Of Hype, Publicity and Negative PR – Where To Draw A Line

Following is a mail that a startup founder received from a competitor few months back.

Greetings,

As a fellow startup, we know the biggest problem you must be facing right now. Users. Or more appropriately, the lack of them.

That is where we come in. As the leading **** service in India, we have a comprehensive database of users, which includes their email IDs, mobile numbers, demographics and spending power.

And we want to sell it to you (for a small fee). We know that you’ll be able to use it for reaching out to lakhs of potential customers.

Contact us if you’re willing to negotiate on this. For obvious reasons, let’s keep this strictly hush-hush.

As a gesture of goodwill, we’re giving you a (tiny) snapshot of our user database for free. We’re including a set of email IDs along with their mobile numbers.

The founder was tempted to act on the mail but after consulting his teammates decided to ignore it. After seeing no action from this founder, the competitor made an announcement after 2 days that his DB was hacked and such mails were sent out from the official account. Everything looked staged and the founder thanked himself for not having taken any action on this attempt from the competitor to gain publicity.

The founder shared this with a senior industry guy to understand if at all there was anything wrong in sharing this with the media and gaining some publicity for his own startup. What do you think?

Off late if middle class entrepreneurs like us have learnt anything about media coverage and free publicity is that controversy is easiest way to get attention. All thanks to TV channels’ lack of substantial news to cover and also our friend from the other side of the world, Techcrunch. Though coverage over minor controversies has reduced now, or it’s just that we have stopped heeding them, it has left a long last lasting mark on first time entrepreneurs who have little to no media experience. PR to them is press release and any publicity is good publicity for them.

After a couple of days of covering a startup we got an anonymous message on our contact form saying:

This is all about **** review for this Post: ******
— Please save our people from this fake company.
I’m really very very sorry. This is FAKE company start-up in India. I will explain you in detail.
*****

After verifying your bank account *******

Yes. Once you verified your bank via **** they can do these things. There is no security in this *******. I had long discussion with my bank people and they confirmed about this.

Their ***** code is fake: 110****** ( you could not verify this with **** ) *** is the Govt Institution

I went for verification by myself. Check the whois for this site ****
Screenshot here: *****

Check the expiration date: it is expiring exactly on **** 2011.

I could not explain more than this.

The tip was very substantial or should I say controversial. Enough to get any blogger to type at 240 words a minute and push the publish button. We had an intuition that the startup founders had themselves written this to get attention and then come out as winners, as nothing of that sort would be proven true. We took our chances and on the expiration date realised that we succeeded in avoiding the trap. Great staged publicity stunt. Alas, it did not work. But had we covered this, would it help the startup?

Recently, I got an email from the founder of a popular ecommerce portal:

Hi,

We just found out that there have been some fraud credit card transaction on our site. In fact it is almost 100 transactions in the past week. The guy who ordered on our site used somebody else’s card. It is one of those nigerians.

You should write about this. We even went to police but they did not take any complaints saying that we won’t be liable. The guy who owned the card got in touch with us. We can get you his interview if you want.

I tried explaining to the founder that this is not a good thing to publicize and he shouldn’t be linking the word “fraud / Nigeria” to his portal. It would have bad long term effect. People would forget the details and only remember the keywords “X site fraud”.

He went onto argue that this happened to one of his competitors as well. In such a case not only the site but the readers would associate fraud with this whole vertical of ecommerce. Although it was nothing particular to this vertical but audience would look for trend and stereotype things. Users just don’t want to be associated with anything negative. Even if Kingfisher Airlines is in trouble, the vendors of other businesses of UB group would be cautious.

In all the above three cases the startup would have gained a lot publicity but nonetheless it would have a long lasting negative effect. Online businesses should remember the fact that time heals worst of pains but Google never forgets. Specially, all things negative.

We can clearly see the effect of such things in the industry. Un-informed newspaper journalist write speculative articles claiming ecommerce transactions to be more troublesome than haggling with a Delhi Autowala and riskier than Harshad Mehta’s portfolio. Even Internet literate and well informed organisations do not want to take chances. For instance, given the fact that Nigerian scammers always use captured credit card numbers on ***** type of sites, Axis bank has stopped issuing payment gateway to anyone coming even close to that definition.

There are easier ways to get attention, publicity and backlinks; none of which is any close to the instances above. Build a great product and talk to 2-3 guys, if they refuse to cover then go back to the drawing board instead of a Bollywood script writer. You are no Poonam Pandey, you are here to do business and for long. Wardrobe malfunctions are not for you.

I recently read this somewhere:

It’s a simple marketing rule and it works; good publicity is good, bad publicity is bad.

Happy PR!

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[Naman is a startup enthusiast and has worked with couple of Indian startups as Product Manager. He writes at The Inspire Blog]