Way back in the day – June, 2010, to be exact – we wrote up a very supportive piece on Caribou Coffee, a brand we expected would throw some major coffee-house competition Starbucks way. We especially liked its focus on customer experience and its plan to increase its commercial business.
For a while we were “spot on,” as they say. Caribou finished 2010 with an 8% sales increase, and followed that up in 2011 with an even better 15% growth figure. The commercial business successfully doubled as a part of the total business, from 13% to 26%. And operating income ticked up a full percentage point each year.
But something went awry in 2012. The business flattened out. That didn’t stop the big and oddly named German business conglomerate Joh. A. Benckiser (aka, “JAB”) from offering a 30% premium to Caribou Coffee’s then stock price, in December of last year. Caribou management took the deal.
Why not? JAB claimed it would let Caribou operate as a stand-alone business. The hardest part of taking the money would be keeping the JAB bureaucrats out of the way.
Three months later, the JAB bureaucrats apparently had enough of the arms-length relationship. In early April, Caribou announced that it would close 80 company-owned coffee-house locations, rebadge 88 others to JAB’s Peet’s Coffee brand, and limit Caribou’s focus to an 8-state region.
So there goes our hoped-for offset to Starbucks dominance. End of story, right?
Caribou management, believing that some marketing would perhaps keep the shops that remained in, er, business, decided to put up a harmless post on its Facebook brand page. Something about a bagel or what have you – the nonsense that most brands toss off to stir up a little “engagement” with their “fans.”
Now, remember that paragraph above about the closing of 80 Caribou stores? Well, turns out quite a few Facebookers couldn’t forget, and let the company have it, stuffing loads of vitriol right up the bagel. Whoever was managing Caribou’s Facebook page must have gone into shock. His or her first reaction was to delete and/or bury the negative comments.
That, as you know, is a “brand authenticity” no-no. Bad situation gets worse, and next thing you know the social media nitwit brigade is out in full force with teaching moments. Like this one, from Candy Tice, on Forbes.com:
“Instead of trying to plaster over the problem, the [Caribou] Facebook page could have been the place to dialogue about why these closures had to happen…They could be asking fans to post their favorite memory of Caribou stores that are closing.”
So there you have it: the new normal for social media will now require that brands vet all their business decisions online. Planning on buying a new fleet of trucks? Or moving the Finance team from the 4th floor to the 2nd floor? Or perhaps hiring five new sales people next month?
You’d best consult with your loyal likers and fan-ners first.