Bailout! A Failure of Phraseology

"With public sentiment, nothing can fail; without it nothing can succeed."
—Abraham Lincoln

bail-out: noun informal: an act of giving financial assistance to a failing business or economy to save it from collapse.
—Oxford English Dictionary

Where are the nation's great wordsmiths when we need them?

Out of a political establishment usually quite adept a coining a phrase comes the most counterproductive word imaginable to describe the proposed solution to our current financial mess: Bailout.

Of course, the politicos didn't come up with this one. The media did. But it's hardly their fault. In an attempt to paint a dramatic picture of imminent economic apocalypse, and spur Congress to quick action, Paulson and Bernanke overdid it. In the absence of anything positive to report, the media simply said what was on everyone's mind.

By the time Congress named their plan the "Emergency Economic Stabilization Act of 2008," they already had lost the rhetorical high ground. This is a bailout. A bailout implies we've lost the ship. And Americans hate failure.

So let's have some fun (if that's possible given the current situation), and turn back the clock three weeks. Let's imagine we're doing some media-prep ahead of that first committee hearing. This is our chance to brainstorm on words—any words at all—that would be better than letting the media fill in the default choice.

It's quite a simple question: How do we "brand" the bailout plan?

Let's get to it, shall we.

Option 1: Rescue
Suggested by others in my field, this word has its merits. To "rescue" is noble, to "bailout" is shameful. Indeed, Americans come to the rescue as a matter of principal. I envision some heads nodding in the imaginary war room. But our economy is not really a proverbial kitten stuck in a tree. I think we might need bigger guns.

Option 2: Stabilization
Better. This is the word used in the final bill, of course, but I think we can pick a more appropriate metaphor than "getting us back to baseline." Americans don't like to be average. (Lake Wobegon, anyone?) We like to succeed.

Option 3: Recovery
Ooh. That's getting there. I'm imagining a few smiles of agreement. Recovery is positive. The "Economic Recovery Act of 2008" has a certain ring to it. It implies things will get better if we only pitch in some time, energy, and money. Conditions are serious, but we'll choke down some collective medicine, eat better, lose some weight, and we'll get through this. Ah, but then are we giving the media the whole "medical" metaphor to play with? Smiles are turning into frowns. Are we recovering? So do we need another "shot in the arm"? Are we in "remission"? Let's keep going.

Option 4: Deliverance
Nice word. Sounds impressive. Literally, deliverance means to "rescue, emancipate, or provide salvation." Perhaps a little too much "hand of the Almighty reaching down and picking us back up" for some people's taste in the room, but it wouldn't be the first time our leaders have used higher power rhetoric to motivate us. Then, someone mentions hillbillies and Burt Reynolds. Deliverance won't work.

Option 5: Safeguard
The Economic Safeguard Act of 2008. Nice... go on. Americans like to protect things, especially big important things. The word also implies we've let the fox in the henhouse (let Wall Street regulate itself), and its time to load the shotgun. That could work.

I think we're on to something here, group. Let's make it one better.

Option 6: Homeowner Safeguard
Much better. This not only "protects" the economy, it gets at the root of the problem—in fact, the mortgage crisis—all in one tight rhetorical package. Now, the actual bill better include actual help for homeowners (and not just a fat load of cash for those who should have known better), but this one drives at the heart of the very people who vote in large numbers and who will be critical as its base of support.

Lock and load. Time to face the Senate Banking Committee.

But alas, our fantasy is over. It's October 6, not September 22, and the narrative is all but written. Any of the six possibilities we came up with here (and countless more you could come up with on your own) would have been better than "bailout."

The act of failing to control the media narrative—not providing a rhetorical counterargument to the words "crisis," "economic collapse," and "bailout"—represents the supreme failure of our leaders to communicate with us effectively. In other words, in order to communicate the seriousness of the situation, they allowed, and even initially encouraged, their economic plan to be defined in apocalyptic terms.

It is little surprise that Americans are mad as hell right now. Our leaders have made the cardinal rhetorical sin of allowing an important issue to frame itself. It is not to say we wouldn't be upset otherwise, but carefully chosen words have a powerful way of channeling those emotions into "roll up our sleeves" action. Those words could have communicated the seriousness of our situation, and at the same time inspiring ordinary people to extraordinary results. Instead, we got unproductive anger and nowhere to vent it.

"A county divided against itself cannot stand."
We fought to hold the Union together.

"All we have to fear is fear itself."
We tightened our belts in the Great Depression.

"Ask not what your country can do for you, but what you can do for your country."
We heeded the call to national service.

"Mr. Gorbachev, tear down this wall!"
We stared down the Soviet Union.

Of course, these words alone could not have created these outcomes. But could you imagine the outcomes without them?

Lincoln, Roosevelt, Kennedy, Reagan—are you listening up there? We need your help.

Pro Cycling is No Dope

When you think of illicit performance enhancement in sports, what comes to mind?

Pro baseball, certainly. Plenty of "enhancement" there. Pro football? Sure. Olympic sports? Of course; it's hard not to notice the occasional byline about an expelled athlete in the lead up to the Beijing games.

But one sport has them all beat: Professional cycling. The guys with the bright tights and fast bikes.

In fact, public perception of the sport is so linked to doping, even the recently completed Tour de France couldn't overshadow an undercurrent of doping allegations. (Can you even name who won this year? Can you remember the doping stories? Enough said.)

[A word about semantics. The terms "doping" and "steroids" essentially refer to the same practice - performance enhancement - only with a different focus. "Doping" typically refers to enhancement in endurance sports - cycling, running, etc. Doping compounds help the body transfer oxygen to the blood, extending normal endurance thresholds. "Steroids" typically refers to enhancement in strength sports - football, baseball, etc - where bulk strength is key. Steroids allow muscles to recover from punishing workouts faster. The quicker the recovery, the faster you get back into the gym.]

But wait a second. Major League Baseball had congressional hearings. There was a time last year that you couldn't read the sports page without a baseball steroid allegation. There was even the damning Mitchell report, naming the names of some of today's (and yesterday's) biggest stars.

Yes, all of that is true. But what about today? As soon as new storylines emerge, steroid allegations fade into the background. Yes, there is new "testing" in baseball, but the players' union fights hard to keep results out of the public eye. And they seem to know what they are doing. They know, from a public relations perspective, steroid allegations are a "flash in the pan" crisis: High intensity, but little staying power. Just be patient, they counsel players, and you can get back to the business of earning endorsements.

So that got me thinking, why do performance enhancement allegations seem to dog professional cycling like they do no other sport? It doesn't seem fair.

My first thought was the international focus of the sport, versus a primarily American perspective for baseball and football.

That could be part of it. International pressure certainly shines an intense spotlight on competition. In American sports, the outcome prevails. If a player "juiced," but went on to win it all, Americans tend to remember (and reward - like it or not - with glory, endorsements, and hard cash) the latter. The same can't be said on the international stage. Competition and fair play hold a stronger procedural footing.

But even there, the logic did not seem to add up.

In the Olympics, the international stage on which many might claim doping and steroid use is rampant, one Olympic gold medal tear-jerker story pushes all of those allegations out of the public eye.

So the question remains. What is it about pro cycling that can't shake its bad vibe?

Being at a bit of a loss, I called on local road cycling guru Blayne Puklich of excelcycle. What he said surprised me.

I came to learn that professional cycling actually wants it this way. Riders see it as a badge of honor that their sport places so much emphasis on cleaning up its act. Average riders talk about doping allegations, sure, and they realize that most people outside the sport must think all pro riders juice, but they don't care. They know the truth.

Blayne reminded me of American Tour de France winner Floyd Landis (remember him?). After he was caught doping (allegedly), pro cycling not only stripped his title, but also banned him from the sport for two years.

In pro baseball, that would be the equivalent of catching Barry Bonds using steroids (allegedly), expunging his home run record, and banning him from play for two years. Could you see that happening?

Even Lance Armstrong, pro cycling's greatest American hero in a generation, has been trailed incessantly by doping allegations. They won't even leave him alone.

Then it occurred to me: Pro cycling is bringing this on themselves. On purpose. Let me explain.

Pro cycling is taking the long view. It wants to be seen as pure sport. To do that, it needs to take illegal performance enhancement seriously. And the only way to be serious is to crack down hard. No games of chicken. No riders' unions. No fooling around. If you are caught, you are tainted, and you are out.

And if you think about it, this makes sense. Professional sports have been slipping more and more into the "entertainment" category for the past two decades. League marketers haven't failed to catch the intense popularity, ratings, and money-making ability of pseudo-sports like the WWE. If you've noticed, they've worked in similar tactical elements. Personal drama. Love triangles. Emotional backstories.

While pro sports in the United States haven't quite sold their soul, they are on a very slippery slope. If they are not careful, they will lose their grounding in reality, and become yet another entertainment phenomenon to rise and fall with the fickle tide of public tastes.

Now think about what pro cycling is doing. They might be taking it on the chin now, but in 10 years, the sport's image will turn around. By contrast, the image of other pro sports is likely to deteriorate.

Branding is all about authenticity - in this case authenticity in pure competition - and cycling will have it. The others won't. And that's a truth they will be able to build a successful business model on.

By the way. Spanish rider Carlos Sastre won to '08 tour. Clean.

An Immediate Marketing Challenge for the Wisconsin Dells

For all intents and purposes, Lake Delton no longer exists.

On June 9, after historic and torrential rainfall, a section of the lake's shoreline surrounding its dam gave way.  The force of 267 acres of water (about 700 million gallons) ripped through adjacent highway A and emptied into the Wisconsin River, about 80 feet away.

According to those who witnessed the event, it was nothing short of biblical.

Fortunately, no lives were lost as the lake violently emptied over the course of a few hours.  Luckily, dams downstream held.  Other lakes in the area were not affected.  That's the good news.

 

Here's the bad news.  Lake Delton is a key part of the Wisconsin Dells resort community.  For anyone living in Minnesota, Wisconsin, Iowa, and Illinois, I hardly need to explain the potential impact.  The "Dells," as it is called in our region, is arguably the largest and most popular family resort community in the four-state area.  Tens of thousands visit each year for the dozens of activities: water parks, petting zoos, shopping, shows, museums, and golf.  And up until last week, a myriad of water activities on Lake Delton.

Of course, there are the direct and immediate effects of the disaster: Homes and property along the lakefront - especially where the shoreline gave way - are utterly destroyed.  For the luckier ones, who directly lost only property of lesser value, a previously lake-front home or resort now sits alongside a festering, muddy pit.

But leaving that aside for a moment, let's examine the broader impact.  The impact to the Wisconsin Dells brand.  And what planners should be doing about it.  Right now.

First, at the onset of the peak summer season, this could not have happened at a worse time for the resorts that line Lake Delton.  In the days immediately following the disaster, tourists canceled reservations in droves.  Cancellations are hardly unpredictable, but certainly they rub salt in the wounds of the resort owners.

Second, because the lake no longer exists, attractions using the lakes are also affected.  The list is long: Duck Tours (amphibious car/boat hybrids circa WWII), the Tommy Bartlett ski show, fishing tours, and many others.  Put very simply, they no longer have a viable business model.  The Tommy Bartlett show, exhibiting supreme creativity, is moving "on shore," but I can't imagine that will fly.  Sometimes moving to another lake will work.  But the Wisconsin Dells area already is crowded with attractions and activities.  Uprooted proprietors are likely to find the pickings slim.

Third, and probably most importantly, is the brand image of the Dells itself.  People visit the Dells to get away from it all.  It is the quintessential summer vacation in the Midwest, where people can shed their winter clothes and buttoned-up personas and cut-loose for a week.  In past years, the Dells has also begun to attract a much wealthier clientele - shedding some of its "campy" image to pull in high net worth visitors who ordinarily would travel out of state.

 

Now, the Dells is a disaster area.  That doesn't fit the mojo.

I don't blame city planners for being a bit dumbfounded at this one.

Even the best PR pros do not plan for this type of risk during crisis planning exercises.  They prepare for the horrible, yet predictable: A child drowns at a water park.  A bear escapes from the zoo.  A duck boat crashes.  The ski show has an accident.  A restaurant sickens a group of people.  The community sees a massive insect hatch.  They were not prepared for this.

But nonetheless, they must act.  Quickly.  And I have some advice.

City planners need to get a media plan in place immediately.  They need to tell anyone who will listen that the Dells is open for business.  They need to say, in clear terms, which activities are off-line and which activities are on-line.  They need to communicate that most of the Dells is not directly affected in order to prevent a wholesale collapse in reservations.  To that end, although the economic impact has been severe, direct incentives to visitors should be in order.  Also, now is the time to plan for the expense and tactics of marketing, public relations, and advertising campaigns necessary to re-promote the area over the next few years.

Additionally, activities and attractions not directly affected by the Lake Delton disaster must quickly act of their own accord. They need to communicate directly with customers who have standing reservations.  As in any disaster, misinformation is rampant, and people may mistakenly believe their (unaffected) resort will be closed for business.  Now is the time to provide customers the correct information. In other words, it still makes sense to come to the Dells.  Do not cancel your vacation.

For the resorts along the lake, this summer (sadly) could be a total loss.  It is more important to get involved with the state planners, the Army Corps of Engineers, and others who will be working on a plan to refill the lake.  If they are not involved in the process, it will likely be years before the plan is in place and activity begins.  They cannot afford inaction.  They must be putting direct (i.e. lobbying) and indirect (i.e. pubic relations) pressure on policymakers to act quickly to avoid a complete loss for summer '09.

Finally, the community can take advantage of the latest trend in travel: charity-tourism.  Funny as it may sound to some of us, some people actually want to visit a disaster area for more than idle curiosity.  They do not come to gawk, but to help in a meaningful way.  It happened on a large scale in Louisiana after Katrina, as well as several smaller examples all over the country and around the globe.  These groups can help with the clean up, rebuilding, and the word-of-mouth PR effort necessary to get the community back on its feet.  The Dells needs to help coordinate this inevitable effort so that it best serves the community's needs.  As a side bonus, with a structured effort, other vacationers could be easily convinced to spend a few hours helping out over the course of their time in the area.

Unfortunately, time is not on their side.

Despite all of the sadness, shock, and disbelief, the Dells must act right now.

How a Four-Cent Text Message Ruined $500 Million in Reputation Building

It was like the earthquake that devastated San Francisco in 1906.

But there are a lot more people when and where this one struck.

On Monday, May 12, 2008, a 7.9 magnitude earthquake hit southwestern China's Sichuan province. Many smaller villages were, literally, wiped off the map.  Much of the provincial capital Chengdu was reduced to rubble.  10,000 people were dead within an hour.  At least 60,000 lost their lives as of this writing.  200,000 have been forced to flee a tenuously perched lake created from massive landslides.  Millions of others have been left homeless.

It is, without question, a disaster of epic proportions, coming just as China had hoped to focus worldwide attention on the 2008 summer Olympic games.

The Chinese government moved quickly and decisively.  (A new phenomenon in China to be sure, partially brought on by media attention surrounding this summer's games, but undoubtedly a trend towards heightened government responsiveness to its citizens.  A good thing.)  China's equivalent of the National Guard moved in with thousands of troops to coordinate relief efforts, prevent the spread of disease, deal with the effects of massive aftershocks, and analyze the geologic stability of the area’s landmasses.

(Sadly, a comparison to Katrina is hardly necessary.)

The real reputation-management story here, however, is the domestic corporate response in China.

Corporations of the size to affect change at this level (i.e. donate large sums of money) are a relatively new concept in China.  Even 10 years ago, no one would have expected any sort of a meaningful response.

But they did respond.  Quickly and generously.  Within a few days, over $1 billion flowed from domestic corporations to relief efforts of all sorts.

While corporations themselves are reasonably new in China, corporate philanthropy is even newer.  The jaded among us might believe that domestic corporations were "pressured" into donating such large sums because of their unique connection to the communist government apparatus.  But I am not so sure.  As more of these large organizations join the international community, I think it is natural they respond as good corporate citizens.  I doubt any arm-twisting—explicit or implicit—took place.  Public pressure (another new Chinese concept) does the trick.

Here's the rub.  Multi-national corporations (McDonald's, Samsung, Nokia, KFC, and many others) responded as well.  They donated money and supplies just as quickly, to the tune of $500 million.

At the time, everyone in the corporate community seemed focused on meeting the challenges of the disaster.

Then simple text messages began appearing on Chinese phones.

Essentially, they accused these multi-national corporations of donating too little to earthquake relief efforts.  That the "iron roosters" (a symbol in China of the uncaring tightwad) only were interested in exploiting China's resources, but cared little that its people were suffering.

One could make the case that domestic corporations contributed twice as much, but I think that misses the point.

One also could make the case that this attitude is the national extension of a wave a patriotism sweeping over China in the aftermath of a disaster - an attitude driven by a deep-seated resentment of colonial aggression during the 19th and 20th centuries. Again, a reasonable argument, and with perhaps some truth.

However, I see something much more modern at work.

The power of the humble text message is undeniable.  It can achieve instant distribution.  It can cast a wide net.  Most interestingly (and frighteningly to those on the short end of one), text messages can carry surprising credibility.

If you think about it, though, it makes sense.  Text messages appear directly on your phone.  That makes them very personal - almost visceral.  The lack of "corporate branding" makes them seem immune from public relations spin-doctors.  We are trained to be suspicious of advertising, but are text messages advertising?  When you get a text message from a friend, where is the line drawn?

The net effect is simple: Too many Chinese citizens do believe the text messages.  Too many do not believe the multi-nationals, their media releases, their posters, and their ad campaigns.

All that said, how could multinationals (or any company, really, including U.S.-based firms) combat this problem?  First, it takes understanding the true nature of "reputation" in the modern sense of the word.  Reputation, as a business construct, no longer follows a source-receiver model (if it ever did).  Reputation is a non-linear, chaotic system.  It does not respond quite as predictably as it once did to "war rooms" and "crisis plans."

That does not mean you are out of luck.

A few things to consider:

1. Authenticity: If you truly are who you say you are, and do what you say you will do, your company's reputation has the solid foundation it will need to build upon not just during a crisis, but over the long haul.

2. Relationship building: The crisis event is not the time to build relationships with those stakeholders who can affect your reputation.

3. Fighting fire with fire: Corporate reputation managers often find themselves remiss to use the same guerrilla tactics their detractors would use - blog posts, text messages, and viral campaigns.  A costly strategic mistake.

If I were a multinational with a large Chinese presence, I'd be warming up my thumbs.

Geek Squad: Best Buy’s Jiffy Lube

They have been called the "Peep Squad."

Allegedly, certain members of the Geek Squad organization have been caught pilfering private customer information during home service calls.  (A simple Google search will yield a myriad of specific examples; I will not indulge them here.)

Certainly, the label is not fair.  The Geek Squad boasts thousands of employees, the largest organization of its kind in the United States.  While there is almost certainly some truth to the charges for a tiny fraction of all employees, the vast majority of employees have never - and will never - do anything wrong.  (The same argument for limited malfeasance could be made for any organization of its size.)

But the facts do not seem to matter, do they?

Bad news always travels faster than good news, and being the top organization of your kind is akin to giving the bad news engine premium fuel.

It really comes down to this: Has Best Buy made a strategic mistake bringing the Geek Squad into its stores?  Has the nation's largest electronics manufacturer put its reputation in the hands of a group of modesty-trained 20-somethings?  Should the company rethink its decision now?

One side of the argument says "no."  The Geek Squad is a sound long-term investment.

From its humble beginnings in the brain of Robert Stephens, the Geek Squad essentially created the brand name computer service industry.  Anyone over 30 remembers what it was like before then.  If you did not work for a large organization (with its own internal IT staff), you were at the mercy of the Yellow Pages.  Sometimes, you got someone who knew what he was doing.  Most of the time, you did not.  Getting your home computer serviced was a game of poker where the house had all the face cards.

But Stephens changed all that.

He made fun of the technicians' reputation (called them what everyone else did: Geeks), made them dress the stereotype (pocket protectors and all), and made them drive around in dorky little cars painted to look like police squads (the VW bug is quite dorky).

And it worked.  People could remember the Geek Squad.  It stuck in your head.  And the business itself backed up the rhetoric.  Agents - as technicians are called - were very smart. Better yet, they communicated well.  They understood people's reluctance and fears regarding home computers and made the service experience comfortable and satisfying.

By 2004, Best Buy recognized a very good thing, as well as a panacea to a vexing (and growing problem).  As computers took up a larger and larger share of Best Buy's sales (and home theater systems were beginning to get just as complicated), the company knew that its customer satisfaction index was at the mercy of the support experience.  What's more, Best Buy saw the Apple Stores' successful model of melding sales, service, training, and support.  So it took the plunge.  Best Buy bought out the (still tiny) Geek Squad chain and brought it completely in house.

Today, nearly all Best Buy locations serve as "precinct" locations for the Geek Squad.  A nice value proposition, really.  Trouble with your computer?  The Geek Squad is just an in-store visit away.

It seemed like a perfect marriage.

But the Geek Squad is almost a victim of its own success.

In order to grow to the critical mass Best Buy required, the Geek Squad needed to expand.  Fast.  Literally, the company needed to hire hundred of new agents almost overnight to staff hundreds of Best Buy stores.

In the early days, Geek Squad agents could be carefully chosen.  Agents had a much longer time to indoctrinate into the Geek Squad culture.  They had a solid culture and experienced mentors.  But these new agents were thrown into the mix, given some training, and thrown into the field.

And therein lies the problem.

From our business case days, we remember a similar situation of rapid expansion: Jiffy Lube.

While the specifics differ, the basic facts remain the same.  Until Jiffy Lube came around, getting your oil changed was an all day affair at your corner service station.  Service was slow, unreliable, and expensive.  You never knew if the greasy technician under your car was actually doing what he was supposed to be doing, and you secretly (and sometimes explicitly) thought he was cheating you.

Jiffy Lube changed all that.

In about 30 minutes, your car was in and out.  Jiffy Lube standardized the process.  They instituted service checklists.  They made the process understandable to the average person.   They dressed in clean uniforms.  They had clean waiting areas.  Heck, you could even look trough the window to watch them work!

The concept took off.  Clones followed, but it was Jiffy Lube who transformed the industry.  It made auto dealer service departments more responsive and (nearly) put the corner service station out of business.

But much like the Geek Squad, Jiffy Lube was a victim of its own success.  Thinking that it was the process - and not the people - who mattered, the company expanded too quickly for its own good.  With a breakdown in controls, nefarious Jiffy Lube technicians would use the company’s brand trust to their personal advantage - overcharging and cheating customers.

It got ugly, to say the least.  Only now is Jiffy Lube climbing out of its hole.

The real parallel is simple: Can the Geek Squad crawl out of its hole?  In their rapid growth, they have expended significant reputation capital for not only themselves, but their corporate parent as well.

In the end analysis, I believe the Geek Squad can recover.  Best Buy has the cash as well as the long-term commitment necessary.

But I am not sure it will be worth it.

Here's why.

Most people do not, and will not, understand computers or computer repair.  That lack of understanding leads to the explicit and implicit feeling they you are bring "taken," even if in the end your computer gets fixed.  Much like the Jiffy Lube case study, owning a computer is, today, analogous to owning a car.  Most people really don’t understand most of what goes on under the hood, and have only fleeting trust for their mechanic.

As their market matures (I would argue the computer service market largely has done so), it will become less and less possible to "thrill" customers as it was in the heady early days of the home computer.  The computer has become an appliance, like any other in your home, and few people are likely to be "thrilled" with the service on their dishwasher.

Look at it this way: Imagine a continuum with "Ecstatic" on one end, "Content" in the middle, and "Disgusted" on the other.  In an immature service provider market, consumer information is so poor, and most service providers fall into the right side of the scale, that it is possible to develop a system that - for a time - moves the bar far to the left, delighting customers and building solid business.  That is what Geek Squad and Jiffy Lube were able to do.

But the advantage doesn't last.  As the market matures, it is harder and harder to "delight" customers. Expectations increase as clones copy your model.  While the bottom of the satisfaction index tends to stay put, the left side gets harder and harder to economically achieve.  As time goes on, what remains is "content" at best and "mad" at worst (essentially the midpoint to low end of the continuum).  In other words, over the long term, the best a company like this can do is make customers feel "OK" about the experience.  Worse yet, the law of averages tells you the overall index will trend negative.

If I were Best Buy, I wouldn’t like a business unit where the best I could hope for is "OK" customer satisfaction.  But is that a bigger risk than not being in control of service at all?  Probably not.

If Best Buy is really lucky, perhaps the Geek Squad can rewrite the rules of the game one more time.