Brands concerned about social media backlash by consumers against their companies have justifiable fears — on Tuesday, public outrage caused Uber shareholders to give ride-sharing service CEO Travis Kalanick the boot.
“The move caps months of questions over the leadership of Uber, which has become a prime example of Silicon Valley start-up culture gone awry,” writes Mike Isaac on Wednesday for The New York Times. “The company has been exposed this year as having a workplace culture that included sexual harassment and discrimination, and it has pushed the envelope in dealing with law enforcement and even partners. That tone was set by Mr. Kalanick, who has aggressively turned the company into the world’s dominant ride-hailing service and upended the transportation industry around the globe.”
In perhaps the most notable sample of social media outrage against the company, the hashtag #DeleteUber became ubiquitous in January. That’s when Uber alerted users it not only wouldn’t honor an hour-long taxi strike aimed at protesting President Donald Trump’s immigration ban, but that it wouldn’t increase rider fares, either. Also, news of Kalanick’s presidential advisory role and his statement that he would work with anyone as long, as it helped Uber’s bottom line, spread through the hashtag — prompting Kalanick to end that commitment.
It’s not the first time, though, that a social media storm affected a CEO. In April, United Airlines CEO Oscar Munoz didn’t get promoted as expected to the role of board chairman. That came after what consumers characterized as a callous statement about a paying passenger being dragged off of an overbooked flight.
There are a few lessons for brands here.
Business Is About the Bottom Line, Until It Isn’t
Consumers are telling brands that they want to feel good about their purchases — by using social media to call them out on misdeeds and then voting with their wallets.
“Fifty-five percent of global online consumers across 60 countries say they are willing to pay more for products and services provided by companies that are committed to positive social and environmental impact,” according to 2014 research from Nielsen.
The CEO of Uber resigned today over pressure from their board and stockholders. Don't ever tell me activism doesn't work.
— Charlotte Clymer 🏳️🌈 (@cmclymer) June 21, 2017
Being Proactive Prevents Brand Suicide, As Well As Piling-On
Uber and United CEOs took a long time to react to public outrage. Not doing what they did could’ve cost them short-term money, but had long-term benefits for brand reputations. For instance, many consumers boycotted Uber and United, switching to different modes of transportation.
As far as adding to woes goes, a former Uber employee’s allegations of sexual harassment went unanswered by the company until many more employees filed those and discrimination claims.
“Travis Kalanick’s combative refusal to acknowledge Uber’s responsibilities in the passenger transportation industry launched and reinforced a number of harmful policies,” reads a statement from Dave Sutton, spokesperson for “Who’s Driving You?” — which is a public safety campaign on behalf of the Taxicab, Limousine and Paratransit Association. “More than 200 Uber passengers have reportedly been victims of sexual assault and harassment by drivers. If Uber wishes to make a turnaround, the new leadership should commit to passenger safety by requiring its drivers to be screened by law enforcement.”
What do you think, marketers? Also, what impact does this specifically have on automotive, as well as travel and hospitality marketers?
Please respond in the comments section below.