Please visit www.dispatchesfromchina.com for blog posts from Mark Hass, who now works as President of Edelman China while also overseeing activities involving former MH Group clients.

Toyota Motor Corp.'s President Akio Toyoda bows during a news conference at the Toyota headquarters.

A few years ago, it would have been considered lunacy to predict that Toyota, long the icon of quality among global automakers, would find itself in a reputational freefall.

In most of the 15 years I have worked on public relations and marketing programs with various automakers, including Toyota, one thing had always seemed clear: Toyota was an unstoppable manufacturing leader against which all other carmakers would be judged.

The brand represented consistency. Their cars were never flashy, never thrilling, but they worked, they lasted. The company used that brand platform to transform itself from a regional Japanese manufacturer in the 1950s and 1960s into the world’s largest automaker, largely at the expense of the U.S. auto industry.

But now look. With sales and share price plummeting, the industry and its consumers worldwide are wondering when the company will hit rock bottom. And, in my estimation, it still has a way to fall, in light of the newest questions being raised about its flagship darling, the Prius.

While it’s too soon to count Toyota out as a long-term player, there is a strong argument to be made that the bungled recalls and amateurish handling of the safety crisis of the past month spell the end of the world as Toyota knew it, and that there has been a basic resetting of the industry’s future.

Certainly, U.S. carmakers stand to regain share and have already accelerated marketing programs to get car buyers into their showrooms. But the biggest long-term opportunity to acquire the customers who will flee Toyota lies with the surging Korean manufacturers and, ultimately, the emerging Chinese makers.

Hyundai and Kia, the big Korean brands, have been on a growth tear since the global recession laid GM and Chrysler low in 2008. Experts predict that Hyundai will continue to win over customers in the largest auto markets of North America and China with its combination of modest price and the promise of quality implied by their 10-year warranties. Not to make too fine a point of it, but this is exactly the formula Toyota used to march to the top of the industry after the 1980s.

In China, the government-supported manufacturers are making better and better cars that will soon meet the tough regulatory requirements to enter the U.S. and European markets. And given the ability of Chinese manufacturers to deliver products at very low cost, they, too, will have an opportunity to deliver value and quality to budget-minded drivers worldwide.

Are these reasons to cheer in Beijing and Seoul? Perhaps, but Toyota’s fall from grace also should raise concerns in Korea and China about the fragility of auto market leadership and set off some serious planning to anticipate and avoid a similar fate.

While Toyota’s manufacturing problems are very real (the recalls focus on the ability of a driver to control a vehicle’s speed and stop it effectively, and there’s nothing more basic), the company’s communications strategies over the years contributed significantly to the magnitude of its current woes.

In an era when customers demand corporate transparency as well as quality products in order to trust a company, Toyota failed to deliver either. The company always maintained a less-is-more approach to its marketing and PR, content to ride its product reputation as a vehicle to achieve corporate reputation. Consumers outside Japan were never allowed to see beyond the marketing and sales operations it built worldwide and into the heart of the enterprise.

This failure created the infrastructure for its inept early communications efforts when the recall news broke. At first, the company said nothing. Then, it issued non-responsive statements from faceless communications staffers. Even when it realized it needed a corporate face to reassure customers, it relied upon its U.S. sales executive, Jim Lentz, as the face of the company. Its global CEO, Akio Toyoda, was saying little, except when cornered by reporters at the Davos meeting of global business leaders. What was he doing in Davos, anyway, at a time when his company was facing its worst crisis in history?

By the time, Toyoda came out from behind the cloaks of the boardroom, the serious damage was done; consumers had been spooked, and Toyota’s corporate reputation was plummeting at an unprecedented rate.

For Korean and Chinese auto executives, the communications lesson should be clear. While it is inevitable that their products at some point will face a serious quality challenge given the complexity of a modern automobile and the industry supply chain, it is not inevitable that their communications capability will fail when the pressure is on.

To support their market aspirations, the Korean and Chinese companies must build a robust, transparent communications and public policy structure that engages stakeholders broadly. Consumers, NGOs, government regulators and shareholders all must have a stake in the future success of those companies.

Every company must learn to operate in the open, social communications environment that now defines business. And success will be built on a three-legged platform: Transparency, trust and quality products. If the emerging Asian auto-manufacturing giants hope to avoid a future collapse of credibility, they must get focused on this new model.

Toyota didn’t get it, and is now paying a dear price.

The large number of high profile social media customer service disasters experienced by companies such as United, Comcast and HP make it plain that any company whose consumer products could conceivably require customer service issues must have a process in place to identify and address customer service issues in social media.

While previously a dissatisfied customer might tell ten friends about his experience, a dissatisfied customer using social media can tell thousands. Even worse, the online record of the complaint stays on the Internet eternally for all to see.

The basic strategy of a social media customer service program should be to:

1. Identify and address all customer service complaints identified online as quickly as possible.
2. Contact the consumer directly within the medium that the complaint was posted. This requires dedicated personnel enabled with social media monitoring technology
3. Quickly take the resolution process out of the public channel. Depending on the platform the complaint was posted on, ask the consumer to send either a Facebook email (Facebook), Direct Message (Twitter)  or email (YouTube, Flickr or Blog comment) with a brief description of their issue and a phone number where they can be reached.
4. Link your social media monitoring function to your company’s CRM system to route the problem to the correct department for resolution.
5. These issues must be prioritized and resolved in a timely manner to avoid further negative social media commentary from the user.
6. The ideal result is that the response so delights and surprises the consumer that the consumer praises the company for resolving complaint within the same social medium that was used to lodge the complaint.
7. Don’t use an automated response system or direct the consumer to call a customer service line – the reason they are complaining online is probably because that system already failed them.

While these basic steps will be sufficient for many companies for the time being, companies also need to plan for the future.

The growing number of consumers using social media as well as the high profile successes some customers have achieved by complaining online means that an increasing number of your customers will be using social media to resolve (and complain about) customer service issues in the near future. You need to think about how your social media customer service operation will scale.

While scaling this program cost-effectively is a concern, there are also some advantages that can make social media customer service programs scale better than you might think.

1. Multitasking: unlike phone support, online customer service representatives can have online conversations with more than one person at a time. Many companies have had great success with instant message-based customer service on their company website for this reason.
2. Elimination of customer holding time: Probably the biggest thing that gets customer service interactions off on the wrong foot is forcing the customer to wait on the phone for 15 minutes to speak to a real person. By the time the interaction happens the customer’s increased irritation has decreased their satisfaction with the company interaction, regardless of the outcome of the call. In contrast, in my recent experience with my bank on Twitter, I DM’d them my problem along with my phone number, and an hour later a service rep called me back with the solution already worked out. Even though it took longer to receive a solution than most telephone customer service interactions, my satisfaction with the interaction was much higher because my time was not wasted. Once I received the initial response via Twitter I knew the company was looking into my problem, so I was content to wait for them to solve it while I went back to my work. I would not have had the same reaction if I was on hold on the phone. My bank also benefited because the only person that had to spend time on the phone with me was the person who had the power to help me.
3. Easy prioritization: Urgent issues/high priority customers can be identified and triaged immediately.
4. Customer service process improvement: The most expensive customer service issues, both from a staff time and restitution perspective, are those where the system you have in place has failed and the customer has escalated the complaint outside of the usual customer service channels. A well-run social media customer service program can help you to identify areas where your current customer service process is failing, to make it more efficient.

Companies need to consider more than the upfront costs compared with outsourced call-center support. Social media proliferation has made it far too risky to farm out customer support to an offshore call-center and hope for the best.

Today’s social-media savvy consumers are not going to go quietly away when your company’s customer service process fails them – they will use social media to make their voice heard on a scale that your company cannot afford. The only question is whether your company will be ready to efficiently and effectively deal with them in social media, or will the issue become a communications crisis before your company acts.

One Florida lawyer was reprimanded by a state bar association for making statements critical of a judge on his blog.  The phrase “Evil, Unfair Witch” apparently left the judge unamused.

Another attorney was held in contempt after asking a judge to delay a trial so he could attend an out-of-town funeral.  The judge visited the lawyer’s Facebook page and discovered he was in town and not at a funeral.  This must have made for a very bad day at the office.

But lawyers are not alone; judges have indulged their social media whims, too.  A North Carolina jurist got himself into trouble by “friending” a lawyer who was handling a matter in front of him and then exchanging comments with that attorney about the evidence in the case.  Their enthusiasm for Facebook apparently led the judge and the lawyer to forget about the rule that prohibits such ex parte communications.

Jurors have gotten into the act as well.  In a number of instances, they have been caught blogging about the cases they’ve been selected to decide—the judge’s warnings against such conduct notwithstanding.  As the New York Times article cited above observes, in at least one case the discovery of this activity resulted in the reversal of a criminal conviction.

Still, very little has been written about how social media significantly raises the stakes for a company that is embroiled in litigation.  Social media creates additional risks for a number of reasons.  One of the principal reasons is this: the company may be talking to the world about the lawsuit and may not even know it.

Managing information and limiting risk poses a substantial problem even when an individual is a party to litigation.  For example, divorce lawyers are starting to instruct their clients to take down their social networking sites out of fear that statements made there will provide an abundance of very useful, and deeply unfortunate, information to the opposition.  For a discussion of this issue see Lawyers USA Online.

And, just recently, The Detroit Free Press reported on a criminal defendant whose incessant “tweeting” prompted a federal judge to tell his lawyers to instruct him to “keep his fingers off the keyboard as well as his mouth closed.”  Shortly thereafter, the unrepentant client posted the message “Tweet On KMA.”

The same problem, but in greatly magnified form, exists for a company caught up in a major lawsuit.  These days, hundreds of employees equates to dozens of individual social networking sites.  Imprudent statements made on such sites could prove devastating: they could disclose compromising information, reveal privileged communications with company attorneys,  outline the company’s litigation strategy—or a viable strategy for the opposing party, violate a protective order or settlement agreement, or even (depending on what is said and who says it) be deemed admissions of the company itself.  A litigation communications plan that does not account for and address this possibility leaves a critical flank unguarded.

To date, this dimension of social media has not played a significant role in business litigation.  But the fact that it will do so—and in fairly short order—is beyond reasonable dispute.  
Indeed, that will be the next avalanche.

Today’s big news isn’t the OS itself—that announcement came back in July—but rather the release of the OS’ source code, which is Linux-based. Plus, the developer preview, taking place at the Googleplex in Mountainview, California, is much anticipated by techies, all of whom are clamoring for more insights into the operation system’s potential power. Among the details leaked so far (courtesy of Robert Scoble):

• It’s based on HTML 5 standards, the latest version of the markup language used to create Web sites whose advancements include a universal video standard, which will eliminate the need for browser plug-ins like Flash.
• It will have two versions: open source and official, much like the Chrome Web browser.
• It will make computers cheaper.

But why should non-techies be excited about the coming release of Chrome OS (expected to be the 4^th quarter of 2010)? To answer that question, it’s important to first consider the importance of Chrome OS’ predecessor, the Chrome Web browser. From a communications standpoint, the Chrome marks the complete integration of social media applications directly into the browser itself. And why not? After all, most of what we use online isn’t static Web pages; it’s interactive content on dynamic, application-driven platforms (videos on YouTube, commentary via Sidewiki, photo-sharing on Facebook or Flickr, etc.). This comic book, drawn by Scott McCloud and released by Google, best summarizes the Chrome concept. Suffice it to say that it falls in line with the premise of asymmetric communications, in which social media content is part of everyone’s online experience, whether they opt-in or not. This video describes a few of its features:

Chrome OS, then, takes this integrated online experience to the next level. In developing it, Google execs sought to answer one question: What if your Web browser was your operating system? Thus is the crux of Chrome OS. This brand-new video explains more:

Google’s move to develop an operating system is smart, and not just because they’re already doing just about everything else. Indeed, having its own OS enables the company to completely own the brand experience, as opposed to relying on other systems to run their various applications. Plus, EVERYTHING is integrated into an online experience—even programs like the word processor (vis-à-vis Google Docs)—because the operating system itself is built around the browser, which is where all applications live and run.

Seeing as the Chrome OS won’t be available until late 2010, it’s hard to accurately predict its communications scope and impact, but it certainly is one more reason to keep our eye on anything and everything happening within Google’s hallowed walls.

As an example of how this new widget works, below is a list containing MH Group Communications executives on Twitter:

The significance here is that this feature will allow any user to embed the live stream of any list into any web page or blog, sharing this content with others who may or may not use Twitter or follow these individuals online.

So, for example, if I want to share the Twitter stream of a group of environmental activists with people who don’t use Twitter, I now have a very easy way to do so.

As we have chronicled on this blog, Twitter is just one of the technology companies making a concerted effort to propagate their particular format of social media content across the web. As a result, companies whose target audiences are not heavy social media users now have to contend with the fact that they audiences will be consuming social media content on traditional web pages.

In this asymmetric communications environment, companies need to rethink their approach to social media communications, and get in the game. For some tips on how to get started, check out our white paper: “Brand Survival in the Age of Asymmetric Communications.”

A brand new research report from Business.com sheds some light on the question of how big a role social media plays as a business resource. Many findings underscored what we already knew—companies and executives are using social media—but some stats offer added dimensions to the hows and whys of this online activity.

But first, an overview: Nearly 65% of the 2,948 respondents reported using social media as part of their normal work routines. As for the most popular social media resources for business information:

• Attending webinars/listening to podcasts: 69.1%
• Reading user ratings and reviews for business products/services: 62.2%
• Visiting company/product profile pages on social media sites: 62.1%
• Visiting company blogs: 55.1%
• Conducting searches for information on social media sites: 54.5%

The list went on from there, but the last bullet point (conducting searches on social media sites) caught my attention because of the ongoing development of social search, in which Google will actually pull in data from relevant social media platforms and display them alongside regular results. So, I would expect that number to change dramatically in the near future.

But that wasn’t the only surprising finding. According to the report, the marketing department is the main driver of social media initiatives among the highest percentage—56%—of respondents, followed by customer support (23%), product (8%) and “other” (3%). The function notably missing: Corporate communications. There are possible explanations for this (corporate communications may fall within marketing at most respondents’ organizations, for example), but I’m still surprised by the absence of any mention of communications at all.

Finally, and perhaps most significantly, there were findings surrounding success metrics. The question “How does your company currently judge the success of social media initiatives (choose all that apply)?” yielded the following percentages:

• Web site traffic: 61%
• Engagement with prospects: 57%
• Brand awareness: 54%
• Engagement with customers: 50%
• Revenue: 42%
• Brand reputation: 42%

First, it’s interesting that revenue and brand reputation were equally used to judge success. But as for how respondents actually turned these success “metrics” into quantifiable impacts … well, there was a disconnect, which fell squarely on the shoulders of the most meaningful performance indicators: engagement and reputation. According to the report:

“The brand metrics [reputation, awareness and engagement] fall to the bottom of the scale, with almost equal percentages of respondents indicating that they can easily see the impact of social media initiatives on these metrics, [and] they can’t measure the impact at all.” The obvious questions, then?

• How can a company claim to judge social media on a particular success metric like brand awareness or customer engagement with no ability to actually measure that metric?
• For those who can “easily” see the impact, what measurement strategies are being used?

Clearly, meaningful social media measurement is being seen as a more attainable objective, but many executives have yet to find the bridge that will take them from point A to point B. For starters, I’d offer the following metrics that can be found easily (and, most often, at no cost), and that do give some indication of impacts like engagement and awareness:

• Time spent on site
• Bounce rates (the lower the bounce rate, the more engaged visiting users must be)
• # of returning visitors
• # of inbound links (tools include Blogpulse and Alexa)
• # of discussions containing key messages on various platforms (Twitter, Facebook, etc.)
• # of comments on blogs
• # of re-tweets on Twitter
• # of Twitter followers/Facebook fans (indicates opportunities to see)

And so on …

For communications professionals, the crux of this search evolution is two-fold: It stands to reshuffle the deck for traditional search engine optimization strategies, and to offer real-time data whose breadth and depth has yet to be seen. So, like most social media-driven evolutions, this one is a double-edged sword bearing positive and negative consequences:

• + The availability of robust data sets will enable executives to shape communications strategies according to their target audiences’ precise preferences and consumption habits.
• - Standard SEO techniques will become antiquated almost as fast as you can say metatag—that is, in near-real time.
• + A simple search query will be a barometer for audiences’ sentiments at that exact moment in time, which can inform strategies for specific initiatives, especially in the context of crisis/issues management.
• - Because search results will show real-time sentiments alongside the “standard fare” (which is updated only as often as the search engine’s spiders crawl the Web and work their algorithmic voodoo), executives will need to revise their messaging strategies as conversations happen. Plus, over time, corporate Web properties—Web sites, newsrooms, official blogs, etc.—could be outranked (even more than they are already) by consumer-generated content on platforms like Twitter and Facebook. The result: companies will be playing a constant game of tag with their external stakeholder for top search engine billing.

Now, I’m the first to admit that I’m jumping the gun a bit. These technologies and features are in the early stages of testing, so it’s hard to say how long it will take for the above issues to come to pass.  Regardless of the timeframe, though, the socialization of search is yet another example of asymmetric communications, where opt-in social media participation is trumped by complete immersion.

More than ever before, executives must rely on their loyal consumers to supplement corporate messaging with organic and favorable conversations about the brand. This means walking the walk, as talking the talk will only take you as far as your highest search result at this moment in time. As for tomorrow, who can say for sure?

So, for example, if you type in a search for “iPhone” into Google, in addition to your regular search results you will also see all of the blog posts, tweets, reviews, etc. that your friends have posted about the iPhone. Given what we know about how much people rely on their friend’s opinions in forming their own opinions and making purchase decisions, these social search results have the potential to be very influential.

With Social Search, users do not have to make the proactive effort to check what their friends may have said about a given product online – Google will pull this information up automatically.

Companies need to pay attention to this – if a user searches for “smartphone” and receives a bunch of social search results talking about the iPhone, and nothing mentioning the Blackberry – which product do you think she is going to investigate first?

From a corporate communicator’s perspective, this creates the imperative to:

• Encourage your customers to create content and commentary around your products and brands across multiple mediums. This includes product reviews, blog posts, tweets, videos, pictures, etc. Every kind of content that is publicly viewable and that would typically appear in a Google search.
• Deal quickly with any negative commentary online

This of course means that traditional SEO and search engine marking strategies are about to become much less effective individually as consumers learn to rely on each other in searches made with intent to purchase. However, the combination of consumers talking about your products in Social Search, along with positive entries within the first ten search results, is a winning combination.

Of course, Google Social Search is experimental technology, and a user does need to have a pretty substantial online social circle to make the results meaningful, but the direction is clear so it behooves corporate communicators to begin preparing now for this change in their company’s search results.

It has been a brutal two weeks for the media industry, even by the standards of what has been a horrific year for the industry. To review, just in the past two weeks:

• The Wall Street Journal announced that it will shutter its Boston bureau

• Forbes closed its LA and London bureaus with a rumored 50 or so editorial staff let go

• The New York Times announced plans to eliminate 100 newsroom jobs — about 8 percent of the total — by year’s end

• Time Inc. is expected to announce next week that it will cut $100 million in costs and make significant layoffs

• Sam Zell, former owner of the Chicago Tribune, went on Bloomberg Television to say of the newspaper industry “nobody can survive.”

• New York Times publisher Arthur Sulzberger Jr. compares print media to the Titanic

For corporate communicators this is concerning as well – after all, with all of these journalists being laid off, who is going to cover their companies? Many people assume that online media and bloggers will pick up the slack, but this is not necessarily so.

As many have pointed out, the economics which allow large groups of highly educated professionals to make a living covering the news are now in question. The traditional business model by which publications were able to bring in enough revenue through advertising and subscriptions to support the staff of people needed to produce this content while turning a profit is broken, and while there are numerous new business models being tried, both on and offline, no one has yet found the silver bullet that can scale.

What this means is that corporate communicators need to prepare for a world without media, where the resources of the traditional publications they relied on for coverage are too limited to allow for significant coverage of their industry or their company. Relying on bloggers, who are often amateur, biased, and not bound to journalistic standards of fairness or accuracy, is not a tenable solution.

The only way for companies to fill this growing void is to create the content themselves – in short, companies need to become publishers.

We are already seeing many examples of this, with companies creating YouTube channels for company-created videos, executive blogs for delivering company news, and ebooks and white papers to provide information on new products and industry perspectives. Just this week, IBM announce a partnership with OgilvyEntertainment where they will create timely “new news” stories that also included a compelling contribution from IBM, focused on topics such as Smarter Electricity Grids and Electronic Health Records.

This is certainly not a new development, but here is the new dynamic: While company-created content used to be an opt-in communications activity, with the continued decimation of traditional media, in-house publishing capabilities are quickly becoming mandatory for companies wanting to get their message out. For many companies the only way to generate significant editorial coverage is to create it themselves.

Also, companies can now longer focus their content exclusively on their own products and services, because the competitor who creates content which is useful to a potential customer long before that person is ready to make a purchase is the company that will be first on that customer’s list when the time comes. Companies need to take an expansive view of the customer’s business needs and challenges, and consider how the company’s insights might be useful to this person much closer to the front of the sales funnel.

There are additional benefits to creating your own content, as described in a recent AdAge article:

Mark Hass, CEO and partner of MH Group Communications, said one of his automotive clients is using YouTube very aggressively and sees it as a way to get its product messages out directly to consumers.

“They still have the usual car-and-driver folks drive and write about their cars, but that’s becoming much less important than [it] used to be,” Mr. Hass said. He said aside from controlling the message the other upside to creating and managing the dissemination of content is the potential to reach a wider and more diverse audience than just newspaper or magazine readers.

“You build a channel on YouTube and you get millions of views,” Mr. Hass said. “And these people are coming from all over, and it’s more about their interest in your product, as opposed to the readership and viewership of a particular medium. It’s horizontal. If you wanted to reach that many people using traditional media, you would have to pitch and place in dozens of outlets.”

We are living through a revolution in mass media, and companies need to get proactive in filling the news hole, or risk being left out of coverage entirely.