By Jeri Denniston, Denner Group International November 12,2014
I’m reading A World Gone Social by Ted Coiné and Michael Babbit, and it grabs you in the first few pages. Right at the start the authors give several examples of how social media is creating a sea change in how companies operate. It has caused major challenges for many companies, including two well-known companies, Abercrombie & Fitch and Barilla (known for their pasta). Both situations were the result of comments by the CEOs which before social media would have gone largely unnoticed by most people.
The A&F CEO candidly commented in a 2006 interview that “In every school there are the cool kids and popular kids, and then there are the not-so-cool kids…..we go after the cool kids.” By 2013, the company had experienced seven consecutive quarters of declining sales and declining stock value, and angry consumers were buying used A&F clothing and donating it to the homeless in support of a hashtag campaign, #FitchtheHomeless. This year, the CEO was asked to step down and the company is looking for a buyer.
On the other extreme, the generosity of a New Hampshire Panera restaurant manager has resulted in a 34 percent increase in same store sales, more than 800,000 likes on their Facebook page, and nearly 35,000 comments. This, because of a Facebook post by the mother of Brandon Cook, who contacted the Panera manager to see if he could buy a bowl of clam chowder for his grandmother who was dying of cancer.
Here is the Facebook post Brandon’s mother shared on Panera’s Facebook page copied from the book, A World Gone Social:
My grandmother is passing soon with cancer. I visited her the other day and she was telling me about how she really wanted soup, but not hospital soup because she said it tasted “awful”; she went on about how she really would like some clam chowder from Panera. Unfortunately, Panera only sells clam chowder on Friday. I called the manager, Sue, and told them the situation. I wasn’t looking for anything special just a bowl of clam chowder. Without hesitation she said absolutely she would maker her some clam chowder. When I went to pick it up they wound up giving me a box of cookies as well. It’s not that big of a deal to most, but to my grandma it meant a lot. I really want to thank Sue and the rest of the staff from Panera in Nashua, NH just for making my grandmother happy. Thank you so much!
It makes you all warm and fuzzy inside, doesn’t it? All because the Panera manager did something nice that was not part of store policy or on the menu for that day and it was shared on Facebook.
Social media has had and continues to have major impacts on how people communicate. The consumer now has the power and the voice, thanks to social media. It brings in the human side of business and enables the average consumer to influence their peers and talk directly to executives. without the traditional political barriers of old.
This change is difficult for CEOs and executives who are stuck in the days of how we always did it before. Top-down command and control is not longer effective nor efficient. Thanks to our digital world, knowledge (and the power that goes with it) is available to anyone willing to do a Google search – it is no longer limited to the few at the top of the corporation. According to Coiné who participated in one of the World Strategy Week panels last week, companies that fail to embrace social will be gone in three years. The old ways just don’t work anymore and resisting the change is just stubborn arrogance, something that was beautifully displayed off the Irish coast in 1998. Many of us have heard this story before, but it’s worth repeating:
Irish: Please divert your course 15 degrees to the south, to avoid a collision
British: Recommend you divert your course 15 degrees to the north to avoid a collision.
Irish: Negative. Divert your course 15 degrees to the south to avoid a collision.
British: This is the captain of a British navy ship. I say again, divert YOUR course.
Irish: Negative. I say again, you will have to divert YOUR course.
British: This is the aircraft carrier HMS Britannia! We are the second largest ship in the British Atlantic fleet. We are accompanied by three destroyers, three cruisers, and numerous support vessels. I demand that you change your course 15 degrees north. I say again, that is 15 degrees north, or countermeasures will be undertaken to ensure the safety of this ship and her crew.
Irish: We are a lighthouse. Your call.