Welcome back to Communication Breakdown, a new podcast from the Observatory on Corporate
Reputation.
Thanks for joining us.
I'm Steve Dowling in Silicon Valley.
And I'm Craig Carroll in New York City.
Each week, Steve and I take a look at strategies companies are using to shape headlines
and sometimes save their skins.
It's a post-game show for PR Pros.
This week, companies pitch in for wildfire relief.
We hardly need to go through the background briefing for this one.
It's been playing out in real time on your TV and in your timelines.
Los Angeles, Altadena, Eaton Canyon, Pacific Palisades- thousands of acres, thousands of
homes, incinerated by wildfire. Tens of thousands of residents displaced, many now homeless.
As we record this, on January 16th, the fires have claimed the lives of 25 people.
Damages are estimated in the range of $250 billion, which would make it by that measure the
costliest natural disaster in the US history.
As the fires raged, major employers and Los Angeles, notably the entertainment industry,
were quick to step up.
The Walt Disney Company pledged $15 million in relief aid and that figure was matched by
Warner Brothers Discovery.
YouTube later announced a $15 million donation as well.
Netflix, Amazon and Comcast have all pitched in $10 million a piece, Sony and the NFL, which
has two franchises in the LA market, each pledged $5 million.
Several other companies and individuals have announced seven figure donations as well.
Beyond cash, Airbnb is arranging free temporary housing for those seeking shelter from the wildfires.
Planet Fitness made locker room showers available and countless restaurants served up free meals.
Those are just a few examples of how companies both played their strengths and also got
creative.
There's no debating the necessity or motivation for the spirit of corporate citizenship,
especially when it hits an entire industry so close to home.
Instead, this week we look at some of the more noteworthy efforts and take a deep dive
on how one company in particular moved fast to support the LA community.
The company is Starbucks and if you've visited one of their stores or opened their mobile
ordering app as millions of people do every day, you might have seen that they're using
those ubiquitous marketing channels, not just to sell iced matcha lattes, they're encouraging
customers to support wildfire relief, linking to a donation page in partnership with the
American Red Cross.
And it's not the first time they've run appeals like this during natural disasters.
What stood out for us this time was how quickly Starbucks was able to mobilize.
The wildfires spread across Los Angeles on a Tuesday and Starbucks had the Red Cross
donation campaign up and running in stores the following day and in their app the day after
that.
Steve and I checked in with our mutual friend Dominic Carr who serves as the Chief Communications
and Corporate AffairsOfficer at Starbucks and he says they're able to swing an action thanks
to an established playbook and cross functional processes ready to go when disaster strikes.
Yeah, we wanted to understand how this came together at Starbucks because they executed
so quickly.
From an outsider's point of view, you might think, Hey, there's a big fire, somebody turned
on the Red Cross donations, what's the big deal?
But there are some really key judgment points for any consumer facing company here.
And from what we learned, Starbucks is early warning system, if you will, is usually their
global security team, which they stress is focused on employee safety.
That global security information feeds into a cross functional group, including comms,
government affairs, the Starbucks foundation, their social impact team, as well as key
operational leaders.
And it sounds like in a case of a major emergency or natural disaster, once they know they have
a good read on the situation from a security point of view, they can move quickly to what's
going on in the community, what resources does Starbucks have that might be of help.
And that's where their playbook kicks in. For situations like the LA wildfires, Starbucks
can move quickly because first they have an existing relationship with the American Red
Cross as well as World Center of Kitchen.
And of course, on top of that, as we mentioned earlier, the marketing channels are a critical
part of getting the word out to customers.
So Starbucks can spin up in-store signs, they can do outreach to tens of millions of people
on their email list.
And they can implement this really critical app functionality that enables donations directly
to the Red Cross.
It's not as simple as throwing a switch, but at some level, they do have it ready to go,
so they can turn it on.
And clearly in this case, they did it very quickly.
And for those who are listening and looking to make a donation, we're going to include
a link to that page in the liner notes for this episode.
I'll say for me, what was fascinating about this, I used the example of flipping a switch,
is that, okay, sure, it's not as simple as flipping a switch, but the beauty of it is,
it sure feels like it's flipping a switch, right?
And it's about all the hard work, the preparation, the foresight, and being prepared.
Of course, the world can unfold so many different ways.
You can't respond to everything that you can anticipate and throw your resources in so
many different directions.
But in this particular case, right, Starbucks was ready and "able to flip the
switch."
But tied to that also was their ability here to -
It's not even right to say work through their employees because what was so powerful here
was that a lot of the work that was going on with Starbucks response was on the ground
for through the employees themselves driven by the employees, taking ownership, taking action,
moving on their own.
And then Starbucks just not getting in the way and seeing the great things that their
employees are doing and jumping it to support it, amplify it, and make it easier to flow
and it happened.
Yeah, one of the big questions in my mind going into this conversation was, is this a
top-down process as you would probably expect, or is it a bottom-up process or can it be?
And the way Starbucks described it, they're equipped for it to go in either direction thanks
to this cross-functional organization.
Obviously, big donation or activating that red cross-relationship happens at the corporate
level.
But in identifying the need, to Starbucks credit, the stores and the employees, Starbucks calls
them Partners, they do apparently have a voice.
And one, I thought really interesting proof point of this was that they're actually getting
as much, if not more, or were last week getting as much attention anecdotally for a new policy
that was communicated to their stores saying, wildfire first responders can get a free cup
of coffee, which is just a nice gesture of thanks and acknowledgement to the work that's
going on all around them.
And as Dominic told us that actually just formalized a practice that was already happening
and started with store employees who were bringing coffee to fire houses or handing them
out to first responders and doing other community outreach that just seems neighborly, especially
in a time of crisis.
I think that's a great way of looking at it.
I mean, often we talk about authenticity, but just this neighborly approach and being
there, being in the community, taking action and being engaged at the local level.
And right now, it's so critical given the severity of the crisis there.
Yeah, that is tricky, though, because putting anything in front of a customer,
let alone an audience of tens of millions of customers takes really serious consideration.
There's the messaging consideration, the placement, the positioning of it and the cadence
of it.
I mean, there are tragedies and hardships every day all over the world and nobody can address
them all. You would like to.
But if you're doing, you hate to say too much, but if you're doing this all the time, then
it doesn't really stand out.
And of course, Starbucks does have an ongoing relationship, as we said, with the American
Red Cross, World Central Kitchen.
But this one, given the scale, it seems like a no-brainer, but somebody does have to make
that decision.
And to do it quickly, you need a really robust process to do it right.
Let's look at another aspect here about how Starbucks responded.
For me, in our discussion with Dominic, it was very instructive to hear how Starbucks
was working on the local level, not only letting employees take the lead and empowering their
employees or really just supporting their employees, but also the response that they had in
terms of coordinating and aligning with the government.
That might be something that's always there, but I think given the say to this crisis,
it's super important.
This is not a moment where you want to be tripping over your toes or getting in anybody
else's way.
And that's something that a lot of governments talk about when companies try to help is
that they sometimes outshine by doing things their way instead of the way in which the local
community or the government needs for things to be productive or to stay on track and to
help everybody as a whole.
Yeah, it's interesting because this cross-functional group inside of Starbucks, as it was described
to us, is not just communications and government affairs.
There's safety aspects of it.
There's the operational aspect of it and in a crisis, as it was described, they wear two
hats.
Once something, this magnitude happens, the organization flips and everybody understands
what they're doing in that crisis situation and a lot of the response is the local team
or the local store and they're so close with they can help inform corporate decisions about
what the community might need.
But I found it really encouraging that there was this listening aspect, because when you
have, I think Starbucks has somewhere in the order of 400 stores in the LA area, that's
a phenomenal resource for a corporate affairs, corporate communications leader at corporate
headquarters in this case in Seattle, but could be even farther away.
And so I found that level of cross-functional coordination and having the, effectively,
the listening post, whether it's listening to customers, listening to first responders
and local governments, but that, I thought, was really flexing the power of having this
huge distributed network of not just stores, but people and community members.
Absolutely, right?
And when we think about cross-functional, we normally think about internally, but here's
an opportunity for thinking about it, not just internally, but externally, as they're coordinating
and cooperating with local government officials, right?
I mean, that's so important.
And certainly, in moments like this, where we have crises at this scale, this is probably
the only time that we're going to see the importance of taking such action and having
that.
So it certainly speaks to the need of having your government relations team connected to
your communications team.
And for me, it just shows, you know, from a corporate affairs perspective, right?
The importance of working together alignment.
And something we've not really talked about is the dexterity for being able to take action
quickly, right?
I mean, you've got to have the muscles, you've got to have the speed.
And it's not something that you can do in the moment.
You've got to be prepared for those moments to be able to move that fast.
And I don't mean just internally.
I mean, externally, as they work with local government officials, right?
And they work to cooperate, align and coordinate and recognize, okay, you know, they may have
had another plan.
But once they heard what was needed on the local level, they could take what they had planned
on doing and work through what was needed at the local level for what they needed, not
helping on their terms, but helping on the terms of the community there.
And put another way and simplifying it quite a bit.
We'd call that being part of a community, which I think is the goal that we're hearing from
Starbucks.
And I think in a lot of ways, seeing play out in this wildfire response.
Given the lack of response that I've seen, so we went out and looked at what other companies
were doing.
And we saw that like maybe 32 of the Fortune 100 had reported doing anything in the area.
And we just, noting the absence of what companies were doing publicly or at least saying what
they're doing publicly, maybe they are doing things privately.
As for companies who aren't taking action, I think the questions that companies face here
are what can a company do, what should a company do, and what form should that take?
You know, we were talking earlier about this bottom-up idea that turned into a Starbucks
policy of giving free coffee to first responders.
But I think that authenticity makes campaigns like these so impactful companies.
Each play a role in the market.
They each have their areas of expertise.
Sometimes unique areas of expertise.
Sometimes they are leaders of a commodity sort of market.
But when they have expertise, it makes sense for them to lend it in a time of need.
And I was struck by Disney's idea.
They have this incredibly creative team called the Imagineers who design theme parks among
other things.
And you know, Iger says maybe they'll help with urban design.
It's an application of their expertise.
It's something that makes sense.
Airbnb, they know where there's available housing.
Planet Fitness has a lot of showers.
And Starbucks makes coffee.
So as always, in crisis response like this, just in everyday corporate communications,
like authenticity is the coin of the realm.
And I think it's great to see companies leaning into that when they can be so impactful in
a time of need.
It's one of those situations when you say yes, them doing whatever they're doing, it just
makes sense.
Yeah, I like the idea of starting with authenticity.
I think there's a little bit more there.
It's not just about being authentic.
It's about authenticity tied to their area of expertise or their zone of genius.
Right.
What are they known for?
What are they good at?
What are they doing the market and turning and flipping it to provide some type of community
need here?
I think that is huge because authenticity by itself is not enough.
If they're not connecting to the local need and to what needs to the needs of their community,
what has to happen now and here.
Right.
And let's say it without being cynical about it, it reinforces a leadership position.
It reinforces that level of expertise and it also shows the value that a company has in
giving back.
Yeah.
Right now, what I'm not seeing is a lot of self promotion, right?
All the examples that are going on, it's very clear that all the players are focused
on the crisis, focused on helping employees, communities and their taking action and they're
not drawing a whole lot of attention to themselves.
You see very little of companies promoting what they're doing.
I mean, that was kind of refreshing, right?
When you think about other crises and other moments, what do we think about, for example,
during the George Floyd crisis during the pandemic or Russia's invasion of Ukraine, there
were other moments when companies have spoken up or other disasters.
But this one here, certainly I would say it looks like many companies are publicly silent,
right?
We're not seeing very much out there.
But that doesn't really matter as much as the people who are impacted and the people who
are affected, getting the needs that they have met at the local level, right?
So whether it's companies simply, first and foremost, taking care of their own employees
at the local level or working through their communities, it's very clear that they are
not focused on this from a self-promotional aspect.
And I think the unspoken message there is that the companies who are making these donations
or making these relief efforts, gestures, they are focused on the work, they're focused
on the results and helping people through this difficult time.
I think it's important to note, maybe we should have earlier, that we reached out to Starbucks
about this.
They didn't reach out to us, but beyond an Instagram post when the campaign kicked off, they
haven't done any proactive PR about it.
And I think that's the right way to handle it.
They don't need to do it for reach if you're a Starbucks customer.
It's not in your face, but it's also hard to miss.
They sent an email to tens of millions of customers, mine arrived on the Saturday of the
11th, and I had already seen the donation link in their mobile app.
The Balancing Act is that you want people to see it.
You want people to see it for the right reasons.
You're marketing it for that reason.
And yes, it has ultimately, in the long run, it has ancillary benefits for your reputation
and maybe for sales.
But you don't want to push that to hard.
And importantly, you don't want to be perceived as pushing it for that reason.
And I think the companies that I have seen are certainly earnest in that way.
For me, another thing that we're seeing here is that this case certainly shows that there's
a lot more than just communications, or it's certainly about how communication needs to
be connected to other parts of the company and company's response to crises.
So Dominic shared with us that they were very much aware of what the employees are doing
on the ground floor and that they were able to respond and support what was happening
at the local level.
Second, from an audience perspective, it did look like they flipped the switch, but it's
very clear there was a lot of work that had to be done ahead of time to prepare for that
moment.
But at the end, it's not just about communications, right?
It's not just about building awareness or getting the word out in terms of safety and security
on the local level or building alignment here.
It's also about connecting and cooperating, meeting the needs, being able to move quickly
and swiftly, coordinating and cooperating here, right?
So this degree of being synchronized and in sync, not only internal with your team, but
in sync with the community needs and in sync with government officials and others, other
authorities that might have more insight or more or additional resources that you need
to play into.
Yes, and I think that's where you really see an effective cross-functional organization
pay off because there's no one organization that can do all of these things.
Or would you want them to because it touches so many parts of the organization and to be
effective, you need that coordination, that cooperation internally and to your point externally
as well.
But I would not discount the impact that the communications function can have during this
because I think flipping those marketing channels and aiming them at this effort is really
powerful.
This is the power of a mass consumer marketing operation harnessed for good between
email, the mobile app, in-store signs, think of them as mini billboards with traffic like
a Starbucks can have.
They're reaching tens of millions of people and they're handing them off to the American Red
Cross.
And if there's an equivalent to a selfless act in digital marketing, I think it's sending
someone to another website.
And of course, it's not entirely selfless, but it's a gesture that builds trust.
It conveys some humanity.
It shows priority over short term business goals.
And when we talked to Starbucks, they said that they had already had just a few days after
it, they had turned it on.
They had already had thousands of donations and it can hopefully really have impact for
people who are in need.
Yeah.
Well, for me, this is a great, this whole situation here is a great example of why we need this
idea of corporate agency, right, of this, this ability to take action not only as a collective
actor, but for them to say empower employees is not the right thing because their employees
were taking action.
It's not like they're allowing their employees to take action.
Their employees took action and they simply supported what was occurring on the ground floor.
Now, you could certainly say that this is a crisis and everybody's going to wake up and
they look, you know, the house is on fire.
We got to do something and be prepared to respond.
But knowing how to respond and to take action and thoughtful, meaningful ways that are
aligned with the community needs, that's huge and it's not something it's going to be done
without worth thought because they're members of that community, right, because they're actually
living, working, interacting with people in their community.
And that, you know, is a gold star for any store in Starbucks or any other store network.
I keep coming back to this idea of authenticity.
You refer to it as the, their zone of genius, which I think, you know, makes total sense.
And by coming at it in the way so many of these companies, I think are, which is let's
look first at what the need is and then let's figure out where we can be most effective.
They're coming at it in the right way.
And for companies who have a large employee base in that area, it makes sense to be writing
large checks because, you know, they want to have a broad impact.
I think it's hard to knock a company right now for not making a massive donation and we
could argue, you know, what is the right amount given the company's role in the community
or their resources that they have.
But I think it can be tough to look around and go, we would really like to help, but it don't
really know where we fit in.
And that's the type of thinking that I think has to happen prior to a situation like this.
But I think it really does come from what is our expertise, what is our role in the community,
what is, how do we serve the market on a day to day basis?
And how would that fit in if the community, you know, were in need?
And for the companies who are writing checks, I think if you're only coming to the realization
that you need to do something because your competitor or your peer is already doing something,
that's a problem.
But it's broader than how you're organized around any given crisis.
Well, that's a problem, but hey, at least they're doing something.
It might be for the wrong reasons, but if they're able to help people, you know, we shouldn't
discourage them from doing that.
I think this situation also gives us an opportunity to think about a major change that's
occurring right now.
And I think the last time that I really thought about it at this level was, you know, during
the pandemic.
But what I see here is an opportunity here is for companies not to think not only about
their situation and their employees, but look, there is a part here for the larger community.
And you know, it used to be that we would say, you know, groups organizations exist to accomplish
goals that only that individuals can accomplish on their own.
And this case shows us that's not good enough.
That doesn't scale anymore, right?
This case shows us that it's about how organizations and their communities, right, cooperating
and working together can accomplish goals larger than what a company can accomplish on
their own or what the community can accomplish on their own.
And I think, you know, we see some, you know, this with the Starbucks example that we just
kind of went through here.
And some of the other examples from the media industry, the tech industry, the NFL and
the auto industry, NLA gives us some other examples here.
But that's something I want to leave us with is that, you know, it looked certainly got
to take care of your employees first, make sure that they're taking care of, but when
crises like this happen, we've got to be able to think about how we can connect, not only
cooperate and collaborate with government officials, community officials, but think about
how working together and cooperating, we can accomplish something larger that no
part can do on the road.
Couldn't have put it better myself.
And Craig, you've lived and worked in Southern California like so many folks, we each have people
we care about in L.A. and our hearts go out to everybody that's been affected.
And again, for those who are looking for a way to give, we're including a donation link
in the liner notes for this episode of the podcast.
That's our show for this week.
Our thanks to Dominic Carr at Starbucks for insight on Starbucks wildfire
relief efforts. And as always, our podcast would not be possible without the support of the
PeopleForward Network and our producer, Shawn P Neal.
If you have feedback for us or a topic you'd like to suggest for our show, we'd love to
hear from you.
Our email address is podcast@ocrnetwork.com or feel free to hit us up on LinkedIn.
Communication breakdown is some production of the Observatory on Corporate Reputation.
I'm Craig Carroll and I'm Steve Dowling.
Thanks for listening.
Hang in there, L.A. We'll be back next week.
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