When the virtual mob comes calling

Businesses have to be prepared for the online lynch mob in a time of intolerence.

In China, the human flesh search engines track down people who have offended the herd sensibility.

As Australia becomes more conservative and reactionary, the same phenomena is developing Down Under. Aussie businesses now have to be prepared for when they come to the attention of an online lynch mob.

Last weekend a South Australian dairy company, the Fleurieu Milk and Yoghurt Company, announced it would not be seeking Halal certification for its yoghurts following concerted harassment from bigots, a decision that will cost it a $50,000 contract with Emirates Airlines.

Fleurieu was not the first company to be targeted by groups of online bigots, a few weeks earlier Maleny Dairies from the Queensland Sunshine Coast announced it would not seek Halal certification for after being deluged with queries from similar groups.

For a company of any size, a wave of abuse from online hate groups is difficult to handle but for smaller businesses like rural dairy companies it’s particularly hard as there’s little training for dealing with obnoxious and ill informed virtual lynch mobs and the resulting drop in morale can affect the entire workforce.

Many managers would draw the conclusion that social media is a dangerous place that only exposes staff and the business to these vile individuals, however withdrawing totally from online channels might actually magnify the effects of being targeted as companies don’t see the internet campaigns developing.

Reacting to a hate campaign is difficult however and much of how a company deals with being the target of one comes down to the owners’ and managers’ appetite for dealing with such a crisis.

Submit to the mob

The quickest way of defusing the situation is to agree to the mob’s demands, as Maleny and Fleurieu did, which has the advantage of relieving the stress on staff and management distractions.

Submission though is not without its risks; the mob may not be happy or agreeing to their demands may upset other customers who actually spend money with the business.

This latter point is something Australia’s agricultural industry and governments should be paying attention to as Middle East nations takes over ten percent of the nation’s food exports.

Agreeing to one group’s demands may also irritate other equally other vocal groups which could actually make the problem worse. Ultimately though it comes down to what a company’s management is most comfortable doing.

Should you decide to go along with the mob, don’t equivocate. Be absolutely clear about what you are doing and why you are doing it. This is something both Fleurieu and Maleny diaries have done.

Don’t engage

If the choice is not to submit, either on principle or for commercial reasons, then it’s necessary to be prepared for continued criticism with staff and management coming under further stress. It’s important everyone is supported by the team in the face of often vile and crude behaviour.

One of the key tenants of online marketing and community management is to engage with your critics, however there is a point where trying to engage with irrational people is pointless and possibly even counterproductive.

When that point has been reached, then there is no need to reply to them and any inflammatory or provocative posts should be deleted. The saying of “don’t feed the trolls” applies.

Should commenters become too strident or silly then they should be blocked and, if they are misbehaving on a social media site, their actions reported to the service’s management. Any threats of violence should be immediately documented and a complaint made to the police.

Don’t provoke

Provoking these groups is also a mistake, descending to their level of behaviour will only encourage them and their friends along with risking alienating your own supporters. Keep things professional and straight forward.

Not being a dill yourself is something that could have heeded by one of the other businesses that found itself on the receiving end of an online lynch mob this week. Mark Clews, the proprietor of Tuk Tuk Hunter Valley, was on the receiving end of an online campaign after a snarky post about a vegetarian who visited his hamburger bar in the wine country north of Sydney.

Reading the Tuk Tuk Facebook page quickly gives one the impression Clews enjoys an online fight and he certainly got one which led to his business receiving dozens of poor reviews and at least one critic set up a Facebook page, later taken down after legal threats, highlighting the business’ poor reviews.

In a heated environment — be it vegetarianism, Halal certification or any sort of politics — it’s worthwhile business owners keeping their own personal views separate from their company’s online presence.

The moral of all three of these stories is the internet is a tough place and in today’s increasingly intolerant society one not without its risks. While every business needs to have an online presence, it’s necessary to be prepared for when the online mob appears with virtual torches at your door.

Similar posts:

  • No Related Posts

Apple launch a local listing service to succeed where Google and Facebook failed

Apple may be able to succeed in small business listings where Google and Facebook failed.

They are late to the party, but given both Google and Facebook have missed the opportunity to grab the local listings market, Apple just might be the company that gets it.

Similar posts:

  • No Related Posts

Googling your business

Despite Google’s new small business service, the space remains a great opportunity for a disruptive entrepreneur.

Google’s small business services have been a constant irritation of this site, with the view that local listings have been a missed opportunity for the service.

Overnight, the search engine giant has launched their new Google My Business site to bring together the disparate services offered to local enterprises.

At first look it’s a fairly slick way to get new businesses signed up, albeit dependent upon Google+ for the initial login. For businesses with existing Google small business accounts, the site directs you to the revamped Google Places administrator screen.

The immediate observation is that Google+ integration is a weakness as it relies on one ‘real person’ account to administer the listing; this will create problems for business as staff leave and founders retire.

Black Box Verification

Another problem is the black box verification process still remains – it’s hard for businesses to keep their listings fresh and up to date when there’s a risk doing so will see their entries might be suspended for violating some vague rules.

For local businesses it’s essential to have the search engine listing and the Google My Business site makes it easier to get it running, however the problems with Google’s local business strategy remain.

With Google, Facebook and the other online empires neglecting small business, this market is still a great opportunity for a disruptive players.

Similar posts:

  • No Related Posts

Solving a global capital crisis

Kiva and crowdfunding challenge the global small business funding crisis.

“We face a global capital crisis,” states Julia Hanna, the chair of crowdfunding platform Kiva.

In a story written with Kiva board member and LinkedIn founder Reid Hoffman, Hanna discusses how crowdfunding platforms are replacing banks as the source for businesses around the world.

Throughout world  banks have effectively stepped out of the small business market, despite the world being flooded with cash to keep the global economy afloat over the last five years. Hanna writes about the US experience;

big banks currently reject more than 8 out of 10 loan applicants, and small banks reject 5 out of 10. Some estimates suggest that investment in small businesses has dropped as much as 44 percent since the Great Recession in 2008.

While the Great Recession had a lot to do with the collapse in small business lending in the US and Europe, the decline in bank support for main street dates back to the first Basel Accords established in 1988.

Basel judged banks’ risks on the classification on their assets – government bonds were the safest and domestic property was the preferred private sector asset with small business lending being a long way down the risk.

Following the cues from regulators, banks favoured mortgages which they could them securitize and onsell to investors; this gave rise to the sub-prime lending markets, Collateral Debt Obligations and eventually the Great Recession itself.

Six years after the great recession started and despite massive amounts of capital being injected into the banking system, the small business sector is still being capital starved.

As Hanna and Hoffmann state in their article, crowdfunding sites like Kiva and community initiatives are changing the banking system and it could well be that today’s trading banks.

Having neglected their core purpose of funding business and industry, are now as vulnerable to disruption as other industries as small businesses, entrepreneurs and communities look elsewhere for their capital needs.

Similar posts:

No country for small business

Online advertising for small business is wide open again as the Internet empires focus on big business.

Facebook’s latest changes to its layout creates more problems for small business using social media as the real estate available on its site for eyeballs gets smaller.

The social media giant has been catching criticism recently for changes to its algorithm that make it harder for businesses to be seen online.

In the hospitality industry, discontent was articulated by the Eat 24 website which closed its Facebook Page down after finding the problems too hard.

With the changes to the online advertising feed, it makes it even harder for small business to be seen on the platform as reduced space means higher prices for the space that remains available.

It’s hard to see small businesses getting much traction with the changes when they’re up against big brands with large budgets.

On the other hand for the big brands, the importance of proper targeting becomes even greater as wasting

A challenge for small business

The big problem now for small business is where do you advertise where the customers are?

A decade or so ago, this was a no-brainer – the local service or retail business advertised in the local newspaper or Yellow Pages. Customers went there and, despite their chronic inefficiencies, they worked.

Now with Facebook’s changes, it’s harder for customers to follow small business and this is a particular problem for hospitality where updates are hard.

The failure of Google

Google should have owned this market with Google Places however the service has been neglected as the company folded the business listing service into the Plus social media platform.

Today it’s hard to see where small business is going to achieve organic reach – unpaid appearances in social media and search – or paid reach as the competition with deep pocketed big brands is fierce.

Services like Yelp! were for a while a possible alternative but increasingly the deals they are stitching up deals with companies like Yahoo! and Australia’s Sensis are marginalising small business.

So the online world is getting harder for small business to get their message out onto online channels.

For the moment that’s a problem although it’s an interesting opportunity for an entrepreneur – possibly even a media company – to exploit.

Similar posts:

  • No Related Posts

Neglecting the small business sector

The IT industry continues to neglect the small business sector

I’ve previously flagged how the IT industry fixates on the consumer sector, the Kickstart forum on Australia’s Gold Coast emphasised this with vendors, particularly those in the Internet of Things market, focusing on home users.

This is mindset is understandable given the huge numbers being cited for consumer applications, but the sneaking suspicion is that home users simply aren’t going to pay for these technologies and that the real money will be made in helping the retail sector deliver services to customers.

On Networked Globe today we discuss that quandary, it’s something that both vendors, consumers and small businesses should be thinking about given the way it’s going to change supply chains and entire industries.

Similar posts:

  • No Related Posts

Revisiting the Lipstick effect

How real is the lipstick effect? The Irish experience says it’s complex.

During the recession much was made about the ‘lipstick effect’ – the idea some businesses and products would survive because they’re little luxuries that cash strapped consumers will spend on while scrimping and saving in other areas.

Some of those areas are ladies’ cosmetics (lipstick), chocolate, movies and coffee shops. All of them offering small pleasures for a few dollars.

It’s a theory I’ve always been sceptical of and an episode of the BBC’s World Of Business where Peter Day travels to Cork to see how Ireland’s second city is recovering from the great recession illustrates the reality is a lot more complex than the theory suggests.

“We really struggled to keep alive,” Claire Nash of Nash 19 restaurant says in her interview with Day on her business experience during the recession.

“My turnover just absolutely took a spiralling tumble and it wasn’t that the customer weren’t coming in – those that had lost their jobs weren’t coming in – but those that hadn’t lost their jobs were really hurting and they were very careful with their spend.

“So they started using us as a treat, which was a model I never wanted to enter into but we weathered the storm.”

It can be argued that Claire survived because of the lipstick effect – she kept enough customers to survive – but it was tough and had she taken out the loans offered to her during the boom it’s unlikely her restaurant would have survived.

The key point though is the lipstick effect turned out to be a very different, and much less lucrative business, for Claire and other businesses in Cork.

So assuming a business will remained unscathed because of the assumption the lipstick effect is a big risk, if that’s the plan then Sequoia Capital’s infamous Powerpoint of Doom comes to mind.

While the presentation was aimed at tech companies and investors, it’s a good overview of how the Global Financial Crisis happened and Slide 49 – Survival of the Quickest – is probably the best lesson for any business: Act fast to adapt.

The lipstick theory is a nice way to justify unsustainable business models, particularly those that rely on consumer spending, in the face of a recession but the assumption spending will remain the same as customers will seek little luxuries is deeply flawed.

A business that doesn’t respond quickly to changed circumstances and reduced spending is one that might not survive a downturn.

Peter Day’s Cork story is a good listen on how Ireland and Cork have weathered the global financial crisis, the main question from the piece is how much have the Irish and the rest of the world learned from the mistakes of the boom years at the start of the 21st Century.

Similar posts: