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Non-U.S. Corporate Image Repair

This section of the chapter offers illustrations of image repair discourse about Rupert Murdoch's News of the World and the phone hacking scandal and Apple's apology to China over criticisms of its warranty practices. Opt (2013) examines this controversy using the Rhetoric of Social Intervention Model.

Rupert Murdoch and News of the World

One of Rupert Murdoch's newspapers, News of the World, became embroiled in a scandal over phone hacking. In November 2005, News of the World published a story about Prince William that raised suspicion that the newspaper had illegally hacked into phone messages. An editor, Clive Goodman, and a private investigator were convicted of hacking into the voicemail of royals and sent to jail. Several settlements from News of the World to victims were paid (Hume & Wilkinson, 2012). Hume and Wilkinson (2012) summarized the main elements of the scandal: “Accusations that journalists at Rupert Murdoch's British newspapers hacked into the phones of politicians, celebrities and unwitting people caught up in the news—including child murder victims—have severely bruised his media empire.” This was a scandal with serious consequences:

The scandal forced the closure of Britain's top-selling paper, the News of the World, resulted in the withdrawal of his bid for the satellite broadcaster BSkyB, and led to criminal charges being laid against former senior News International figures, including his trusted UK chief executive Rebekah Brooks. It also led to a wide-ranging inquiry into press standards by Lord Leveson. (Hume & Wilkinson, 2012)

There is no doubt that Rupert Murdoch, News of the World, and the parent company, News Corp, faced a serious image threat in this case.

This analysis examines two newspaper ads run in mid-July 2011 by Murdoch (ironically, he paid to have them printed in other newspapers, including the Guardian, which had carried stories about this scandal). The first one was a letter titled “We are Sorry” and relied mainly on two strategies: mortification and corrective action. The letter, signed by Rupert Murdoch, started by elaborating on the headline:

The News of the World was in the business of holding others to account. It failed when it came to itself. We are sorry for the serious wrongdoing that occurred. We are deeply sorry for the hurt suffered by the individuals affected. We regret not acting faster to sort things out. (Reuters, 2011)

This is a clear illustration of mortification. It acknowledged wrongdoing, apologized for hurting people, and expressed regret. Second, Murdoch promised corrective action: “I realize that simply apologizing is not enough . . . In the coming days . . . we [will] take further concrete steps to resolve these issues.” He also briefly used compensation, declaring that they would “make amends for the damage they have caused, you will hear more from us.” These statements, promising to “resolve” problems and “make amends” for harm, are clear examples of corrective action.

This message was immediately followed up with another advertisement, titled “Putting Right What's Gone Wrong,” a clear reference to corrective action (Telegraph, 2011). This message begins with mortification: “We are appalled by the allegations that some individuals at the News of the World failed to uphold the values of decency and the rule of law.” The ad then mentions one instance of corrective action: “This led to the closure of the newspaper.” The Telegraph (2011) reported that the ad also acknowledged that the parent company's “obligation” includes “Full co-operation with the Police”; News Corp is “committed to change” and promises, “We will not tolerate wrongdoing and will act on any evidence that comes to light.” In addition to corrective action, the advertisement briefly mentions “compensation for those affected.” This image repair effort employed three strategies: mortification, corrective action, and compensation. These are plausible choices in this situation, but the corrective action was too vague. For example, Murdoch could have established oversight for his remaining media outlets, such as an ombudsman. Closing the News of the World was a ver y dramatic form of corrective action. Generally, these messages were good choices and may eventually help News Corp's and Murdoch's images. When you do something that is clearly wrong, it is appropriate to admit wrongdoing (if image repair is the primar y goal) and undertake corrective action. However, eventually doing the right thing is not as good for one's image as never having done something wrong.

Apple Apologizes to China

As Cheng (2013) notes, China is “an important market to Apple.” Complaints arose concerning Apple's warranty service in China, prompting a letter from Apple CEO Tim Cook. Cheng (2013) explained,

The letter comes about a week after Chinese state media began its open criticism of Apple and its response—or lack thereof—to warranty complaints. The People's Daily even ran a front-page piece calling Apple “arrogant” in dealing with Chinese consumers, saying Apple ignored customers and offered sub-par customer service.

This case study relies on a translation of the letter, which, appropriately for the intended audience, was written in Chinese (He, 2013).

Cook's image repair effort relied primarily on mortification and corrective action, with brief use of minimization and bolstering. Cook stated that We are aware that insufficient communications during this process has led to the perception that Apple is arrogant and disregard[s], or pays little attention to, consumer feedback. We express our sincere apologies for any concern or misunderstanding arising therefrom. (He, 2013)

His statement apologizes for the concerns that arose in China over Apple's warranty policies.

Next, he used corrective action, highlighting four actions designed to improve the quality of Apple's service:

In order to further improve our service levels, we are implementing the following four major adjustments:

• Improve the repair policy for iPhone4 and iPhone4S.

• Provide a concise and clear repair and warranty policy statement on Apple's official website.

• Strengthen super vision and training efforts on Apple's authorized service providers.

• Make sure that consumers can easily contact Apple for feedback on our service and other related issues.

Each of these four points was elaborated in the letter. Cook also stressed that his goal was to “give the best user experience and customer satisfaction, even more it is our promise. It has been deeply rooted in Apple's corporate culture. We will make unremitting efforts to achieve this goal” (He, 2013). These four points, and Apple's declaration of intent to improve its warranty service, constitute a clear use of corrective action.

While acknowledging the complaints that prompted his statement (and Apple's corrective action), Cook attempted to minimize the problem. He noted, “Nearly 90% [of] customers have expressed their satisfactions to [sic] our repair service” (He, 2013). Cook also attempted to bolster Apple's relationship with China: “We give our heartfelt thanks to everyone for valuable feedback. We always bear immense respect for China and the Chinese consumers are always our priority among priorities” (He, 2013). Stressing the company's respect for China helped bolster the company's reputation.

This image repair effort is well designed—both mortification and corrective action were needed—although the Chinese might remain skeptical until proof of Apple's resolve is established. This incident is also interesting because the Chinese state media conveyed the accusations against Apple.

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