Tuesday, August 14, 2012

The latest in corporate social media failures: Progressive

New York comedian Matt Fisher's sister Katie, was killed in a car accident, the fault of the other driver. Since the other driver was underinsured, Katie's insurance, Progressive, would be on the hook for the difference between the other driver's insurance and Katie's policy. To get the money, the Fisher family had to sue the other driver to prove negligence, then use that decision to get Progressive to pay the policy. But to their surprise, at trial the other driver was defended by Progressive's legal team, since they would rather defend the other driver than pay the money they owed.

I'll let lawyers decide if this was the best legal decision for Progressive, but as word of this spread on the internet, it was clear this was a PR nightmare. Progressive, instead of tackling this head on, issued a robotic auto-response to anyone who tweeted the story at their @Progressive twitter account (which have since been deleted).
Now instead of replying, even with that robotic auto reply (and an unfortunate pic of a smiling Flo), they have decided to say nothing, which only increase the amount of vitriol directed at them. If you search for Progressive on Twitter, it is just a barrage of comments and links to this story. And on Facebook, users have taken over all their recent updates that don't address this but discuss whether people like fresh corn or fresh tomatoes, and a special "Road Trip Trail Mix recipe" (I'm not kidding).

If a company puts itself out there on social media, it has to understand that it cannot control what others say. Not posting about the issue or deleting all references to it is not going to make people stop talking about it, nor are robotic responses. This will never be a "good" story for Progressive, but by not having a coordinated idea of what to do with personal and thoughtful responses to their customers that are bothered by this is only going to make it worse.

3 comments:

Rob Montrone said...

This is a great example of how social media can hold corporations accountable for their actions, and highlights the importance of properly managing social media as a company. Social media really does increase the visibility of customer dissatisfaction and it's simply not enough to leave corporate engagement in the social media realm up to a small team of techs that run a company's social media program. Companies really need to actively monitor their footprint in the digital realm, as it's the best finger on the pulse of customer sentiments.

eric kuo said...

I think as importantly as companies needing to actively monitor social media is have a team able to respond to social media. It isn't enough just to know what is going on and have a canned response. Companies need to push back, tell their story in a respectful manner, and put a counter view on the table.

Niki Madjlessi said...

This is exactly the point to "content Marketing". Brands don’t own control anymore over the content being published on their behalf and have no other option than to adopt an online content marketing strategy. In other words, companies will have to generate a content that’s interesting, real that delivers informational or entertainment value, and market it to get people to discover and engage with the content. I recall a Ralph Lauren ad that was posted on a blog, showing a super skinny model, generated many negative online comments as well. A blogger even expressed that even though being neutral about the brand until seeing the ad, they have lost him as a customer. This was an example of how user generated online content can hurt the reputation of a brand. Obviously companies like progressive and Ralph Lauren in this example are still immature about the power of user generated content and the impact of it on their brands. Indeed Media has evolved from a world where content was generated only by Media and brands at a relatively high cost to free peer to peer content, generated by users where authority belongs to consumers. A successful on line content strategy has to account for people, and integrate them into the overall advertising and marketing techniques. Companies that ignore this will only set themselves to failure. This is exactly the mistake Progressive is making.