November 1, 2011
“Life moves pretty fast. If you don’t stop and look around once in a while, you could miss it,” Ferris Bueller said in the 1986 film, “Ferris Bueller’s Day Off.”
Bueller’s comment is still true in today’s consumer technology market, where users of ubiquitous services like Netflix and Facebook endure rapid changes to features, user agreements and privacy settings with little choice in the matter. The way that companies announce such changes has also become faster in the digital era.
In September, Facebook further obscured users’ ability to maintain profile privacy with the introduction of the Timeline and Open Graph functions, which post notifications about everything users read, view and listen to.
Meanwhile, Netflix fueled an already-controversial price increase by renaming its DVD-by-mail service Qwikster, dismantling the convenience of managing DVD and streaming movie queues seamlessly and distancing itself from mail customers altogether. Both companies’ moves ignited massive criticism on social networks. (Neflix abandoned its Qwikster spinoff in October.)
“Many tech companies don’t do a good job building relationships with customers and influencers in advance of significant changes,” explains Judith Hurwitz, president of Hurwitz and Associates and author of “Smart or Lucky: How Technology Leaders Turn Chance into Success.”
However, fostering these relationships vets market reaction and creates more enthusiastic constituents.
Industry events and conferences gather constituents in a format successfully used by companies like Amazon and Apple to make big announcements. Some annual events become known entities where attendees and media expect news.
Facebook used the familiarity of its annual f8 conference to announce its latest changes. Positive reasons for doing so include surrounding your news with supporters to influence favorable reaction and the magnetism that these events create, even encouraging others to tune in and live stream or blog the event.
In addition to logistic and cost realities, cons include the pressure to impress. Consider Apple’s “failure to launch” last month, when event attendees expected an iPhone 5 unveiling but saw an improved iPhone 4S instead.
Netflix chose passive approaches for its announcements. A customer email broke the price-hike news, setting off customer threats to leave the service. CEO Reed Hastings later posted a YouTube apology for how he handled that communication.
Positive reasons for these approaches include controlling succinct messages while targeting both specific and broad recipients. Cons include perceptions of greed, considering the success of Netflix’s business. The Qwikster announcement looked hastily delivered — it did not have a Facebook page or the @Qwikster Twitter handle at launch.
Netflix displayed panic according to Hurwitz, who encourages communicators to position themselves to write the story during transitions. She suggests testing strategies with experienced outsiders under NDA.
“Even if you say ‘I’m going to do it my way,’ you are at least informed how the market may react and can develop messaging in advance,” she says.
Above all, define your objective, outcomes that you seek and how you want the headlines to read. “Netflix didn’t want ‘prices raised, customers fleeing’ but that’s what they got,” Hurwitz said. “There is no substitute for well-crafted announcements.”