RBC Responds to Outsourcing Plans
The Royal Bank of Canada is under fire for replacing 45 employees with oversees workers. A representative of RBC admits that work is being moved to another supplier, and current employees are training their replacements. The company is looking for new jobs for the displaced workers, who will leave at the end of the month. The new supplier is iGATE Corp., an Indian multinational outsourcing firm.
In an interview, RBC HR chief Zabeen Hirji tried to explain that RBC isn't hiring the workers, and the workers aren't replacing RBC employees-just transitioning to the new staff. Both are tough sells. First, RBC hired the supplier who is hiring the workers (so they have some accountability). Second, having interim workers doesn't change the outcome: people are losing their jobs, and-as it appears-foreign workers will be doing the work. The reporter called the distinction "semantics" and said, "I get what you're trying to sell, but I'm not sure I'm buying it."
Criticism is high, particularly the concern that RBC is violating federal rules that foreign workers may not replace Canadian citizens. In response, the bank published a statement that said, "External suppliers with the right skills allow us to introduce new efficiencies, continually improve our service at reduced cost and reinvest in initiatives that enhance the client experience. Agreements with our suppliers include strict controls and ongoing monitoring to ensure full compliance with all regulatory requirements."
Public backlash is also high. A Facebook page, Boycott Royal Bank of Canada, has 7,600 likes.
Discussion Starters:
- Analyze Zabeen Hirji's interview. What does she do well, and what could be improved? What are her strongest and weakest arguments?
- Overall, do you buy RBC's position?
- One article referred to Hirji's "corporate-speak explanation and histrionic hand gestures." Do you agree with this characterization?
Lone Star College Communicates Stabbings
At least 14 students were stabbed on the Lone Star Community College campus near Houston, TX. One student critically injured two others, as he ran to different buildings, stabbing people with an Exacto knife. When the suspect, known only as "James," was tackled, he said, "I give up. I give up."
The college posted an emergency alert on its website, and the school went into lock-down, with students held in classrooms until more information was known.
The college told students, "Stay away from the area. Seek shelter in a secure location until the incident is resolved." This is sound advice and reminds us of Virginia Tech's emails during the 2007 shootings-although some of those messages came too late.
Discussion Starters:
- Assess the college's emergency web page. What works well, and what could be improved?
- What additional communications would you recommend that the college send to students, faculty and staff, alumni, and parents? What medium should be used for each group?
Carnival Responds to Yet More Ship Trouble
Are all of Carnival Cruise's recent ship problems unrelated? That's what the company would like the public to believe. Carnival's Triumph-which was stranded in Alabama last month-broke free from its moorings. Hurricane-link winds blew the ship from its anchors and threw two shipyard employees into the Mobile River. Although one man was found, another is still missing.
Although the crises are mounting for the cruise company, it's getting better at responding via social media. The company quickly tweeted about the situation and posted several updates throughout the day:
Carnival also posted this statement to its Facebook page:
April 3, 2013, 7PM ET
Earlier this afternoon, due to strong winds that reached speeds exceeding 70 miles per hour during a severe storm in Mobile, Ala., Carnival Triumph, which was in wet dock at a Mobile shipyard, broke away from its moorings. The ship drifted, and was secured.
With the assistance of tugboats on site, the ship has been moved to the Mobile Cruise Terminal. Lines have moored the ship, and, as a precaution, tugboats will remain alongside the vessel as well.
All of the approximately 600 crew and 200 contractors who were onboard the vessel are safe and have been accounted for through a roll call. There are no reports of injuries. While assessment of damage to the ship is ongoing, initial indications suggest the damage is limited.
According to reports, two shipyard employees on an adjacent pier fell into the water. One has reportedly been rescued by the U.S. Coast Guard and the search continues for the second. Our thoughts and prayers are with the missing shipyard employee and the family.
Discussion Starters:
- Assess Carnival's response on social media. How else is the company using Facebook and Twitter to communicate during this crisis?
- How can Carnival rebuild the brand and explain the recent incidents as separate and distinct from one another?
Rutgers Coach Gets Terminated—and Apologizes
Rutgers basketball coach Mike Rice was terminated for abusive behavior towards his players. The decision was a surprise only because it came months after Rice's suspension from the university.
The videos of Rice's interactions with players are shocking: throwing balls at them, pushing them, and calling them homophobic slurs. But the university's decision last year was to suspend him, fine him $75,000, and send him to anger management classes.
Only recently-within a day after a video of Rice became public-did the university decide to terminate his employment.
Athletic Director Tim Pernetti is taking responsibility for the initial decision:
"I am responsible for the decision to attempt a rehabilitation of Coach Rice. Dismissal and corrective action were debated in December, and I thought it was in the best interest of everyone to rehabilitate, but I was wrong. Moving forward, I will work to regain the trust of the Rutgers community."
Rice did apologize in this video interview:
New Jersey Governor Chris Christie weighed in on the situation:
"Rutgers has done the right thing by firing Mr. Rice, but that still doesn't resolve questions about how he was allowed to continue overseeing college students after this behavior first came to the attention of Rutgers administration last year.
"I'm puzzled as to how anyone could think Mr. Rice was someone who should be representing our state university on a national level.
"I expect a full and detailed explanation from the Rutgers administration as to why Mr. Rice was not dismissed sooner and how exactly that decision was made. If answers aren't forthcoming, we are prepared to do what's needed to get them for the people of New Jersey."
Discussion Starters:
- What's your view of the athletic director's statement: a noble admission, poor showing for a bad decision, or something else?
- How do you assess Governor Christie's statement? Why would a state governor insert himself in this situation?
Ford Regrets "Distasteful" Ads
Ford is doing damage control after a PR firm created two ads showing a Figo truck with women tied up and gagged. In one ad, the driver is former Italian prime minister Silvio Berlusconi, in the other, Paris Hilton (with Kardashians in tow). The tag line for both ads is "Leave your worries behind with Figo's extra-large boot."
JWT India, the PR firm, admitted to creating the ads as mock-ups, or creative examples, without Ford's approval. Still, WPP, JWT's parent company repudiated the ads:
"We deeply regret the publishing of posters that were distasteful and contrary to the standards of professionalism and decency within WPP Group. These were never intended for paid publication and should never have been created, let alone uploaded to the Internet. This was the result of individuals acting without proper oversight and appropriate actions have been taken within the agency where they work to deal with the situation."
Although the company wasn't involved in the design, Ford submitted its own statement to explain the ads:
"We deeply regret this incident and agree with our agency partners that it should have never happened. The posters are contrary to the standards of professionalism and decency within Ford and our agency partners. Together with our partners, we are reviewing approval and oversight processes to help ensure nothing like this ever happens again."
Discussion Starters:
- Consider the view of JTW's creative team. What is possibly their defense of the ads?
- Assess the two companies' statements. In what ways did they handle the response well, and how could they have improved the response?
IRS Criticized for $60,000 Training Video
You would think that government agencies would learn the lesson that taxpayers don't like footing the bill for expensive training. About this time last year, the General Services Administration (GSA), which oversees purchasing and cost-cutting policies, was caught spending $822,000 at a conference in Las Vegas. Now, the IRS is being criticized for creating a $60,000 "Star Trek" parody video for leadership training.
When Miller refers to the "island theme," he means Gilligan's Island, of course.
Discussion Starters:
- What's your view of the IRS' video series: justifiable business expense, flagrant misuse of taxpayer dollars, or something else?
- What are alternatives for the IRS to get its points across? Could the agency use another approach for training on specific topics?
Hyundai Apologies for Ad Capitalizing on Murdered Baby
Hyundai Motor Company has apologized for a social media post linking car safety to a murdered two-month-old baby. The baby was abducted from an SUV and then strangled and buried in the snow. Of course, people were horrified by the event and took to Weibo, China's microblogging site for consolation and updates.
A post on Hyundai's Weibo account referenced the new Santa Fe SUV's safety features. The company says it was posted by a non-employee and has since deleted the post:
"A few thoughts following the Changchun stolen car and child incident: When buying a car it's completely okay to choose brands with better technology. Tianhe Buicks carry the OnStar GPS system, which can track down the location of a stolen vehicle at any time and automatically report it to the police. Feel at ease, have peace of mind, if you're going to buy a car, why not choose a completely safe Buick!!!. Sales Hotline: 024-86547880 86547881 QQ:521279389 2523275273 www.inthbuick.com"
In an email to Bloomberg, Hyundai apologized:
"We pledge to be more vigilant in managing our social networking service accounts, while we send our deepest condolences to the victim's family. Hyundai Motor is a responsible corporate citizen that is not in the practice of taking advantage of tragic incidents."
According to Bloomberg, GM has been more reluctant to comment:
"Dayna Hart, a Shanghai-based spokeswoman for GM, which owns the Buick brand, said the U.S. automaker is monitoring the situation and isn't ready yet to comment."
Aside from the egregious overuse of exclamation marks, the post does what other brands have regretted: "newsjack"-take advantage of news for the purpose of sales. Some strategies work well, such as Oreo's tweet during the Super Bowl. But many others have failed because of poor taste and inevitable backlash.
Discussion Starters:
- What other companies have tried newsjacking and failed?
- If you were consulting for a company, what criteria would you identify to help the management team decide whether to hook into something trending on Twitter or Weibo?
Carnival Responds to More Ship Trouble
Generator trouble on Carnival Dream, docked at St. Maarten, caused a problem no company wants to explain: non-working toilets, the second publicized incident for Carnival within the past month.
A discrepancy seems to exist between passengers' accounts and Carnival's position. According to CNN, passenger Gregg Stark said,
"There's human waste all over the floor in some of the bathrooms and they're overflowing -- and in the state rooms. The elevators have not been working. They've been turning them on and off, on and off."
Jonathan Evans, another passenger, emailed CNN:
"We are not allowed off of the boat despite the fact that we have no way to use the restrooms onboard. The cruise director is giving passengers very limited information and tons of empty promises. What was supposed to take an hour has turned into 7-plus hours."
But Carnival posted this message on its Facebook page:
"We know there have been questions on the conditions onboard Carnival Dream last night and wanted to update you. We have had multiple conversations with the ship's management team. Based on the ship's service logs and extensive physical monitoring of all public areas, including restrooms, throughout the night, we can confirm that only one public restroom was taken offline for cleaning based on toilet overflow and there was a total of one request for cleaning of a guest cabin bathroom. Aside from that there have been no reports of issues on board with overflowing toilets or sewage. The toilet system had periodic interruptions yesterday evening and was fully restored at approximately 12.30am this morning."
Discussion Starters:
- CEO Gerry Cahill gave a press conference during the recent Triumph situation. If he were to give another conference, how should this one be different? What can Cahill do to rebuild trust in the Carnival brand?
- Trouble started during the last part of a seven-day trip. The company is reimbursing passengers for three days of the trip and is offering half off a future cruise. Carnival has been criticized for insufficient compensation in the past. Is this deal appropriate?
Weight Watchers Employees Weigh in on Compensation
Frustrated by big payouts for celebrity endorsers, Weight Watchers employees have taken to airing their complaints on a message board hosted by the company.
The New York Times published an article highlighting the pay gap. As one employee said, "They know my love for the program, but I can't say we're treated right. We are professionals, we have to dress nice, but we are paid less than kids who work at McDonald's." As celebrities Jessica Simpson and Jennifer Hudson collect millions of dollars for their endorsements, many Weight Watcher employees are paid minimum wage.
Company CEO David Kirchhoff, responded to employees' complaints: "One of our top priorities is to improve your working life at Weight Watchers, and in particular, the way we reward you for the incredible work you do."
On his blog, Mr. Media Training, Brad Phillips speculates about what Weight Watchers could have done differently:
"I couldn't help thinking that Weight Watchers could have helped prevent this story from bubbling up to the surface simply by moderating their site more carefully. Sure, nothing would have stopped employees from complaining on third party websites, but it would have been much more difficult for them to communicate without a central website to visit, especially because the workforce is diffused and decentralized."
Discussion Starters:
- Do you agree with Brad Phillips' assessment?
- What else could the company have done differently to prevent employee sentiment from becoming public?
- How else could the company have managed employees' communications?
Travel Blogger Thrown Off United Flight for Taking Pics
On a United Airlines flight from Newark to Istanbul, a passenger was asked to deplane after taking pictures of his seat and surroundings. A flight attendant asked Matthew Klint to stop using his camera, and pointed to this blurb in Hemisphere, United's in-flight magazine:
According to Klint's version of events, he smiled at the flight attendant and stopped taking pictures. But, a while later, he did ask her to hang up his coat and continued the conversation:
"I want you to understand why I was taking pictures. I hope you didn't think I was a terrorist. Here is my business card [offering her one]. I write about United Airlines on an almost-daily basis and the folks at United in Chicago are even aware of my blog."
A Global Services representative then asked Klint to leave the plane: "The captain is not comfortable with you on this flight. You'll need to gather your things, and we'll find another way to get you to Istanbul." Klint then had a conversation with the captain, which you can read in Klint's blog post. During the conversation, the captain (apparently, not making eye contact) said that the flight attendant asked Klint to stop pictures, but he did not. Klint said, "Your FA is lying-I did not disobey any crewmember instruction." This continues to be a topic of debate.
Others on the flight seem to agree with Klint's telling of the story. In an NBC News article about the incident, Klint admits, "perhaps I should not have used the term ‘terrorist.'"
Klint has reported good contact with United, which is conducting an investigation. In the meantime, Klint has an interesting perspective on corporate apologies and says he doesn't expect one from United:
"At this point, United has not offered an apology and frankly I am not expecting one. An apology would reflect horribly on the pilot and FA and I do understand the delicacy of corporate apologies in general. United did express an appreciation for my loyalty and a desire to see me continue to fly on the carrier."
Well, Matthew, there are many types of apologies.
Discussion Starters:
- Based on Klint's version of the story, did United do the right thing? Could the airline have done anything differently?
- We haven't heard much from United yet. What could be the airline's position?
- How could United apologize without reflecting "horribly on the pilot and FA," as Klint says?
Arguments for Remote Workers
The buzz after Yahoo!'s come-to-the-office email hasn't died down yet. Business Insider has jumped on the critic-wagon, suggesting that Yahoo! take an approach similar to Google's.
In an article with the descriptive title, "Marissa Mayer Should Have Used Google's Excellent Argument To Bring Remote Workers Back," Business Insider reminds us that Google was Marissa Mayer's employer before she joined Yahoo!. Although she may have been inspired by the Google culture to encourage remote employees to come to the office, she missed some of the obvious persuasive arguments, according to writer Max Nisen.
Nisen highlights two differentiators between Yahoo!'s recent message and how Googlers are encouraged to and rewarded for coming to the office. In addition to emphasizing the "magical moments" that Google employees share when they are in the same space, Google offers significant benefits for employees to be in the same physical location: "great food, amazing offices, and great amenities."
Nisen also suggests that Yahoo! could sell the tax benefits to employees, particularly how the benefits save employees money. Perks offered in the office are considered fringe benefits and are not taxable income. He points to DealBook's Victor Fleischer's assessment of the tax benefits of working in an office:
"Suppose Abe works at Yahoo, makes $150,000 a year and is taxed at an effective 33 percent rate, thereby paying $50,000 in taxes. Bridget, by contrast, makes $120,000 and also enjoys $30,000 of untaxed fringe benefits.
"Bridget's tax liability is only $40,000 (33 percent of $120,000), meaning that she pays $10,000 (or 20 percent) less in taxes, yet received the same economic compensation as Abe."
Yahoo! could have done a better job of communicating its message. This could have saved some backlash for the company and perhaps have clarified the intent-and the benefits-of having employees come to an office.
For more about the benefits and challenges of remote workers, read Cornell ILR's summary.
Discussion Starters:
- How, if at all, do you think this suggested approach would have helped Yahoo! with the initial announcement?
- Other than the initial response of "This isn't a broad industry view on working from home. This is about what is right for Yahoo right now," we have heard little from Yahoo! since the controversy. What, if anything, should the company say at this point?
Facility Stands By Decision Not to Perform CPR
An independent living center is defending a staff member who refused to give CPR to a woman who died.
At Glenwood Gardens in Bakersfield, CA, a staff member called 911 when 87-year-old Lorraine Bayless was found lying on the floor, not breathing and with no pulse. Fire dispatcher Tracey Halvorson asked the woman to administer CPR, but she refused. The facility didn't have a do-not-resuscitate order on file for Bayless.
According to the 911 tape, the fire dispatcher tried several times to get someone to administer CPR:
- "EMS takes the liability for this."
- "Is there a gardener? Or any staff? ... Can we flag someone down in the street and get them to help this lady? Can we flag a stranger down? I bet a stranger will help her."
- "Is there anybody there that's willing to help this lady and not let her die?"
In response to the last question, the staff member said, "Not at this time."
Christopher Finn, a spokesperson for Brookdale Living Center, which owns the facility, said that, although the staff member is a nurse, she was "serving in the capacity of a resident services director, not as a nurse." Finn also explained that Glenwood Gardens, "is an independent living facility, which by law is not licensed to provide medical care to any of its residents."
The executive director of Glenwood Gardens further stated, "In the event of a health emergency at this independent living community, our practice is to immediately call emergency personnel for assistance and to wait with the individual needing attention until such personnel arrives."
Discussion Starters:
- Based on the statements of Brookdale and Glenwood so far, do you find the staff member's refusal justified?
- What, if anything, else should the company representatives say about the incident?
Anheuser-Busch Defends Its Beer
Anheuser-Busch is responding to lawsuits claiming that several brands are watered down and mislabeled. The company is accused of misrepresenting the alcohol content on Michelob, Michelob Ultra, Bud Ice, Bud Light Platinum,Hurricane High Gravity Lager, King Cobra, Busch Ice, Natural Ice and Bud Light Lime.
According to an article in the LA Times, former employees are siding with the plaintiffs, supporting the claim that the lead attorney on the case, Josh Boxer, calls "a matter of corporate practice" and "a simple cost-saving measure." Boxer says that water is added right before the bottling process, diluting alcohol content by 3 to 8 %.
In a statement, Peter Kraemer, Anheuser-Busch vice president of brewing and supply, denied the claims:
"Our beers are in full compliance with all alcohol labeling laws. We proudly adhere to the highest standards in brewing our beers, which have made them the best-selling in the U.S. and the world."
The news inspired fun on Twitter, such as this tweet by the managing editor for the Chicago Sun-Times:
Discussion Starters:
- Assess Anheuser-Busch's statement. In what ways is it effective and ineffective?
- How does this story relate to the recent news of Subway's 11-inch foot-long sandwich? In what ways are they different? Compare the companies' approaches, given the similarities and differences.
Ikea Responds to Horse Meat Scandal
Swedish furniture store Ikea is the latest to be implicated in the horse meat scandal that has shaken European consumers. Beginning in Ireland last month, horse meat was discovered in several beef products. Ready-to-eat meals in several countries have been recalled, such as frozen beef lasagna in Sweden, which consisted of between 60 and 100% horse meat.
Horse meat was found in Ikea's popular meatballs, and stores have stopped selling them in the Czech Republic and 13 other European countries. Other locations, which have different meat suppliers, are continuing to sell the meatballs in the in-store cafeteria and as frozen food, packaged for purchase.
The world's largest furniture retailer posted a statement on its website to reassure U.S. customers:
IKEA US Meatball Content is Only Pork and Meat Products
IKEA is committed to serving and selling high quality food that is safe, healthy and produced with care for the environment and the people who produce it. We do not tolerate any other ingredients than the ones stipulated in our recipes or specifications, secured through set standards, certifications and product analysis by accredited laboratories.
In the "pink slime" scandal last year, which accused U.S. beef manufacturers of using an ammonia-infused additive, Beef Products Inc. was, similarly, on the defensive.
Discussion Starters:
- Ikea claims that its own tests revealed no horse DNA. Did the company do the right thing by pulling the meatballs?
- Assess Ikea's statement to U.S. customers. What is effective about this response, and what, if anything, could be improved?
- What does "[sic]" mean in the statement above? What is the issue?
U.S. Postal Service Rallies Support for Cutting Saturday Service
The United States Postal Service is going all out to convince the public that eliminating Saturday delivery is a good move.
As the nation's second-largest employer, the USPS has been cutting locations and jobs for several years. After losing $16 billion last year, the organization has announced the service reduction as an essential decision, saving $2 billion a year.
In the press release, Postmaster General and CEO Patrick R. Donahoe emphasizes "financial realities" and customer input to the decision:
"The Postal Service is advancing an important new approach to delivery that reflects the strong growth of our package business and responds to the financial realities resulting from America's changing mailing habits. We developed this approach by working with our customers to understand their delivery needs and by identifying creative ways to generate significant cost savings."
On the USPS Facebook page, a key message is customer support: that 70% of Americans support the decision. This is reinforced in the press statement with a quotation by Donahoe:
"The American public understands the financial challenges of the Postal Service and supports these steps as a responsible and reasonable approach to improving our financial situation. The Postal Service has a responsibility to take the steps necessary to return to long-term financial stability and ensure the continued affordability of the U.S. Mail."
However, the USPS is facing opposition. Congress still may block the move; some consider the service cut illegal. The employee union-the National Association of Letter Carriers-and the greeting card industry both oppose the elimination of Saturday delivery. The union president referred to the decision as "a disastrous idea that would have a profoundly negative effect on the Postal Service and on millions of customers."
Staying ahead of the controversy, the USPS also posted a fact sheet about the new schedule. The sheet clarifies important information for customers, for example, that packages still will be delivered on Saturday
Discussion Starters:
- Read the USPS fact sheet. Which are the strongest and weakest arguments?
- What do you notice about the headings in the fact sheet? How can they be improved?
- In the press release, the CEO could use more natural language. Rewrite the quotations for a broader audience.
Responses to the Super Bowl Outage
Twitter users were active during the Super Bowl outage, and parties involved are responding to the blackout that delayed the game by 34 minutes.
A joint statement by Entergy and Superdome manager SMG blames energy lines for the outage:
"A piece of equipment that is designed to monitor electrical load sensed an abnormality in the system. Once the issue was detected, the sensing equipment operated as designed and opened a breaker, causing power to be partially cut to the Superdome in order to isolate the issue. Backup generators kicked in immediately as designed.
"Entergy and SMG subsequently coordinated start-up procedures, ensuring that full power was safely restored to the Superdome. The fault-sensing equipment activated where the Superdome equipment intersects with Entergy's feed into the facility. There were no additional issues detected. Entergy and SMG will continue to investigate the root cause of the abnormality."
New Orleans Mayor Mitch Landrieu said the power outage was "an unfortunate moment in what has been an otherwise shining Super Bowl week for the city of New Orleans. . . . In the coming days, I expect a full after-action report from all parties involved." He may have reason to worry: critics say that the outage may affect whether New Orleans hosts future games.
During the outage, fans were active on Twitter, reporting what they saw and making jokes. And marketers took advantage of the downtime, quickly generating relevant ads:
Other advertising tweets were timely:
- Walgreens: "We do carry candles" and "We also sell lights."
- Tide: "We can't get your # blackout, but we can get your stains out."
- Audi: "Sending some LEDs to the @ mbusa Superdome right now…" (This one is a dig on Mercedes-Benz' sponsorship of the stadium.)
Discussion Starters:
- If you watched the game, what did you do during the outage? Did you visit social media sites to post or see commentary? What did you expect, and what did you find?
- Read some of the tweets sent during the Super Bowl. What strikes you about these examples? How would you summarize the two or three ways that people used Twitter during the game?
Taco Bell Pulls Anti-Veggies Ad
"Veggies on game day is like punting on fourth and one-it's a cop out." So says a Taco Bell commercial that the company has since pulled. According to the ad, people will hate you for bringing vegetables to their house for the Super Bowl.
Nutrition organizations took offense. The Center for Science in the Public Interest urged people to tweet complaints to Taco Bell.
The company responded quickly. The CSPI posted this statement on its website:
"It's bad enough that there aren't many ads on television for broccoli, kale, or carrots. The last thing healthy fruits and vegetables needed was to be the subject of attack ads. We are delighted that Taco Bell is pulling an ad that urged people not to bring veggie trays to their Super Bowl parties, but to instead bring 12-packs of Taco Bell's tacos. Thanks to Taco Bell for responding with record speed to address nutritionists' and consumers' concern over this ad campaign."
A spokesperson for Taco Bell explained the decision simply: "We didn't want anyone to misinterpret the intent of the ad."
Discussion Starters:
- Are people justified in their criticism of the ad, or are they just too sensitive? What's your view?
- Did Taco Bell make the right decision to pull the ad? What are the arguments for and against the decision?
H&R Block Responds to TurboTax Ads
TurboTax pokes fun at H&R Block in two recent ads, and H&R Block is fighting back.
The first ad shows a salesperson in a retail store helping a customer. When the customer realizes the woman did her taxes for her, she says, "I thought you were an expert with returns."
With a similar message, the second ad shows an H&R Block employee as a plumber.
TurboTax is differentiating its product by promising that users get advice only from CPAs, EAs, and tax attorneys-"real tax attorneys." In the commercial, TurboTax also claims that more Americans used the system than all H&R Block and other tax stores combined.
Bill Cobb, CEO, H&R Block called the ads "outrageous" and sent this email to reassure employees:
When we say we believe in our people, we mean it.
TurboTax has launched two new outrageous commercials that attempt to sell their tax advice resources as more prepared, more professional, and simply superior to ours. As you can see in the links to these ads below, TurboTax uses misleading data and statements to not only suggest that their advisors are better, but to also make fun of plumbers and retail sales clerks as not very smart.
We work in a competitive business that challenges us every day to live by and defend our values. So when a competitor takes a pot shot at our people – the tax professionals who deliver for our clients every day and in every season – we step up and say: no way – not on our watch.
We have a strong brand built on integrity and professionalism and anchored by our tax professionals. We are going to defend our tax professionals and our brand against this attack – and we will do it quickly, directly and aggressively.
New H&R Block TV commercials to fight this challenge are in development and will augment our current marketing campaign that is all about the tax pro. Legal considerations are being assessed and appropriate action will be taken quickly. And we will develop a way for each of you to have your voice heard in support of yourself and all our tax professionals – stay tuned for more specifics this week.
The season begins next January 30, and we are focused on executing our plan. Don't let these commercials be a distraction – we've got this covered. Instead, stay focused on your day-to-day efforts to deliver for our clients – this is our best response. And let every client or potential client who is a plumber, retail clerk, salesperson or other hardworking American know we are honored to serve them.
We believe in our people. I believe in our people – and I want the world to know I've got your back.
Discussion Starters:
- What strategies of persuasion does TurboTax use in its commercials?
- What strategies does Cobb use in his email to employees?
- Which do you find more convincing and why?
Let the (Commercial) Games Begin!
A week before the Super Bowl, marketers are already capitalizing on a strong audience. Last year, ads that ran on YouTube received 600% more
views than those that waited until the big day (9 million compared to
1.3 million).
Although some companies hold out for the "big reveal," Nielsen data shows that the early release didn't hurt last year's brands. Opting for short "teasers" on YouTube still is a popular strategy, but this may change. The YouTube audience for Super Bowl ads is 300 million, far more than the 111 million who watch the game on TV.
On the other hand, so far, the most talked about video is a teaser. A new Mercedes Benz video featuring model Kate Upton aims to reach a younger audience for the car manufacturer-people in their 30s and 40s rather than the current 50-year-olds who currently buy the cars. The company's compact sedan sells for under $30,000, which is part of their new strategy as well. In classic Super Bowl ad fashion, the commercial plays on Upton's sex appeal.
Discussion Starters:
- Why would some companies hold out for a "big reveal," rather than post videos online before the game? What are the trade-offs of each strategy?
- What is your view of the Mercedes commercial? How effective will it be in selling more cars?
- Compare the Mercedes commercial to Go Daddy ads from previous Super Bowls. Other than the obvious sex appeal, what similarities do you see?
Subway Loses an Inch and Credibility
How many inches are in a foot? Eleven, according to a Subway customer in Australia and others who have posted similar photos of the "footlong" sandwich. The initial photo received more than 100,000 likes on Facebook, yet Subway was slow in responding.
It's unclear why Subway corporate didn't address comments on its Facebook page, but Subway Australia did post this response:
The company seemed to try a different approach in this statement to The Huffington Post:
"As you know, all of our sandwiches are made to order, and our bread is baked daily in every one of our more than 38,000 restaurants in 100 countries worldwide. We have policies and procedures in place to ensure that our products are consistent and have the same great taste no matter which Subway restaurant you visit.
"We have seen the photo you referenced of a Subway sandwich that looks like it doesn't meet our standards. We always strive for our customers to have the most positive experience possible, and we believe this was an isolated case in which the bread preparation procedures were unfortunately not followed."
Nice try, but this doesn't seem to address the many photos of 11-inch Subway sandwiches.
In a response to ABC News, Subway corporate reinforced the concept of the "footlong" not being a real measurement: "Most countries, such as Australia, follow the metric system so the term Footlong can only be used as part of a trademark." However, the spokesman did acknowledge, "Our global standard for a SUBWAY Footlong sandwich is 12 inches regardless of the restaurant's location."
The metric-system defense seems to contradict this 2008 commercial, clearly stating that a "footlong" is 12 inches.
The company probably want the whole issue to just go away. On its Twitter feed, Subway is promoting its role in The Biggest Loser and, still, the "footlong":
Discussion Starters:
- Some theorize that Subway's toasted bread shrinks, causing the final product to be only 11 inches. Do you buy this argument? If you think it has credibility, should Subway have incorporate this information into its statement? How could this have helped or hurt the company's position?
- What should Subway do on its Facebook page and Twitter feed to regain credibility?
- What if the company is skimping on its sandwiches? What would be an appropriate response in this case? What are the downsides of admitting this?