Archive for February, 2010

FOE Plays Anti-Corporate Card

While recently reviewing the Friends of the Earth US (FOE) website, I saw that they introduced a new genetic engineering policy campaigner named Eric Hoffman. Congratulations to Mr. Hoffman. Perhaps at a future time, he and I can have some interesting discussions on issues of mutual concern. But I hope that those future discussions would be based upon better writing than that which I found in connection with Mr. Hoffman’s employment announcement.

As part of the FOE US introduction of Mr. Hoffman, FOE used the following lead-in passage:

Friends of the Earth is a fierce advocate of scientific progress, but corporations often seek profit from scientific developments with little regard for human health. We must take precaution (sic) to ensure new technologies don’t do more harm than good.

Now, I’ll put aside the minor spelling error in their second sentence. I’ll also put aside the fact that there was no date on this post, which is really just a “bush league” error when it comes to Website writing and management. Instead of those small errors, I’ll just concentrate on the meaning of the passage itself.

playing card 1This approach of playing the “anti-corporate card” gets a bit wearisome, and is plainly just bad argumentation. The anti-corporate card to which I refer is the phrase, “corporations often seek profit from scientific development with little regard for human health.” Let’s take this phrase apart to see how it represents poor argumentation on the part of FOE and only weakens any argument that they are trying to make.

“Corporations often seek profit.” Yes. Okay, I can go along with that part. That is the function of a corporation, to seek a profit in its activities, many of which are directed at scientific developments. Thankfully they do that. Without profits, no one would ever get a merit raise in pay. And without scientific developments, people would be dropping dead from what are now, as compared to the past, “easily-cured” illnesses or from complications arising out of minor injuries. Now, let’s move on to the next part of the phrase and talk about “with little regard for human health.”

This part of the phrase conjures up a picture of research & development departments operated by zany, madcap scientists who indiscriminately toss new products out the door without adequately testing them, or at least without testing them to the satisfaction of government regulators within the jurisdictions in which their corporations do business. In my career, I’ve known many R&D personnel, and have found them to be painfully cautious and responsible personalities, almost to the point, perhaps, of being too cautious. I’ve yet to meet one who I would consider as either a businessperson or scientist with “little regard for human health.” If, indeed, these individuals, and the corporations for which they worked, “often” acted as portrayed by this phrase, their mad scientist-like lack of “regard for human health” would produce deadly products quickly killing thousands, drawing the ire of the marketplace, causing the corporation to lose revenue quickly, putting the company out of business in short order. And if the marketplace didn’t do this, government regulators surely could and, I would hope, would

Using unsupported phrases such as “corporations often seek profit from scientific developments with little regard for human health” is plainly unfair and irresponsible. Had they sourced that passage, I might not be writing this post. Phrasing of the sort used in this FOE example plays upon people’s tendency to believe whatever it is they read, just as long as it’s in black and white, and not vet what it is that they read, especially on the Web. (How can I make a statement such as that one? With support. For more on this human tendency to believe without question what’s written on the Web, please see: “Making the Call on Web ‘Facts’.” The Christian Science Monitor. October 11, 2009, and Universal Mc Cann’s study entitled “When Did We Start Trusting Strangers?”)

In using this type of phrasing, it appears that FOE and perhaps many other NGO and activist organizations base their media tactics on this knowledge that people won’t question what they see in writing. And in making such unsupported, anti-corporate statements, it seems that organizations making such statements will count on their audience to call upon the NGO or activist organization to “right the wrong” as defined by the self-appointed “expert” group. (Don’t forget the second sentence in the passage: “We must take precaution (sic) to ensure new technologies don’t do more harm than good.”)

No. For me, at least, unsupported, “anti-corporate card” plays of this sort only make this organization appear weaker, as if they can’t find enough examples to support what they contend. And I would think that an organization of FOE’s stature would be able to find examples through which to set up a better argument.

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Change.org Is a Formidable Irregular Competitor – Part 2

So, here we are in Part 2 of this case study in irregular competition, a case study that focuses on Change.org. If you haven’t read Part 1 and you wish to do so before proceeding on with this second part, then please click here to go to “Change.org Is a Formidable Irregular Competitor – Part 1.”

In Part 1, we left off with the Findings, Corporate Status. In today’s post we’ll pick up with the research findings and take a look at some of the web traffic factors of Change.org.

Findings

Traffic

Change.org is no slouch when it comes to attracting traffic on the Internet. Let’s see what Alexa.com, one of the major Internet traffic trackers and a unit of Amazon.com, says about Change.org.

Alexa.com

Per Alexa.com, accessed on January 29, 2010, based on traffic Change.org was ranked as the 16,464th most popular site on the Internet. You can check their ranking today by clicking here. Now, this ranking of 16,464 might not seem very impressive at first blush. But, I can tell you that this level of traffic ranking is very impressive. Here’s why.

Alexa.com tracks approximately 20 million websites. Number 20 million would be the least trafficked website that Alexa.com tracks, while number 1 would be the most popular. (On the date that I checked this, Google.com was the number 1 site.) This ranking of 16,464th is a global ranking. Alexa.com showed that the ranking for United States traffic is 4,350. This is especially important since most of the social issues with which Change.org deals are American issues. With Change.org being the 4,350th most popular website in the United States, it’s plain to see that many Americans are receiving the Change.org message.

Okay, traffic rankings are fine. But what do these rankings translate to in terms of the numbers of visitors that actually go to the site? Alexa.com doesn’t provide much in terms of identifying actual numbers, but Compete.com does. So, let’s go over there.

Compete.com

On the same date as shown above, I went over to Compete.com to learn about Change.org’s traffic level. You can take a look at the current Change.org status by clicking here. On the date that I examined it, Compete.com showed that in 2009 Change.org averaged around 300,000 unique visitors per month. Check the Compete.com graph below, which is as of January 29, 2010.

This graph represents unique visitors, not “hits.” So, even though their traffic is relatively flat for the period shown (except for that blip up in January 2009), it’s plain to see that Change.org does very nicely in terms of the numbers of people who visit the site every month. That means that every month well over a quarter of a million people are seeing the social change, and anti-corporate, messages that are being sent via Change.org.

Where’s all this traffic coming from? Well, Alexa.com says that Change.org has 2,321 sites linking in. This is an astounding number that definitely contributes to that unique visitor trend you see in the graph above. But I think a more significant contributor to Change.org’s traffic is referrals from the social web. Indeed. Compete.com, on the date I visited, showed that approximately 28% of Change.org’s referrals were from Facebook.com. This is a considerable percentage of their referral traffic, and may account for much of those 2,321 inbound links reported by Alexa. com. So, it would appear that the social media program of Change.org contributes heavily to their activist efforts. Let’s take a look at that social media program.

Social Media Program

Here we’re going to take a focused look at Change.org’s social media program. You and I are going to concentrate today only on their Facebook and Twitter efforts. They do have other areas of the social web in which they are active and I may come back to those areas in a future post. But because Change.org’s social media effort is so extensive, for now, I would just like to concentrate on their Facebook and Twitter initiatives.

On the date examined, January 29, 2010, the Change.org Facebook main fan page contained about 4,000 fans. This is a respectable amount, but it is not overly impressive when you consider the amount of traffic that they have going to the Change.org site every month. Yet, the Change.org Facebook blog effort more than makes up for any seeming deficiency in fan levels on the main Facebook page. Let’s take a look at the fan blogs they have on Facebook and also at their individual Facebook blog fan numbers.

Name of Facebook BlogNumber of fans
Global Warming981
Criminal Justice773
Animal Rights5819
Gay Rights6700
Education326
Women's Rights3202
End Homelessness1427
Social Entrepreneurship1848
Universal Health Care1321
Humanitarian Relief228
Immigrant Rights564
End Human Trafficking1443
Global Health225
Poverty in America275
Sustainable Food1995
Job for Change258
Total Number of Blog Fans27,385

A number of over 27,000 Facebook blog participants, as of January 29, 2010, is quite impressive and most likely contributes to those heavy unique visitor numbers we saw above. Of course, it could be that some of the 4,000 Facebook primary page fans participate in more than one blog, making the blog fan numbers appear larger. Yet, it is clear that with a blog fan number of over 27,000, the Change.org message has great “legs” and propagation potential.

A random sampling of the fans that I observed in the blog pages, and on the main fan page, shows than most are individuals and not groups. So, this means that Change.org is not necessarily “preaching to the choir.” A high proportion of fans being other groups, similar in agenda to that of the social causes that Change.org promotes, would certainly indicate that their audience characteristics are limited. But with individuals comprising most of the audience, we cannot say that the audience is necessarily skewed.

And with a “Take Action” tab prominently displayed on their Facebook fan pages, any of the many blog participants can make an easy trip to that “Take Action” area where they will find at least three choices for petition participation. Change.org has many more than three petitions active on their main website at any given time. So, on their Facebook Take Action page, they have displayed a convenient link which when clicked will take the Facebook user to the Take Action area of the Change.org website. There the user will be greeted with a full menu of petitions. The visitor merely needs to enter in some identification info and press submit. There are many other features that Change.org deftly employs on their Facebook fan page, almost all of which will further their activist campaigns, but I’m rapidly approaching my self-imposed 1500 word limitation for blog posts. I’ve more to say in other areas, so we will need to move on. Let’s move to Change.org’s Twitter use.

Their Twitter main profile page shows, on January 29, 2010, a Twitter following of almost 10,500. This number is nothing to be “sneezed at.” There is a lot of controversy on the level of Twitter followers. The arguments revolve around quality or quantity of followers. Of course, just accumulating followers for the sake of inflating your Twitter following number may not increase the power of your message. But a high Twitter number certainly doesn’t decrease the power either. Although this Twitter following is not considered extremely high, it is a decent level and indicates that the following of Change.org on Twitter can help increase the efficacy of Change.org’s message. This number of 10,500 may also help contribute to their petition effort. As new petitions are launched on the main Change.org site, tweets may be launched, automatically, driving traffic to the site for petition participation, signature, and completion.

As I alluded to above, there is so much that can be said about Change.org’s social media program. I’ve barely scratched the surface. I could probably write a book about how this particular irregular competitor exerts force against various business efforts. Perhaps I will. But right now, because I’m approaching my own words per post limitation, I’m going to wrap up this case study and move on to the Discussion and Conclusion section.

Discussion and Conclusion

Overall, this is one very high-powered irregular competitor. They are a very adept activist organization and they make use of their digital tools, as we saw above, in an effective manner.

If indeed Change.org is a for-profit corporation, which they certainly seem to be as shown by the evidence in Part 1 of this case study, it certainly makes one wonder why they use the dot org upper level domain name in both their corporate name and in their URL. There is no prohibition in for-profit companies using the dot org upper domain level name. It’s just that it’s not customary for this to be done. The dot org designation is usually reserved for the non-profit organization. Of course, I have my own theory as to why they use the dot org upper level domain name. A theory about which I will leave you to ponder. You may have your own theory as well.

Their presumed status as a for-profit company, as explored in Part 1 of this case study, if true, is quite unusual for an activist group. This would make Change.org a new breed of activist. They are a new breed of activist not only for their ability to combine editorial content with activist initiatives, but they would also be classified as a new breed of activist because of their apparent for-profit status. And this presumed status combined with Change.org’s excellent use of digital technology, as we have seen here in Part 2, makes them a formidable irregular competitor.

In Part 1, I said I would discuss why their for-profit status would be important. Here it is.

The fact that they are a Delaware corporation (remember from Part 1 that they switched to become a Delaware corporation in 2006), and if they are indeed a for-profit company, affords them certain state income tax advantages not available to corporations domiciled in other states. This tax advantage gives Delaware corporations comparatively more net income with which to work. Perhaps that’s why they made the corporate registration switch from California to Delaware in 2006? And in the case of Change.org, such a status would simply give them relatively more resources with which to communicate activist, and sometimes anti-corporate, messages; perhaps some of which are aimed at your employer. Ironic, isn’t it?

You may be thinking that since non-profit 501 (c) 3 organizations don’t pay any taxes at all, wouldn’t a better organizational strategy be to simply form under that tax-exempt, non-profit status, and have even more resources with which to operate? Not necessarily. I have two theories for which they may be organizing their corporation in this for-profit manner.

The first theory is that for-profit companies can do more in terms of backing political candidates, as we have seen, at least in part, from the recent U.S. Supreme Court decision in Citizens United vs. FEC. Non-profit corporations, i.e., 501 (c) 3 – tax-exempt organizations, because they do not pay taxes and in effect operate partially on implicit tax payer dollars, have many, many, restrictions on the backing of political candidates. Thus, for-profit activist groups can have a far greater impact on the political process, and by extension a greater effect on corporations, than can their non-profit activist group cousins, with all the anti-corporate effects that implies.

The second theory is that for-profit companies can raise funds in the private money market. Venture capitalists are often looking for new tech companies to invest in. And a tech-based company such as Change.org would represent a new vanguard of company, one with a differential advantage. This might increase their overall ability to attract funding, and make them not have to rely on the capriciousness of donations as would a non-profit corporation. Thereby, the possibility exists that this type of activist organization could be better financed than the non-profit variety.

Of course, these are all theories. If Change.org is not a for-profit corporation, I would certainly like to see them correct their “Entity Type” status on their Delaware corporate filing, as shown in the Part 1 post, so as to avoid further confusion.

What all this comes down to is, based on the evidence shown in both Parts 1 and 2, Change.org is a very formidable irregular competitor.

So, on the “Irregular Competition Threat Index,” a scale of 1 to 10 (10 being the highest threat level), I rate Change.org as a “9.” If this organization has your corporation in its activist sights, well then, you may need some help.

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Change.org Is a Formidable Irregular Competitor

Change.org. That’s the focus of this case study in irregular competition. Before we begin, do you need a definition of “irregular competition?” If so, please click here.

Introduction

Ready?

Who is Change.org and what do they do? Well, to help define them, let’s start with a passage from their own About page (accessed January 28, 2010):

Today as citizens of the world, we face a daunting array of social and environmental problems ranging from health care and education to global warming and economic inequality. For each of these issues, whether local or global in scope, there are millions of people who care passionately about working for change but lack the information and opportunities necessary to translate their interest into effective action.

Change.org aims to address this need by serving as the central platform informing and empowering movements for social change around the most important issues of our time.

Change.org is a site, and an organization, that combines activist editorial with one-stop petition shopping. As a “platform” for social change, their editorial content, both from guest writers and from Change.org staff and rendered in blog format, attracts readers from across the Internet who, once at the site, may participate in the signing of petitions organized for grievance purposes against various targets. The petition initiatives are plainly and prominently featured among the editorial content. Even for the casual reader, not noticing these petition initiatives is almost impossible.

Some of the targets of the petitions are traditional petition recipients, i.e., government entities and legislators. Some of those targets are entities less accustomed to receiving petitions from the general public, i.e., trade coalitions between academe and corporations. And some of those targets are entities even less accustomed to receiving petitions from the public, no less acting on them, i.e., corporations.

The petitions may be started by groups or by individuals. Change.org gives either groups or individuals the platform and the audience to start or augment a social movement.

Since this blog, Telofski.com, is about irregular competition and how it affects business, from here on in this post I will be discussing Change.org from the viewpoint of being an irregular competitor. And as you know from the definition of irregular competition, irregular competitors are activist organizations and NGOs within the context of their impact on corporations.

At first glance, Change.org would appear to be an activist organization itself, targeting or enabling the targeting of various corporations, and would seem to fit the definition of irregular competition, one aspect of which is that irregular competitors are generally thought to be non-profit. But, after doing some research on Change.org, my findings say that they don’t seem to fit this definition completely. And where they don’t seem to meet completely the definition of irregular competition is in that non-profit aspect. They don’t appear to be a non-profit organization. The reason I say this is due to the findings of my corporate status search for Change.org which I will share with you now.

Findings

Corporate Status

In this corporate status search, I had two objectives. First, to identify the corporate name behind Change.org, and second to determine if that corporation was a non-profit organization.

Identifying the corporate entity behind Change.org wasn’t particularly difficult, but it did require some digging, as well as the knowledge of where to dig. The first place I looked for corporate entity information was at the bottom of the Change.org home page. The copyright notice is always a good place to start to look for this type of information and theirs says “© 2010, Change.org. All Rights Reserved.” Hmmm. I thought that it’s odd for an organization that describes itself as a “social entrepreneurship venture” not to have the more liberal and permissive Creative Commons copyright notice. This was an indication that they might be a for-profit corporation. A nice clue, but what I was looking for was a corporate name, and the copyright notice didn’t give me a corporate name, only the website address. Unless, I thought, the domain name is also the corporate name. I moved on. (Note: This characterization of “social entrepreneurship venture” is also per their About page, same access date as above. Yes, I know that access date is several weeks prior to this post’s date. That’s because I tend to write ahead and employ the “magic” of Word Press’ post pre-scheduling function.)

Thinking that the domain name and the corporate name were the same, I then made a leap of research faith. Presuming Change.org to be a non-profit corporation, I tried searching for Change.org on Guidestar.org which is a database site containing information about non-profit corporations. On the same access date as listed above, Change.org was not listed at Guidestar.org, indicating that they are probably not a non-profit organization. However, there is always the possibility that Change.org was overlooked in the Guidestar.org database input process (even though Change.org lists Guidestar.org as an information “partner.”), or that the Change.org organization is registered on Guidestar.org under another company name. I wanted more and better information. I continued my search.

Still in search of that corporate name, to identify it, I tried the old standby, searching the “Whois” Registry at my favorite Internet domain registration website, but that search didn’t provide much useful information. I then went back to the Change.org About page. There was a clue there that I had missed before.

The About page said that this social entrepreneurship venture was based in San Francisco, CA. Okay. Now, we’re cooking, thought I. So from there I went to the California Secretary of State’s website to check for Change.org’s corporate filing information. You can see that California corporate filing information, too. Just click here to go to the California Secretary of State’s Business Entity search page. Check the “corporation” radio button, then type in “Change.org” in the search box, then click the Search button. After you do that you will see a listing for Change.org, Inc. Click on the company’s name and then you will see the following result:

Entity Name: CHANGE.ORG, INC.
Entity Number: C2929488
Date Filed: 09/29/2006
Status: FORFEITED
Jurisdiction: DELAWARE
Entity Address: 709 DOUGLAS ST
Entity City, State, Zip: SAN FRANCISCO CA 94114
Agent for Service of Process: C T CORPORATION SYSTEM
Agent Address: 818 WEST SEVENTH ST
Agent City, State, Zip: LOS ANGELES CA 90017

Alright, so now I had the corporate name. But, now this search was starting to get very interesting. Yes, Change.org’s statement on their About page saying that they were based in San Francisco was confirmed by this state record, although that record was going on four years old at the time I accessed it. But, I wasn’t really intrigued by their location. No, an online company being based in San Francisco wasn’t a surprise. But, that word “Forfeited” was a surprise. That word intrigued me. So, that I would have a proper definition of “Forfeited,” I clicked on the “Field Descriptions and Status Definitions” link provided on the search results page. I looked through the list of definitions and found this:

Suspended or Forfeited: The business entity’s powers, rights and privileges were suspended or forfeited in California 1) by the Franchise Tax Board for failure to file a return and/or failure to pay taxes, penalties, or interest; and/or 2) by the Secretary of State for failure to file the required Statement of Information and, if applicable, the required Statement by Common Interest Development Association. Information regarding the type of suspension can be obtained by ordering a status report. For information on ordering a status report, refer to Information Requests.

Researcher’s Note: This search of the California records was made on January 28, 2010.

Now, in this particular case study, it didn’t matter to me if the corporate status was forfeited for reason #1 or reason #2 as shown in the definition above. Or even if Change.org, Inc. is registered in California or if they even need to be registered in California. Although, it would be interesting to find out these things, I didn’t order a status report via the Information Requests link which would have detailed the situation further. If you’re interested in further information on these issues, you may always follow that link. No, I had enough of a clue here to reach my second research objective, to determine if this company is a for-profit organization or is of the non-profit variety. That clue was “Delaware.”

So, my next stop was at the website of the Department of State: Division of Corporations for the State of Delaware. Delaware, the home of more corporate “headquarters” than any other state. Click here to go to their site, if you like. At that site, in the search box you would type in “Change.org,” then hit the Search button. From there, click on the result “Change.org, Inc.” You will then go to a page entitled “Entity Details” and you will see the following:

Entity Details


THIS IS NOT A STATEMENT OF GOOD STANDING
File Number: 4215439 Incorporation Date / Formation Date: 09/08/2006
(mm/dd/yyyy)
Entity Name: CHANGE.ORG, INC.
Entity Kind: CORPORATION Entity Type: GENERAL
Residency: DOMESTIC State: DE
REGISTERED AGENT INFORMATION
Name: THE CORPORATION TRUST COMPANY
Address: CORPORATION TRUST CENTER 1209 ORANGE STREET
City: WILMINGTON County: NEW CASTLE
State: DE Postal Code: 19801
Phone: (302)658-7581
Additional Information is available for a fee. You can retrieve Status for a fee of $10.00 or
more detailed information including current franchise tax assessment, current filing history
and more for a fee of $20.00.

Would you like

Status

Status,Tax & History Information

Yes, it looks like they transferred their corporate status from California to Delaware in September 2006. And I thought that significant, but not pertinent to my research objectives. In the Discussion section of this case study, I will talk about why I think that switch from California to Delaware is significant. That’s later. For right now, let’s stay on the second objective of determining if this company is non-profit or not.

Now, I believe that that sentence “This is not a statement of good standing” doesn’t necessarily mean that the record is a statement of bad standing. I believe this means that to get the official statement of “good standing” you need to pay the record retrieval fee. So, what you see in these preliminary search results would just be an unofficial record. But considering that I was seeking their profit status, I knew I didn’t need the official statement. What I needed was right before my eyes. And what answered my profit status question was “Entity Type: General.”

If you click on the Entity Type link you will see the definitions:

A – General – Type General refers to a legal entity with no special attributes such as non profit or religious.

and you will see;

R – Non-profit or Religious – This description type refers to a corporation that sets forth in it’s certificate of incorporation or subsequent documents that it is a non-profit corporation. The “Religious” literal does not infer that, in every case, the corporation is for Religious purposes only. The intent is to define the corporation as Non-Profit, charitable corporation which maybe formed for Religious purposes.

Researcher’s Note: This search of the Delaware records was made on January 28, 2010.

So, according to these Delaware Secretary of State definitions, if Change.org, Inc. was a non-profit corporation, in the Entity Type field it would read “Non-profit or Religious” and not “General.”

Therefore, from this research and the evidence found, it appears that Change.org, Inc. is a for-profit corporation. And I will take it that state corporate records are highly reliable.

Why is it important to know whether Change.org, Inc. is a for-profit venture? Well, there are several reasons. And you and I will discuss those reasons when we get to the Discussion section of this case study.

*          *          *

Right now, I’m going to pause this case study by breaking it into two parts. Generally, for readability reasons, I don’t like to write over 1500 words in any one post and in this post I’ve exceeded my own limit by quite a bit. So from here, we will move on to Part 2 of this case study.

Part 2 will be published on Tuesday, February 23, 2010. If you are reading this prior to that date, please click here to subscribe to the free RSS feed so you will be notified when Part 2 publishes. If you are reading this after that date, you may simply click here to be taken to Part 2.

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CorporateWatch.org Is Not Social?

Corporate Watch. Do you know who they are?

Well, Corporate Watch, located in London, UK, is a research organization with the objective:

to examine the oil industry, globalistion, genetic engineering, food, toxic chemicals, privatisation and many other areas, to build up a picture of almost every type of corporate crime and the nature and mechanisms of corporate power, both economic and political. We have worked with and provided information to empower peace campaigners, environmentalists, and trade unionists; large NGOs and small autonomous groups; journalists, MPs, and members of the public. (Per CorporateWatch.org About page, accessed January 27, 2010.)

Since Corporate Watch keeps an “eye” on corporations, the least I can do is return the favor. So, I keep an “eye” on them. I check their website periodically to catch up on the latest “corporate scandals,” much of which is a re-hashing of themes that have been floating around for quite a while. Since I’ve been visiting their site, I’ve noticed that CorporateWatch.org is not “social.” By “social” I don’t mean “socialist,” although much of their writing certainly contains that philosophy, and by “social” I don’t mean captivating at parties or adept at interaction at a bar. By “social” I mean employing social media in their communications strategy. Such a move would seem to be a logical step for Corporate Watch because, as activists, social media is almost tailor-made for the types of missions that they undertake. Social media is a perfect environment for an organization like Corporate Watch to extend their message. But, no. Apparently, they don’t understand that. They don’t do that “social thing.”

Elderly Caucasian man expressing surpriseOn a recent visit, where I was once again befuddled as to why Corporate Watch doesn’t have a social media campaign, it occurred to me that maybe I was missing indicators of their participation in the social web. Upon visits to their site, I’ve found myself looking for the “obligatory” indicators of a Twitter, Facebook, MySpace, or other social media account. You know. What I was looking for was those cute buttons hung on websites and attached to social media profiles at Twitter, Facebook, etc. CorporateWatch.org doesn’t have those. But that doesn’t necessarily mean that they don’t participate in social media. Maybe I wasn’t looking in the right place. So, I started a hard target search.

In their Nav Bar I noticed “Links” and “Contact & Links” anchor text. I clicked them, with great anticipation I might add. Both links took me to the same place, a portal page filled with links to other anti-corporatist websites. “Interesting. But not what I’m looking for right now,” thought I, “Perhaps they just don’t want to place those cute little social buttons on their site. Maybe they think those buttons are a little too ‘bourgeois.’ ” So, I moved on. I moved on to Twitter, Facebook, and MySpace to perform a discrete search, to see if I could find a Corporate Watch presence. Here’s what I found.

Twitter: Nothing. No Corporate Watch presence. Tried various spellings. Unless they’re hiding it very well (like under a different name), I didn’t find a Twitter account for Corporate Watch. I did get search results for a pile of other .org organizations, however. But nothing for Corporate Watch. Yet, while I was there, so it shouldn’t be a wasted trip, I updated my own status. Never pass up a good opportunity to tweet, I always say.

Facebook: Again, nothing. No Corporate Watch presence there either. Again, I tried various spellings. The Facebook search gave me some web results for Corporate Watch, but nothing of a social nature, just standard Web 1.0-type website references. I didn’t update my Facebook status while I was there, though. My Facebook friends are mostly real friends, friends I’ve had since junior high, or relatives. Not business associates. I didn’t think people I knew in seventh grade and my cousins, whom I’ve known since Day One, would really care about my CorporateWatch.org hard target search. So, I moved on again. Next stop, MySpace.

MySpace: Ah – hah. Got a hit there. They have a MySpace account at MySpace.com/corporate_watch. There was an Australian Corporate Watch profile there, as well. But I disregarded that, at least for now, because in this post I’m just concentrating on the British version of Corporate Watch.

Let’s talk about that MySpace presence.

On the Corporate Watch MySpace profile, the visitor is greeted with the following caption:

The Earth is not dying – it is being killed. And those who are killing it have names and addresses.

Ooooo . . . kay. Rather baleful. But let’s move past this abstruse warning and the rhetoric and take a look at what’s happening on this MySpace profile, or should I say what is not happening on at this profile.

Corporate Watch has only 127 friends on their MySpace account (as of January 27, 2010). I’m not entirely certain how long this profile has been up and trying to gather friends. There is no date indicating creation of this MySpace profile. But the last Corporate Watch administrator login date was shown as June 30, 2008. So, after at most a year and one-half, Corporate Watch has been able to muster only 127 friends. That’s not a very impressive following for being in the MySpace game for at least 18 months. Quantitatively, I can say that their MySpace effort is not successful. Now, let’s take a qualitative look at those friends.

From a random sampling of their friends list, most of those friends appear to be other activist groups, not individuals. This high proportion of groups as friends indicates that Corporate Watch is having trouble attracting individuals, which I would expect would be extremely important to the success of the anti-corporate campaigns that they undertake. The fact that most of their friends list is comprised of other activist groups indicates that Corporate Watch may be “preaching to the choir.” Consistent with their friends list being mostly groups, not surprisingly, many of the comments on their MySpace page are from activist groups, not individuals. This is a strong indication that the Corporate Watch message may have limited reach. To test my theory of limited reach, I took a trip over to Compete.com, a website ranking service. Limited reach, indeed. Compete.com shows that for 2009, CorporateWatch.org attracted between 500 to 3500 visitors per month. Again, not very impressive, is it? You can see those findings by clicking here.

And getting back to those Corporate Watch MySpace friends. They aren’t very active commenters. On the date I visited (January 27, 2010), the most recent comment was dated November 18, 2009; the comment immediately prior was dated May 25, 2009. The comment before that? October 1, 2008. See what I mean? Not a very active MySpace group. The group is limited in interaction, number, and frequency.

So, what does the foregoing mean?

Well, it means that:

1) Corporate Watch is apparently either ignorant of the benefits social media could bring to their campaigns, or is overlooking the benefits that a properly organized social media campaign could have, especially for an activist organization. They either don’t understand social media, are afraid to use it, or are oblivious to it. In any case, this is a “plus” for the corporations that Corporate Watch “watches.”

2) Due to their relatively limited reach, and seemingly narrowly segmented audience (at least based on the sample seen at their MySpace profile), this “irregular competitor” is not a significant threat against the reputations of the corporations they monitor and on which they report.

All of this is very surprising. For an organization that, by their own declaration on the banner of their website, has been doing “corporate critical research since 1996,” one would think that they would have evolved with web technology. That has been a web technology that since 1996 has given birth to new social movements and “legs” to social movements that existed prior to that date. But this activist group, this “irregular competitor,” has not kept current with the evolving trends in web communications. Indeed, their website, CorporateWatch.org, looks like something right out of 1996. Click. See for yourself. The site is of the Web 1.0 variety, static and non-interactive. They don’t even offer an RSS feed. In this current configuration, their lack of employment of Web 2.0 technologies and participation on the social web seriously mitigates the degree of efficacy that Corporate Watch can have as an “irregular competitor.”

On the “Irregular Competition Threat Index,” a scale of 1 to 10 (10 being the highest threat level), I rate CorporateWatch.org as a “3.”

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The Irregular Competition Threat Index

All irregular competitors are not created equal. Nor do they necessarily later all become equal and evolve into threats about which a company should be uniformly concerned. Some irregular competitors have more mojo than others; either because of smarter staff or better funding or both.

Hammer and nailWhen you’re a corporate communications or PR person trying to deal with an irregular competitor who is talking trash about your company, it’s good to know something about them. (That harks back to what Sun Tzu said.) An understanding of the irregular competitor’s strengths and weaknesses will definitely help you in determining: 1) whether you should be responding to them at all; and, 2) if it’s determined that you should respond, knowledge of their strengths and weaknesses can help you choose which strategies and tactics to apply against them and what the irregular competitor’s counter-actions may be in return.

To assist in this understanding, today I introduce The Irregular Competition Index. This is a scale rating system that I will use in some of the case study posts on this blog to rank the irregular competitors discussed. You will may select those irregular competitor case studies specifically under the category Irregular Competition or more generally under the category Research – Case Studies.

The ranking of irregular competitors in The Irregular Competition Index will be primarily along factors of their social media and web campaign strategies, but offline strategic factors may also contribute to their rating, and these will be called out in the case study posts.

So, I look forward to presenting some interesting case studies and I also look forward to your feedback.

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One Source Doesn’t An Anti-Corporate Environment Make

Wondering how your company can become more competitive in today’s “anti-corporate” business environment? (Or at least a business environment that’s portrayed as being “anti-corporate.”) Hey. Who isn’t? Apparently it’s “known” that today’s company operates in an “anti-corporate” environment. So let’s talk about it.

I recently finished reading “Engaging Fringe Stakeholders for Competitive Imagination” by Stuart Hart and Sanjay Sharma. In this 2004 article from the Academy of Management Executive, the authors offer up the theory of engaging with “fringe stakeholders” in order to reach two objectives. The first objective, which is related to anti-corporatism, is about avoiding what the authors call “smart mobs,” which they define as the wrath of individuals that can be created and mustered online for the purpose of spreading negative information about the company. The second objective the authors describe is related to efficient product development. The achievement of both of these goals depends upon getting pertinent information from the fringes of the stakeholder sphere which surrounds a company. The article details how companies may go about achieving these goals.

The achievement of the second objective, more efficient product development, is described with various case studies showing how certain corporations have extended their market research operations to the outer fringes of the societies in which those companies do business. From this “fringe information” collected have come new initiatives for products designed to solve problems that the companies had not known existed prior to their journey to the fringe. Thus, the term “competitive imagination” used in this article’s title. The insights gained through the fringe market research give those companies who conduct it a competitive leg up on their competition. Very sound reasoning. No objections here at all.

There is a double-edged sword in this approach, one that cuts toward both objectives. The authors maintain that by performing this type of informational outreach, not only may a company discover new consumer insights for application within product development, but the company may also simultaneously engage with fringe stakeholders, or what they describe as “non-salient” stakeholders, who had previously been ignored by the company. As I pointed out earlier, this is the first objective that the authors raised. Hart and Sharma say that through this engagement and interaction with, and from the subsequent input from, these fringe stakeholders, the company may preclude a public relations backlash initiated by these fringe actors, who may manifest as the “smart mob,” against future company actions. Again, I have no objections here. Proactive communication can serve as a preemptory tactic, reaping future benefits. But what I do object to is the premise upon which Hart and Sharma base most of their thesis. That premise is found in one pair of statements near the beginning of this article.

On the second page of this article we see the passage,

The power of governments has eroded in the wake of globalization and the growth of transnational corporations with global supply chains that span several continents. Non-governmental organizations (NGOs) and civil society groups have stepped into the breach, assuming the role of monitor and, in some cases, enforcer of social and environmental standards.

The source for these two “statements” is David Korten’s When Corporations Rule the World. These two statements set up the standard, and progressively tiresome, anti-corporate meme, which is used as a foundation for the balance of the article. The article’s foundation of anti-corporatism is vital to the value of the engagement strategies the authors recommend because if there was no anti-corporate sentiment out there, well then, this whole idea of engaging with the fringe would have only one objective, the enhancement of product development. No double-edged sword would be needed. The goal of avoiding the smart mob would not then apply. But since Hart and Sharma say that the power of governments has been usurped by corporations and that NGOs and activists are now our last hope, then the value of the authors’ engagement approach is increased. And, as a result, so is the value of their article. No anti-corporate sentiment? Well, then the article is just another take on market research.

scale 1I have no idea what the authors, Hart and Sharma, are doing now, but when they wrote this 2004 article they were described as follows. Hart is listed as being the S.C. Johnson Chair of Sustainable Global Enterprise at Cornell University’s Johnson School of Management. Hart is also listed as being a professor of strategic management at the University of North Carolina’s Kenan-Fagler Business School. Sharma is listed as being a professor of policy at Wilfrid Laurier University in Canada. So, quite frankly, I’m astounded that men with these academic credentials would use only one source upon which to describe a business environment, that tired old meme of the “evil corporation,” that supports their thesis. I’m also astounded that the journal editor would let this type of research go to print. And, adding even more to my astonishment, I’m gobsmacked that they would draw that one source from an author who is seen as left-leaning. (”Although Korten speaks from an obviously liberal position . . . “, see the Library Journal review on Amazon.com. Click.) What the heck happened to academic balance? And what happened to basing your thesis on more than one source?

I agree with the methodology that Hart and Sharma propose in that it can, indeed, be of great value in obtaining “competitive imagination” for use in new product development. And even engaging the “smart mob” preemptively may, under certain circumstances, have value. But as for the overall article, I just can’t get behind their “statement” concerning the supplantation of government by corporation. without some additional and balanced support.

And for that reason, for me, the whole article just falls apart.

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A Journey in Anti-Corporate Thought

For those interested in learning about the anti-corporate movement, I recommend a book that I recently completed. The Rise of the Anti-Corporate Movement by Evan Osborne is a first-rate work.

Student studying behind bluSubtitled Corporations and the People Who Hate Them, in this book Evan does good work in laying out the history of the corporation, taking us back about four millennia to the origin of what evolved into today’s modern corporation. He then moves us forward in time, tracing the development of the corporation from ancient Assyria, up through 18th century Britain, and then to its current form both worldwide and in the United States. At each stop in this journey through corporate time, Evan stops to impress upon the reader the details of corporate myth created at each stage, emphasizing how those myths trickled down into today’s collective social conscience, but debunking the myth before continuing the journey.

During the early parts of the journey, he deftly points out that previous forms of the corporation had, by virtue of their legal foundation in significantly less democratic societies, much more power than the corporate form takes in today’s America, decrying the claims by anti-corporate activists that modern corporations are omnipotent and all-powerful. He punctuates this illustrative journey of countering the claims of the anti-corporate movement (ACM) with profound insights, based on common sense and everyday observations. One such insight undermines general ACM claims of runaway corporate power by observing the corporate disdain for the corporate income tax and stating that if corporations were truly as all-powerful as the ACM makes them out to be, then indeed there would be no income tax.

About a third of the way through the book, Evan, an economist at Wright State University, takes on the economic assertion often put forth by the ACM, that society is actually poorer because of the existence of the corporation. Over many pages, he does an excellent job explaining how this claim is invalid. His counter-argument is clear, cogent, and convincing. I’ve read other books making this same argument (For example, The Role of Business in the Modern World, by David Henderson.), but they were not nearly as on-point or as substantially sourced as is The Rise.

This is definitely a book that should be read by all engaged in business issues involving activists and NGOs.

It’s also a book that could benefit members of the general public, to help dispel some of those corporate myths generated over the past few hundred years. I have no illusions that members of the general public will read this book any time soon. But, the loss is theirs because of the great insights they would miss. I’ll close with one of those insights.

Near the end of the book, when Evan invokes the late economist Milton Friedman who stated that the corporation owes no more “social responsibility” than any other member of society, Evan states that it is just as improper for the anti-corporate campaigner to use the law to force a corporation to pursue the campaigner’s objectives as it is for a corporation to use the law to force the anti-corporate campaigner to pursue the corporation’s objectives. We see many examples of the former and, I’d dare say, none of the latter.

Of course, all the issues found within this book could be debated incessantly in philosophy and business ethics classes. But that’s part of what makes this book so interesting, the intellectual challenges found within.

Thanks, Evan for a great book.

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