For many companies what’s stopping them from further expanding on their social media campaigns is simply the fear of the risks that associated with such activities. These risks can be larger than most of us realize. When social media is not carried out correctly, it can lead to numerous issues that run the risk of destroying a company. Thankfully, all of these risks are manageable. Let’s look at the most common risk forms and how they can be managed.
The Public Relations Disaster
There is no company that is exempt from a possible public relations disaster. Social media is like putting your PR issues on steroids. This in itself scares off many companies from enjoying the many benefits that social media can offer.
One excellent example of a PR disaster that social media fueled is Netflix. Not only did they receive a tremendous amount of negative publicity from upset customers, their company stock dropped from $291.27 to $52.81 in a short period of time. What caused this? Netflix announced a 60% price increase, their customers took this news to social media and that caused all of Netflix’s troubles. So you can see why companies might be a bit gun shy of social media and what it can do to their business.
Luckily, public relations disasters can be managed. Netflix is an example of doing everything wrong in attempting to manage their disaster, but there other companies like Domino’s and FedEx that have successfully handled public relations nightmares. The type of crisis will define the type of response that is needed. This should be thoroughly thought out and the path clearly defined. This would be a great time to have a marketing team working with you. In fact, having a marketing team working with you early on will allow you to avoid such pitfalls.
The Compliance Disaster
Many companies must worry about the regulatory bodies that they fall under. These companies must follow specific rules on how they handle information. For example, the financial industry falls under SEC regulations, while the healthcare industry falls under FTC and FDA regulation. There are many others.
The fact is that every post on a social media channel has the potential of causing a compliance risk. For the pharmaceutical companies this can be a disaster because each time someone posts about a negative side effect of a drug, the pharmaceutical company must report it to the FDA. This has the potential to cause the drug to be pulled from the shelf.
This is a known risk, which makes it easier to manage. Every company should know what their compliance and regulatory obligations are, relating to social media. One of the most constructive things any company can do to control their social media risks is to hire an experienced marketing company.