February 5, 2013
Kotkin Enterprises is still in business, but a crisis last December nearly cost owner David Kotkin everything. The launch of a much-anticipated new product was crushed, his and his company’s reputation was severely damaged, and Kotkin Enterprises’ very survival was threatened.
The public relations crisis was not only handled poorly – it was actually caused by his PR firm.
If you’re a CEO or business owner, you’ve probably already thought about how you’d handle a public relations crisis. Maybe you already have a crisis PR plan, maybe you’ve discussed developing one with your leadership team or maybe it’s just something that keeps you up at night when you see other companies being ripped apart on the nightly news.
If you don’t have a crisis public relations plan, the time to get one is now – before the crisis arises. The first step is to choose who is going to speak for your company during a crisis. Whether you hire an outside firm or decide to go with someone on your staff, your spokesperson should be someone with experience and expertise handling crisis PR, and who understands your company, its reputation and how important that reputation is to your success.
Most importantly, it should be someone you’d trust with your company’s survival. Because that’s what you’ll be doing. Choosing the wrong person can cost you millions, or – as is the case with more than half the companies that face a crisis every year – it can drive you out of business.
Kotkin Enterprises’ nightmare started Dec. 16, 2011 when a customer, “Dave,” emailed the company asking about the expected delivery date for the Avenger Controller, a new PS3 game controller. The Avenger’s launch was creating a great deal of buzz in the gaming community.
Kotkin, who built the Avenger for a company called N-Control, had hired Paul Christoforo of Ocean Marketing to handle communications surrounding the launch, apparently including customer service communications.
Christoforo’s first email was short: “Dec 17.” Two days later, Dave sent another email asking if his shipment was on the way. Christoforo first told him the controllers were still in China, and then that they were being held at customs.
Dave’s emails continued to be polite and Christoforo’s continued to be short and vague until after Christmas, when Dave asked whether a $10-off offer for new orders that appeared on the company’s website would be extended to customers who had ordered early and still not received their controllers.
That’s when Christoforo’s tone went from indifferent to belligerent. He started belittling the customer and eventually stooped to profanity and name-calling. Customer Dave, in the meantime, had begun sharing the email chain with members of the press, including Mike Krahulik, owner and publisher of the popular gaming website Penny Arcade, and organizer of the Penny Arcade Expo (PAX), a tradeshow where the Avenger Controller was apparently going to be featured.
Krahulik interceded on Dave’s behalf and quickly became a target of Christoforo’s ire, who responded by calling Krahulik a “douchbag” and referring to Dave and other customers as “Little kids unhappy with a PRE ORDER,” adding, “unless you’re his boyfriend then you should side with the company.”
When Christoforo apparently realized the potential fallout of his actions, he tried to backtrack – but Krahulik was having none of it. Their email exchange ended with Christoforo threatening to put a team of 125 people “on a smear campaign of you and your site.”
When Penny Arcade published the entire email exchange, Christoforo became an instant Twitter sensation. Media outlets publicly disowned him. Actor Wil Wheaton, a veteran of Star Trek: The Next Generation and The Big Bang Theory and hugely popular in the geek-loving gamer community, slammed Christoforo. Even Geico Insurance took a shot at him.
The formerly much-anticipated Avenger Controller, which David Kotkin had originally designed to make it easier for handicapped players to enjoy the gaming experience, received hundreds of one-star reviews on Amazon, and the controllers page on the GameStop website disappeared. Other reports of poor customer service and delayed product shipments from N-Control began appearing.
Kotkin reacted quickly to distance himself from Christoforo and Ocean Marketing. But without a contingency plan in place, confusion reigned in the following hours and days. For a while, an under-aged former intern became the defacto spokesperson for the company on Twitter.
Christoforo later refused to turn over control of the company’s social media and email accounts, forcing staffers to resort to G-mail accounts and a blitz campaign to let the public and press know how to contact the official spokesperson.
Now Christoforo has filed suit against the company, casting himself as the victim.
Should Kotkin Enterprises have known Ocean Marketing was the wrong firm to trust with its reputation? Probably. Christoforo’s unique use of the English language should have been a red flag early on that he was not a trained communications professional. It’s also hard to imagine that the vitriolic personality that showed through in his email exchanges would escape the attention of anyone he interacted with regularly.
More importantly, his track record handling major accounts should have given any potential client pause.
Kotkin has rebounded and the Avenger Controller is apparently a good product, which helped. But it’s hard to imagine the real cost of this disaster to Kotkin Enterprises’ reputation and bottom line.
Could the same thing happen to you? Probably not in the same way. But in companies everywhere, there are eager young employees who may be tempted to cut corners on safety and highly-paid executives who may be tempted to fudge on a report. Since you can’t be everywhere, it’s best to plan ahead for when things go wrong and pick the right people to handle your public relations when the crisis arises.
Check out potential PR firms’ track records and ensure they understand your company and will protect your brand and reputation. Start putting together a crisis public relations plan today, or let experts you can trust guide you through the process. Your company’s survival may depend on it.
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