Wednesday, 18 March 2015

What Gushcloud and Its Influencers Did Wrong (and how Singtel did right)



Some of you may have read my piece on how Gushcloud spent a bomb on a poor response to Xiaxue's expose on their business when Xiaxue wrote about her investigations into Gushcloud's questionable business ethics last December.

If you haven't already seen Part 2, you may read it here, where local telco SingTel gets implicated as well this time.

My analysis this time focuses on what Gushcloud and its influencers did wrong, as well as what Singtel did right in contrast. Due to their actions, we can safely assume that the damage done to SingTel will blow over in a matter of months (or even weeks, perhaps?) whereas I'm not quite sure if Gushcloud and its implicated influencers will ever recover back the trust they've lost.

Let's take a look.

P.S. If you're lazy, you can just read the bolded parts + the pictures to get the full story

Lesson 1: If you want to defend an accusation, make sure you get your facts right first.

I've already explained in a previous post why and how Gushcloud responded poorly to Xiaxue's claims when the whole saga started. Once more, Xiaxue finds a loophole in Gushcloud's so-called defence, and shatters it.

Vincent Ha said in an official statement:
There was never an intention to “inflate” our earnings or to deceive and mislead anyone. Think about it logically. There is no reason to attract needless attention to the financials of the company and to pay higher taxes on income the company never even earned. I am also aware that any plan to make ourselves seem bigger than we actually are would go out the window once our accounts are filed with ACRA.
Xiaxue's excellent rebuttal:

Source: Xiaxue's blog.


Lesson 2: Stop releasing conflicting message
(Why get caught eating your own words?)

We first saw this in December when Gushcloud founders denied the accusations by Xiaxue, and then ended up having to apologize for it once she produced the hard evidence to prove that they had not been telling the truth.

History repeats itself (obviously, Gushcloud did not learn from its mistakes) and this time, Gushcloud releases a statement suggesting that the brief was not what it seemed, leading us to think that perhaps the leaked brief alone is insufficient to conclude whether or not they were indeed engaged in a smear campaign against SingTel's rivals? 

I've highlighted this below.



Perhaps they didn't expect SingTel to publicly admit that they had done wrong on 17 March, as SingTel's initial stance was that "it did not issue the brief". Maybe they thought they could cover it up (just like how Xiaxue pointed out they covered up their inflated earnings along with other things?).



Oops! SingTel apologized! 

Now look what happens minutes after.



Hmmmmmm.

 
Lesson 3: Don't engage in personal attacks 
(Something Gushcloud seems to like doing! Cos you know...tit for tat right?)

Along with his apology (after SingTel's move left them with no choice, perhaps?), Gushcloud proceeds to criticize Xiaxue.







Now, note that it is a different thing for Xiaxue if she wants to make personal attacks on Gushcloud and its people, because she is an individual. She is ultimately accountable mainly, if not solely, to herself.

Gushcloud, on the other hand, is a professional business. Or at least, they try to be. And corporations do not engage in petty, personal attacks. Co-founder Althea Lim made this mistake in December when she released her rather childish statement against Xiaxue, and fast forward 3 months later, CEO Vincent Ha does the same exact thing.

This is poor practice! Note that none of the 3 telcos engaged in personal attacks against each other in this whole incident. Neither did SingTel (if you take Gushcloud as Singtel and Xiaxue as M1 + Starhub in this case) criticize their competitors after admitting their mistake.

It's almost akin to this:

John: You are so stupid, your IQ must be terribly low.
Tom: What? I'm going to prove to you that my IQ is higher than average.
*proceeds to show proof*
John: Ok, I'm sorry. 
John: But in the first place, you're a terrible person anyway.

Does that even make sense to you?

Lesson 4: Don't try to shirk responsibility by talking about altruistic "management beliefs"
(especially after you've just been forced to admit you did something wrong)

Gushcloud's CEO Vincent Ha said,
"...we had discussions with the client...But as an influencer marketing company, we should have known better and made better recommendations to our client." 
I don't know about you, but it sounded to me like they are shirking the blame to SingTel instead. Cos you know, clients are king and we have to do what they say.

 

Then he goes on to talk about their positive, altruistic management's beliefs.

Do you see the problem here? It's just like:


A murderer claims his belief is that all mankind are equal.
After apologizing for killing a life.

 I exaggerate, but you get my point.


Lesson 5: What's the best immediate response then?

Critics' voices: Ok Budget Babe! After talking so much, why don't you solve the issue then?

Now, I don't like to dish out PR advice and specific actions online for free, considering how my clients actually pay me for advice on what to do. And in this case, Gushcloud is not my client which was why I refrained from posting any ideas on what they should have done last December, choosing to focus on an analysis of what they did wrong instead.

But I'll make an exception this time and will share just a tiny bit, since I pity how poor Gushcloud really doesn't seem to know their PR skills at all. Maybe this will help them (or maybe not, since the damage has already been done).

For this March saga, I would have recommended for Gushcloud to say to the media:
- Gushcloud "cannot confirm if the brief was indeed issued by a Gushcloud employee" 
- but is "currently investigating internally"
- and "will rectify the situation if they find that their staff is indeed guilty"

Why would this have been better? Not denying it straightaway suggests a company that is responsible enough to investigate if it has done wrong. And if it is, being willing to correct the situation will convince people that it is willing to change. After all, we all know human beings are not perfect. People make mistakes. What's more important to consumers is whether you admit and understand the mistake made, and take corrective steps to ensure that this will not happen again.

We're forgiving people aren't we? Just like how I forgave M1 even though they had no service on 4 February last year and still signed up my line with them anyway when my Singtel line was up for recontracting (even though I miss my 12GB Singtel data plan. M1 only gives me 2GB each month now and that's not enough. I'm exceeding this every single month without fail).

 Gushcloud ought to learn from M1 how to handle crises when you're in the wrong.

Instead, Gushcloud's immediate response was to issue a statement suggesting that they were innocent and did no such thing (instruct its influencers to conduct a smear campaign).


Then they apologized and ate back their own words (review Lesson 2 again).




What did SingTel do right?

SingTel, too, was guilty of initial denial and ended up eating its own words a few days later. When the saga first broke out, a spokesperson responded by saying SingTel "did not issue the brief". Fair enough.

But then they realized one of their staff had indeed made this mistake, and so their marketing VP came in to clarify and apologize.

Both Gushcloud and SingTel 
(i) denied, and then admitted guilty
(ii) resorted to using senior management to make the corrections

But these are the 2 different impressions we get:
(i) SingTel: Responsible, willing to learn and correct its mistakes. I'll give them a chance.
(ii) Gushcloud: Dishonest? Insincere? I wouldn't trust them again, not in a long time.

Also, note that Singtel is a much bigger company with a lot more staff than Gushcloud. Thus, if you were to look into the time needed to investigate internally, logically speaking Gushcloud should have found out their mistake first before SingTel. Instead, the fact that Gushcloud apologized (I emphasize) minutes later suggests that they could have already known they were guilty but refused to admit it until otherwise forced to.

What does that tell you about the brand?


Responses from the Gushcloud influencers who were implicated by Xiaxue

Here's a summary of the influencers who were implicated in Xiaxue's expose:
1. Xavier Ong
2. Symone Oei
3. Marxmae
4. Saffron Sharpe
5. Lydia Izzati
6. Goh Yilin
7. Eunice Annabel (who received the most severe beating of all)

I found it interesting that among these 7, only Xavier Ong has apologized.


It's only gracious to apologize when you've been caught with your pants down. And when you apologize without / before others demand you to, this move reflects even better on you and the type of person you are.

It took Xavier Ong a few days after the saga before he apologized, but at least he did. So fair enough, let's be gracious too and forgive him, shall we?

I can't say the same for the other influencers though. 

Eunice Annabel released a blog post in response, but it did not contain an apology. Instead, it was more of a defense, a justification for the wrongs she had been singled out for by Xiaxue.

I read through the whole thing and didn't see a single apology. To be sure, I did a search and you can see in the screenshot below that there were zero results. I also tried other words like "apologise" / "apologize" / "apology" / "wrong" but there were none. Feel free to try it out yourself.



 
She also spent some effort attempting to clarify the issue of her LG vs. iPhone 6.
 

Unfortunately, it just sounds like a really lousy excuse to me. 
Why? Because everyone has a choice. If she claims she "didn't switch back to using an iPhone by choice", there were plenty of other options she could have done. For instance, if she really did love her LG / Android so much, then why not sell off her iPhone 6 and buy the LG?

Prices for selling used iPhone 6: $700 - $880
Price to buy a brand new LG G3: $620
(I did my price check here.)
Eunice Annabel could have even gotten a $80 - $260 profit in doing so! 

I'm not sure about you, but once again, I'm not buying into this response based on facts.

And what about the other influencers? Most of them just continued with their lives, posting updates about how amazingggg their life currently is (with no mention of the Gushcloud issue or that they've been caught by Xiaxue in an incriminating smear campaign).

Some simply took the cowardly way out and switched their social media accounts to private to block off haters.

Lydia Izzati:





Saffron Sharpe (who the heck is she anyway? I've never even heard of her):




Marxmae (again, another "famous" influencer whom I've never heard of):




Symone Oei (same thing, never heard of this girl):



Last but not least, Yilin Goh. She's currently on holiday though, so let's give her the benefit of the doubt. Plus, she did apologize rather graciously in December when part 1 of this saga broke out, so I shall choose to maintain hope that this girl knows what's the right move to make.






Final thoughts (a summary)
1. Gushcloud has very poor PR.

2. Damage done to Gushcloud is huge, but was further aggravated by their own actions in response to the saga. They have only themselves to blame.

3. My impression of Gushcloud now is that they're not only unethical (which was what Xiaxue set out to prove), but also dishonest (a conclusion drawn from their own responses).

4. Good job to SingTel in dealing with this whole incident. While I may not switch back anytime soon (unless they entice me with a better plan to solve my data woes), I would still do business with them in the future. 

5. Can't say the same for Gushcloud.


6. Who are all these influencers and where did they come from? How did they shoot to fame so quickly? Some of them are so young!

7. A huge boo to the influencers who didn't apologize. It would have been gracious to admit you made a mistake (and no one would blame you for not knowing about Singapore's clause against competitive advertising anyway) and offer a simple apology, but most didn't.

8. Except Xavier Ong. I've never really liked him, but him apologizing makes me want to like him and give him a chance to start anew.

9. Same for Yilin Goh, whom I've not heard of until last December. She won me over with her unabashed apology after Xiaxue exposed her. I'm hoping she apologizes this time too once she's back from her vacation instead of glossing over the whole incident like the other influencers.


10. This was one long analysis!

What do you guys think of this whole incident? (Comments on how Gushcloud/SingTel/the influencers handled it are particularly welcome!)

With love,
Budget Babe

6 comments:

  1. Great write up on the saga! I appreciate the work you have done to put it all together

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    1. Thanks! Glad you liked it. It took me hours to put this piece together and confirm my thoughts. I hope people will look at it objectively and focus more on the bigger lessons one can learn from this whole saga.

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  2. Very well thought out analysis! Eunice Annabel has since posted an apology. However, it does not come across very sincere as she was still insisting her original reasons/defence were true. Personally, I feel an apology without trying to defend herself would have been better but like what you said, we are all forgiving humans. So kudos for the apology (finally).

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  3. I think she wrote before this post, as she published at 7am on wed. not sure the timing of this post though, but still, great job done on her side and yours too :) well-written analysis!!

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  4. Hi Wheatpaths!

    Yes, you're right that SingTel had significant responsibility. I didn't say they were innocent, but lauded them for openly apologizing and putting their name and reputation at stake. They've now opened themselves up to lawsuits from their competitors and have essentially admitted guilt - as a media student, you should know what the outcome of the court hearing will be based on this.

    Yes, an agency answers to their clients. But don't forget, this is not a hard and fast rule. In ANY industry, not necessarily an agency, we all answer to clients. Clients are king, after all. But it takes ethics and guts to say "no" to a client when they've overstepped the boundaries of what's right and wrong. Gushcloud themselves admitted that "they should have known better" - quite the contrary, I suspect they already knew but decided to go ahead with the project anyway since SingTel is a pretty decent paying client. When an agency chooses profits over ethics, they have to hold themselves accountable. Unfortunately, Gushcloud's apology does not strike me as sincere. It sounded to me more like they were sorry they got caught, rather than being sorry at all. Same goes to their influencers.

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  5. All the best in your school assignment by the way!

    With love,
    BB

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