Is public engagement ever a bad idea?

wiresIf you hang out in the social-media space for more than 10 minutes, you’ll heard evangelists preaching the importance of public engagement — over, and over, and over.

First you listen to the online conversation, then you analyze, then you participate. In theory, your truly passionate consumers will also participate, resulting in goodwill and understanding — providing you’re not a complete a#@hole — and providing you have passionate customers. Not everyone does.

Is it ever appropriate to hang back? Is it ever OK to reject the idea of public engagement in social media?

Last week,  I chatted with a colleague who works for a large public utility. Knowing my interest in in things 2.0, he asked me point blank: “Should we be part of the online conversation?”

“What do you think?” I asked him.

“Well, I don’t see how it will help the company,” he said, “and I think it carries a good bit of risk.”

I asked him to explain.

Electric utilities have certain opposition that may never be satisfied, he said. For example:

Staunch environmentalists oppose the burning of fossil fuels and want nothing to do with nuclear energy. Green power is ideal until you consider costs. Electricity from wind power can cost twice as much as coal, solar about 5 times as much — at least until the technology is developed and dispersed. And in a deregulated distribution environment, you simply can’t produce electricity at those higher rates and hope to compete.

Community activists focus on quality-of-life and neighborhood safety issues, and don’t care much for high-voltage electric lines crisscrossing their towns or subdivisions. Opponents range from those who see the wires as unsightly to those who believe the wires cause cancer — or worse. There’s no reliable scientific evidence to support public fears about high-voltage lines, but you know what they say: Perception is reality. But regardless of perception, the electric company has to string the wires.

Property owners battle utilities almost daily. Most fights in the Midwest of late have been over the maintenance of transmission lines, which requires heavy trimming or removal of old-growth trees. “We have no choice,” my friend said. “The law mandates that we remove the threats to the power supply, and felling a shade tree Grandpa planted 100 years ago is never going to be popular.”

Try fighting that battle before a TV camera or a public meeting! It’s no fun.

That’s just a partial list of angry publics who oppose utility companies. But like the rest of us, they also demand a reliable supply of electricity and natural gas. Can the opponents be persuaded to moderate their positions? I’m not so sure compromise works for many of these folks.

The “regulation” obstacle. Electric utilities are among the most regulated industries anywhere. They must comply with state and federal regulations or risk huge fines. If one company were to go above and beyond — for example, cutting coal-plant emissions and additional 20% — that company would become immensely popular with the greens but immensely unpopular with investors. Only one of those two groups keeps you in business.

There’s no “unique selling proposition” in the electric business. Your computer doesn’t care if the juice comes from a nuke plant or a windmill. And as consumers, we can’t choose “green” electricity unless we put solar panels on the roof. Bottom line: Utilities must produce power they can sell at a competitive price or, like any other enterprise, they’re out of business.

SEClogoDon’t forget the SEC. Since most utilities are publicly traded, they must speak carefully in any public forum. If you want a real challenge, try fitting a safe harbor statement into a 140-character tweet! While a number of public companies do participate in online conversation, those companies talk about unique products and services that set them apart. Utilities produce a commodity that’s not the least bit sexy. Do you ever brag about your electric company?

The burden on utilities is an enormous one. They must meet demand for electricity in the peak periods, and they have no choice but to accept new customers. They’re subject to massive public criticism, but they can never take their ball and go home. Sometimes they “strategically” ignore public criticism because there appears nothing to be gained by addressing it.

Whereas social-media engagement might put a human face on these mega utilities, will it lower the cost of electricity? Will it improve air quality? Will it solve the issue of nuclear waste?

As we finished our chat, I urged my friend to begin monitoring the social-media conversation. At the very least, I said, the company may spot potential opposition before it hits the front page. It will make your communication more timely and more effective.

But I had to agree that online public engagement — at least in the context of a publicly traded utility — might not be worth a major investment of staff time. I’m not sure that’s the right answer.

15 Responses to Is public engagement ever a bad idea?

  1. Breeze says:

    Damn… you had me until the whole “not a complete a-hole” caveat. No wonder my PR career was so brief. 🙂

  2. Ike Pigott says:

    Bill, have you been hacking into my notes?

  3. Good discussion. On a related point, we assume that conversations are good and relationships are a desirable outcome – yet in the real world we often just want transactions, or actions. Part of the appeal of online retailing is the absence of mock-friendly ‘have a nice day’ conversations.

    Markets involve conversations – but they’re based on transactions too.

  4. Michael Clendenin says:

    I think this post is great because it does what so many discussions around social media do not — bring it back to the bottom line of the business. Does participation help your company sell widgets? Directly or measurably indirectly? I will say that even the utilities could look toward social media to help customer service efforts. Shel Holtz has more than one story of a blog mention of a problem with a company garnering the attention and eventual resolution of the problem. That gains customer loyalty — indirect, but measurable, or at least documentable (is that a word?).

  5. Bill, great example and thanks for reminding us that social media needs to be considered on a case-by-case basis.

    Sure, you can make an argument that this public utilities company could benefit by appearing more human — but putting a “face” to the company won’t change the environmentalists’ or howeowners’ views. Social media is a set of tools. Just like any other communication tool, it needs to pass the ever-important litmus test: Does it make good business sense? (Don’t get me wrong — that doesn’t mean social media is only viable when it leads to direct sales. PR often doesn’t lead to direct sales, but it’s still a valuable part of a company’s communication strategy.) Some utility companies may find value in educating consumers about green energy or water filtration, especially in markets where competition exists. But, for other companies, that may not be enough to pass the litmus test.

    Heather (@prtini)

  6. Roger Pynn says:

    What if your friend had asked whether the utility should be involved in community relations, or whether the company should have a public relations program at all? As a regulated monopoly it would be easy to say “there’s no business case for it because our customers have no choice but to buy from us.”

    But the simple truth is that social media is just one more way to engage your stakeholders and as more of them move toward this form of communication you have to find a way to create a voice that avoids the pitfalls of publicly traded environments and confrontational topics in favor of valuable messages that tell those with whom you share different ends of the electrical line that you are there for them and care about their needs.

  7. James Aach says:

    You’ve summarized many of the problems facing utilities in the public arena well. Having actually worked in the industry for many years (the nuclear side) and then watched the public dialog, it’s pretty clear that there is a huge need for better public understanding of our energy supplies. Without this, much of the conversation becomes non-sensical. We’re all experienced enough with Health Care that if a really silly statement is made by the media, a politician, or just a commenter, we know it. In energy, that isn’t true – you can say all sorts of really oddball things and not be questioned. This makes the likelihood of public debate ever arriving at the best solution rather unlikely.

    FYI: for an insider’s take on the social, technical and political aspects of the US nuclear industry – see my novel “Rad Decision.” It is available free online at http://RadDecision.blogspot.com and at Amazon. Reader reviews are at the homepage. No advertising, no sponsors, no $$ for the author (even for the paperback) – just the real world of nuclear, good and bad, including a lot of things you won’t hear the typical media experts chattering about (since they spend little if any time actually working at power plants).

    • Bill Sledzik says:

      Sorry for the late approval on that one, James. The link somehow pushed you into the Askimet filter. I gotta be more vigilant about checking it.

  8. Chuck Hemann says:

    Bill – quality post, as usual. I have a question though: why didn’t you immediately recommend Twitter and Facebook to this company? Isn’t that what social media is? Shouldn’t everyone be on Twitter/Facebook? Isn’t social media the savior for brands that couldn’t figure out traditional channels?

    Ok, I promise…I’m done being sarcastic (for the moment). In all seriousness, you raise an essential point: social media is NOT for everyone. There are benefits, and drawbacks to any communications discipline.

    This conversation boils down to one central point for me – can you realistically enhance the experience your customer has with your product or company through social media? If the answer is yes, then an external effort probably makes sense. If the answer is no, perhaps a more internal focus is required, or heck, you just stick to the traditional channels.

    Enjoyed it. Thanks, Bill.

    @chuckhemann

  9. Bill Sledzik says:

    Wow. Thanks for all the feedback so far. Been in meetings all day and without Internet access. Kinda nice. Anyway, Thanks to Chuck for summing up the very same lesson I took from this post — and the one I hope my students will take away as well.

    I’m not one who believes in engagement for the sake of engagement. If it fits the strategy and if it helps both customer and client, then go for it. But as Richard said, for some clients and some products, it may be best to simply focus on the transaction. I don’t think the utilities have anything to hide, since the regulators won’t allow it.

  10. Ike Pigott says:

    Michael, we’ve got some documented cases of that very activity. Taking a couple of moments to correct an error or turn a slightly disgruntled customer into a satisfied evangelist for your Awesomeness is worth it — but it doesn’t scale to the broad “engagement” role some wished upon all the corporate world.

    What Bill seems to be hitting on is that these tools are not all-or-nothing – and there’s a place for very limited and surgical use when the business case is not clear.

    When I spoke at the Social Media Conference in Vegas, I was immediately after Tony from Zappos. He talked (a bit too much) about the culture he had created. It’s interesting, but it’s also easy when you’re the CEO and it’s your company, with no pre-existing stakes.

    I told the audience that it’s easy to use social media when the culture is optimized for it — and most of us are not in that Happy Place (nor should we be).

  11. Bob says:

    Social media presumes engagement, but the reality is far short of that. Good public relations considers strategic engagement, which means targeting and using specific tools. That said, good PR would presume strategic public engagement and not just doing it because the situation or medium (allegedly) calls for it.

    Like with everything, moderation is probably a good rule of thumb. Too little public engagement will ultimately bite you in the butt; the same with too much.

  12. Bill, great post and commenters, great conversation.

    This is a recent favorite topic of mine; with my small consultancy in its infancy, I need as much awareness as I can get, so have jumped in with both feet to socmed.

    IMO, social media hasn’t begun to demonstrate sufficient business value to justify much of its expenditure. There are myriad examples to the contrary, especially dealing with customer service complaints and other issues, and the direct-to-consumer businesses in IT and Southwest Airlines.

    It certainly give entrepreneurs a platform to speak intelligently about their given specialties. However, for many companies, social media will have no impact on its communication objectives. That’s considered high heresy by the socmed high priests, but I think it’s time to acknowledge that.

    At this point, it’s another tool in the toolbox — it can be transformative — I have nurtured new business relationships on Twitter, for example, and found old professional friends on LinkedIn, and even long lost cousins on Facebook. What is the incremental value of that activity to my business? Unknown and possibly incalculable.

    We could conclude that any heavily regulated industry is a poor fit, mainly due to the legal and regulatory ramifications of doing social media wrong. Maybe not — if for example, a utility was willing to let workers accused of shoddy maintenence and safety were allowed to explain themselves online to their aggrieved customers…

    Good luck with that!
    Sean @commammo

  13. Brilliant post Bill–no, not everyone needs to be involved in public engagement.

    But, directly to the public utility aspect–PSNH (Public Service of New Hampshire) has a very forward-thinking person heading their PR group, Martin Murray. He established a Twitter account, toyed with it and wasn’t sure how to apply it. Enter the nasty ice storm we had back in December…and the PSNH twitter account became an information and communication source for us when electricity was out (I got updates on my cell phone).

    The response during a crisis was great, and PSNH really got it right.

    As a public utility, they struggle with the same issues you’ve outlined above but still found an effective use for social media.

    YMMV!

    Jen

  14. Absolutely, Bill.

    With all the hype surrounding social media sites like Twitter and Facebook, organizations sometimes forget that this is not just another avenue for advertisement (often the underlying motive for most organizations attempt at “public engagement”). For every great social media attempt (think eepybird.com with the famous Mentos and Diet Coke experiment) there are a dozen pathetic ones (think the Dial handwashing challenge– awful!).

    Sometimes, just sometimes, it’s better to watch the losing team than be a part of it.

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