Flo and Progressive Insurance – How Not to Do Trust Recovery

How does a nice gal like Flo end up in a nasty fix like this?

Flo is Progressive Insurance’s TV fictional character.  Flo’s twitter handle (come on, you knew Flo has to tweet) is @ItsFlo and “her” bio reads, “Progressive’s always-happy-to-help insurance expert. Lover of discounts, unicorns and tacos. Plays a mean air guitar.”

So this headline had to be a bit of an image hit for Progressive:

Progressive Insurance’s Response to the Fisher Scandal is a Textbook Example of a PR Catastrophe.

Yes, you could say that. Click the link for the long, sad tale: the (very) short version is that Progressive insured a woman killed in a car accident. Progressive refused to pay her family a claim of $75,000 on the grounds that it had not been proven she had not been at fault – even though the other driver’s insurance company did not dispute fault.

Through some bizarre twists of law and amazing judgment on the part of Progressive, the woman’s family was forced to sue the other driver – and the woman’s brother claimed that Progressive’s legal team had, in fact, actually ended up working for the other driver.  Get that: the dead woman’s insurance company, in court, on behalf of the driver who killed her.

That story got legs on FaceBook, Gawker et al. Progressive responded with a tweet, saying they’d investigated and were “within our contractual obligations.” They tweeted the identical message to dozens of complainers.  Of course, the carbon-copy tweets then got put together on another site, making Progressive look even more ham-handed and insensitive.

Progressive then explained that, in fact, “Progressive did not serve as the attorney for the defendant in this case.”  Rumor quashed.

Except that, one hour after that posting, the internet sleuths came up with court records showing a Progressive attorney had been granted an allowance “to intervene as a party Defendant.” It depends on the what the meaning of the word “defendant” is, I guess.

And then Progressive lost the case anyway. And it all ended up on the “real” news too.

What Not To Do

Ah, where to begin. Let’s start with the easy stuff.

  • If you’re accused of doing something bad, and in fact you’ve been doing something that looks like bad, walks like bad, and rhymes with bad – for heaven’s sake don’t try to get off on a technicality. Don’t do it anyway, but especially don’t do it at a time like this.
  • Don’t confuse the law with ethics. “But it’s not illegal” is the last defense of the morally lame, and will never win in the court of public opinion. How well does “I’m not a crook” go over?  Does “within our contractual obligations” sound any better?
  • Don’t think you can outrun the internet. You are naked out there, and everyone’s waiting for you to deny the truth.  Simple answer: don’t do bad stuff, and if you do, don’t lie about it. Karma has a deputy these days called “search,” and it’ll getcha.
  • Pay attention to backlash, for heaven’s sake.  You pay good money for market research to give you feedback. When you get it for free in the form of bad publicity, look at what the optics are telling you! D’ya think defending your client’s killer might not play too well? D’ya think that robo-tweeting might not be a great social media strategy?  D’ya think that doubling down against a viral human interest story might suggest a little more PR sensitivity?

I’m a firm believer that we learn more by failure than by success.  If this hasn’t happened to your company, go knock on wood, and then go to school on Progressive. Such clumsiness shouldn’t go to waste: someone should learn from it before it happens to them.

Reputation Recovery

When you are more virtuous than your reputation would suggest, you have a communications problem.

When your reputation for virtue exceeds the facts on the ground, you have a ticking business problem.

When Image and Reality Part Ways

When you have a communications problem, the communications team should hire a PR firm. Most firms do this.

But in the second case – where the reputation is better than the truth – most firms do not do what they should. They don’t even thank their lucky stars for having a better reputation than they deserve.

Instead, they begin to believe the hype.

Then one day, It Happens. The subsidiary defaults. The pipeline springs a leak. Animal byproducts show up in the food. Someone comes forward to testify.

Let’s be clear. These things just kind of seem to happen more often to the non-virtuous than to the virtuous firm. If the event truly is an anomaly, it doesn’t last on the front page. Acts of god don’t make good news for long.

But what about the non-virtuous firm?

When Disclosures Accelerate

When it turns out the smoke really did indicate fire, the non-virtuous firm all too often behaves predictably.  Having believed their undeserved hype about being virtuous, they then do what the virtuous firms did – they hire a PR firm.

Which is all too often the wrong thing to do – and hardly ever the main thing to do.

In an interesting display of PR sensitivity,  BP chose to hire Dick Cheney’s former campaign press secretary as head of PR, and a Wall Street PR firm as outside advisors.

Of course, there is a role for communications experts even in a crisis. With multiple constitutencies and tons of experience at keeping things secret, perhaps it made sense for Penn State to hire two outside PR firms.

But most non-virtuous firms aren’t looking for technical expertise; they’re looking to follow the lead of Muammar Gadaffi in seeking spin.

PR: a Delicate Balance

It cannot be an easy thing to tell clients seeking spin that the solution is to become virtuous. Clients want virtue now, and backdated if possible, thank you very much.

In such a milieu, the temptation for ambulance chasing is high. How can you keep on teaching virtue when the clients are paying you to shut up and stop the pain?

Yet that is what must be done. Arthur Page, the poster child for “good” public relations, had it right. He had a list of seven principles, the first of which was “tell the truth.” What a concept.

He also said that public relations is 90% doing and 10% talking about it. In other words, if you are virtuous, you’re not going to have much of a problem explaining crises.

Recovering Virtue

The fallen firm wants to know what they can do now to recover. After all, they always sought fast fixes in the past, and they worked. But there simply is no fast route to virtue recovery if you’re coming from a history of un-virtuous behavior.

At a personal level, it’s conceivable that someone could have an instant conversion and become virtuous, though I don’t think I’ve ever seen it – most conversions I have seen have come through pain and hard work.

And at a corporate level? Fuggedabout it. The fastest route to serious change is to change all the top leadership, and even then you’ve got habits, policies and cultures to change. Minimum 6-12 months, and I can’t off-hand think of an example where change has happened that fast.

Non-virtuous leaders who’ve been caught with their pants down don’t want to hear it, but the best way to handle crises is to prevent them happening in the first place. The best way to be trusted is to be trustworthy.

Spin is not the solution; spin is the problem.

You may not be able to change by tomorrow, but you can always start the journey today.





Trust Me

Courtesy of The Financial Brand comes the story "A Failure of Trust:"

"On Thursday, September 4, an ad from Silver State Bank asked, “Why do so many of Nevada’s strongest businesses trust Silver State Bank?” The answer? “Security” and “protection.”

The next day, the bank was seized by federal and state regulators.…In the two months prior to the bank’s seizure, customers pulled $264 million of the $1.7 billion on deposit at Silver State."

There are no more trust-destroying words one can say than “trust me.” Googling “trust us” gets more than 5 million hits. Interestingly, well over half appear to be of the cynical phrasing, e.g. “Trust us, we’re experts: How Industry Manipulates Science."

In other words, most of us are “on” to the con.

Yet the self-delusion (and occasionally cynicism) continues. I periodically Google “your trusted advisor” to see who still thinks advertising “trust me” is a good strategy. I won’t name names—you can do it yourself: just search on “your trusted advisor” (don’t forget the quote marks), and decide for yourself whether the advertisers really are your trusted real estate agent, your trusted financial planner, your trusted land developer—or not.

Most people who use the term “trust” or “trust me” or “trusted advisor” in advertising mean well. In a few cases, they’re even right. But they miss the point.

The point is, it’s inherently contradictory to advertise your trustworthiness. It’s like bragging about your humility. Trust is supposed to be largely personal, and about serving the customer. Trust ads are intrinsically non-personal, and inherently self-serving.

George Burns once said, “Sincerity is the most important success factor; if you can fake that, you’ve got it made.” The joke lies in the implausibility of faking sincerity. Ditto for trust.

Unsolicited testimonials are fabulous. Solicited testimonials, quoted in mass media, are quite another thing. The difference lies in the motives.

Talking internally about how to be trusted is great; talking to clients about it is good to the extent you do it one on one, in small groups, with blank notepads and a willingness to learn. Talking to clients about trust via statistically valid online surveys that don’t let you expand on the “other” checkbox and that are designed solely to be converted into incentivized behaviors—not so much.

Trust advertising is a personally critical issue to me, given the name “Trusted Advisor Associates.” I need “trust” in the name to describe my content and subject matter, but I have on occasion cringed when a client went off-script and introduced me at a speech as “the trusted advisor.”

Our website always says “we help build trusted advisors…” and never “we are trusted advisors.” Even with that, we get occasional snide comments about the insincerity of calling ourselves “trusted advisors.”

I don’t blame them a bit. The currency of language is frequently debased in business (think ‘loyalty,’ ‘customer focus’).

Given the current state of cynicism about trust, the best any of us can do is to be careful about our own language, and to let our integrity and trustworthiness be their own advertisement.

After all—that’s how trust really gets built.

What the Pharmaceutical Industry Must Do to Regain Trust

Pharma has been taking it on the chin for some time now.  It’s been targeted by activists, bloggers, politicians and reformers. Next to Wall Street, it’s one of today’s least trusted industries.

But until last week, much of the industry’s response had the flavor of, “if people only knew the whole story,” or “they just don’t appreciate the good we do.”

Fair enough, perhaps.  But no longer good enough.

Last week, the industry drew negative cover-page articles in two iconic, industry-friendly major publications.

Et tu, Advertising Age? From the trade magazine of an industry that benefits enormously from Pharma comes this tabloid-like headline:

Vytorin Ad Shame Taints Entire Marketing Industry


Cholesterol Drug’s Ad Campaign Turns Into PR Nightmare, Fanning Flames of Public Mistrust of DTC.

Reports that Merck & Co. and Schering-Plough Corp. kept under wraps for more than a year findings that Vytorin does not deliver results it spent more than $100 million advertising to consumers is much more than a PR disaster for the drug’s co-marketers. Coming on the heels of a New York Times story that Pfizer’s $2 billion drug Lyrica treats a condition, fibromyalgia, that a lot of doctors don’t think exists, the Vytorin news is fanning the flames of public mistrust for the $5 billion direct-to-consumer drug industry — and the ad business in general.

"The pharmas are in big trouble in terms of credibility," said brand expert Rob Frankel, who runs his own consultancy at "They’re just above Congress and used-car salesmen."

Talk about biting the hand that feeds you.

But the topper has to be making the cover story on BusinessWeekDo Cholesterol Drugs Do Any Good?


Never mind the typically well-researched and well-written critique of the industry; never mind the bad press Merck and Schering-Plough got for the Vytorin data, coming on the heels of the Vioxx lawsuits; never mind the bevy of critical testimonials the article digs up.

The plain fact is, once Ad Age and BusinessWeek put you on their covers—in nakedly negative terms—it’s time for some basic re-examination.  Low trust is not a surprise to the industry—but this is a wake-up call about the failure of the industry’s response to date.

One of the major pharmaceutical firms (because it’s not likely to be PhRMA, the industry’s trade association) needs to find a voice and take a leadership role—to speak what has become obvious to the world outside Pharma, as represented by leading business publications.

The message is this: the only way to resolve the industry’s trust issues is to become trustworthy—worthy of trust.

• Trust will not be regained by “educating” the public.

• Trust will not be regained by “getting the message out.”

• Trust will not be regained by improving your PR; your PR will be improved by regaining your trust.

• Trust will not be regained by framing it as a problem of image, marketing, or perception.

• Trust will not be regained by coordinating, refining or sharpening talking points; the problem is not getting the message out—it’s listening to the market to hear the message coming in.

The good news is, there are a great number of very well-intentioned, smart people in this industry, who are deeply pained at having been demonized the way they have been.  Some are courageously beginning to face up to it.

It won’t be easy for them. Twenty years of success, blockbuster drugs, and an overdose of marketing culture erects barriers to even their good intent.

Further, any gain in trustworthiness must be broad-based.

It won’t be enough just to help sales forces become listeners, rather than shills—though that will help. It isn’t enough to wean physicians from the “consulting” and “education” fees they reap—though that will help. It isn’t enough to deal with the appearance of conflict in researchers and journals’ affiliations with pharma funding—though that will help. It isn’t enough to seek business models beyond patent-stretching, features-tweaking and disease creation—though that will surely help. 

It is an industry whose beliefs and practices have become encrusted, making its untrustworthiness opaque even to those who most sincerely would reform it.

So, what will it take?

• Courage, for one. Which does exist; there are some fine people in pharma.

• Brains, for aother. Again, pharma is blessed. The trick is to turn those brains loose; to use the courage to think boldly, examine anew.

• Transparency is required too, though even that is hampered by layers of regulation brought upon itself by the industry’s own past practices.

• But above all, the industry needs a sense of urgency.  Not just business urgency, but a personal willingness to face some  shame, or disgust, or revulsion; something that comes from the gut and says, “you know, we are better than this; we can do better than this; and I for one have had it.”

I can’t think of any industry where the trust gap between what is and what could be is larger, and where the social cost of that gap is greater. It is in society’s best interest to have a trusted pharmaceutical industry. At its best, the pharmaceutical industry saves hundreds of thousands of lives, and adds quality of life to millions.   We are paying gazillions in cost, red tape, suspicion, and lost or devalued lives because of its absence.

We should all be rooting for this industry to heal itself.

The first step is admitting you’ve got a problem.

When Trust Betrayal Keeps Coming Back

Cobalt57 has a half-life of 257 days. The half-life of a bad divorce ranges from a few years to a lifetime.

And the half-life of betrayed trust is somewhere beyond that.

In fact, trust betrayed has a way of regenerating. Call it Zombie trust: when trust is trashed, it has a way of never really dying—it just keeps on coming back to get you.

Trust Betrayal and the Black Community

Two cases in point. From the early 1930s until 1972, a government sponsored study of syphilis in Tuskegee, Alabama systematically and intentionally lied to poor black sharecroppers about the “research” being done to help them. In fact, their infection was left untreated, so as to study the ravaging effects of the disease.

The study is pretty well-known in the black community, and is a powerful story about the depth, depravity and reality of racism in the USA.

Powerful enough that it has made black people afraid of taking part in medical clinical trials. It’s not hard to understand why. And yet, we have this news story:

In a report to be published in the journal Medicine online Jan. 14, experts in the design and conduct of medical research found that black men and women were only 60 percent as likely as whites to participate in a mock study to test a pill for heart disease. Results came from a random survey of 717 outpatients at 13 clinics in Maryland, 36 percent of whom were black and the rest white.

"The survey is believed to be the first analysis showing that an overestimation of risk of harm explains why blacks’ participation in clinical trials has for decades lagged that of whites. The results come at a time of increased recognition of racial differences in disease rates and treatments. Researchers point out that some kidney diseases, stroke, lung cancer and diabetes all progress more quickly in blacks and kill more blacks than people of other racial backgrounds.

"There is enormous irony that without African-American subject participation in clinical trials, we are not going to have tested the best therapies we need to treat African Americans," says study senior researcher, Hopkins internist and epidemiologist Neil R. Powe, M.D., M.P.H., M.B.A. "So long as the legacy of Tuskegee persists, African Americans will be left out of important findings about the latest treatments for diseases, especially those that take a greater toll on African Americans and consequently may not have ready or equal access to the latest medicines."

The Zombie of Trust Betrayed is at work here. The past abuse of trust was so horrific that it continues to wreak havoc, even when—ironically—researchers could be of help.

Robert Zogby and the Polling Debacle

Here’s another case. After the New Hampshire Democratic primary polling debacle, Jon Stewart’s Daily Show invited famed controversial pollster Robert Zogby as a spokesman for the polling industry.

Zogby held his own in the unwinnable format—but the Zombie of Trust Betrayed got him—bad—a week later.

In a post on January 16, Rick Rottman recounts a first-hand story from 1992, when he took a European history course from Zogby at Utica College. Long story short, as Rottman tells it, Zogby offered to raise everyone’s grade a point if they came in and volunteered for an 8-hour shift at his polling business.

At first, everyone agreed to it. Later, everyone reneged. Pressed as to why, they all said they felt it was unethical. Zogby, as Rottman recounts it, blew a gasket.

Worse yet, says Rottman, he had gotten an A on his midterm before these events. He never saw the results of his final exam (on which he thought he had done well), but his final grade was a C—implying an improbable F on his final exam. Understandably, Rottman is inclined to wonder why.

That was 1992. Now, 16 years later, Rottman is in the blogosphere saying “John Zogby is the reason I don’t trust polls.” And it’s not hard to understand why.

Note: I want to be very careful about spreading critical comments like this. If Zogby has something to say, he’s got white space here in this column to do so. And if he convinces me Rottman is a nut job, then I’ll strip his story entirely out of this blog. Until then, however, Rottman is writing quite clearly about a first-hand experience which sounds credible to me—or I wouldn’t be citing and linking to him here.

Final examples of the half-life of mistrust: look to the Russian-Chechen conflict; the feelings between the Sunnis and the Shia.

Trust lasts a long time. Trust betrayed appears to last longer.

Lessons in Propaganda: What Politicians Learned from Business

I am hardly the first to note the application of PR principles to politics. Nor is it a new observation. Kennedy and Nixon had their communications advisors; Lincoln read books on rhetoric—ancient Greeks wrote them.

We now see it in mind-numbing three-word phrases printed, Louis Vuitton-like, on backdrops behind the Presidential podium; in the evolution of “talking points” from a novelty phrase during Monica-gate to commonplace today; and in the devolution of the Cabinet from advisory body to vehicle for staying “on-message.”

Many call this a failing of George Bush or of a Republican administration (though the Clintons know this material well too), or a misapplication or perversion of business principles.

But that’s not quite right. Politicians haven’t misappropriated business lessons—they borrowed directly, main-lining their Big Brother 1984 lessons from the very heart of what has come to be called business best practices.

The problem isn’t cynical politicians twisting business ideas; it is cynical business ideas themselves, granted mainstream legitimacy by business opinion leaders—the business media, business schools, industry associations, and business leaders themselves. Politicians are just following.

Take four common terms: “on message,” “brand,” “alignment,” and “communication.” Now think Marketing 101 (or any CEO’s speech), and see how familiar this sounds:

In this consumer-empowered, media-cluttered age, the company that understands customer needs and communicates its message the best is the one that will survive in this hyper-competitive market.

Consumers have less and less patience and attention span: companies need to develop a coherent branding message—the same on the web, in stores, and in ads—about who they are and what they can do for the customer.

A company not completely aligned around its core value proposition and the message it communicates about that proposition will fail. Sales collateral must be on-message with marketing’s branding; incentives must align with company strategy; measurements must track missions, aggregating to sustainable competitive advantage.

Even marketers—professional cynics—are taken aback by the success of a current ad campaign. You’ve seen it / heard it:

Apply directly to the forehead—apply directly to the forehead—apply directly to the forehead.

Blunt force repetitive trauma to the brain. Think Orwell. Goebbels. Big Brother. The Big Lie.

From there, it’s a quick trip to “we’re in Iraq to stop Al-Qaeda from invading Kansas,” with flight jacket and aircraft carrier backdrop.

Massive repetition works. Better than we like to admit. “Brainwashing” is just a value-laden term for what politely passes as “alignment” and “on-message” in the corporate setting. Even “shared values” brushes uncomfortably close to the same territory.

Reggae rapper Shaggy parodied this angle a few years ago in the song “It Wasn’t Me.” Seeking advice after having been caught in flagrante by his girlfriend, he’s told, “Just say ‘It wasn’t me’.” Repeat it often enough and you can get away with anything. Was he being ironic? Or just astute? (Did he help Larry Craig and OJ come up with “I’m not gay” and “it was my stuff”?)

Mainstream marketing and business 101 teach companies to simplify, refine, and focus on one message and mission, then design the whole organization to apply massive force to the fulcrum point of the customer.

The result is called “tuned,” “focused,” “aligned, “and—most chilling—a perversion of “customer-centric.” Apply directly to the marketing. Apply directly to the marketing. Apply directly to the marketing.

There is nothing “wrong” with these techniques per se—the means, in this case, are value-neutral. It is the ends to which they are put—the motives—that matter.

Unfortunately, Roger Ailes, Turdblossom et al didn’t have to translate the business play book to politics. They copied directly. Both have become about winning against other competitors/candidates—not about helping consumers/voters. Bombardment of the consumer/voter with simple messages is good for quitting smoking or announcing emergency traffic routes. For selling pharmaceuticals, wars and presidents? Not so much.

In business, it’s reach and frequency—in politics, it’s being on-message. Tax and spend. Support our troops. Apply directly to the amygdala.

The problem in business and politics is identical. Both have become all about competition and winning—not about consumers and voters. Both have turned the legitimate concept of “customer focus” from a goal into a tactic, linking it tightly to quarterly earnings and the two-year election cycle.

Business has turned "customer focus" into a codeword for tweak, massage and manipulate.

Modern marketing practices flaunt the dictionary, Shaggy-like, when they turn "communication"—formerly defined as "exchange of information"—into the one-way megaphone of "apply directly to the forehead."

At root, this is a failure of belief systems. We are teaching an ideology of short-term me-me-me-ism in business, and our politicians are drinking the same Kool-Aid. For those who think this brand of “competition” is what makes for a successful economy—take a look at the falling US dollar. A focus on commerce, not on competition, is what makes an economy great. We’ve gotten it backwards.

Don’t blame George Bush, Republican; blame George Bush, MBA President. Until the B-schools start preaching networks, collaboration, transparency and commerce in their strategy classes instead of in their so-called “ethics” classes, we in business have no right to complain about the politicians.