Uber Controversy: How PR could have saved Uber from itself

By this time you have probably heard how Uber has gotten itself crosswise with many in the tech and business news media. Its latest controversy centers around Sarah Lacy (@sarahcuda), founder and editor of tech blog Pando Daily (@pandodaily), and her reporting on what she considers a culture of misogyny and bad behavior at the high-flying startup.

It appears that the company’s Senior VP of Business, Emil Michael, was quoted at a dinner party as suggesting Uber should commit $1 million to hire a team to dig up dirt on any journalists who dare criticize Uber. The dinner, ironically enough, was part of the company’s “charm offensive” aimed at normalizing relations with the media. In front of several reporters, including BuzzFeed (@Buzzfeed) Editor-in-Chief Ben Smith (@BuzzFeedBen), Michael went on to say that the team would look into “your personal lives, your families” in order to discredit reporters as a source and, presumably, to shame them into silence. Michael singled out Pando Daily’s Lacy as a target for the campaign, implying the team would dig up something very specific and damaging about her personal life.

BuzzFeed reported on Michael’s comments, and a media firestorm erupted. According to BuzzFeed, there were no warnings from any Uber representatives present at the dinner – including the startup’s director of communications – that the conversations during the dinner were off the record. Since the BuzzFeed post went live it has had over 677 thousand views with hundreds of comments by readers.

There were several ways PR could have headed this controversy off before it became so incredibly (and justifiably) sensationalized in the media. Here are some Monday Morning Quarterback lessons that any tech firm can take away from the media meltdown in progress:

Respect the Power of the Media: In what can only be described as a Nixonian strategy, Uber decided it could go after the media and help itself by discrediting individual reporters. That Uber may never have pursued the strategy, that it may have been the Machiavellian musings of one Uber executive, is neither here nor there – it was spoken to a media professional and had the appearance of being under active consideration.

It’s never a good idea to target the media. Why? They control the bully pulpit – newspapers, TV, magazines, radio…pretty much the whole shebang. What more, many journalists are idealistic about their profession. Let’s face it, they aren’t in it for the money, or the crazy workload. They follow a pretty strict professional code of ethics and have the instincts of a bloodhound when sniffing out a controversy. They aren’t afraid to go after the Man. And nobody represents the man in Silicon Valley at this point more that Travis Kalanick, CEO of Uber.

Weak PR Counsel: Uber’s great failing, which symbolizes much bigger problems with its leadership and company ethos, is that it did not empower PR to do its job. The communications director was at the now infamous dinner meeting, yet one can only assume there was not a planning meeting to discuss the main talking points and what to avoid. Maybe Emil Michael, the VP with the foot-in-mouth problem, had one too many scotch and sodas. No matter, there should have been a PR professional monitoring every executive’s conversation to intervene before the verbal gaffe went to far.

Off the Record: After BuzzFeed’s reporting of the dinner, Emil Michael said he had assumed the conversation was off the record. We all know what “assume” means, right? Now why in the world the media present were not read the riot act on this point beforehand to make sure the comments could not be used against them is beyond me. When you get a media professional to agree to the terms, they can’t violate them without putting their professional integrity at risk, not to mention putting themselves in line for a lawsuit from Uber. The PR person in charge at Uber should have nailed this down in advance, especially knowing how prone Travis Kalanick, and now apparently Emil Michael, is to getting into hot water with ill-conceived comments.

Too Big to Fall?: “Too big to fail” is synonymous with the excessive risk and failure of banks and investment houses during the Great Recession. Uber seems to assume that because it’s the face of the new sharing economy, has experienced astronomic growth and is a darling in the VC community that it has a “too-big-to-fall” card up its sleeve. Not so. As Uber’s problems continue to mount – only yesterday a new article in Re/Code reveals that Uber is grabbing tons of personal data from its Android phone users – the weight of the collective controversies are pointing to a leadership problem that could eventually topple the management team, if not give the competition a shot at stealing market share. PR can help counter the negative publicity by creating a rapid response team to provides honest, transparent feedback – to the extent it’s possible without giving away any critical secrets – in order to show the media it does care about the startup’s image.

Muzzle Ashton Kutcher: Don’t allow an outside investor – a celebrity, no less – to muddy the waters with obnoxious tweets that support Uber’s plan to sabotage the reputation of journalists: “What is so wrong about digging up dirt on shady journalist? @pando @TechCrunch @Uber” Um, maybe because it’s wrong, malicious and really, really stupid?

Kutcher’s a lightning rod, Kalanick’s a lightning rod, Uber is a lightning rod. When the media storm clouds are swirling, keep a low profile. Somebody from the Board, or maybe Kalanick himself, should pick up the phone and ask Kutcher to back off. Uber already suffers from enough celebrity hubris.

Peace Offering: It’s time to bury the hatchet. Extend the olive branch to Sarah Lacy and others in the media. Hit the reset button on that now-famous “charm offensive” that quickly turned into a “harm offensive.” You can’t buy your way into the media’s good graces. After all, the code of ethics at many media outlets precludes accepting gifts in excess of $25. But shower them with gifts of honesty, transparency, access and maybe, just maybe, a little humble pie. Uber’s actions speak louder than its words, so start showing the better side that, one hopes, exists but needs a little polishing.

Ignore and More: It’s never a good idea to ignore the pink elephant in the room lest it come back to haunt you even more. Doing nothing with a “damn the torpedoes” attitude only makes matters worse. Having that much negative publicity is a major drag on marketing, and eventually it will have a negative impact on growth and profitability. Right now, Uber is expanding worldwide and many new markets haven’t heard of the controversies that follow it like the cloud of dirt about Pig Pen from the Peanuts cartoon. Eventually, however, the dirt starts to sully as stories about how the company operates with a win-at-all-cost mentality pop up in the media. It’s entirely possible that international markets currently accessible could begin to shut out Uber, or other competing options may emerge, like Lyft, which is nipping at Uber’s heels. Right now the company is only concerned with top-line revenue growth and expansion; but investors eventually demand profitability and expect a profitable exit. The General Sherman burn Atlanta to the ground strategy that alienates, crosses ethical lines and makes mortal media enemies could eventually backfire and leave the company a smoldering hole in the ground.

These are just some of the ways PR can help bring sanity to the company. Right now, the Emperor has no clothes and the media is already pointing that out with the excitement of a tiny tot waking up on Christmas Day. Once the realities of profitability and sustainable growth come into play and Uber can’t hide behind a fantastical growth trajectory and the promise of becoming the Google of transportation, it will be too late. The media will be too busy chronicling the Rise and Fall of Uber.

About Dave Manzer:  Dave Manzer founded an Austin tech PR agency for startups and emerging-growth businesses in 2009. Dave Manzer specializes in highly integrated PR & marketing strategies that help companies in technology, healthcare and professional services reach their goals in brand awareness and revenue growth. To contact Dave directly about the PR over Coffee blog, please email him at dave(@)davemanzer.com.

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