February 28, 2014

Transparent Communication in the Age of Technology

An adage you were told as a child will serve you very well in marketing and advertising.

“Honesty is the best policy.”

Scott Monty, the head of digital communications for Ford Motor Company, wrote in The Guardian that the business world currently operates in an age when privacy is fleeting. A company secret can go from being known by a select few people to thousands within milliseconds. If the secret is insidious enough, thousands can turn to millions in the blink of an eye.

This is where being forthright as a best practice pays off. Many organizations have already taken transparency to heart. Openness with the public and most importantly its own base of customers has become a higher priority for companies of all sizes.

Openness with the public and its own base of customers has become a higher priority for companies of all sizes.

“It is one thing for a brand to tell someone what its position is; it is more convincing to use earned media tell the story on the brand’s behalf,” Monty wrote on The Guardian. “But the most powerful impact is when a company is confident enough in its process or operations to bring viewers in to see exactly how things are done. It is the ultimate in show and tell.”

Complete transparency doesn’t serve anyone well, as some things should be kept in-house. However, picking spots where honesty will pay off can be a huge benefit for businesses.

Monty gave the example of McDonalds fighting against the rumor that its famed (or perhaps infamous) Chicken McNuggets are made from so-called “pink slime.” No food business wants customers to believe it is serving them something unappetizing, so McDonald’s released a video showcasing its supply chain and manufacturing process. Thus far, it has 3 million views and gained praise for its transparency.

Telling customers about areas of business which need to be improved may also work well. Marketing Sherpa noted that while many take the “Wizard of Oz” approach (seemingly residing behind a curtain), Chipotle admitted to utilizing Genetically Modified Organisms, or GMOs. By saying they use these but are trying to cut them out on their own website, the company showed where it needs to improve. This gives them the option to show customers its development over the years.

Admitting a flaw, no matter how minimal, will likely lead to customers thinking the organization is being honorable across departments. As Psychology Today notes, apologies tend to be viewed as a sign of weakness but should actually be seen as a sign of strength. If done correctly, a genuine admission or apology can create good will and gain forgiveness, the website said.

Holding back the truth can hurt

Showcasing an obvious lack of transparency can make a brand look very bad. Target learned this late last year when as many as 110 million of its customers’ credit and debit cards were breached, far surpassing their original admission of 40 million. The New York Times stated that the “drip, drip” of disclosures seemed to harm sales, as the fourth quarter was down 2.5 percent from the same period of 2012. This is especially painful during the holiday season when retailers are expected to thrive.

While Target was eventually fully honest about the extent of this breach, customers certainly felt the pendulum over their heads as the number of those affected slowly increased. It will likely take some healing time before many people can fully trust Target again.

Trust is an extremely valuable commodity in marketing. Being open and honest pays off for businesses on multiple levels, especially as information technology continues to grow. Social media’s ascension means companies will need to have an improved grasp on their online presence to truly gain the faith of potential clients and customers.