#37 – EA Games feels the full wrath of the force, Logitech loses customer Harmony, and the 3 hottest ORM tips for 2018
Two tech companies face a reputation backlash but demonstrate how to quickly recover good will with their customers.
Each week, Erin Jones and I take a look at the most interesting reputation management stories, answer your questions, and share valuable ORM tactics. In this week’s episode:
- EA Games sets new record for Reddit down votes, quickly reduces game credit costs.
- After Logitech announces Harmony Link’s demise, backlash ensues, forcing the company to apologize and appease.
- Erin’s back from one of the largest marketing conferences in the US, with her top 3 take aways for ORM.
- Don’t miss Erin’s workshop in South Denver!
If you have a question you would like us to tackle, please leave a comment below or on my Facebook Page.
Transcript (forgive us for any typos):
Andy Beal: Thank you for joining us, and we’re going to jump straight into it. We have a story about EA Games. Now, they’re a very popular global games maker, and you’ve probably, if you’ve got any kind of console, you’ve probably played one of their games, and you may have seen the commercials for the new Star Wars game that’s coming out. Well, some people have had a chance to play it a little bit early and there’s not so much good news coming out of that, because you can unlock these players, so if you want to unlock Darth Vader, or play as Luke Skywalker, then you can earn these credits, and to do so, you’d practically have to give up work and spend 40 hours a week playing the game in order to earn enough credits, or you can pay cash and buy the credits, and for $80 you can purchase Darth Vader or Luke Skywalker.
Now, that’s more than what the game costs, or about the same amount the game costs, and there was a backlash, and a lot of gamers took to Reddit to complain about the cost of unlocking these players. EA tried to come in and justify the cost with their own kind of, ah, it was corporate, trying to kind of make it sound like it’s not as unfair as it seems, which earned them, get this Erin, it earned them an amazing 677,000 down votes from Reddit users.
Erin Jones: Unbelievable. I think there are two groups of people here that you should really work to not upset, and that’s Redditors and gamers, because they are relentless.
Andy Beal: Right, and they’re in the same, it’s the same place, right, so you’ve got gamers on Reddit. Now, hat off to EA for at least monitoring Reddit and knowing that’s one of their centers of influence, because you have to know where your customers are going to hangout, and you’re probably not going to get the backlash, if you’re EA Games, it’s not likely going to come on Twitter and Facebook. A lot of gamers, hardcore gamers that I know are not that, they don’t really care about those networks. Reddit was the place to monitor it, but they also didn’t kind of grasp just the extent of the backlash and how their response was going to just get them fired up even more, and had this just … What was potentially a huge reputation issue for a company that’s had some battles in the past. Now, fortunately within hours they realized that they needed the goodwill of Reddit gamers if they wanted this game to be successful, and so EA Games came out and announced a 75% decrease in credit costs.
Erin Jones: They did, but now I’m reading that the rewards on those credits that you purchase are also decreased greatly, so I’m not so sure if they tried to outsmart their audience or if they tried to come to a good conclusion here. I read this morning that over 60% of their revenue last year came from in-game purchasing.
Andy Beal: It’s huge. I play Clash of Clans, I have to admit I kind of like playing that in the evening when there’s not much on TV, and it’s easy. They make it so easy for you to just like buy in this case gems, which is credits, and speed things up. But if you get savvy to that and you realize, “Wait a minute, I got this game for free, but it’s costing me a fortune,” and so I think Wall Street is even looking at this now, right? They’re looking at this to say is EA Games going to hit the profits that they were anticipating, because now they’re … When you have to decrease the credit cost by 75%, that’s going to impact the bottom line, because as you pointed out, they’re heavily relying on the revenue from the people, basically gamers. It’s like the 2017 version of cheat codes, right? When I was playing games, if you could go up, down, left, right, whatever, X, Y, in a certain order, you could unlock something, but now it’s like hey, if you’ve got whatever it is, 16 digits on a credit card and an expiration date, you can unlock it within a few seconds.
Erin Jones: You can, and as a parent that’s terrifying, first of all.
Andy Beal: Yeah.
Erin Jones: I’ve heard horror stories of kids racking up thousands of dollars in bills just hitting OK, OK, OK. You know what I want to get to with this is I think Reddit really controls a lot more of brands reputations than they think, and I think that EA knows that. Right when this started taking off, they scheduled an AMA. For people who don’t know, that’s an ask me about, so people can come onto this thread and ask these developers any questions they want. Unfortunately, that was where the success stopped. During the AMA, people had great questions, and all they got back was really corporate legalese speak for “Sorry, but not sorry,” basically, and so then people got upset all over again.
Andy Beal: Yeah, and you’re right, Reddit is a big center of influence for gamers and it’s spread, right? I’ve often said that like if you’ve got a reputation issue that’s confined to a particular small area, then maybe you can kind of contain it, but this jumps. This jumped to mainstream media, CNBC picked up on the story, Huffington Post picked up on the story. If you search for “EA Games,” you’re going to see it plastered all over the front page of Google.
The big question I have is that this game, as EA points out, went through beta testing, so this went through like a pre-release of beta testing, and how was this not surfaced earlier, and it got me thinking about how sometimes as business owners, as CEOs, we don’t want to ask those tough questions that might result in us getting an answer we don’t want, so maybe they just didn’t ask, maybe they covered it up. I don’t know the details of it, but it is puzzling that like, well, wait a minute, unless you bait and switched here and you increased the costs after the beta period, I don’t understand. Either you didn’t make this known to them, this feature wasn’t available to them so they didn’t have an idea of purchasing, because it was in beta, or you just were too scared to ask the question, “OK, well, thank you for your participation. We’re going to charge you $80 if you want to unlock Darth Vader. What are your thoughts on that?” Because they could have saved themselves a whole lot of hassle by actually engaging the community and getting the feedback before the game goes live.
Erin Jones: Absolutely, and I could be wrong here, but I was under the impression that these were the beta testers, that the game actually isn’t being released until tomorrow.
Andy Beal: Yeah, I think there was a couple stages.
Erin Jones: OK.
Andy Beal: I think there was like a beta test like weeks ago, and then this is like an early preview release. I don’t know who’s got their hands on it right now, but clearly 677,000 at last count are not happy with it, but it is kind of interesting. You really do need to … When you’re going to have features like this, you’ve got to ask yourself the tough questions. You’ve got to say to yourself, “OK, we release this game, what are the areas where we could be attacked?” It’s the same for your product. We’re going to release this product, we’re going to announce this service, where could we be attacked? Let’s spend some time to ask those tough questions to see if it is going to be an issue or not, because it’s going to be a whole lot cheaper to fix it in beta testing than it is to let it go live and then scramble.
Erin Jones: Especially if it accounts for 60% of your annual revenue.
Andy Beal: Yeah.
Erin Jones: This is something you want to have ironed out before you go. The only thing I can think of is maybe that the beta testers were handed a certain amount of credits at the start so that they could really just jump right in.
Andy Beal: Right.
Erin Jones: I don’t know, but I think that this one is going to hurt them. I noticed that they’ve also just released a new, I think a golf game or something similar to that. Either good timing or deflection, I don’t know, but I think that’s two very different user bases, the people who play the sports games versus the people who play the more sci-fi fantasy stuff.
Andy Beal: Right. No, I think you’re right. I don’t see a lot of crossover between light sabers and putters.
Erin Jones: No, and I think that this is a group who has a very long memory, and I think EA is going to have to be a lot more transparent if they want to win them back.
Andy Beal: Yeah.
Erin Jones: I think that AMA just made people more angry.
Andy Beal: Also, just as a sidebar, if you’re listening, my advice is to never do an AMA. I mean seriously, never do an AMA, right, because it’s basically ask me anything, and you are basically saying to them, “Hey, you can ask me anything and I am vowing that I will give you an answer.” Well, if you’ve got even a whiff of a reputation issue, you don’t want people asking you anything in an environment that you have no control over, where you can’t moderate what questions are answered, and it’s just so dangerous. Even I wouldn’t do an AMA, because there’s probably questions people would ask me where even though I think I’ve got everything buttoned up, and I’m clean, and I’ve never had any issues, I wouldn’t want to risk it, and I’m a reputation guy, so please.
I know it seems trendy, but there’s only a very small percentage who I would say, “Yeah, go for it,” and that is if you’re a relatively unknown, and it’s on a really big platform, and it’s going to get promoted, maybe it’s co-sponsored by a big company, and basically what I’m getting at is the benefits far outweigh the risks, then go for it. But if you’re just the 99% of everybody else that’s in business, just stay away from AMAs. Nothing really good comes from it, at least not in what I’ve seen. Unless you’re Elon Musk, then … Measure yourself against him, because even he probably gets some tough questions he’d rather not be asked, but if you’re not Elon Musk, if you’re not Jeff Bezos, if you’re not one of these big guys that’s kind of like a superstar in the tech world, then I would just say don’t do them.
Erin Jones: Yeah, I’ve never, well, maybe two. I’ve maybe seen two go well, and they were from doctors, and people were having a really fun time asking them about the craziest case they ever got or something, but these tech people, if they smell blood in the water, they’re coming for you. You want to be really, really careful about what you offer up, and especially they didn’t answer the questions with candor, so not only did they get these people piling on them, but then they just added fuel to the fire.
Andy Beal: Yeah, heaven forbid you don’t actually answer with transparency and honesty, and you just try and give sound bites and just have a PR shield on there, something like that. All right, well, let’s move on, because there’s another company that has blood in the water, and that’s Logitech, and they announced they were basically going to terminate their Harmony Link product, which is kind of like a media remote that you download for your iPad, or your phone, lets you control all of your entertainment devices. But they were having some issues I think with some security certificates, and rather than just push forward with that, they just announced, “Hey, we’re shutting the entire service down in March, and you won’t be able to use it, it’s going to be bricked,” and of course the thousands of people that own the Harmony Link were not happy with that, were they?
Erin Jones: They weren’t, although I have to give Rory Dooley, the head of the Harmony Department, a little bit of credit. His first response was, “I made a mistake.” How often do we hear somebody just come right out and say, “I made a mistake,” without a “but” at the end of it?
Andy Beal: Yeah, not often.
Erin Jones: I do think that it was a lack of forethought on their part to just brick this thing, but now they’re sending out a new device to everyone who ever had one, whether they’ve been using it or not. I think that handshake is great. We don’t see a lot of companies go that far into the red to make right this way without major, major backlash.
Andy Beal: Right. It’s a good observation, because EA Games, they went down the road that we often see, and we often feel like we want to do, and that is justify the decision, try and defend the decision even when it’s overwhelming odds that you’re going to appease your community. Whereas Logitech looked at this, and you could argue, “Hey, look, you’re about to brick a product that people are using, and you know, what you’ve offered them initially is not …” They offered initially like 35% off of the new product or if you were still in warranty you did get a free one, but it was really, really bad.
But at least they, when they saw the backlash, turned around real quick and said, “We made a mistake. Everybody’s going to get the upgrade to the Harmony Hub,” which is a different product, which by the way I have, and I love, it works with Alexa, and it’s just a great product for those of us that are so lazy we don’t even want to reach for a remote when we’re on the recliner. It’s really good. So, they did the right thing, but I think this is also a lesson for all of us that we’re waking up to the idea that just because you buy a piece of hardware, that doesn’t mean that you’re always going to be able to use it, because that hardware is often tied to software, or hosting, or some kind of server, and if that gets shut down, you’re out of luck.
Erin Jones: Right, I mean look at the first generation iPhone.
Andy Beal: Yeah.
Erin Jones: I mean they definitely didn’t asy, “Here, we’ll send you the next generation so that you can stay up,” they said, “Go ahead and buy one, we’ll be waiting,” and people got annoyed, but they do, they buy it, because they want the tech. I think what’s really cool about this is they didn’t leave the device running and let it just die out as the technology changed. They upgraded people to a better more efficient device, because from a support principle I feel like it probably is going to save them a lot of money in the long term, and it’s really going to instill a lot more trust in their users.
Andy Beal: Right, and so you have to as a company, you have to plan for the demise of your product or service, what does that end of life look like? You can make an announcement a couple of years out to give people plenty of time to kind of make an adjustment, but you should also factor in like an appeasement fund, right? It’s like, “OK, we are going to terminate this product, we are going to wind down this service,” or, “We’re going to get rid of this free version of our product. How much is that going to cost us to ensure that those that are using it don’t ruin our reputation?” And so you start setting aside funds as part of your development costs, or your upgrade costs, or whatever it is, to say, “OK, there’s going to be a percentage of our customers that are not going to be happy. We’re either going to have to eat it in free product, we’re either going to have to eat it in PR,” but somewhere along the lines you’re going to have to say, “OK, when we price out our product, when we price out our services, because we’re getting rid of something else, we need to have a fund here that covers those costs, because something’s got to give.” You can’t just pull the plug on something and expect that nobody’s going to care about it.
Erin Jones: Agreed, and I think even the, “OK, this is coming, here’s 30% off of our next generation device,” is a very, very dangerous game to play, because some people will jump on it, but if the people who don’t get upset enough, they’re going to make enough noise that then you’re going to upset the people who jumped on buying it too. I definitely think that this is a hard, hard lesson, for sure, but I-
Andy Beal: And I can talk to that. I can talk to that. Sorry to interrupt.
Erin Jones: No, go.
Andy Beal: Netgear had their line of security cameras called VueZone, and they announced that they were going to shut it down within like a three or four month period, I can’t remember how long it was, but they were offering a discount if you sent in your old equipment to prove that you had it. They would give you a discount on a refurbished version of their Arlo security cameras, so I’m thinking, “Well, I may as well do that. I’m really upset that, you know, they can’t just let me keep it going,” but again, lesson learned. When you have a web camera that uses some kind of server, you’re at their mercy.
I sent it all in thinking, “Ah, you know, this is going to be done,” and then within weeks later, they reversed it and extended the deadline for the longevity of the original product by another year or so. Meanwhile, I could have saved myself money, I could have waited and maybe done research on finding a better product, but because I had this short deadline, I jumped on it. You’re right, I’m one of these people that’s like, “Well, wait a minute. You’ve changed it, but what do I get out of it, because I was one of the ones that played by the original rules.”
Erin Jones: And you kind of feel like you got taken.
Andy Beal: Yeah.
Erin Jones: I think this really speaks to the fact that if you are going to phase something out, giving people as much advanced notice as possible, like you said, they had a year after the second notice. Then people can go, “OK, well, you know, I really like this system, I’m going to go ahead and move forward with the upgrade,” or, “Well, a lot has come out in the last year, maybe I should look at what my other options are.”
Andy Beal: Hopefully for you guys listening, some thoughts there in terms of whether you have to wind down your company, whether you have to stop offering a service or a product, plan in advance. Set aside some resources, whether that’s to cover email campaigns, or to cover refunds, or discounts, whatever it is, but if you want to keep your reputation intact, even if you’re getting out of a business, you need to handle it appropriately. Otherwise, if you just shut up shop and cut off service, remember your reputation’s going to be tied to that, so even if you go off and then join another company, or start another firm, people will Google your name, see that you were involved in a company that did this to their customers, and that’s going to follow you around.
All right, last thing we’re going to do is something a little bit different, because Erin was at Pubcon in Las Vegas last week, and if you’re not familiar, it is not a conference that’s held in a pub, it used to be, but it is a massive internet marketing social media conference, probably one of the best in the US, and Erin was there speaking on reputation management, but she also went to a whole bunch of sessions. I’ve asked Erin to put together her three top takeaways from this conference that while are not necessarily directly reputation management, have an impact on online reputation management. Erin, what did you have for your number one takeaway?
Erin Jones: My number one takeaway, which when I heard it, a light bulb came on and I realized I should have realized this long ago, but that local data can have an impact on your reputation. If you have a local address listing in the search engine results, even if you solely work online, it shows people that you’re real and that Google recognizes your credibility as a real business.
Andy Beal: Yeah, that’s a really good one to have. I have one. I mean I have a local listing for my own name and for my agency, Reputation Refinery, even though we don’t offer anything locally.
Erin Jones: Right, and I from Colorado can see that, so even though you’re not local to my area, I can see that yes, you do live close by, you’re a real person, you’ve got a real physical location, and it’s just another level of transparency for your audience.
Andy Beal: A couple of words of caution, because I’ve been doing this for so long. It’s not all roses though, right? A couple of things to consider. One is, especially if you work from home, you got to get a mailbox, a USPS address, or a Regus office, and use that. Do not use your home address. If you get some kind of backlash and it’s your home address listed in the local listing, you don’t want people coming to your house or sending stuff to your home.
Erin Jones: Yeah, and not just-
Andy Beal: Go ahead.
Erin Jones: Oh, sorry. I was going to say not just people.
Andy Beal: Yeah.
Erin Jones: People will, clients will go, “Well, I’ve looked at your address and I see that you live in a nice house, so you can afford to give me a discount.” People get very strange and very up in your business very quickly when they have access to your information.
Andy Beal: Absolutely, and then the other thing to consider, if you do this and you do have a reputation crisis, then you could end up with a negative Yelp profile, or negative reviews on Google Local even though you don’t actually do business locally, but because you set these profiles up. It’s kind of like Wikipedia. A lot of people get tempted to set up a Wikipedia profile. That’s all well and good if everything is going really well, but if you have a reputation crisis, someone’s going to put that in your Wikipedia profile and now you’ll wish you didn’t have one.
It’s the same with local listings. It’s great while everything is going well and you can use it to your advantage, but just keep in mind somebody’s going to be unhappy and they’re going to leave a negative Yelp review, or a negative Google Local review, and that just becomes one more center of influence that you’ve got to get cleaned up.
Erin Jones: Absolutely.
Andy Beal: Which Erin and I don’t mind, because it gives us more work to do, but for you guys out there, not necessarily a good thing. All right, Erin, number two?
Erin Jones: Number two. I was awakened a lot more this year to the negative side of what we do. I’ve been pretty lucky to surround myself with people in this industry who work with transparency, who run really positive above board businesses, and I got to hear this year about some businesses that don’t quite run so well, and I just wanted people to realize that anyone who offers a quick, cheap, easy fix for anything is lying to you. They’re not doing you or themselves any favors, so if you’re not setting expectations accordingly or someone you hire is not setting expectations accordingly, everyone is going to be disappointed.
Andy Beal: Right. You’re absolutely right, either they don’t have the appropriate experience and so don’t ask the right questions in order to price out the service or product properly, or they don’t care about offering the right service and they’re just trying to get your money. I spoke with an individual a couple weeks ago who called me to potentially get some help. He said he had tried two different ORM firms, reputation management firms, and had minimal success. Well, I looked and he had like, it was a racketeering or something change, and a lot of FBI listings.
It was one of those few cases where I’m like, “Look, your best bet is changing your name, because no amount of money you’re going to spend is going to help you. These guys are just taking your money and, you know, putting you through a process, and it’s definitely not going to work.” At least if you’re going to work with a service or some kind of firm and you’re not sure of their quality, then spend the money on it, but don’t get locked into a contract. Just say, “Look, I’m willing to spend the money, but if this doesn’t work out for me, I need to be able to stop.” A legitimate company that’s going to do a really good job and believes in the work they do will be fine with not locking you into a contract.
Erin Jones: Absolutely, and if someone promises to get you the number one listing on Google for every search phrase you mentioned for $400, run.
Andy Beal: Yeah, run. Yeah, absolutely. Number three, what’s your number three takeaway from the conference?
Erin Jones: My number three takeaway I found both in sessions and after the conference. Every single thing you do affects your reputation.
Andy Beal: Right.
Erin Jones: Going from the terms that you optimize your website for, to how you run your social media, even to the type of slides you use in a presentation, whether it be a conference or a client meeting. People are constantly taking the information that you share, whether it be nonverbal communication, or online, or wherever, to decide who they think you are, so pay attention to what you’re doing.
Andy Beal: Yeah, I’ve been to enough of those conferences where the guy that gets up onstage hungover from the night before, in a wrinkled shirt, unshaven, and doesn’t know his material. He could be the smartest guy on that particular topic, but people are not going to give him the time of day because he’s not put in the effort, it’s the perception. But you need to be authentic to your character, I’ve said this for years. If your character is you go out … Let’s keep with the conference. There are some guys that go to Pubcon where their reputation is they go to the bar, they’re up all night, and maybe they did a little black hat stuff, whatever, but that’s their reputation, that is their, and it’s their character.
Now, I’m not saying that they are bad people, but like they have the reputation of being the guy that you want to meet at the bar, because he’s going to tell you the stuff that you’re not going to learn in the sessions. He’s going to work with the clients that you’re not going to hear about as case studies, and so that’s totally fine, he’s being authentic to his character. But you’ve just got to consider that everything you do affects your reputation, and so Trump and Clinton, their reputation is deserved, based on their character, right, and you’ve got some brands that are a little bit more edgy, like Harley-Davidson or something like that where they can afford to be less buttoned up when it comes to their reputation because it fits their character.
Erin Jones: Absolutely, and I actually mentioned that in one of my sessions, that we can’t all use the same script. A tattoo artist is going to have a very, very different conversation and interaction online than a kindergarten teacher is, but the kindergarten teacher needs to remember that they’re a kindergarten teacher and act accordingly when they have an audience. A lot of that was really interesting, and actually some of the people that I was on a panel with mentioned that they are afraid to associate themselves with other reputation management professionals, or other people who call themselves SEOs, because they don’t want the reputation by association.
Andy Beal: Right.
Erin Jones: So, it just keeps reaching, and reaching, and reaching.
Andy Beal: Yeah, you can’t segment your reputation. You can’t say, “Well, this is me onstage, this is me at home,” you can’t say, “This is me at my business, this is me at my church.” Everything is the same reputation. Somebody’s going to make the connection, so don’t try and live separate lives, just live authentically, and if that means that there are some, a few little cracks in your reputation but it’s authentic, that’s fine, but if you’re trying to cover up those cracks by trying to be somebody you’re not, that’s when you kind of get into trouble.
Erin Jones: Absolutely.
Andy Beal: All right, great show. We hope you enjoyed it. We always enjoy chatting and sharing some tips with you guys. If you have any questions or any topics that you would like us to discuss, then feel free to head to the Facebook page www.Facebook.com/AndyBealORM. You can also head to www.AndyBeal.com and leave a question there. Then if you live in the south Denver area, Erin’s going to be putting on a workshop, I’ll make sure there’s a link in the podcast post for that, so if you want to meetup with Erin face-to-face and get some training from her, she’s putting on a workshop. I definitely recommend that, because Erin, I always enjoy chatting with you.
Erin Jones: Thank you so much. I enjoy chatting with you as well.
Andy Beal: And we love it when you guys tune in and give us feedback, so we’ll hope you’ll join us again next time. Thanks a lot and bye-bye.