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  • Apple Responds to Tax Criticism

    Apple CEO Tim Cook is using his persuasive communication skills to address the company's avoidance of billions in taxes . Cook appeared on Capital Hill and received a surprising number of compliments from the nation's lawmakers. Committee Chairman Senator Carl Levin, for example, said, "We love the iPhone and the iPad." Libertarian Ron Paul also defended the company: "I’m offended by the spectacle of dragging in Apple executives. What we need to do is apologize to Apple and compliment them for the job creation they’re doing." Still, the panel accused Apple of creating offshore "ghost companies" to avoid paying taxes. Apple shifts as much as $100 billion to these entities , saving $7 billion in taxes in 2011, according to one estimate. Rather then deny the accusations, Cook blamed the outdated tax system: "Unfortunately, the tax code has not kept up with the digital age." By deflecting attention away from Apple and towards loop holes that should be closed, Cook effectively "disarmed" (to use The New York Times ' word) the Senate committee. Of course, Apple isn't the only company avoiding taxes. According to one study cited by Senator Levin, 30 of the country's largest multinationals "paid nothing in federal income taxes over a recent three-year period. Zero." Discussion Starters: Watch Tim Cook's opening statement in the Senate hearing . What are his strongest and weakest arguments? Watch the rest of the Senate hearing . Which questions are most and least effective? How does Cook use delivery skills to persuade the committee?
  • This Tweet Brought to You by Dos Equis

    To promote its "Legend of You" app, Dos Equis hired a comedian to tweet . When Michael Ian Black ("The State" and "Ed") tweeted that the new app turned him into "a Most Interesting Person," his 1.9 million followers knew it was a paid advertisement. Black's other tweets are funny (depending on your sense of humor). The backlash was harsh, with one tweeter saying, "I wish you had died in 9/11" and another criticizing Black for using language that an unpaid intern probably wrote. Black responded to some tweets, such as this one: You have to admire Black's honesty, but I wonder how his employer feels about it. Discussion Starters: What advice would you give to companies considering paying for tweets? Should they not do this at all, or can safeguards be put in place? If you were the marketing manager for Dos Equis, would you hire Black again to promote your products? He did get a good discussion going...
  • Abercrombie CEO Faux Pas

    CEO Mike Jeffries has surprised and disturbed people with his alleged comments about customers in 2006, which just became public: "We go after the attractive all-American kid...A lot of people don't belong [in our clothes] and they can't belong. Are they exclusionary? Absolutely." The comment has been interpreted to mean that plus-sign people aren't welcomed in the store, and this may be substantiated by the retailer's inventory: no pants size is larger than 10. Public reaction has been strong. As of yesterday, about 1,000 people signed an online petition to boycott Abercrombie. And a nine-year-old in Plano, TX, altered her T-shirt to express her feelings: Discussion Starters: As yet, the company has not responded to requests by ABC news. Should the corporate communication people say something? If so, what? What's your reaction to the CEO's alleged comment? Do you find it offensive, his right to define his customer, or something else?
  • JC Penney's Re- ReBranding Efforts

    After rebranding and ousting its CEO, JC Penney is trying to lure customers back to the store. In a new commercial, the company says, "It's no secret that JC Penney changed" and admits that not everyone liked what they saw. The voiceover asks people to return, saying "We learned a very simple thing: to listen to you." The CEO was in place for only 17 months, and by most accounts was a disastrous choice for the company. A former Apple executive, Ron Johnson implemented a strategy to target younger customers, and the company brought in hipper products and stopped running sales. But JC Penney's loyal customers were alientated in the process. Will the new commercial and CEO (Mike Ullman, who preceded Johnson) turn the company around? Skeptics say it's a rough road : same-store sales were down 20% last year and are down 15% so far this year. A writer for USA Today thinks the company is doomed: "Either way, there is no reason that these customers will come back. J.C. Penney's share of the retail market is already permanently depressed. "J.C. Penney is done for. The only party that has not admitted as much is management. Discussion Starters: Assess the new commercial. How does the company use language, images, and music to convey its message? Which arguments in the commercial might convince customers to return to the store? Which may detract from the company's message?
  • Offensive Ad of the Day: Mountain Dew

    Mountain Dew pulled an ad that was deemed racist and sexist. This one seems to jump, rather than cross, the line. A badly bruised woman is asked to identify someone in a police line-up of African-American men—and a goat. Felicia the Goat, with the voice of rapper Tyler The Creator, made his first appearance in Mountain Dew commercials in March. In an earlier episode, the goat beats up the waitress for failing to give him enough soda. As one might expect, the ad was criticized for being misogynistic. Because bad things come in threes, Mountain Dew has another commercial set to air on May 24. In a statement to The Hollywood Reporter , PepsiCo has taken responsibility for the ad: "We apologize for this video and take full responsibility. We have removed it from all Mountain Dew channels and Tyler is removing it from his channels as well." A representative for Tyler The Creator released a statement to The Hollywood Reporter : "It was never Tyler's intention to offend however, offense is personal and valid to anyone who is offended. Out of respect to those that were offended the ad was taken down," it said. "For those who know and respect Tyler he is known for pushing boundaries and challenging stereotypes through humor. This is someone who grew up on David Chappelle. This situation is layered with context and is a discussion that Tyler would love to address in the right forum as he does have a point of view." "Contrary to what many may discern from this Tyler is the embodiment of not judging others, his delivery may not be for everyone (which is true for anyone who pushes boundaries) but his voice is nonetheless important to the conversation since his demographic understands what he ultimately stands for and sees the irony of it all," continued the statement. "He absolutely never intended to spark a controversy about race," it read. "It was simply an again admittedly absurd story that was never meant to be taken seriously. Again we apologize if this was taken out of context and would never trivialize racism, especially now in America where voting and civil rights are being challenged at the highest level." Discussion Starters: What's your view of the first two commercials? Do you find them offensive, funny, or something else? PepsiCo's response differs from the recent McDonald's and Hyundai situations, where the companies said ads were created without their approval. Does PepsiCo's response work better?
  • Anti-Gay Marriage or Just Anti-Relationship?

    Beer brewer Tui posted a billboard in response to New Zealand's legalization of same-sex marriage. It's meant to be funny but has caught a negative reaction. Controversy is brewing (sorry) on the Tui's Facebook page , but the company is defending the ad. Tui's marketing manager said that "Yeah right" ads have been around since 1994: "There have been a fair few 'Yeah Right' lines which have made it to the billboards over this time, all of which have been generated with the intention of delivering a smile to New Zealanders. "Given the duration of this campaign and the quantity of 'Yeah Right' lines, occasionally there is the odd... line, which doesn’t hit the mark in generating a smile for all. "Our intention with the current Tui Yeah Right billboard 'Dad’s new husband seems nice' was to highlight the common situation or uncertainty experienced when someone’s parent remarries. "Given the recent passing of the Same Sex Marriage Bill in Parliament, this 'Yeah Right' line is a topical spin at the age-old situation of a parent's new partner." It's true: Tui has a long history of edgy "Yeah Right" ads. Here are 16 others . Discussion Starters: What's your view of Tui's ad: tasteless, insensitive, funny, or something else? Look at Tui's other "Yeah Right" ads . Do you find them funny? Does this context change your perception of the gay-marriage ad?
  • Nike Pulls "Boston Massacre" T-Shirts

    A "Boston Massacre" T-shirt showing splattered blood stains will mean only one thing to people now: the bombing tragedy at the Boston Marathon. But this Nike T-shirt is a reference to the Red Sox/Yankees baseball games in 1978 and 2006. Still, some people feel the T-shirts should have been removed from the outlet store before being spied (and photographed) by a producer for the "David Letterman Show." A Nike spokesperson emailed a response to the Huffington Post : "The shirts being referenced are older baseball shirts that were predominantly being sold through our Factory Stores Outlets. In light of the tragedy in Boston we took immediate action last week to remove this product from distribution. We conducted this process as quickly as possible and are confident the product has been removed from distribution." The situation is reminiscent of Nike T-shirts in a Boston store window sporting slogans such as "Dope" and "Get High." In this situation, the mayor of Boston wrote a complaint letter, but the company denied that it promoted drug use. Discussion Starters: In what ways does the "Boston Massacre" T-shirt differ from the "Dope" and "Get High" T-shirts? How are they similar? How do you assess Nike's response? Should the company have done anything differently, or is this an understandable mistake?
  • Hyundai's Ad Mocking Suicide: Not Funny

    Hyundai is apologizing for an ad that pokes fun at a failed suicide attempt. Proud of its new ix35 model that uses water rather than carbon monoxide emissions, the company played on a way that some people end their lives. But the ad didn't go over well, particularly for one woman, who lost her dad to this method of suicide. Holly Brockwell wrote a touching blog post about her father's suicide and how the ad affected her. As a creative advertising director, Brockwell has good credibility for her reaction: "I understand better than most people the need to do something newsworthy, something talkable, even something outrageous to get those all-important viewing figures. What I don’t understand is why a group of strangers have just brought me to tears in order to sell me a car. Why I had to be reminded of the awful moment I knew I’d never see my dad again, and the moments since that he hasn’t been there. That birthday party. Results day. Graduation." Brockwell also posted her father's suicide note, which has gone viral. A week before Brockwell's blog post, AdWeek had criticized the ad . Apparently, a reporter contacted Hyundai but received no response. That was a warning the company should have heeded. Now, after more bad press, Hyundai has pulled the ad from YouTube and issued these statements : Hyundai Motor America Statement: "We at Hyundai Motor America are shocked and saddened by the depiction of a suicide attempt in an inappropriate European video featuring a Hyundai. Suicide merits thoughtful discussion, not this type of treatment." Hyundai Motor Company Statement : "Hyundai Motor deeply and sincerely apologizes for the offensive viral ad. "The ad was created by an affiliate advertising agency, Innocean Europe, without Hyundai’s request or approval. It runs counter to our values as a company and as members of the community. We are very sorry for any offense or distress the video caused. More to the point, Hyundai apologizes to those who have been personally impacted by tragedy." Discussion Starters: Hyundai's defense is similar to McDonald's, which was criticized for the subway ad mocking mental illness: the ads were created "without Hyundai's request or approval." Do you buy it? We haven't seen a response from Innocean, the ad agency. What, if anything, should they do?
  • Ethical Social Media Marketing After the Boston Bombings

    An article by Augie Ray, director of social media for a Fortune 100 company, describes the ethics of social media marketing , and gives us several interesting examples from the Boston Marathon tragedy. In contrast to these companies that perhaps crossed an ethical line, recall El Pelon Taqueria , the restaurant that offered help and asked for nothing in return. Calling it a "desperate attempt to trade on people's feelings," Ray described an NBC Facebook picture of a boy in a hospital bed. The post asks people to "'LIKE' this to wish him a continued speedy recovery." Ray points out that "liking" a post does nothing to help the boy recover. In another example, Ray criticizes Ford for muddying a message with its products. According to Ray, "Ford's use of brand imagery not only reduced the sincerity of the message but demonstrated questionable ethics." For comparison, Ray presents Ford's actual post, at right, next to one without branding, at left. The difference is fairly obvious. Individuals made mistakes as the tragedy was unfolding, too. Author Guy Kawasaki was criticized for continuing to post promotional tweets, as others were suspending theirs. Clearly, he didn't agree with the criticism. He responded, "Loving how people with less [ sic ] than 1,500 followers are telling me how to tweet." Discussion Starters : How do you assess these three situations? Do you agree with the criticism of each? Augie Ray offers a sound suggestion for modifying the Ford post. Can you think of something similar for the NBC post? What might make this one more acceptable (read: more compassionate)?
  • Student's Letter Stirs Up Controversy

    Like many high school seniors, Suzy Lee Weiss is receiving her share of college rejection letters. Disappointed—and clearly more than a little peeved—Weiss published a letter in The Wall Street Journal , " To (All) the Colleges That Rejected Me. " Weiss claims that her 4.5 GPA, 2120 SAT score, and experience as a U.S. Senate page weren't good enough. Partly, she blames her lack of diversity: "For starters, had I known two years ago what I know now, I would have gladly worn a headdress to school. Show me to any closet, and I would've happily come out of it. 'Diversity!' I offer about as much diversity as a saltine cracker. If it were up to me, I would've been any of the diversities: Navajo, Pacific Islander, anything. Sen. Elizabeth Warren, I salute you and your 1/32 Cherokee heritage." Jokingly, Weiss also blames her parents and uninflated job titles. A student who claims " I took your spot at Harvard ," wrote a snarky response to Weiss, including, "But when my parents got divorced and my mom came out of the closet and hooked up with the ¼ Navajo lady neighbor, I closed my textbooks and put down my pen. I figured—why bother? I’m a black female from the inner city with divorced parents, a gay mother, and a part-Native American stepmother. Every college was going to recruit me like I had a great jump shot. . . . "As for me—I’m set for life. Obama is president, racism has ended, and law schools have already come a-callin." Discussion Starters: Although Weiss says it's just satire, some people read the piece as cynical and bitter. Are you with the 53% of Today Show viewers who said the letter was whiny? What's your view? Watch Weiss on the Today Show . How, if at all, does this change your opinion of her?
  • Carnival Updates Guests with "Improvement" Plans

    In a letter from CEO Gerry Cahill , Carnival tries to restore guests' confidence in the brand after several technical and other issues on ships during the past few months .In addition to this letter, Carnival has posted a video on YouTube and created a News and Updates page on Facebook . In some respects, the letter is a confusing mess. Although the $300 million is more clearly explained in the video, this letter makes it sound as though Carnival is buying hotels: "$300 million to expand the availability of hotel services." Cudos to having some of the main point upfront ("Our goal is to drive continual improvement across all aspects of our customer experience"), but isn't much of the main point at the end, where Cahill thanks guests for their loyalty? Also, the letter seems overly jargony for typical Carnival guests. The company just wants them to book another cruise, right? The encouragement could be clearer and more direct. Discussion and Assignment Ideas: Compare Carnival's guest letter, video, and Facebook page. What differences do you see, and how do you account for them; for example, what are the audiences for each? Rewrite the Carnival letter. How can you improve the content, organization, and tone?
  • McDonald's Apologizes for Ad

    McDonald's says it didn't approve an ad that makes light of a mental health issue . In a Boston subway ad, the company pokes fun at someone with an addiction to a Big Mac. Nicole DiNoia, a spokesperson for McDonald's, issued this statement: "A local print ad displayed on the Massachusetts Bay Transportation Authority (MBTA) was recently brought to our attention. We can confirm this ad was not approved by McDonald’s. And, as soon as we learned about it, we asked that it be taken down immediately. We have an approval process in place, with our marketing and advertising agencies, to ensure that all advertising content is consistent with our brand values. Regrettably, in this incident, that process was not followed. We sincerely apologize for this error." With no one taking responsibility, who's to blame? The response is reminiscent of the Ford ad that the company said it didn't approve. In that case, the ad agency did take responsibility for the offensive ads and terminated those involved. In this case, Arnold agency president Pam Hamlin apologized and blamed the process rather than the design: "Arnold apologizes for its mistake to McDonald's and to anyone who was offended by the ad. McDonald's did not approve the ad, and its release was our unintended error. We've addressed the issue and have improved our approval process to ensure this does not happen in the future." In the Ford situation, it was somewhat believable that the ad agency created the ads just to show its creativity. But this situation is different: the agency is hired by McDonald's but didn't get approval during any stage of ad development: concept development, composition, printing, or distribution? Discussion Starters: What's your reaction to the ad? Do you find it offensive, funny, or something else? How do you respond to the apologies from McDonald's and the ad agency? What, if anything, could they do differently?
  • RBC Responds to Outsourcing Plans

    The Royal Bank of Canada is under fire for replacing 45 employees with oversees workers. A representative of RBC admits that work is being moved to another supplier, and current employees are training their replacements. The company is looking for new jobs for the displaced workers, who will leave at the end of the month. The new supplier is iGATE Corp., an Indian multinational outsourcing firm. In an interview, RBC HR chief Zabeen Hirji tried to explain that RBC isn't hiring the workers, and the workers aren't replacing RBC employees—just transitioning to the new staff. Both are tough sells. First, RBC hired the supplier who is hiring the workers (so they have some accountability). Second, having interim workers doesn't change the outcome: people are losing their jobs, and—as it appears—foreign workers will be doing the work. The reporter called the distinction "semantics" and said, "I get what you're trying to sell, but I'm not sure I'm buying it." Criticism is high, particularly the concern that RBC is violating federal rules that foreign workers may not replace Canadian citizens. In response, the bank published a statement that said, "External suppliers with the right skills allow us to introduce new efficiencies, continually improve our service at reduced cost and reinvest in initiatives that enhance the client experience. Agreements with our suppliers include strict controls and ongoing monitoring to ensure full compliance with all regulatory requirements." Public backlash is also high. A Facebook page, Boycott Royal Bank of Canada , has 7,600 likes. Discussion Starters: Analyze Zabeen Hirji's interview. What does she do well, and what could be improved? What are her strongest and weakest arguments? Overall, do you buy RBC's position? One article referred to Hirji's "corporate-speak explanation and histrionic hand gestures." Do you agree with this characterization?
  • Lone Star College Communicates Stabbings

    At least 14 students were stabbed on the Lone Star Community College campus near Houston, TX. One student critically injured two others, as he ran to different buildings, stabbing people with an Exacto knife. When the suspect, known only as "James," was tackled, he said, "I give up. I give up." The college posted an emergency alert on its website, and the school went into lock-down, with students held in classrooms until more information was known. The college told students, "Stay away from the area. Seek shelter in a secure location until the incident is resolved." This is sound advice and reminds us of Virginia Tech's emails during the 2007 shootings—although some of those messages came too late. Image source . Discussion Starters: Assess the college's emergency web page. What works well, and what could be improved? What additional communications would you recommend that the college send to students, faculty and staff, alumni, and parents? What medium should be used for each group?
  • Carnival Responds to Yet More Ship Trouble

    Are all of Carnival Cruise's recent ship problems unrelated? That's what the company would like the public to believe. Carnival's Triumph—which was stranded in Alabama last month— broke free from its moorings . Hurricane-link winds blew the ship from its anchors and threw two shipyard employees into the Mobile River. Although one man was found, another is still missing. Although the crises are mounting for the cruise company, it's getting better at responding via social media. The company quickly tweeted about the situation and posted several updates throughout the day: Carnival also posted this statement to its Facebook page : April 3, 2013, 7PM ET Earlier this afternoon, due to strong winds that reached speeds exceeding 70 miles per hour during a severe storm in Mobile, Ala., Carnival Triumph, which was in wet dock at a Mobile shipyard, broke away from its moorings. The ship drifted, and was secured. With the assistance of tugboats on site, the ship has been moved to the Mobile Cruise Terminal. Lines have moored the ship, and, as a precaution, tugboats will remain alongside the vessel as well. All of the approximately 600 crew and 200 contractors who were onboard the vessel are safe and have been accounted for through a roll call. There are no reports of injuries. While assessment of damage to the ship is ongoing, initial indications suggest the damage is limited. According to reports, two shipyard employees on an adjacent pier fell into the water. One has reportedly been rescued by the U.S. Coast Guard and the search continues for the second. Our thoughts and prayers are with the missing shipyard employee and the family. Discussion Starters: Assess Carnival's response on social media. How else is the company using Facebook and Twitter to communicate during this crisis? How can Carnival rebuild the brand and explain the recent incidents as separate and distinct from one another?
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