Wednesday, June 16, 2010

5 Own Goals Scored In Business Blunders

The 2010 World Cup will produce its usual crop of memorable football moments, including spectacular mistakes and possibly one or two own goals.

Catastrophic errors of judgement or lapses in concentration can, of course, be presented in a positive light. A bit of PR spin and polish can make failure look like a form of achievement, if only in an educational sense. We all learn from our mistakes, right?

But it's usually less painful to learn from the mistakes of others. So here are 5 'own goals' that have been scored in business over the years and which still offer useful lessons today.

1. A few words can cause big problems. We'll start with one that's very current. Tony Hayward, Chief Executive of BP, is currently spending a lot of time in the public eye as oil pours from a damaged BP well into the Gulf of Mexico, causing huge disruption. In a bid to assure the US population of his commitment to fixing the problem he told a journalist that he wanted it sorted because "I'd like my life back."

This is perhaps the most serious of a string of gaffes made by Hayward. Thousands, maybe millions, of people have had their livelihood threatened by the oil spill. The environment is being damaged. And, most poignantly, 11 people died in the accident that led to the problem. They'll never get their lives back.

As an own goal, Hayward's ranks as one of the most spectacular. BP's reputation is in tatters and he's unlikely to keep his job for very long.

Lesson: Don't say a word in public unless it's been checked and double-checked.

2. Not every good idea makes a good product. As a teenager in the 1950s British inventor Sir Clive Sinclair dreamed of building a small electric car. For years he focused on other devices, including the pocket calculator, but in the late 1970s he began development on his dream and in 1985 the Sinclair C5 was launched.

The tiny electric vehicle, with a top speed of 15 mph, was an immediate commercial disaster. It was too small for the roads and too large for pavements. Its open design exposed the driver to the elements and its small motor struggled to get up hills. Within 8 months of its launch, production of the C5 ceased. Sinclair lost the millions that he'd poured into his idea.

Lesson: Do your market research before investing in full production.

3. Mind their language. There are plenty of tales about global brands who've chosen inappropriate product names in foreign countries, such as Chevrolet's Nova which, in Spanish, means "won't go." However, these stories are often urban legends - the Nova actually sold well, even in Spanish speaking Latin America.

On the other hand, Kentucky Fried Chicken's "finger lickin' good" was translated into Chinese as "eat your fingers off." And the Honda Fit was going to be released into Europe as the Fitta, until someone discovered that's really quite rude in Scandanavia, so they changed it to Jazz.

Lesson: Have all your product names and slogans sense-checked by different people, even in your own language. Words can mean different things to different people.

4. Be careful being green. There's credit to be had in promoting your environmentally-friendly credentials. But the New York Times also discovered the potential for it to create bad publicity. Their paper-recycling policy included using old business printouts to wrap bundles of newspaper, which led to the the credit and debit card details of 240,000 subscribers being distributed to retailers and carriers in Massachusetts as packaging material.

Lesson: Keep educating your staff in key issues, such as data security and environmental awareness. Don't just tell them once - tell them over and over again.

5. Don't build on sand. In 2001 Fortune Magazine named Enron "America's Most Innovative Company" for the 6th consecutive year. Enron employed over 22,000 people and was widely-hailed as a hugely successful business.

By 2002, Enron had collapsed when years of false accounting were uncovered. Behind the bold and extravagant fa├žade the business had been hiding its losses on a massive scale. Failure was inevitable and led to criminal convictions of executives.

Lesson: If you're building for the long-term make sure your foundations are solid.

If you know of another classic blunder, or are willing to share an 'own goal' you've scored, please share by leaving a comment.

Saturday, June 12, 2010

Is Your Website Social Media Optimized?

Many businesses have invested a lot of time and money in making sure they appear near the top of Google's rankings.

But how much effort do you put into your social media presence? If this has been less important to you than SEO (search engine optimization) it might be time to change your approach.

UK internet users now spend more time looking at social networks than they do search engines. According to leading web analyst firm Hitwise, in May this year social networkings such as Facebook, YouTube and Twitter received more visits than the search engines like Google.

That's all very well, you might say, but people still come to the search engines when they want to find stuff. After all, people go to news sites for current affairs updates, games sites to play and social networking sites for sharing their lives with friends. But when they want to find something they'll usually start with a search engine.

People Prefer to Search Using Search Engines, Don't They?

Yes and no. Comscore, another digital analyst firm, say that US users performed over 10 billion searches on Google in March 2010, compared with a mere 647 million on Facebook. So yes, the majority of enquiries are still initiated on search engines.

But Comscore also noted that the number of searches on Facebook has increased dramatically and users were using it more often to search for commodities, such as "games" or "shoes." The search capabilities of Facebook still lag a long way behind those of Google but there's been a discussion for some time about social networking also taking on the mantle of search engine and evidence suggests this is beginning to happen.

The Human Side of Search

Businesses need to understand that using social media as a starting point for a search is about more than just typing something into a search box. People use social networking to share favourite sites, which can include those selling products that they use. They also use networks to complain about products or brands that they've had a bad experience with.

So there will be people going to social networking sites who follow links from their friends, leading them to places where they can spend. This isn't search as we've come to understand it, but the result is the same - a financial transaction.

Do you want your business to be the landing point for this type of search? Of course you do. The challenge, however, is working out how to achieve it. If you're already familiar with search engine optimization, it's time to start thinking about social media optimization.