Nestle's PR disaster

. Tuesday, March 23, 2010

Nestlé's PR issues is another case in point on how social media can be an equivalent of mob justice and how poorly companies are able to cope with the new-found power of the customer.

A brief overview of what went wrong with Nestlé. For sometime now, Green Peace targeted Nestlé in their website when they accused the chocolate manufacturer of "using palm oil from companies that are trashing Indonesian rainforests, threatening the livelihoods of local people and pushing orang-utans towards extinction. The company's Facebook page was was suddenly filled with 'hate messages' by 'fans' who criticized the company for not taking a stand against the use of palm oil. With many Facebook users and 'fans' putting up profile pics that are altered versions of their logo, Nestle put up a request that went like this: "we welcome your comments, but please don't post using an altered version of any of our logos as your profile pic - they will be deleted." What followed are a series of PR disasters!

Nestle has gone wrong on many counts here. For starters, they must have learnt from their predecessors (Shell, McDonalds anyone?) and must have issued a press release clearly stating their stand on the palm oil. They could have even partnered with Green Peace as some of the other organizations have done before, to identify what is the best solution to this problem. Some of the things they could have done is initiate a campaign to save the orangutans, offer to provide employment and education to the local population, take steps to improve their standard of living. Instead, they decided to fight with their customers in a public forum.

The important lesson though is the power of Social media. Whenever you are experimenting a new channel to reach out to your customer, it is important to realize the reason why you are using the channel - to reach out. Social media should not be a PR stunt and firms must realize that this is a channel by which they can engage with their customers, establish a loyal base.

It is a pity that what could have been a wonderful example of how a company managed to reach out to the customer to re-brand itself will be now remembered as the biggest PR disaster for a firm that was just not ready to learn from other's mistakes.

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