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The very public explosions emanating from the Adidas and Telecom bunkers this month tell a tale about corporate adjustment and discomfort in a new and very changed media environment.

While the two cases are different, there is one central issue that's common to both. Both Adidas and Telecom misread public sentiment and took up positions that alienated them from a public they so desperately wish to cultivate.

Adidas jersey price

Here is a business that needs to make a profit. They spend millions on sponsoring and equipping the All Blacks' and the agreement gives them the right to sell All Blacks jerseys from which they should be entitled to make a tidy profit. That seems reasonable in terms of an agreement between Adidas and the New Zealand Rugby Union (NZRU). Is that a fair deal for All Blacks fans? Yes, except that the fans know a fair price for a jersey when they see it and, in their perception, Adidas was ripping them off.

The first part of this scenario is not so bad. Adidas were given a clear signal that the jersey price was causing a problem, but they responded in the first instance by failing to address the public concern, but rather responded with a justification for the pricing strategy.

Oh dear. When a rugby fan is asked to tolerate the Adidas logo next to the beloved All Black logo, she doesn't then want to pay through the nose simply because Adidas wants to recover the cost of its sponsorship investment.

Telecom "Abstain for the game"

Asking New Zealand rugby fans to stop you-know-what during a footie tournament had to be a joke, right? But it turned ugly and very serious for Telecom, even before the campaign hit the television screens.

The problem in my view wasn't that no one got the joke or that it was particularly offensive, it was simply that it was so badly out of step with how the public relates to the All Blacks and the seriousness with which they are taking the Webb Ellis Trophy.

Some lessons

The NZRU has a brand and a community of supporters that others want a piece of. But the power of the All Blacks brand is in the ownership fans feel for the brand. So the lessons for Telecom, Adidas and for New Zealand rugby are clear. Their positions of profitability and power only persist with the continuing goodwill of their public supporters. While the NZRU may be happy to profit from Adidas sponsorship, they should not assume that the fans will always be so willing to pay for that privilege by default. Telecom, on the other hand, must now be asking if their marketing team and ad agency have any real connections with public sentiment, or whether they'd be better off spending a bit more time doing their market research down at the local pub.

In today's new media world where what's talked about at the pub is also on Twitter to a much wider audience, organisations and businesses sometimes still struggle to come to grips with it all. We all need to give up some of the old "power and control" assumptions and appreciate that listening is the most important component in communications, especially to those who make profit possible - the public. It always was important but now it's crucial.

Organisations and businesses have always sought to 'build brands' that have sustainable value. In the new world order they also need to contribute to building communities of shared interest where everyone profits.


See Fraser Carson’s blog post on “No sex at Telecom this week”.

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