This article from today’s “Financial Times” makes some interesting points.

The new corporate firefighters
By David Gelles

Published: January 22 2009 02:00

When advertisers launched a campaign last September for the pain reliever Motrin, they hoped to attract the attention of mothers whose backs might be sore from wearing baby-carriers. The advertisements implied that while baby-carriers might be fashionable, hauling a child around could be painful.

Mothers were not amused. Soon after the ads were released, anti-Motrin campaigns appeared on Facebook and blogs. Outraged mums, furious at the suggestion that their babies were a hassle, posted rebuttal videos on YouTube. Through Twitter, the microblogging service, thousands of people attacked the company.

Motrin was caught off-guard. For days, no company representative replied. Critics accused the company of being not only insensitive but also unresponsive.

Eventually a marketing executive at McNeil Consumer Healthcare, the subsidiary of Johnson & Johnson that markets Motrin, e-mailed individual bloggers to apologise for the campaign. But the damage was done.

The “Motrin moms” episode illustrates the power of social media – the expanding network of websites that allow users to interact with each other and, increasingly, with companies. It also demonstrates the perils for enterprises that are unprepared to interact with social media.
But now a growing number of companies, including Ford Motor, PepsiCo, Wells Fargo and Dell, are creating new high-level jobs to ready themselves for engagement with social media, with titles such as director of social media, head of communities and conversation, vice-president of experiential marketing and digital communications manager. The role of these new executives is to monitor and influence what is being said about their companies on the internet.

Johnson & Johnson made its own appointment in the wake of the Motrin debacle. Having already dabbled in social media, in December the company promoted Marc Monseau, a 10-year company veteran and former director of media relations, to director of social media. “My responsibility is to work with the corporate office and the individual companies to better interact online,” Mr Monseau says. “It underscores the fact that we realise this is an important audience and one that we need to develop relationships with.”

These new jobs represent a broad shift in media relations strategy at large companies. “Corporate communications has radically changed,” says Andy Sernovitz, chief executive of the Blog Council, an organisation for heads of social media at big companies. “It’s no longer just companies talking to the press, and customer service talking to customers. All these other people showed up in the -middle. They may not be press and they may not be customers, but suddenly their collective voice is bigger than the traditional channels.”

The essence of social media is conversation. Rather than a one-way stream of information, where companies make announcements to the press and customers, social media enables a great deal of interaction, where companies are in constant dialogue with the public. “We’ve seen a shift from doing things the old way to now having conversations with our customers,” says Jeanette Gibson, director of new media for Cisco Systems.

Ms Gibson, who began her job in 2007, says there is now a mandate at Cisco that all staff be attuned to what is being said about Cisco online. “It has definitely shifted how we’ve done communications,” she says. “Our executives are video blogging every day. Everybody’s job is now social media.”

Dell, the computer maker, has one of the most robust corporate social media programmes. Bob Pearson, former senior vicepresident of corporate communications, became vice-president of communities and conversation for Dell in 2007.

He now has 45 people working for him. The core team works on “blog resolution” – trawling the web for dissatisfied customers, then attempting to contact them to make amends. Others on Dell’s social media team manage the company’s 80 Twitter accounts and 20 Facebook pages. Still others manage IdeaStorm, Dell’s forum for customer feedback.

Dell is taking its customer feedback seriously. When the company launched the Latitude laptop last summer, six of the features, including backlit keyboard and fingerprint reader, were ideas that came from IdeaStorm. “It’s always worth talking directly with your customers. It’s always worth listening to them,” says Mr Pearson. “It’s the wisdom of crowds.”

Peter Shankman, a social media expert and founder of Help a Reporter Out, a service that broadcasts reporters’ requests to a network of experts, says many companies are still reluctant to get involved: “Companies are slow to adapt because they’re still not 100 per cent sure they can make money with social media,” he says.

Yet Dell, for one, has made a business of it. By broadcasting discount alerts on Twitter, it says, it has generated more than $1m in sales. And in the US, 59 of the 100 leading retailers, including Best Buy and Wal-Mart, now have a fan page on Facebook, according to Rosetta, an interactive marketing agency.

Other savings can be realised through the Web’s ability to reach many people at once. “If you solve someone’s problem on the phone, nobody knows,” says Mr Sernovitz. “If you solve that same problem in writing on a blog, it costs you no more, but thousands of people are satisfied. And then, if 100 people never call because they found the answer, you very, very quickly get to multimillion-dollar savings.”

Other companies are using Twitter to douse public relations fires before they erupt. Scott Monty, head of social media for Ford Motors, used Twitter to appease users who were angry after the carmaker sued an enthusiast website that was selling unauthorised Ford merchandise. When fans of the enthusiast site posted angry messages, Mr Monty “tweeted back” to explain the company’s position.

Bonin Bough, who was appointed director of social media for PepsiCo last year, also used Twitter to defuse a brewing crisis after the company released a series of advertisements depicting a cartoon calorie character committing suicide.

“Social media is much more than getting out there and having conversations,” says Mr Pearson of Dell. “It transforms a business if you use it correctly.”