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A Tale of Two Companies & Social Media

Social media are credited with fueling the uprisings in the Middle East, and two cases this week show the influence it can have on business.

As Al Maag points out in his blog, the changes {complink 10867|Facebook} made to its site have raised such a hue and cry that the uproar is its own news story. (See: Is Your Business Face on Facebook?) Facebook invited user feedback, which so far seems overwhelmingly negative. It doesn't sound as if Facebook is going to change things back, though. The vibe I'm getting is that, like {complink 379|Apple Inc.}, Facebook is telling users, “We know what's good for you. Just hang in there.” The first iPhone had connection problems when handled a certain way, and Apple's original response was “So don't do that.” It has since fixed the problem.

In contrast, we have OnStar, which reversed its policy yesterday regarding data collection and its subscribers. OnStar told the press:

OnStar announced today it is reversing its proposed Terms and Conditions policy changes and will not keep a data connection to customers' vehicles after the OnStar service is canceled.

OnStar had recently sent e-mails to customers telling them that effective Dec. 1, their service would change so that data from a customer vehicle would continue to be transmitted to OnStar after service was canceled — unless the customer asked for it to be shut off.

“We realize that our proposed amendments did not satisfy our subscribers,” OnStar President Linda Marshall said. “This is why we are leaving the decision in our customers' hands. We listened, we responded and we hope to maintain the trust of our more than 6 million customers.”

If OnStar ever offers the option of a data connection after cancellation, it would only be when a customer opted-in, Marshall said. And then OnStar would honor customers' preferences about how data from that connection is treated.

Maintaining the data connection would have allowed OnStar to provide former customers with urgent information about natural disasters and recalls affecting their vehicles even after canceling their service. It also would have helped in planning future services, Marshallsaid.

“We regret any confusion or concern we may have caused,” Marshall said.

Not all the correspondence between Apple, OnStar, and their users was via social networking, but you can bet a big chunk of it was. Even if comments weren't sent directly to the companies, readers, users, “Friends,” and the news media were able to gauge public reaction through posts, Tweets, blogs, and Likes. I know OnStar was monitoring posts, because it sent its statements directly to me, and I quoted the Wall Street Journal as my original source regarding OnStar. (See: Measuring the Value of ‘Big Data’ in the Supply Chain.)

OnStar has impressed me on two levels. First, it responded quickly and decisively to its users' concerns. Second, it went the extra mile to track down EBN's editorial e-mail address. (I'm sure there is an automated data-collection technology behind that, but still…)

These businesses will continue to collect data, but that's not the point (at least for today). Social media played a big role in the decisions these companies made. I've had my doubts about social networking and its application in business, but I'll never deny its power.

17 comments on “A Tale of Two Companies & Social Media

  1. prabhakar_deosthali
    September 29, 2011

    That is true . Social networking media are for social cause and on social issues there is nothing better than today's social networking media to form a collective opinion on the social issues.

    In case of On-star case the issue seems to be of the right to share data.

    Recently in India  the anti-corruption campaign by one of the social activists got a worldwide support mainly thru these social media.

    The power of these social networking media is tremendous no doubt for driving attention to burning social issues of international nature.

  2. jbond
    September 29, 2011

    That's great news that Onstar actually responded with an email directly to EBN. I also think it was quick thinking and the proper handling of the issue at hand for Onstar. They heard about the complaints quickly through social media and other outlets and instead of ignoring the customers, they actually listened to them. If only other companies would follow suit. I sometimes think all this social media gets irritating at times, but this was definitely a case when it did some good.

  3. Himanshugupta
    September 29, 2011

    I agree that just like playing an epicenter during the middle-east uprising, social media played a vital role during the anti-correction campaign in India. I am not sure whether it was the social media first or the print and digital media first that picked up the issue but discussion and format support of the people in social networking sites played a vital role in helping bend the government. These are the recent examples of how strong the social networking media has become and how much influence they are imparting on a common man.

  4. Anne
    September 29, 2011

    Social media is rapidly transforming the way most companies communicate with their customers or the potential ones.  It's cost effective way that gives companies broader reach beyond the traditional communication methods.  With a simple post, businesses can promote products and services.

  5. Taimoor Zubar
    September 29, 2011

    When it comes to Facebook, drastic upsetting changes are nothing new. Over the past 3, 4 years the biggest social network has continued to make big changes in terms of the policies, user interface etc. Even if the changes received a negative initial feedback, people quickly got used to them and in fact started liking them. Thus, despite the enormous cry-out about the recent changes, I am convinced Facebook has made this change after deeply analyzing what appeals to it's users and eventually people will start liking these changes as well.

  6. JADEN
    September 29, 2011

    It is an important part of businesses now, that's for sure.  Like the systems and programs, it has become a near-essential organ in making business better and more efficient.  The internet connects people and many gather in social media sites, so that's where the business will go as well.  Many companies like Skittles, Cocacola, RedBull, Wholefoods, etc already are taking advantage of social media.

  7. Anna Young
    September 29, 2011

    Facebook though unrepentant, realised the importance of gauging its users or customers mood via its recent site alterations. However the outcome may not have been what the company anticipated – I think this may count when Facebook is planning any future changes. Thus Social media aids, transform, and improve services for businesses via data collections, advertisement and marketing strategies.

  8. Daniel
    September 30, 2011

    “Facebook invited user feedback, which so far seems overwhelmingly negative. It doesn't sound as if Facebook is going to change things back, though. The vibe I'm getting is that, like Apple Inc. (Nasdaq: AAPL), Facebook is telling users, “We know what's good for you. Just hang in there.” The first iPhone had connection problems when handled a certain way, and Apple's original response was “So don't do that.” It has since fixed the problem.”

    I think it’s a wrong policy of Facebook. They are forcing the user to use, what they like on behalf of users taste. There is big question, how long they can force the users like that?

  9. FLYINGSCOT
    September 30, 2011

    Social networking is a very powerful tool and companies should try their best to harness the force.  I suppose like anything else it can be used for good or bad and so companies must view it as another check and balance on business conduct.

  10. maou_villaflores
    September 30, 2011

    I certainly what you have posted. But i have these companies can be responsible with the message they are sending to their target audience.

  11. Eldredge
    September 30, 2011

    While I don't like the changes that FaceBook has made, I do see a bit of a difference between the FaceBook situation and OnStar. With FaceBook, uses have volutarily (and often naively) place information in the public domain, giving the user control of the data provided (although no control over how it is used, which should be a concern to users). With OnStar, the user doesn't know or have control over what information is collected or how it is used, whether they subscribe to the service or not.

  12. Ashu001
    September 30, 2011

    Anna,

    Right you are!!!

    Facebook has to make changes to make it suitable for us .

    Regards

    Ashish.

  13. Ashu001
    September 30, 2011

    Anna,

    Right you are!!!

    Facebook has to make changes to make it suitable for us .

    Regards

    Ashish.

  14. Ariella
    October 1, 2011

    Exactly, FlyingScot. I've seen it at work in marketing campaigns that people soundly rejected and posted about why on social media outlets, as in the case of the aborted  Got Milk? campaign that ran this summer. You can get some sense of the discussion and arguments it sparked at http://gotdiscussion.org/#/

  15. Anand
    October 3, 2011

    Social media played a big role in the decisions these companies made.

    @Barbara, I totally agree with you. Social media is playing vital role in the decision these companies are  making. Infact social networking sites like Twitter are being used by hedge fund managers. The millions of tweets posted on Twitter are being analysed by hedge fund managers to predict share price patterns. As you rightly summarised we cannot deny social meidas power.

  16. Anand
    October 3, 2011

    Facebook though unrepentant, realised the importance of gauging its users or customers mood via its recent site alterations.

    @Anna young I agree with you. Facebook is still unrepentant. But I guess this attitude is slowly changing after google+ was released. Till now FB didnt care to gauge its customers mood, but after Google+ success FB is worried about its market share.

  17. stochastic excursion
    October 3, 2011

    The negativity over the recent Facebook changes seems overly-hyped, and the relative indifference over OnStar's callous treatment of customer preferences underscores this.  The difference between the two companies in their customer relationships goes beyond the degree of control customers have on what data is transmitted. 

    With OnStar, your vehicle's operation is potentially turned over to a remote third party.  This is not always an error-free proposition and false alarms have been known to happen.  This scenario is a lot more disturbing than your Facebook information becoming more visible to your Facebook friends.

    After OnStar's violation of their former customer's right to sever a business relationship, I would take their latest assurances with a grain of salt.  Certainly an RF transmitter ceasing to operate is a tricky thing to verify, and probably incurs some cost to verify.

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