10 Disastrous PR Moves by Companies

The business world will always have loose cannons -- executives who stray from their crafted bullet points to say cringe-worthy things.

There are also decisions made at the top that no public relations expert would ever condone. When AIG(AIG) was spared from extinction with an $85 billion federal bailout from the government, its clueless leadership didn't think twice about spending nearly a half-million dollars on a luxurious spa retreat and golf outing for executives.

Executives for the "big three" automakers made a political miscalculation by flying into Washington, D.C., hat in hand for a bailout -- on corporate jets. Chastened by the response, they later overdid things by driving themselves in hybrid cars.

In looking at some of the biggest PR miscues in recent years, we discounted thick-headed blunders such as these. No matter how good internal or external PR departments are, they can be no match for a CEO gone rogue.

Instead, we focused on situations where a company's public response amid controversy was either too little, too late or dishonest and it was the spinmeisters themselves making the unforced errors. The following are 10 examples of when spin control spun out of control and a PR strategy only made matters worse:

Detroit (expletive) City
So, you work for a firm that gets hired by Chrysler(DAI) to help build its social media presence.

If you read the newspapers, you may realize that the company had battled to stay alive, resorting to a government bailout to stay afloat. You should also be aware that the government loan riled up conservatives, despite supporters maintaining it was needed to save U.S. jobs, particularly in Michigan.

If you know anything about your big client, you might also know Chrysler had! unveile d a series of dramatic commercials, some featuring rapper and Detroit native Eminem, to show the world that the hardworking character of that city's workforce should be a source of American Pride and optimism.

You should have known all that. Instead, an employee of New Media Strategies, a Virginia-based marketing firm retained by Chrysler, went on the company's Twitter feed, @ChryslerAutos, and posted: "I find it ironic that Detroit is known as the #motorcity and yet no one here knows how to f***ing drive."

(In the tweet -- accidentally posted to the company site instead of a personal feed -- the expletive we censored was actually spelled out.)

Accidents happen and, really, the tweet was not that bad. But in the world of social media, never the company and personal should meet. Given the company's Detroit Pride message, the posting was even more of a wreck.

Fortunately, Chrysler shook aside the flurry of unwanted media attention.

The firm, however, lost the gig.

As for the staffer who made the mistake, last month he started work on the social media initiatives of another company -- this time Ford(F).

A&F offends Asians; says critics think dirty thoughts
It is hard to know whether the brain trust at Abercrombie & Fitch(ANF) is inept or brilliant.

The latter, and a calculated move to maximize publicity, might be the only explanation for some of the hard-to-believe ways the company has responded to controversy.

Back in 2002, the retailer was under fire for T-shirts seen as reinforcing negative Asian-American stereotypes. One shirt shows cartoon Chinese laundry worker caricatures -- complete with slanted eyes and conical "rice-paddy" hats -- with the slogan "Wong Brothers Laundry Service: Two Wongs Can Make It White."

Amid charges of racism and nationwide protests and boycotts, the company fi! nally of fered an apology -- sort of.

"We're very, very, very sorry," a spokesman told the San Francisco Chronicle. "It's never been our intention to offend anyone."

Then came the head-scratching coda: "We personally thought Asians would love this T-shirt."

The response to a later controversy -- selling thong underwear for children adorned with images of cherries and the words "kiss me" and "wink, wink" -- had the same bizarre mix of contrition and glibness.

The official statements to the media included such gems as "It's not appropriate for a 7-year-old, but it is appropriate for a 10-year-old" and "The underwear for young girls was created with the intent to be lighthearted and cute; any misrepresentation of that is purely in the eye of the beholder."

Laying out its case for what age it is OK to start sexualizing young girls was scurrilous enough, but the kicker accusing critics of harboring their own dirty thoughts broke just about every PR and crisis control rule ever written.

Toyota Steers into the skid
Remember the Disney(DIS) movies featuring Herbie, a sentient Volkswagen Beetle that could start, stop and steer all on his own?

In real life, it is not so much fun when your car seems to have a mind of its own.

Toyota had the misfortune of balancing a growing PR crisis with the legal imperative to cover its bumper. The two didn't mix well.

As Toyota(TM) would learn, silence doesn't work. Nor does blaming the motor skills of drivers when the sheer volume of incidents, some of them fatal, seem to indicate that's not the case.

Are we really, even now, 100% sure what was happening with the sudden acceleration? Although the problem seems solved, many questions remain.

What we do know is that Toyota's public relations response was a textbook case in what not to do when they dodged and denied the! problem for months before issuing an apology and potential mechanical fix.

Brian Dobson, a crisis PR expert, says Toyota was "flat-footed" and slow to respond.

"If brand managers don't engage the media from Day One, then crisis reports get driven by critics, competitors and pundits who dominate news with negative comments," he said last year in comments about the issue. "Toyota lost ground trying to minimize its troubles as competitors pounced to capitalize."

Facebook vs. Google
Facebook seems to always be under attack by one disgruntled party or another, usually about its ever-changing, sneaky approach to a privacy policy. Bottom line: A company that give you a service for free in exchange for mining data is never going to be too keen on shielding your data from prying eyes.

It does seem Facebook suffers a disproportionate share of scorn regarding this topic than the bigger potential threat to personal privacy that is Google(GOOG).

Still, Facebook crossed a line when PR firm Burson-Marsteller was tasked with trying to spread privacy-related vitriol about Google and plant news stories and blogs that prodded writers to make the case for them, even offering to help write these pieces. The targets ranged from influential blogs to USA Today.

In one of the emails leaked by an unwilling blogger, Google is described as having "a well-known history of infringing on the privacy rights of America's Internet users."

PR firms always try to influence stories -- it's what they are paid for. What made these efforts such a failure is that the firm refused to reveal it was working for Facebook. Here's the other miscalculation: The public often has a finely tuned hypocrisy detector. A suitable defense for Facebook when its lackadaisical approach to user privacy is denounced really needed to be more than "They started it!"

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Antennagate
Rest in peace, Steve Jobs. We would be doing Apple's(AAPL) late genius a disservice, however, if we didn't include one of the most famous examples of his sometimes caustic management style.

When a design flaw was uncovered in the 2010 iPhone 4 -- touching certain areas killed reception -- Apple initially avoided the topic with a companywide cone of silence. Jobs didn't help matters by chastising users, in one of his many off-the-cuff email answers, that they were holding it wrong.

Ignore the problem. Blame the customer. Refuse to apologize. Those approaches never work.

Cooler PR heads eventually prevailed, and Apple instead spent $175 million sending cases to owners to resolve the issue. (Even now there may be questions about the problem. AntennaSys, an antenna design and consulting firm, did tests and told PC World that "all the hype has been just hype ... It's not any more sensitive to hand position that was the first-generation iPhone -- and probably many other phones on the market.")

LeBron James' bad decision
LeBron James has a lot to carry on his broad shoulders. There is the six-year, $110 million investment the owners of the Miami Heat have in him. There are basketball fans to appease. And there are big-name sponsors who have shelled out big bucks to associate themselves with the top NBA star, among them McDonald's(MCD) and Nike(NKE).

For most of his career, James was one of the few young phenoms who seemed to pan out, entering the league straight from high school. He was young, likable and talented -- a native of Cleveland who played for the hometown team.

But James' decision to pursue free agency left Ohio residents hanging. It was very likely their hometown hero would pack his bags.

While t here would surely be a fair share of Cavaliers fans who would never forgive their prodigal son, James certainly had the opportunity to exit gracefully and with at least muted good wishes. Many of his critics, deep down, would be thankful for the resurrection of the team he ruled and admit they too would switch employers for a few million more dollars a year.

But James let his consultants and handlers pitch him on making the whole contract process a spectacle. Notable was a disastrous, hourlong, ESPN special called The Decision, in which cities vied for his services as though they were reality show contestants.

In trying to create drama and build upon James' reputation, all they did was ruin it. James is now one of the more reviled and mocked figures in sports (aside from another classic PR bungler, Tiger Woods).

Alaska Airlines and the diaper incident
The inevitable bit of bad service on an airline (or a grumpy passenger) make for easy headlines. Southwest Airlines(LUV), for example, had to deal with the weighty fallout when they angered filmmaker Kevin Smith by saying he was too fat to fly with a one-seat ticket.

All a company's PR department can do in a situation such as that is straddle the line between apologizing and defending their actions. With any luck, short memories will prevail and everyone moves onto a new villain. (Thankfully, airlines always have the TSA to steal away the attention.)

Alaska Airlines(ALK) had every opportunity to douse a publicity fire when a family was stuck in Las Vegas because the man's wife, tending to a baby's diaper needs, was kept from boarding the plane because, in the alleged words of an employee, she was "one minute late."

The airline certainly sounds heartless. To be fair, however, time is of the essence when boarding a plane. With all due sympathy for a mom h! aving to deal with a child, once the plane door closes, security measures dictate that no one boards. People are stuck on standby every day because a connecting flight was a few minutes off schedule.

But Hell hath no fury like a "mommy blogger" scorned, and an online attack on the airline's handling of the incident titled "Alaska Airlines Hates Families" got widespread exposure and was reported in mainstream media.

In its annual rundown of the worst PR blunders, the San Francisco-based Fineman PR explained what the airline did wrong.

"While Alaska Airlines social media manager Elliott Pesut did respond promptly in the blog's comment section, he did so without compassion, citing rigid policy and offering a future travel voucher for less than half the family's losses," the PR firm wrote.

The lesson learned: when you are under the harsh light of a full-on media attack, swallow some pride and a few bucks by going beyond normal procedures to make things right. A little contrition can go a long way.

FEMA's fake reporters
What if they threw a press conference and nobody came?

That was the scenario when FEMA scheduled a 2007 press conference to update media on efforts to combat raging wildfires in California.

To reporters, press conferences are a necessary evil in covering big stories for which a public official has to efficiently answer questions or detail talking points, and they know they must separate spin from facts. But delivering the trut is harder when a press conference is missing one very important element -- the press.

Instead of letting reporters grill executives, FEMA filled the room with staffers and agency officials. It was a make-believe press conference!

In a memo to all FEMA employees Oct. 29, 2007, administrator R. David Paulison said that "without intending to deceive," the FEMA external affairs staff "nevertheless lost perspective of the core imperative that they preser! ve the c redibility of our agency." He described the fake press event as among "a series of serious mistakes and extremely poor decisions."

Among the issues Paulison cited is that media who did get to take part in the conference off-site were restricted to a "listen only" capability, which kept them from stepping on the toes of the fake reporters who did get to ask questions.

An earlier statement from FEMA's vice admiral, Harvey Johnson, missed the point: "The real story -- how well the response and recovery elements are working in this disaster -- should not be lost because of how we tried to meet the needs of the media in distributing facts."