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It is more dangerous than ever for a company to get on the wrong site of their consumers. Social media sites, such as Facebook, mean that angry consumers and activists can spread the word quickly, efficiently, and widely, and there is little the company can do after the fact to halt the damages.

For example, Nestlé decided to buy some palm oil from a supplier that was clearing rain forests to plant palm plantations. Only 1.25 percent of the palm oil the company bought was from this supplier, and it has since discontinued its supply relationship. And yet on its Facebook site, Greenpeace expanded its marketing campaigns against Nestlé, prompting 95,000 Facebook protests against the company.

In the same campaign, Greenpeace posted a YouTube video: a mock commercial of a customer opening a KitKat and snacking on a bloody orangutan finger. Another Greenpeace report showed the KitKat log with the brand switched to “Killer.” Various protesters followed suit and posted the fake logo in their Facebook profile pictures, even as they continued to complain on Nestlé’s Facebook page. According to Greenpeace, Nestlé continues to purchase the offending palm oil indirectly from third-party suppliers.

The food company is caught in the tough position of needing to restore its image. Social media have made customers more aware of the negative comments, but Nestlé cannot just shut down its Facebook page to limit the public complaints, because then it would face criticism for failing to engage with customers.

In another example, Domino’s Pizza suffered mightily when a YouTube video showed two employees blowing their noses on pizza. Within 24 hours, Domino’s said it had fired the employees and charged them with crimes. As the pizza maker showed, social media moves so fast that a company must respond just as fast, or the problem or publicity grow exponentially worse.

Discussion Questions:

  1. What are the advantages and disadvantages of social media?
  2. What should Nestlé do?

Emily Steel, “Nestlé Takes a Beating on Social-Media Sites,” The Wall Street Journal, March 29, 2010.