[Viewpoint] Direct means of crisis management

It is a fact universally acknowledged, via a number of studies and corporate experiences, that direct communication with consumers raises customer satisfaction and loyalty.

By taking into account customers’ individual preferences and their potential value, direct communication allows companies to deliver customized service by immediately providing a solution, thus raising customer satisfaction.

In reality, however, not enough direct communication has been done due to costs, time and regional restraints. Against this backdrop, companies are increasingly realizing direct online communication in public relations and marketing.

Four tips can be suggested for companies utilizing the Internet as a strategic means for direct-to-consumer communication.

First, develop creative ideas for sharing product information through the Internet. To induce a customer click, you need fun content and an interesting interface. The Korea Tourism Organization’s online marketing offers a successful model for providing both information and fun resources.

To attract Japanese tourists in their 20s, the KTO opened a Web site that features a gallery of Korean and Japanese celebrities, such as Korean wave star Lee Dong-gun and Japanese actress Haruka Ayase.

The two celebrities travel around Seoul, Jeju, Gyeongju and Busan, pursued by the paparazzi, exclaiming their love of Korea’s tourist sites and vistas. Web site visitors track their travels and can obtain detailed travel information in the process. Since the launch of the Web site, the rate of Japanese in their 20s traveling to Korea has more than doubled that of the overall number of Japanese visitors.

Second, use word-of-mouth marketing strategies. Online community sites like Twitter have triggered an explosion of interactive networking. Companies are looking for online opinion leaders and using them as pivotal spokespersons to spread information. For example, Microsoft operates a MVP program through which it selects 100 online opinion leaders worldwide, including power bloggers and community site operators. It induces these opinion leaders to explain product information and evaluate products in a positive manner.

Another form of word-of-mouth online marketing takes advantage of a company’s own brand community site. Cuckoo Homesys, a local rice cooker manufacturer, sponsors a culinary platform called “Cuckoo Mission,” which allows its community-site members to post their own recipes. Members upload content, including photos, at the company’s site, and awards are given to the best recipes. With a storehouse of recipes piled up online, netizens search for a specific recipe at a portal site, and find those that use Cuckoo’s wares.

Third, the Internet can be used to minimize the spread of fatal corporate problems such as safety and quality accidents. Paul A. Argenti, an authority in crisis communication, proposes companies simplify their communication channel and tell customers all they can - and fast. This is to pre-empt potentially fatal rumors or prejudice due to a lack of information. The Internet in this regard is very effective in providing information promptly and on demand. Via Internet video, CEOs and managers in charge can express themselves and help minimize damage.

U.S. toy maker Mattel faced a crisis over lead paint detected on one of its biggest sellers, the Barbie doll, but CEO Robert Eckert offered a sincere apology by posting a video on the company Web site on Mattel’s philosophy on safety. His actions helped mitigate consumer anger.

Last, but not least, it is crucial to create a space online for directly communicating with consumers. Younger generations are highly attuned to communicating online, which can enable companies to develop a more frank relationship with them.

The Samsung Group operates a nonprofit Web site targeting people in their 20s called “YoungSamsung.com.” Here, members create content themselves and propose ideas for better services. The most active members act as reporters and write articles, thus serving as an actual operator or planner of the site, with the company only helping them from the sidelines. The site, with 2.4 million members and 70,000 visitors a day, is the largest of its kind in Korea.

When directly communicating with consumers through the Internet, companies should judge when to act and when not to act. As for negative rumors and customer complaints about products, they should act promptly to prevent adverse effects from spreading. Within the space for communication, it will be desirable for the company to take one step back and prompt natural information communication among customers.

Of course, acting is not easy even when one knows about the positive effects of interactive Web communication. This is because although it is widely known that online communication reduces costs, it can actually generate huge costs and, when incorrectly operated, can have a damaging impact.

Another burden is that consumers’ voices can be exposed to top management. However, it is now increasingly being utilized as a strategic way to differentiate a company from rivals.

So it is crucial to be more than a Web site operator and attempt to communicate with consumers more closely online.

*The writer is a research fellow at Samsung Economic Research Institute. For other SERI reports, please visit www.seriworld.org.
Translation by the JoongAng Daily staff.

by Shin Hyung-won