Wednesday, September 30, 2009

Sigg's Bottle Full of Troubled Water Pt. 4

The final phase of a crisis is Resolution. It will be hard to talk about the resolution for Sigg's water bottle crisis since resolution for the company is a long way off.

I've written about the other three phases of a crisis and you can read parts 1-3 of the series if you want to learn about the Warning Phase, Acute Phase and Chronic Phase.

The most important part about resolution is that Sigg doesn't get to determine when the crisis is resolved. Its customers will. That's because a company's reputation is owned by its customers. My good friend and crisis communicator Bob Roemer makes that point in his book, When the Balloon Goes Up. He's exactly right on this point.

Think of Exxon and the Valdez oil spill. That spill happened more than 20 years ago. The most recent news story about the spill I could find was from September 24, 2009... less than a week ago as of this writing. It was a story in the Alaska Journal of Commerce about workers filing claims for medical injuries suffered while they cleaned up the spill.

There's even a new play about the spill that opened in Anchorage last week. In October, it will go on the road and play in Valdez. The author of the play told KTUU Television that he was surprised by how deeply people in Alaska felt about the spill:
"I didn't realize 20 years after that I would have audiences in Anchorage for whom the spill was still a very raw wound."
-Dick Reichman, author "The Big One"
There are times you know when the crisis will be resolved. I was on the team of communicators who worked the Space Shuttle Columbia disaster. The accident on re-entry claimed the lives of seven astronauts and put the future of the entire US human spaceflight program in jeopardy.

About a month into the crisis, I had a conversation with an executive United Space Alliance (United Space Alliance is the Shuttle's prime contractor and a client). No one was sleeping more than a few hours a night and people were desperate for normalcy. The executive said that he felt that things were "getting back to normal." I told him that things wouldn't get back to normal for a long time. People may work shorter days (12-16 hrs vs 16-20 hrs) but in the public's mind, the Columbia accident would only be resolved when the next Shuttle landed safely.

When you get to the Resolution Phase, how can you succeed in moving beyond the crisis?

1) Remember the past
The way to get past a crisis is not to forget it happened, but to remember what happened and what you've learned. Your customers or the public will allow you to move on, but only when they know you aren't trying to rewrite history.

2) Honor your people
All crises are human events, and it is important to honor the people impacted by it and those who have helped the organization recover. There were thousands of people working to get the Space Shuttle flying again. Everyone I worked with understood that Return to Flight was as much about flying again as it was honoring Rick, Willie, David, KC, Michael, Laurel and Ilan. In fact, the crew patch for the Return to Flight mission included a silhouette of the shuttle and seven stars to remember the fallen astronauts.

3) Demonstrate humility
People understand that humans are fallible. Your customers will forgive you, but not if you're arrogant or in denial. The ability to be in business depends on your customer's or the public's willingness to let that happen.

The resolution of the Columbia Disaster happened more than two-and-a-half-years after the accident when the Space Shuttle Discovery landed after its Return to Flight mission. We were lucky, because few crises resolve themselves so precisely or with so few words. In this case, four.

"Houston, Discovery. Wheels stop."

It's hard to say when Sigg will reach resolution in this crisis. But I'm pretty sure it will be measured in years, not words.

Bill Salvin

Monday, September 28, 2009

Sigg's Bottle Full of Troubled Water Pt. 3

We looked at the warnings Sigg ignored and examined how they performed during the Acute Phase of their crisis. Now, let's look at the stage in which Sigg currently finds itself, the Chronic Phase. It is just as it sounds. The crisis continues for an indeterminate length, weighs down a company's reputation and clouds people's view of the company's actions and products.

To review: Sigg announced that prior to August 2008, liners used in their pricey water bottles contained the controversial chemical BPA (Bisphenol A), which some people believe is harmful to human health.

Sigg made its liner announcement in late August 2009, three years after it knew the old liners contained the chemical. Sigg marketed heavily to the eco-friendly crowd, including moms who didn't want their children exposed to BPA.

Sigg has mostly gone quiet since the Acute Phase of the crisis ended. Their marketing tactics are now the subject of a class-action lawsuit and one of the major retailers of Sigg Water bottles has cut its ties to the company. Patagonia feels strongly that Sigg lied about BPA in its water bottles.
"We very clearly asked SIGG if there was BPA in their bottles and their liners, and they clearly said there was not." Rick Ridgeway, Patagonia’s VP of environmental initiatives
Elaine Shannon, Editor-in-Chief of the Enviornmental Working Group asked the essential question from a crisis communications point of view in her column on Huffington Post:
For many consumers, the question has transcended the issue of BPA. It's, can you trust this company?
You know a crisis has gone chronic when the debate shifts from the specific event to questions that go to the core of a company's soul. It's important to point out that the science regarding BPA is not settled. Some people think BPA is dangerous to humans, some don't. But the issue with Sigg has nothing to do with science, it has to do with emotion. People feel duped.

Sigg initially posted the ingredients of its new liner on its Website, it has since taken the page down. Below is a screen shot of what they have now.

I don't have a screen capture of the the liner ingredients page (lesson learned), but the description was vague. I doubt environmentalists or moms will take Sigg's word for it when it comes to the mineral fillers, flow additives and pigments added to the Griltex high performance polyester that make up the new liner.

What is Griltex, anyway? There are 47 different versions of Griltex listed in the material property data base MatWeb. How does a mom know if all Griltex high tech polyesters are BPA-free? Who makes the Griltex that Sigg uses, which version do they use and who certified it BPA-free?

People want to know because they no longer believe what Sigg says.

Sigg's competitors have seized on the crisis (as competitors always do). The owners of Klean Kanteen have posted a letter on their Website that takes direct aim at Sigg, even though they don't name the company.

If someone isn't familiar with the crisis, Klean Kanteen is happy to help. It dedicates a page to the anatomy of its bottles and helpful links to blog posts harmful to Sigg.

Sigg ceded the high ground. Now, competitors are seizing market share from a position of strength.

I think there are three key things that Sigg can do now to get through the Chronic Phase of this crisis:

1) Keep communicating
Now is not the time to pull back, even though it probably feels like it. Continuing to communicate will be the only way Sigg can talk about its new BPA-free liner and demonstrate that it has learned from its mistake. If Sigg stays silent customers may never realize that the new liner makes Sigg bottles a choice for them.

2) Pay for shipping for people to exchange their old bottle
Sigg's president said he didn't want to do that because he was afraid people who didn't care about BPA would send in their "three-year-old bottles just because they were dented." What does he care? The three-year-old bottles have BPA in the liner, regardless of the customer's motive. Paying for shipping would help re-establish trust between Sigg and its customers.

3) Get the ingredient list for the new liner up ASAP
People are going to know that the ingredients were posted; I'm not the first blogger to write about it. With the "coming soon" page Sigg is reinforcing people's perception that it has something to hide. Note to Steve Wasik on transparency: You are doing it wrong.

The Chronic Phase of a crisis is where companies often learn the most painful lessons. In this case, Sigg is finding out that it was faster and cheaper to take BPA out of its bottles than it will be to restore trust to its brand.

Bill Salvin

Wednesday, September 23, 2009

Sigg's Bottle Full of Troubled Water Pt. 2

Working our way through the four phases of a crisis, I wrote last about the Warning Phase and the multiple warnings ignored by reusable water bottle maker Sigg regarding the chemical BPA (Bisphenol A) in the liner of its pricey water bottles. In this post, I will look at the Acute Phase of the crisis.

The Acute Phase is when the fire is burning or the story breaks about an issue. Sigg set off the Acute Phase with a letter from its CEO on its Website announcing that Sigg reusable water bottles manufactured before August 2008 were made with a liner containing BPA. The announcement came three years after Sigg knew of BPA in its liner, and after years of reassuring customers that its product was "100% safe". Sigg never said their liners were BPA free, but they never corrected the perception many customers had that "eco-friendly" meant BPA free.

All news is about how an event or issue impacts people. The headlines from traditional news sites and blogs let you know exactly how people felt about Sigg's admission.

Sigg gets points for making the announcement, but not many. They had known for more than three years about BPA in their liner but told no one until they were ready to roll out their new BPA-free liner. Sigg offered to exchange the old bottles for new ones, but only if customers paid for shipping. Here's what Sigg's CEO told Simran Sethi from the Huffington Post.
"We don't believe this is a recall but we know there are some consumers out there that are concerned. If we pay for this we'll get people who aren't concerned - which is about 9 out of 10 people - sending back bottles they bought three years ago that have dents in them." -Steve Wasik, CEO, Sigg
So the company that many people feel duped them into buying its product can't spring for shipping because it is afraid of being taken advantage of.

That's what we writers like to call irony.

I guess when you've been taking advantage of people for years you expect people will take advantage of you.

The only thing that could be worse would be if Sigg replaced the returned bottles with one that included an image of Wasik flipping his customers the bird.

The torrent of customer anger led to another apology letter from Sigg CEO Steve Wasik.
"After reading and responding to hundreds of emails and viewing nearly as many blog & Twitter posts, I realize that my first letter may have missed the mark. What I should have said simply and loudly to all of our loyal SIGG fans is: I am sorry that we did not make our communications on the original SIGG liner more clear from the very beginning."
It took the crisis to get to the Acute Phase for Sigg to have an acute attack of the obvious.

Two key points to get through the Acute Phase of a crisis with as much of your reputation in tact as possible:

1) Make sure your actions match your words.
Sigg made its money playing to people's eco-fears. It is not surprising people get hostile when they feel duped.

2) Never lose your temper.
This screen capture of the former Sigg Facebook Page (since taken down) highlights the contempt some people at Sigg had for people making "all the fuss"
The "we-suck-just-as-much-as-other-people" tactic really doesn't work here.

I will focus on the Chronic Phase of this crisis in my next post. But before leaving the Acute Phase, I want to give a hat tip to the consumer advocacy blog Z Recommends. They put it perfectly when they posted:
Transparency is a value, not a strategy.

Bill Salvin

Monday, September 21, 2009

Sigg's Bottle Full of Troubled Water Pt. 1

The Swiss company Sigg, maker of trendy and expensive reusable water bottles, is in a heap of trouble. The reusable water bottles they marketed as eco-friendly included a liner that contained small amounts of a controversial chemical that many believe harmful to human health.

The revelation sent Mommy-bloggers into a rage. They felt betrayed and blasted the company for misleading them. Sigg has a huge crisis trying to convince customers that they weren't deceived.

There are four phases to a crisis: Warning, Acute, Chronic and Resolution. Sigg has fumbled the first two phases, is smack in the middle of the chronic stage and is hoping resolution comes quickly.

I'm going to put Sigg's words and actions into each phase, chart how things unfolded and give you some info you can use to prevent or manage a crisis in your organization.

Warning Phase
Most crises have warnings. Sigg's warning came from numerous stories and studies questioning the use of the chemical BPA (Bisphenol A) and the potential for it to leach into liquids. In 2006, Sigg learned that the liner it used (manufactured by a third party) contained small amounts of BPA, although none of the chemical leached out in multiple independent tests.

The company began designing a new BPA-free liner in 2006. Here's what Sigg CEO posted in a letter to customers on the company website a few weeks ago:
"Despite the fact that these bottles were manufactured well within strict international regulations and posed no health risk, my team and I initiated a project in June 2006 to develop a new liner which would be both BPA free and produced in a more environmentally friendly manner. We recognized early that there were questions surrounding BPA and we wanted to be sure that we had a bottle liner that you, our customers, could have absolute confidence in."

Steve Wasik, CEO Sigg

Sigg knew three critical facts in 2006:

1) People were concerned about the presence of BPA in products

2) People bought Sigg water bottles based on its "green" merits and many customers equated "green" with "BPA-free"

3) Their product contained BPA

Sigg delayed more than three years before disclosing its liner contained BPA.

In 2007, the Environmental Working Group (EWG) included Sigg's liners on a list of products that contain BPA. A claim known by Sigg to be true. Yet, Sigg sent a letter to the EWG demanding to be removed from the list. Below are excerpts from Wasik's letter to EWG from the Legal Planet Blog and the Eco Childs Play Blog:
"I can assure you that SIGG bottles are absolutely not made with a plastic liner and are in fact lined with a proprietary non-toxic, water-based resin which has been refined over decades of study and is extremely safe & stable."
"We understand the controversy and concern surrounding BPA leaching from plastic water bottles and can assure you that SIGG bottles are leach-free and 100% safe. We are upset about the misinformation which has circulated and are working feverishly to clear the good name of SIGG."

Wasik wrote the Sigg bottles are absolutely not made with a plastic liner... true statement, but not the point. He also writes that Sigg bottles are leach-free. Also true, and also not the point. The letter was precisely crafted to dodge the issue.

Sigg bullied EWG into removing it from its list. And it worked. It worked for two more years. During that time, Sigg bottles were featured in eco-friendly stories in dozens of publications and they even made the Today Show twice.

Sigg's slow-burn warning of its impending crisis has three important points that stand out to me as a crisis communicator:

1) Denial is a powerful force.
When your market strategy is successful, it is hard to consider telling your customers information that will likely lead to decreased sales. Force yourself to confront difficult reality. Write the story you don't want to see and figure out what you can say, maintain your integrity and still be successful.

2) There is no such thing as selective transparency.
Sigg had some facts on its side, but not the most important one. Either you are transparent or opaque. Sigg was deliberately opaque in its communications. Great brands are built on trust. Sigg earned trust with its customers with incomplete information. It's not hard to predict what will happen when your customers find out you lied.

3) Never underestimate your audience.
Sigg underestimated the power and fury of moms who felt they had been mislead into a purchase that could harm their children. If Sigg had put itself in the position of the mothers who bought its products, perhaps they would have come clean sooner.

In my next post, I'll write about what happened during the Acute Phase of this crisis.

That's when the BPA really hit the fan.

Bill Salvin

Wednesday, September 16, 2009

Technology Changes. Wisdom Doesn't.

CNN has a story about being careful what you Tweet after someone from ABC News Tweeted that the President of the United States called Kanye West a jackass. I know that many companies are wrestling with Social Media policies and how to incorporate the new technology into the workplace; I'm helping some of my clients write those policies.

But this isn't a Twitter or Social Media problem, this is a Media Training 101 mistake. Seriously, the President knows better. I advise my media training clients that if you don't want something printed or broadcast, DON'T SAY IT. That advice hasn't changed since I started media training in the early 90s.

Plus, the President told people that his remark was off the record AFTER he made it. Sorry, Mr. President, it doesn't work that way. I wrote a piece called 10 Things You Should Never Say to a Reporter. One of them is: "That last part was off the record."

The debate about whether the ABC News employee should have sent out the Tweet is a subject for another post. But, I hope everyone understands it wasn't the Tweet that made the President less "presidential."

As for wisdom? My grandfather used to tell me (a lot), "Never miss a golden opportunity to keep your mouth closed."

Bill Salvin