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Corporate apologies, customer power are rife with story potential

The last few weeks have offered no shortage of corporate moves resulting in mass consumer umbrage, bad PR and utlimately a financail toll on the companies making the misstep.

Think Netflix and its short-lived, New-Cokesque “Qwikster” faux pas.  Think Bank of America’s backpedaling on its $5 debit-card fee.  Think JetBlue and its hungry passengers suffering lack of lavatories aboard stranded aircraft.

Safeway drops charges

Safeway dropped charges against the Leszczynski famiy after having them arrested for shoplifting. Credit: KGMB-TV

And now, we have Safeway in the crosshairs for allegedly throwing the legal book at shoppers who may or may not have intended to abscond after an unpaid-for in-store snack.  This story in particular has lighted up blogs, message boards, comments sections on news sites and other venues of public discourse. And my unscientific survey shows that in tens of thousands of comments, sentiment is running about 90 to 1 against the supermarket chain.

If you want to jump aboard the corporate bungling story, here are a few ideas for relating some local coverage to the headlines:

SUPERMARKET SHRINKAGE.  I’ve been boggled, in following the Safeway story and commentary, at the overwhelming number of shoppers who think it’s A-OK to consume unpaid-for food during a grocery-buying trip.  There’s a term for it — grazing — and ABC News reports that one in five shoppers admits to it.   The “What Would You Do?” TV show also aired an episode about the trend; here it is on YouTube.

Given the notoriously low profit margins at supermarkets —  I can’t help but wonder what this short of shrinkage costs food stores, and what they feel they can and cannot do about it.  Are stores and shelving designed to minimize it?  Are tactics like cash registers at deli counters designed to prompt noshers to pay? I think a behind-the-scenes report on preventing, spotting and dealing with supermarket theft would be fascinating in any market, especially with the big holiday food season — rife with luxury items and splurges — coming up.  You could even include graphics of supermarket design elements, special packaging or display units and other theft-prevention strategies that stores use.

WSJ Video reportPhiladelphia-based Checkpoint Systems just this week released its Global Retail Theft Barometer report showing that retail theft is up 6 percent in the U.S. this year; much of the losses though, are attributed to employee dishonesty rather than shopper theft.  Again, how do the stores in your market work against this costly liability?

NEGATIVE PUBLICITY AS AN INVESTMENT LIABILITY.  Through a bit of Googling it appears that companies ranging from Spirit Airlines to Goldman Sachs are including “negative publicity” in disclosure statements made in SEC filings.  You might poke around among the corporate filings of companies you cover to see if they’ve had to similarly warn investors.

ARE COMPANIES ALWAYS THE BAD ACTORS? From a journalistic ethics standpoint, I’ve followed much of the coverage of the Netflix, BofA, Safeway, etc. stories and found some of it to be knee-jerk and sadly lacking in objectivity.  There seems to be a tendency among reporters to give the benefit of the doubt to the consumer or patron or passenger and to omit some facts or circumstances that could mitigate the black eye to companies.

For example, in the banking fees coverage, I read few stories that acknowledged the prevalence of fees in previous banking eras, or that made the effort to report how costs of banking compare these days than it was even in higher interest-rate eras or pre-ATM.  I can remember paying $5 a month a couple of decades ago  for the privilege of having a passbook savings account, for example, and I had to schlep to the bank to make a cash deposit!  Financial products and technology are a lot more convenient and plentiful — an objective reporter might want to ask, why do we expect to not pay for them?  Do we not pay for Internet access, or cable TV, or roadside assistance, or a cup of coffee from other local businesses?

JetBlue apology

JetBlue: 'We let some of you down': Chief Operating Officer Rob Maruster apologized in a company video posted on YouTube.

Same with the JetBlue story; the airline is being blamed but — did it have the means or the authority to physically unload passengers snowbound on the tarmac?  You might take a pre-emptive look at what would happen should a stranded plane be sitting out on a taxiway this winter at your airport — what’s the chain of command, specifically who controls the shuttle buses and ground traffic, what contractors are in use and what are the bad-weather clauses in their contracts, and what other factors and staff contribute to getting a planeload of people off the jetliner and into the terminal?  I think a real outline of the roles and accountability would be a neat pre-travel-season look at the issue rather than a knee-jerk blame-the-airline response afterward.

Same with Safeway; common sense says that the grocery chain had little to do with a police decision to send a toddler to protective services, or several of the other factors that made this story a somewhat dubious national talker.   What is the industry’s point of view? Are grocery stores now supposed to exempt expectant moms from shoplifting suspicion, or suspend their pilfering policies when children are in tow?  Should they post prominent signs outlining in-store eating and payment rules?  Do zero-tolerance policies like the one applied in Hawaii reduce exposure to profiling charges even as they open the company to heckling when a sympathetic person is charged?

I didn’t see many of these questions asked or addressed in coverage of the corporate gaffes.  But keeping in mind that companies have the right to be profitable (on behalf of shareholders like you and me) and to minimize their losses help make stories more well-rounded.


 

About the Author

Veteran financial writer Melissa Preddy served as a business writer, editor and columnist for The Detroit News from 1995 to 2008, is a Michigan-based freelance journalist. She now works as a writer and editor for a medical research unit of the University of Michigan Medical School. Follow her daily posts. | E-mail: Melissa Preddy

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