February 9, 2017

In nearly three weeks since Inauguration, President Trump’s willingness to engage with – and about – specific brands on Twitter has kept many jittery business leaders on their toes. And it is no secret that how to avoid, or react to, a Trump tweet has become one of Corporate America’s most frequently discussed concerns.

The recent Nordstrom incident provides a good case-in-point. So in an effort to provide some guidance, we wanted to briefly analyze the facts, and share some valuable lessons for companies looking to navigate this new landscape.  

Lesson #1: There Are No Boundaries

Perhaps the first lesson is that we may not be able to predict the scope of the president’s tweets, as they may know no bounds. The purpose behind the president’s prior tweets, aimed at companies, was to criticize them because, in his view, they charged the U.S. government too much money for projects (Boeing, Lockheed Martin), or cost our country jobs (Carrier, Ford, Toyota). There was a semblance of a policy disagreement underlying each of them. 

The latest tweet is very different; it clearly sprung from the president’s desire to defend his daughter while criticizing Nordstrom for cutting the Ivanka Trump clothing line from its stores this season. Here is the text:

“My daughter Ivanka has been treated so unfairly by @Nordstrom.  She is a great person – always pushing me to do the right thing!  Terrible!” 

Press secretary Sean Spicer later doubled down and tried to inject policy into the flap, calling Nordstrom’s decision a “direct attack on his policies and her name.” But indisputably, the president’s tweet took direct aim at Nordstrom’s business decision.

Lesson #2: A Fast, Credible Response Can Mitigate Adverse Impacts

Nordstrom responded quickly and matter-of-factly to the president’s tweet, explaining in a statement:

“We made this decision based on performance. Over the past year, and particularly in the last half of 2016, sales of the brand have steadily declined to the point where it didn’t make good business sense for us to continue with the line for now.” 

The Company went on to say it had a “great relationship with the Ivanka Trump team” including “open conversations with them over the past year to share what we’ve seen and Ivanka was personally informed of our decision in early January.”

Nordstrom’s response is proof that straight, factual responses from targets of tweets play well and can even win the news cycle. Nordstrom’s response was pitch-perfect. The company responded with a short and reasonable business explanation for its decision. It avoided any language that might further provoke the president. And Nordstrom closed with nice words about Ivanka and her team.

Lesson #3: Not All Trump Tweets Are Created Equal

While the president’s tweets criticizing companies for overcharging the government or moving jobs overseas may be potent, tweets that defend his family and call out companies for sound business decisions may be less impactful. Along these same lines, the Ivanka Trump line of clothing is not a big deal for Nordstrom’s business success say, in comparison, to Boeing’s relationship with the U.S. government which was at issue with criticism regarding the cost of the new Air Force One.

Lesson #4: Secondary Narratives = Diminished Impact

Trump tweets that trigger secondary, unintended debates diminish his intended impact.

In this case, the president’s Nordstrom tweet set off an unintended debate and significant media coverage about the ethics of the president commenting on routine business decisions that adversely affect his family. That debate was further exacerbated when the official POTUS Twitter account retweeted the president’s personal message, and Spicer escalated the attack during his daily press briefing. Over the course of the day, the narrative of the news cycle shifted quickly from the substance of Trump’s tweet to its appropriateness, a transition that repositioned Nordstrom from villain to victim.

Lesson #5: The Market Is Adapting

The market may be adjusting to, and no longer overreacting to, Trump tweets.

Having seen Lockheed Martin and Toyota bounce back strongly following Trump tweets, the market may be factoring in this experience and taking new tweets in stride. For Nordstrom, this impact was clear: after the stock initially dropped about 2% as news of the tweet hit, it eventually closed up 4%, with its strongest one-day gain this year, even though the overall market dropped slightly.

Conclusion:

President Trump’s tweets are giving rise to a new communications specialty, advising companies on best practices to respond to critical presidential social media messages. There is a growing body of experience from which to learn, but companies should remain vigilant and flexible because every situation is different, and there is not one best way to manage when your business is caught in the @realdonaldtrump crosshairs.


February 22, 2016

Name: Bob Chlopak
Title: Founding Partner, CEO
Time with CLS: From the Beginning

1. In your career, what is the best advice you’ve been given?

My father rose up through the ranks to run a privately held business. He told me that his biggest regret was not taking the risk of launching his own business. He said that if I ever had the chance to create my own business, I should do so. Twenty-four years later, still working in the business I created, I am very glad that I took his advice.

2. If you weren’t in the PR industry, what would you be doing?

Have done might be more appropriate in my case. If I had more talent I would have tried to play baseball, or given my interest in the law, I might have practiced law rather than spend my time communicating about legal cases.  

3. What is your favorite PR failure? (i.e. Pepsi Syringe, Tylenol Recall)

This is not really a PR failure but is a great story about success and failure. We once worked for the fresh poultry producers to try to change a USDA rule that basically allowed poultry producers who froze their chicken to sell it as fresh. We recruited famous chefs. We had people bowl outside the Capitol with frozen chickens to demonstrate they were rock hard frozen. We had a terrific Fresh vs. Frozen ad campaign.  And we persuaded regulators to change the rule so consumers would have clear labels so they could choose to purchase fresh or frozen chicken, and would know what they were getting. Our client thanked us for our work and ended our contract.  Shortly thereafter in the middle of the night, a Senator with strong ties to frozen poultry producers attached a rider to an appropriations rule that killed the change in the rule that we had fought so hard, and successfully to win. Our client should have followed the sage advice of Yogi Berra who once said “it ain’t over till it’s over.”

4. How did you get started in PR?

After years of working in politics, I joined a firm that did both political campaign media and PR and found that my skills were transferable, and the PR work did not require as much travel, sleeping on couches and floors, and crazy election schedules. 

5. What has been a highlight moment in your career with CLS thus far?

There have been many, but I will give two examples that are perhaps the most satisfying because of their importance. The first is when we helped the Red Cross manage the crisis facing the organization following 9/11. We helped guide the Red Cross  as they shifted their policy to ensure all of the money collected in association with the attacks went directly to help victims of 9/11, rather than reserving funds for future acts of terrorism. The decision and our work to communicate it generated editorial praise such as “The Red Cross Gets It Right,” and the appreciation of families of victims, public officials, and more. 

The other campaign I am very proud of is our work to persuade the U.S. Congress to pay its billion dollar debt to the UN and fully support the institution – a decision which came at a time when there was a real risk of the U.S. walking away from the UN and seriously weakening its ability to provide peace keeping and life saving humanitarian support.  

6. What is your favorite movie?

When Harry Met Sally

7. What is your favorite sport? Sports team? 

Baseball and the NY Yankees

8. What is your favorite DC monument?

Lincoln.

9. What was the last book you read?

Everybody Rise by Stephanie Clifford, which is not about the law but was written by the former New York Times Brooklyn federal court reporter. It’s a great read.  

10. Dog person or cat person?

Definitely a dog person. I am the proud owner of a seven year old Goldendoodle, Maggie.


September 23, 2015
September 23, 2015

Hall of Fame catcher Yogi Berra passed away yesterday, exactly 69 years after he made his Major League debut. His contributions to the game have few rivals. Perhaps lesser known to the wider public are his contributions to our nation – a member of the Navy, Yogi was part of the D-Day invasion on Omaha Beach.

But perhaps what he is best known for are his “Yogi-isms”, statements that he made seriously that became part of popular culture, and also made people laugh. 

The CLS Strategies team is filled with die hard Yankee fans, so in his memory, we wanted to share with you some of our favorite quotes from a Yankee legend that we will miss.

  • “When you come to a fork in the road, take it.”
  • “It's deja vu all over again.”
  • “Ninety percent of this game is half mental.”
  • “No one goes there anymore. It's too crowded.”
  • “Always go to other people’s funerals. Otherwise they won’t go to yours.”
  • “I really didn’t say everything I said.”

Yogi also famously once said, “It ain’t over till it’s over.” While sadly Yogi has passed on, the memory of his game and words will never be over. 


April 29, 2015
April 29, 2015

When it was announced in February 2014, the conventional wisdom on Comcast’s plan to acquire Time Warner Cable was that the merger would be approved, perhaps with conditions similar to those imposed on its last acquisition of NBC Universal. Instead, after completing their reviews, the DOJ and FCC escorted Comcast to the nearest exit and cut the cord on their merger.  

What can be learned from this dramatic shift in merger sentiment and outcome?  

The most significant obstacle to the merger turned out to be Comcast’s colossal miscalculation that the national broadband market doesn’t matter – or worse, isn’t even a relevant market. From the day it announced its deal, Comcast stuck to its basic talking points claiming that only local markets mattered, that there would be no overlap between the two merging companies, and dismissed any suggestion that there was a national broadband market affected by the deal. Meanwhile, Netflix and many other programmers, over 1,000 competing broadband network providers, and consumers and public interest organizations, made a compelling case against the deal that Comcast failed to rebut. They raised concerns that Comcast’s post-merger share of the national broadband market would jump to well over 50%, and threatened to be a serious bottleneck for over the top (OTT) content providers, their consumers and an increasingly broadband-dependent economy. 

In the end, Comcast wasn’t nimble, didn’t adapt and lost the argument over the merger’s relevant market and impacts by a landslide, a fatal defeat in any antitrust review. We are proud that the Los Angeles Times recognized our Don’t Comcast the Internet Campaign, led by COMPTEL, NTCA–The Rural Broadband Association and ITTA, as a driving force in the successful effort to stop the merger.  

Another major shortcoming for Comcast was its failure to articulate significant benefits of the merger and to generate support from Members of Congress or third parties who would give voice to these outcomes. Indeed, several reporters mentioned to us over the course of the deal that it was striking how little Congressional support Comcast generated for this transaction after leveraging quite a bit for its NBCU acquisition. Comcast senior executive, David Cohen, certainly did not help his own case when he candidly commented:  “We’re certainly not promising that customer bills are going to go down or even increase less rapidly.”

With few benefits and little organic backing, Comcast tried to use its financial muscle to manufacture the perception of widespread support, only to have this backfire when The New York Times published an exposé revealing that the Company spent millions on donations to more than 80 civic groups, each of whom dutifully filed comments with the FCC in support of their donor. Comcast’s “Astroturf” was clearly no match for the unprecedented opposition the merger faced, which by the end numbered about 800,000 hostile comments to regulators, making it the most opposed merger in history.

Last, corporate reputation may not play much of a role in some mergers, but in those involving well known consumer-facing companies, Comcast’s failed merger may come to stand for the large handicap faced by businesses with reputations so poor that the mere mention of their name provokes disdain.  This past December, the University of Michigan’s Consumer Satisfaction Index found that Time Warner Cable and Comcast were the two most unpopular companies in America. In our own research, we found that the prospect of Comcast doing to the Internet what it already had done to cable TV provoked universal and passionate opposition to the merger. Consumers strongly opposed putting more control in the hands of these companies over their online programming options. These findings gave rise to our campaign name, Don’t Comcast the Internet, and these very real fears ultimately brought an end to this merger.  

The good news is that Comcast’s defeat is a very important win for competition and consumers as it helps to keep the market for broadband access more open and vibrant. But all those who have a stake in the broadband-dependent economy should remain vigilant, as there surely will be follow on efforts to “Comcast” the Internet.

 


February 10, 2015

Following the Brian Williams self-induced crisis triggered by his false claims that his helicopter was hit by enemy fire in Iraq, Bob Chlopak spoke with PRWeek to share his advice for the NBC Nightly News anchor and the network. 

Six crisis communicators: What we'd tell Brian Williams and NBC News to do next
PRWeek
By Diana Bradley
February 10, 2015

Is Brian Williams’ reputation beyond repair? As the controversy surrounding the NBC Nightly News anchor continues to snowball, PRWeek asked six crisis communications experts to share their advice for Williams and the network.

Bob Chlopak, partner, CLS Strategies
NBC is mishandling the situation by allowing Williams himself to dictate its response. The only possible path to saving Williams’ job – and his significant value to the network – begins with an independent investigation of the facts.

Williams’ apology fell short and will not stop the damage caused by his false claims. He must take full responsibility for all of his exaggerations or falsehoods, and give viewers concrete reasons to believe that they can trust him again in the future [...]

Read the full article at PRWeek here.