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Blackberry – after the blackout

27-October-2011
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Blackberry – after the blackout

When Blackberry services went down for three days (which felt like eternity to some) last week, the joke that did rounds on every social platform was ‘Steve Jobs has already started destroying his competitor from iHeaven’. Facebook and Twitter served as the shoulders for angry users who could cry on for losing access to e-mails, Internet and their most loved ‘BBM’. While some cried over business loss because of no backup, pranksters tweeting messages like‘Dear Blackberry, I think it’s nice that you’re honouring Steve Jobs’ death with a 3-day silence’, ‘'Blackberry Services collapse worldwide... time to get an iPhone me thinks’ garnered enough attention of international media.

Fixing up the faulty switches and assuring uninterrupted services, RIM apologised to its users offering premium apps worth $100 free and one month of free technical support for its enterprise customers. But can free apps delete the experiences from users’ minds? Can this one instance cause great harm to brand value of Blackberry? Would this serve as compensation to angry users?

Compensation
“It is not so much about the compensation, but the fact that the brand has thought about giving something in return for the inconvenience caused”, said Sameer Suneja, CEO, Perfetti Van Melle. He added, “The reason of so much agitation is the dependence on these devices. People were frustrated when it happened. But offering freebies worth this amount is appreciable. It’s not a small amount. It is substantial to make people feel that the company has taken some measures as it respects the sentiments of its users. Had it been a paltry sum, it would have offended people. The idea is either do it or don’t do it at all. RIM has done it well.”
 

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Though the amount is substantial, are these apps contentious? As Debraj Tripathy, MD, Mediacom, put it, “Blackberry has business as well as non-business users. The free apps would appeal majorly to non-business users only. Whether freebies can compensate for the inconvenience caused, not sure, but public apologies by the management have definitely earned trust for the brand.”

Perceptions
According to a survey done by shopping comparison website Kelkoo on 1,000 BB customers post the outage, 19 per cent users claimed that they lost business as a result of the service outage, 19 per cent are thinking about moving to another manufacturer, 42 per cent will consider changing later and 8 per cent said they had bought a new mobile phone already. Already facing stiff competition from Apple, Google and Samsung, losing market share constantly with declining share prices, what does this failure mean to Blackberry?

While a single instance would not lead to strong perceptions, the incidence has raised questions. Anupam Bansal, Managing Director, Liberty, confirmed, “We have server crashes sometimes because of which billing stops, but we do have a backup. If my POS is not functioning, I can’t make my customer suffer. The main question everyone is asking is being such a large enterprise, why didn’t RIM invest in infrastructure and have backups?”

“People would realise there is nothing that is error free. There will be awareness now that even a giant like RIM cannot have full control and glitches like these can happen anytime,” emphasised Tripathy.

Brand Value
Though Blackberry enjoys die-hard followers, this incident has definitely shaken the brand value. But this is not the first time. There have been various instances when brands have faced wrath of consumers due to faulty products, irregular services, etc. Cadbury’s brand value and business had reached an all-time low during the worm controversy. Nokia came under strict scrutiny when its batteries exploded and caused injuries to people. Cola majors like Pepsi and Coke have also gone through public renunciation due to high levels of pesticide residue in their drinks. So what does a brand do to get over things?

Accept, sympathise and apologise, advised Sanjay Thapar, Group President, North & East, Ogilvy & Mather, the agency that handled Cadbury’s campaign to recover from the worm controversy. He said, “In cases like these, a company can come out clean if it is willing to accept that yes, there has been a problem, they are making all efforts to rectify it and apologise for inconvenience. If one tries to hide the facts, consumers can retaliate and say don’t make a fool out of me. Blackberry’s offer of freebies as an act of thankfulness for people’s patience will prove beneficial for it. A smart brand would look at this as an opportunity to win the trust of consumers.”

“But the response has to be immediate so that people are not left wondering if the brand has gone in hiding,” warned Suneja.

Apart from an opportunity to win trust, situations like these also help building soft reputation of the brand, explained Tripathy, adding “Things can go wrong, however much you try. The gesture of RIM’s CIO coming out in public and apologising shows that the company takes responsibility of what has happened. This would help the brand win back its reputation as people would realise that such blackouts can happen and it’s not in anyone’s control.”

Anupam concluded with a last word of caution, “If the brand has to maintain its trust and belief amongst its consumers, it has to ensure that instances like this do not repeat in future, else it can have a very wrong impact on the brand.”

 

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