PR Industry's Analysis of OCA's Starbucks Campaign

Cyber-attack against Starbucks shows what to do when a crisis brews

Public Relations Ragan Communications, Inc. May 2001 Issue 5

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You walk into your office, sit down with a cup of coffee and begin your regular morning search for online news clips. Instead, you come across a Web site that sends you into a cold sweat.

Your company is being terrorized by an online public relations assault. The site features a call to action, mobilization plans and a schedule of upcoming protests. Your trademark has been bastardized to promote the campaign. And everyone can see it.

It's a public relations nightmare, and you cringe at the thought of newspaper headlines and television images of protesters picketing outside your business.

That may have been how Starbucks' officials felt three months ago when they got wind of an impending online attack from the Organic Consumers Association, a group devoted to eliminating all genetically engineered food.

Campaign chief Ronnie Cummins says the association went after Starbucks because the company does not brew enough private-label coffee grown by individual farmers (known as Fair Trade coffee). And Starbucks has failed to condemn low wages and unjust labor practices on their suppliers' coffee plantations, he says.

But the association's biggest complaint is Starbucks' continued use of genetically engineered milk and other products.

"We want all [genetically engineered] foods off the market. We want free trade," Cummins told us. "We're not talking about choice here."

Starbucks has won praise from some public relations professionals for its handling of the protest, while others say the company gave up too much. IPR took a closer look at the campaign against the coffee giant to see how the company's response can help others manage an online threat.

Background: The Organic Consumers Association campaign against Starbucks began rather quietly 18 months ago on its site, www.purefood.org. The group transformed the Starbucks logo and dubbed its campaign "Frankenbuck$."

On Feb. 14 of this year, the association took the campaign to a new level, laying out its demands in a three-page letter to the company and threatening a nationwide grassroots and media campaign if Starbucks did not acquiesce.

The letter prompted the Starbucks' communications team to meet with the corporate responsibility department and high-level executives "to determine our position and put together the communications plan," PR manager Cheri Libby recalls. They also began monitoring the purefood.org site to keep tabs on the campaign.

Starbucks asked the association for a meeting, but Cummins said his group didn't want to "talk" until the company agreed to meet its demands.

Instead, Starbucks responded with a March 16 letter from CEO Orin C. Smith addressing the issue of genetically modified organisms and other demands. The company alerted its partners, such as Pepsi, about the company's strategy, and contacted trade groups, such as the National

Coffee Association.

The letter begins by promoting the company's product safety record but ends with a vague promise to change Starbucks' policy.

At first, Smith defended the use of recombinant bovine somatotropin, known as rBST, a supplement that helps cows produce more milk: "The

USDA, World Health Organization, American Medical Association,

National Institutes of Health and regulatory agencies in 30 countries take the position that milk from cows supplemented with rBST is no different than milk from untreated cows."

But he also acknowledged that some Starbucks' customers were concerned about the issue and said the company would offer an rBST-free milk option sometime this summer.

And surprisingly, Smith didn't stop there, adding that he hoped to make all of Starbucks' milk rBST-free, though he warned that supplies might prove inadequate.

Starbucks sent copies of the letter to each of its retail outlets so that store managers would be able to answer customers' questions. Anticipating protests at its annual shareholders' meeting, Starbucks issued the letter as a press release five days before the event and posted it on the company's Web site.

Starbucks needed to "share our position with the community," Libby says. "We wanted our side to be known."

About 100 protesters showed up on the day of the shareholders' meeting, but Libby says the event went on without disruption. Smith addressed the activists' issues during the meeting and gave shareholders copies of his letter. "Our shareholders applauded our efforts," says Megan Behrbaum, PR program manager.

A nice PR touch: Starbucks offered its shareholders freshly brewed Fair Trade coffee and a bag for them to take home.

Lessons learned

Step 1: Take a deep breath-then go to work.

The first hint of an online attack can be a frightening prospect for any public relations professional, whether it's an ex-employee bashing your company online, a site that infringes on your trademark or an activist campaign.

Your first thoughts: Who knows about the site? Will your shareholders find it? Will the media see the story?

"Communicators fear the media will pick up the story and panic," says Gene Grabowski, communications vice president for the Grocery

Manufacturers of America.

And in most cases, reporters will run with the story, Grabowski says, because it's sexy, controversial and sure to make great headlines. "These activists are ingenious at getting public attention," he says, whether it's warranted or not.

But eventually, he adds, "the story will die and customers are smart enough to see through the news."

Step 2: Judge the credibility of your attackers, advises Jay Byrne, former Internet outreach programs director at Monsanto, which has faced numerous online attacks.

Before you craft your response, determine the credibility of the site, who's behind it and what they want to accomplish.

Most sites that malign your company fall into two broad categories: a direct attack, like the campaign against Starbucks; or an indirect attack from an anonymous site owner. Watch out for the direct attacks, which typically generate significantly more traffic than the anonymous sites.

Note: Anonymous sites often can be shut down by contacting the site's hosting company. To avoid any possible liability, hosting companies will shut down a site if they can't identify the owner, Byrne says.

Starbucks' public relations staff only learned about the purefood.org site after receiving Cummins' letter. Once alerted, however, they used the site to monitor the group's activities and to prepare for the protests at the shareholders' meeting.

IPR learned that the purefood.org site draws an average of 2,000 visitors a day and is registered in the top search engines. Starbucks officials may take comfort in knowing that their company's Web site shows up in search-engine results long before purefood.org.

Step 3: Ask yourself: Do your customers care?

"Companies have an obligation to meet and serve the needs of their customers; they do not have an obligation to be responsive to special-interest groups with agendas," says Grabowski.

"If consumers decide they are concerned about biotech, food companies will respond faster than anyone," he adds.

The Kellogg Company seems to get it. In the last two years, the giant food maker has researched activists' efforts nearly as much as it studies its own customers.

The company's customer-service department gets letters every month about genetic engineering issues but staff have become expert at sorting the activists from actual customers. "We know who's sending the letters and what their agendas are. Those agendas don't jive with what our customers want," says Christine Irvine, director of corporate communications.

When reporters call about the issues, she refers them to Grabowski's staff, who offer facts about biotech and try to clear up misconceptions.

The company's efforts have paid off: "In general, we have seen no unusual product-buying behavior or trends in consumer behavior that correlates with activist activity," she says.

What's more, the activist groups have moved on to other companies, Irvine says.

"Once a fisherman feels a nibble, he goes for more," says Byrne of Monsanto. "If he feels no nibble, he goes to another pond."

After the letter from the Organic Consumers Association, Starbucks' staff noticed a spike in "customer comments" around the Fair Trade and genetic engineering issues. But they realized that many of those comments were coming from the activists.

"The initial communications we received were form letters that seem to mirror content on the [purefood.org] Web site," says Behrbaum. "After Orin [Smith] responded to the concerns of the activist groups via his letter and we issued the press release, we received a large number of positive e-mails and calls," she adds.

Step 4: Draft your response.

Starbucks' Smith publicly announced that the company is looking into available supplies with the goal of offering only rBST-free milk at all its stores.

Some call Smith's response a stall tactic, others say it is a leap into unknown territory. But one thing's clear: The move has angered both sides of the biotech debate.

Cummins says Starbucks' response is vague-and that will only lead to more protests and yet another attack. He's demanding the company stop defending the safety of rBST.

Cummins says the Frankenbuck$ campaign has given his group credibility and attracted 3 million visitors to the purefood.org site in March alone. At last count, he says the campaign has generated 750 articles, TV news clips and radio reports, from National Public Radio to the

Associated Press and The Boston Globe.

And while some of that coverage has criticized the activists' efforts, Cummins sees all coverage as good coverage. "On March 28, we were attacked in both The Wall Street Journal and The Washington Times, a sure sign that we are starting to make an impact," he says.

Starbucks' response has raised some hackles from scientists, farmers and others in the biotech industry. Here's a sampling:

"Why let Ronnie Cummins and his gang trample on your business? Why not turn to valid scientists and food technologists, to university experts and scientific panels instead of the ballyhoo and whine and shouts of the protest industry?"

"Don't you know that the issue of bovine somatatropin (rBST) use in milk production was settled about a decade ago? When offered a choice in the supermarkets, consumers overwhelmingly chose healthful, refreshing conventional milk. Few cared, or would pay even a few cents more, when the product in the jug was exactly the same. Only the process is different!"

"The activists' attack on Starbucks is an example of organized crime," says a food industry insider. "It's called a shakedown. They attack a business, threaten to shut it down in exchange for a payment-attention. And that raises funds. This is illegal."

Starbucks defense: As for Starbucks, Libby says that actual customers, not activists, were behind the company's decision. Starbucks consumers want nongenetically-engineered milk products, she says, in much the same way they asked for skim and soy milk as alternatives to whole milk.

Providing alternatives is just good business, so why is Starbucks looking to make all its milk offerings, including alternatives, rBST-free? Libby points out that no customers have asked for rBST milk and that it's much simpler to settle on one milk supply.

She also cites a recent Pew Charitable Trusts study on consumers' reaction to genetically modified ingredients in their food. Pew found that 75 percent of the respondents wanted to know about the presence of those ingredients, and 58 percent didn't want them in their food.

But Grabowski says many of these studies are skewed. Consumers care less about genetically engineered ingredients once they understand the science behind them, he says.

Libby concedes that rBST is used only to boost production and adds no ingredients to milk. Isn't it the same milk? we asked her. "Not based on consumer awareness," she says.

So the company's decision is based on what its customers perceive to be the facts, not the facts themselves.

"Starbucks appears to be creating a solution in search of an issue," Grabowski says.

Note: IPR will file more reports on this story as it unfolds. Please send any comments or feedback to IPR Editor Nina Shariff at ninas@ragan.com.

Before you respond to an online attack, answer these seven questions:

Who runs the site?

Is the owner and content credible?

How many people are visiting the site? Hint: Many activist sites feature a counter that lets you check the traffic.

Who are those visitors? Does increased traffic on the attack site have any effect on the buying patterns of your customers?

What is the site asking of your company, and are those demands legitimate?

Does the site infringe on your trademark or make false and misleading comments about your company?

Is the site registered on major search engines?

Understand activist behavior

Companies that face such attacks should take advice from others who've been there, such as scientists and others in the biotech community.

Monsanto's Jay Byrne says company officials made themselves available for counsel, but Starbucks didn't take them up on it. Starbucks says Monsanto offered help only after CEO Smith responded to the campaign.

For a great place to learn about the biotech industry and the debate over genetic engineering, join the listserv at Dr. Channapatna S. Prakash's AgBioWorld.org site. The discussion forum's subscriber base is made up of 3,000 scientists (including three Nobel Prize winners), activists, companies and more.

Companies should talk to industry groups, trade associations and other third party groups that will help them understand the attacks and the best way to respond-or not respond, Grabowski suggests.

Did Starbucks cave in?

Starbucks surrendered to "thugs" and now suffers from "battered socially responsible syndrome," says Steven Milloy, publisher of junkscience.com, a Web site devoted to fighting bad science. Starbucks brags about its record of "environmental leadership," but now the company has become a punching bag for the groups it is trying to appease.

"It was a stupid move with no scientific reason," he says of Starbucks ' goal to offer only rBST-free milk.

"These groups who attacked Starbucks are some of the same anti-technology extremists who supported the multimillion dollar vandalism in the gourmet coffee retailer's hometown and several of its storefronts during the 1999 Seattle [World Trade Organization] riots. Some of them are Starbucks' competitors. They don't care about science; they only care about money."

But Gene Grabowski, communications vice president for the Grocery Manufacturers of America, takes the opposite view. "Starbucks is doing well," he says. "If you read what they're saying, they're going to do their best to find ingredients that are not biotech-produced."

"And those ingredients are hard to find," he says.

Grabowski agrees that it's best to "stand up to the bullies," but notes that Starbucks is new to activist warfare. "They're doing the best they can. They don't have the experience and education like Kellogg's or the others."

He sees a bright future for the company and the biotech industry. "In the end, the truth (about biotech's safety) will prevail."

But Milloy says Starbucks' cave-in only makes the company vulnerable.

"Starbucks should wake up and smell its own coffee before it gets an offer it can't refuse," he says.