Biggest PR Blunders of 2011
Business Insider published a piece right before Christmas on the public relations blunders in 2011, including my list of the top blunders of the year. Their article included commentary on why these blunders are getting more attention, including the impacts of the current economic environment and social media. You can read the full article here and find my list of biggest PR blunders of 2011 below.
I also have a video up on YouTube where I talk about the top 3 public relations blunders of the year.
Biggest Public Relations Blunders of 2011
Netflix frustrated millions of customers this fall when CEO Reed Hastings announced he’d split the company in two. There was such huge backlash against Qwikster that shares plunged, and 23 days later, he took back the announcement. (Now Hastings is paying for it, with a 50% reduction in his stock option awards next year.) Argenti says that Netflix will never regain its previous status as the dominant market player: “The company has strategy execution issues. What they should do is kill people with service.”
Former British CEO Michael Woodford exposed “one of the biggest and longest-running loss-hiding arrangements in Japanese corporate history” by revealing that Olympus hid $1.5 billion of investment losses, going back three decades. Details are still emerging, and this week Japanese prosecutors announced they were “set to raid the offices of Olympus Corp and homes of former executives,” reports Reuters.
The News of The World hacking scandal has tarnished Murdoch’s News Corp. brand, and ultimately, his legacy. It led to police and government investigations for bribery and corruption in the UK, and FBI investigations in the U.S. The 80-year-old media tycoon has already paid out settlements to a number of public figures; and the saga is still ongoing.
Tokyo Electric Power Company (TEPCO)
The Tohoko earthquake and tsunami damaged TEPCO’s Fukushima Daiichi plant, leading to the biggest nuclear disaster since Chernobyl. Damaged reactors led to leaked radiation and displaced 50,000 households. The head of TEPCO, Masataka Shimizu, checked into a hospital shortly after the disaster, and resigned in May, when the company reported a $15 billion annual loss, “the largest by a nonfinancial company in Japanese history.”
The former New York U.S. representative ruined his career when he got caught Tweeting explicit photos of himself to a young woman. The impact is “long-term horrible,” Argenti says. “I think Anthony Weiner’s career is over.” And because he’s not as powerful as, say, Eliot Spitzer, the political fallout is “more devastating for him.”
The child sex abuse scandal involving assistant coach Jerry Sandusky has damaged Penn State’s renown sports program for the near future. The implications are “also devastating,” says Argenti. “The university’s entire reputation was built off money they were making off of sports. Consider if your kid were applying to school right now. Now Penn State has a big black mark.” Instead of trying to cover up the scandal, the school should have been more transparent early on, he says.
Sheen had an extraordinarily bad year. His drug, alcohol and marital problems became extremely public, but instead of making an effort to solve his problems, Sheen aggravated the situation with some embarrassing public appearances, which led to him getting kicked off his television show, Two And A Half Men. His defiance is what made his PR problem disastrous.
Kardashian is another celebrity who damaged her image in 2011. After 72 days of marriage and making $1.5 million from the photo rights to her wedding photos, she divorced her husband, NBA player Kris Humphries. The move confused and betrayed her fans. Now the Kardashians — who made $65 million this year — are caught up in a sweatshop investigation.
- RT @TuckSchool: When choosing to be more transparent, Prof. @paulargenti, says companies have to be committed for the long haul: “With soci… 5 days ago
- RT @TuckSchool: Tuck's @paulargenti says when organizations choose to be more transparent they have to be ready: "If you’re opening up this… 1 week ago
- See my thoughts about how Bill and Melinda Gates take on tough questions about their giving wapo.st/2o08gSC?tid=ss… @jenamcgregor 1 week ago