Tag Archives: sock puppeting

1st2c CGM Report: The Whole Foods Case-Study

The following case study was conducted in September 2007.

There’s nothing wrong in a CEO doing his best to promote his brand. It is perfectly logical for a CEO to communicate with his networked market online. It is quite smart to do so in those places where your brand and business are discussed.

The unwritten rules of consumer-marketer interaction on Internet’s social media have recently been fire-tested and there’s something to be learn out of this experience for every marketer.

For 8 years, John Mackey the visionary entrepreneur who led the Austin, Texas based natural-foods chain Whole Foods chain to meteoric success was active in Yahoo’s stock community. Using the pseudonym “rahodeb” (his wife Deborah’s name spelled backwards), Mr Mackey has been posting messages on various issues regarding his business.

This phenomena known as “Sock Puppeting” exploded early June following an FTC anti-trust lawsuit alleging that Mr Mackey has been posting controversial company information, trashing competition and touting management.

Social media fails to show “CGM autopilot” effect

Such sensation-charged story, with an official “seal of seriousness”, was sure material for a major online consumer backlash and potential consumer antagonism crisis for the Whole Foods brand.

This was an exemplary case study for 1st2c, the forerunner of Online Strategizing Research©, to examine the DNA of an online consumer-driven crisis situation.

A day-by-day monitoring of online consumer resonance indicates that the stereotypical perception of social media as facilitating and encouraging consumer to mobilize against “misbehaving” marketers is too simplistic.

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Story breaking on July 12, 2007 did trigger a huge surge in consumer talk about both John Mackey and Whole Foods. However, as 1st2c tracking report shows, not only did consumer talk return to previous levels from the very next day but also talk on Mackey behaved differently than talk on Whole Foods. That following surge in talk correlated with media coverage to the issue and to Mackey’s apology posted (this time) on Whole Food’s corporate blog on July 17.

Interestingly, blogs were more aggressive and attempting to mobilize mass action than social mind-sharing platforms (like forums and message boards).

Case study takeaways

Analyzing the nature of consumer response 1st2c analysts highlighted these insights:

1. CEO controversiality does not necessarily rub off on the brand If consumers do not perceive the CEO’s “misbehavior” as compromising their health or interests in an immediate and critical way they are likely to judge his or her practices with limited collateral implications on the brand.

2. John Mackey “behaves” as a brand in terms of consumer attention Many of the surges in talk about Mackey correlate with surges of talk about Whole Foods, sometimes in similar volumes. We have noticed such phenomena looking at consumer brands (mostly consumer goods) and see it as indicative of the significant impact these CEOs do or can have on brand equity, both on the negative and positive side.

3. Blogs represent a different audience and play a different role than social networks Blogs are not the mirror of the market! In many cases they are less so than social networks (Forums, message boards, etc.). The active (vs one shot) blogs tend to represent a more maven, activist and influence-oriented audience while social networks tend to represent the “involved masses”.

1st2c will continue to monitor the market and provide consumers and decision makers with better understanding on the dynamics and the rules and tools of engagement in the networked market©.

Engaging the networked market

1st2c was established in late 2004 as a full service Consumer Media research and strategy powerhouse by internet and brand strategy veterans with extensive international experience. 1st2c is a forerunner of the Online Strategizing Research©. This strategic planning driven research provides vivid market pictures, in-depth understanding of market dynamics and seamless transfer of insights and opportunities to actionables. 1st2c employs well-tested and proprietary technologies and covers both one-to-many and many-to-many platforms.

 

Ofer Friedman
Chief Research and Client Officer
1st2c

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