chamber and a genuine public outcry
Deloitte found only 49 per cent of board directors have engaged with management to understand what has been put in place to support crisis preparedness.
Ms Green says: “The trick is to remain faithfully transparent and responsive, whatever the issue. The wrong response is to shut it down and hide. Some worry that conversations on social media can’t be controlled, but not being there doesn’t mean it isn’t happening. If there is a discussion being had that is relevant to your business, then it’s far better to know so you can do something about it.”
Having “intelligence” matters in the information-gathering sense of the word, Mr Bennett says. “You need to know what they are saying about you, before it becomes a storm.”
A suite of social media monitoring tools is not enough. Human judgment is vital. Ms Green says: “A minor issue can take hold and escalate out of control, whereas something more significant can go unnoticed.”
Mr Bennett agrees, warning: “You need to be able to distinguish between a vacuous rumbling in the Twitter echo-chamber and a genuine public outcry. You need to decide when to respond, but equally when not to. Old-fashioned PR and communication skills still matter.”
Ms Green concludes that there is a golden rule for reputation management in the online age when a crisis breaks.
“You don’t have to have all the answers, but you do need to reassure customers that you’re doing all you can to find out,” she says. “People will forgive a mistake, but it’s far harder to forgive incompetence or deception.”