Online reputation management: lessons from the ‘Billion Dollar Day’ sale
Monday, October 6, 2014 was a momentous day as far as e-commerce in India was concerned. It was the day when India’s leading e-retailer Flipkart rolled out its now much-criticized Billion Dollar Day sale. The campaign, as all Indians know, created enormous buzz, with unprecedented multi-channel advertising luring consumers with unheard-of discounted prices and deals on millions of products.
However, as we now know, Flipkart was not fully prepared for the success of its own marketing and advertising blitz. Anything that could go wrong, did. From technical challenges due to the website unable to handle the traffic to merchandising, inventory management and order fulfilment—hordes of online shoppers were subjected to a forgettable shopping experience that took away most of the sheen of the mega sale day. Of course, the poor user experience still couldn’t stop the e-retailer from raising huge revenues from that single day; however, they could well be left wondering what might have been if things hadn’t gotten so out of control.
As expected, the problems with the sale led to a huge backlash for the company, as consumers took to social media and the mainstream media reported heavily. In the course of one-day, Flipkart became ‘Flopkart’ and all of a sudden, it seemed that there was nothing right with the e-retailer.
It could have been a total PR disaster, but for the founders of the site holding up their hands and admitting that the company had botched it. Sachin and Binny Bansal were prompt to admit, through a lengthy apology e-mail, that they weren’t adequately prepared for the kind of demand that the site witnessed.
A customer who misses out on a great deal is an angry customer and one can only guess how much the apology e-mail from the founders would have served to pacify such a customer. Nevertheless, we believe that Flipkart did the right thing—and perhaps, the only thing they could have done— in accepting their mistakes and communicating with their community of online shoppers. As the dust settles and the heat cools downs, we are certain that at least a large segment of customers will accept the apology and forgive Flipkart for the goof-up. Nevertheless, there will undoubtedly be some damage done to the online reputation (and of course, overall reputation, as well) of the company, which many of the site’s competitors are sure to capitalize on.
Here are some key lessons that we take from an online reputation management perspective from the above episode:
a) Beware of what you promise: that age-old maxim, under-promise and over-deliver is a much better and safer bet, a anytime.
b) Be prepared for the consequences of excessive marketing: Ultra-aggressive and over-the-top promotional marketing is a double-edged sword and can have devastating repercussions, if fulfillment cannot match the marketing hype.
c) Think on your feet and take immediate actions: As the problems with the sale came to the fore rather early in the day, Flipkart could potentially have done some things differently. For example, they could have adopted a staggered approach, giving ‘forced’ breaks. During these breaks, the ‘sale’ could have been suspended and the company bought time to make some alternative arrangements, especially with regard to technical issues (server, page load speed etc.)
d) Put your hand up if you mess up: Mistakes happen or things go wrong sometimes. Whether it is something within your control or not, if things do go wrong, acknowledge it and duly apologize. There is no shame in apologizing for mistakes made, as long as customers can be made to recognize that you are taking corrective and preventive actions.
e) Make it up to your customers:To the extent possible, Flipkart needs to really crunch all the data and server logs to identify customers who experienced problems and couldn’t fulfill their purchases, get in touch with them with personalized offers related to whatever they were trying to buy. This will go a long way in not only salvaging the relationship, but also build greater customer loyalty.
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