Bad Publicity is Good Publicity? A Study Says Maybe

In light of the Charlie Sheen fiasco in the news, I thought BrandMakerNews.com post on bad publicity was inspired by it. It turns out their article was a repost of “Better to be reviled than ignored” by the Economist. The article begins with examples of bad publicity for well-established entities that barely bounced back from it. But Alan Sorensen, an economics professor, did a study looking at the New York Times book reviews and the effect on sales. The results:

“…well-known authors who earned glowing reviews for a new book could expect to sell 42% more copies, whereas a negative review caused sales to drop by 15%. For unknown authors, however, it did not matter whether a book was panned or lauded. Simply being reviewed in the Times bumped up sales by a third”

The study concluded that unknown brands benefit from bad publicity because the name is out and bad publicity won’t be remembered considering the brand isn’t well known. Simply put, consumers only remember the publicity. The article gave an example: Kazahstan whose tourism went up even after it was ridiculed on “Borat”. The article also gave an antithesis example: Vitaly Borker, the online eyeglass seller who purposely provided bad service to increase his online complaints and thus boast his Google search ranking. He was exposed after gloating about his strategy to the New York Times (I wrote about the article in “The Definition of Anti-Salesmanship”). He was eventually arrested for harassment and Google dropped his rank.

Johnson & Johnson: Recalls Do Not Help

What’s going on with Johnson & Johnson? The other day I found out another J&J product, Rolaids, is being recalled. The first thought in my head was “Again?”. According Parija Kavilanz of cnnmoney.com, “13 million packages of various Rolaid medicines following consumer complaints of foreign materials, including metal and wood particles” were recalled. The response from J&J McNeil division is that it's a third party issue. Days before the recall, Kavilanz wrote another article stating the FDA warned J&J to get their act together and still found more violations.

At this point, I do not care if it is Johnson & Johnson or their third party affiliates who are feeding the problem. The heart of the matter is Johnson & Johnson is the face of the problem and therefore, this is their problem. Considering the power and established brand of the company, J&J needs to do a better job to control their recall situation. It seems the FDA, congressional hearings, and consistent bad press is not enough for the company to act better. Stating the problem as due to a third party sounds like an excuse. It could be true but unfortunately, the string of recalls has now rebranded J&J an untrustworthy company. 

The Definition of Anti-Salesmanship

Have you read New York Times article “A Bully Finds a Pulpit on the Web” by David Segel? Please read this article. PLEASE. I read a shocking 8-page exposé on negative customer service and the loopholes that allow incredibly appalling service to exist. That’s right, I said appalling. As in… disgusted, sickened, angry, hostile and so many other words that cannot be expressed.

Every person has at least one bad customer service experience. Some vary from small to incredible. I have never read customer service as bad as Segel reported. Vitaly Borker runs Decormyeyes.com. The company sells eyeglasses and, simply put, they provide horrible service. The service is followed by verbal and sexual harassment and physical threats against customers who dare to dispute charges or complain personally to the company. There is a whole lot more but it would take too much time to detail the article. According to the article, Decormyeyes.com is featured on plenty of message boards and customer service sites like getsatisfaction.com and has plenty of bad complaints splattered all over the web. So how do they get customers? For some time, according to Segel, a google search for an eyeglass brand would yield décormyeyes.com. Borker’s response to the negative reviews: negative or positive an online mention of the company’s name ranks them higher on the google search. Therefore, bringing them customers. For Borker, there is no need to halt the bad service or harassment.

I tested the theory. I searched for “eyeglasses” “designer eyeglasses” “Lafont eyeglasses” and “Chanel eyeglasses”; only “Lafont eyeglasses” gave me décormyeyes.com in the ads section. Theory wrong? Well, the article turned to Google asking the company why their search did not weed out rankings based on the negative reviews. Maybe the method was changed in response to the article.

Google was not the only company mentioned. While Google’s search rankings may not be able to weed out negative from positive mentions, Mastercard, Citibank, and Ebay did little despite knowing full well they were associated with a company that purposefully provided negative service and harassed customers. Their response in the article is that somehow, someway, and through some magical loophole, Borker was able to comeback any time. Only in the end did Segel reveal that after having been contacted by the New York Times, all companies kicked Borker out of their network. The only company with enough courage to not withstand bad service is Amazon. According to Borker, Amazon doesn’t play around with bad service and will kick bad sellers off their site; he is an angel on Amazon. So, great job Amazon for being dedicated to good service.

I am angry that Borker believes this is a good long term business strategy. I am angry that companies claimed ignorance about the so called loopholes of their system (or lack of care for customers) until a journalist came calling.  The good thing is the companies mentioned apparently realized the consequence of bad press and rectified the situation. Borker, as mentioned, doesn’t care.

This is not a stable strategy. It has worked for some time for Borker but unfortunately the integration of social media with the Internet will not allow his business to grow. Social media clearly gives more room for customers to find enough research about the company. As internet search engines further intertwine social media into the actual search, it should be about a year before bad service will either drop search rankings or leave rankings unaffected with customer service ratings attached to the search (google claims this will happen in the near future).

The other reason the business model is not stable: while bad ratings may be good for Borker, it is not good for other affiliated companies. With new legislation protecting consumer rights and disgusting stories of harassment, what company in their right mind would want to be associated with decormyeyes.com? Let’s not be naïve, some companies don't care about complaints but harassment is another thing. The more bad press Borker and decormyeyes.com receives, the more affiliated companies will not be willing to risk reputation and new customers. Borker will have to change his ways or risk abandonment.

Borker is the epitome of anti-salesmanship (as Segel put it) and his shamelessness and badge of pride associated with that is what left me appalled about this man and his deplorable business strategy. So is it worth it? Is a bad reputation and quick one-time customers better than good reputation and long term customers? I think not but I’m just someone who prefers to build relationships instead of burning them before they are created.