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Published 02 May 2013 10:16, Updated 03 May 2013 09:11
Myer has a social media crisis on its hands after chief executive Bernie Brookes’ negative comments about the National Disability Insurance Scheme. Photo: Luis Enrique Ascui
It is not going to be a good day for Myer chief executive Bernie Brookes and his team.
On Wednesday Brookes told a Macquarie Securities conference that the proposed levy to fund the National Disability Insurance Scheme would hurt retail sales.
“Today’s announcement about another 0.5 per cent on the Medicare levy is not good for our customers and not good for the discretionary income world, and ideally that’s another one that may have an impact,” he is reported as saying.
“Remember, a lot of our customers have equity portfolios, they’ve got superannuation and they get the bills each week, and suddenly the Medicare levy costs them another $300 from July next year and that’s $300 they might have spent with us.”
As a result, Myer now has a social media crisis on its hands. On Wednesday night there were hundreds of messages on Twitter and Facebook pillorying Brookes for the “selfish”, “callous” and “bigoted” comments, particularly in light of his multi-million-dollar pay cheque.
The word Myer was trending nationally on both Wednesday night and Thursday morning and hundreds, if not thousands, of tweets promised to boycott Myer. It was a similar story over on Myer’s Facebook page.
Commentator Mike Carlton (@mikecarlton01) wrote: “Memo to self: do not spend another buck in a Myer store until this dickhead delivers grovelling apology.”
Disability advocate Stella Young (@stellajyoung) wrote: “Oh @Myer_MyStore, I SO loved your Christmas windows. Shame about the bigotry, ey?”
Ros Hart (@roshart wrote): “#Myer wants your $1 per day rather it going to the #NDIS. Guess who’s not shopping there anymore!”
One commenter snidely noted that if the boycott resulted in empty Myer stores, it would be “basically business as usual”.
Similarly, over on Facebook, customers were expressing their views in longer comments.
One Facebook commenter, Jackie Softly, wrote: “Myer is Australia’s largest department store group and has been synonymous with style and fashion for over 100 years. Sadly, the thoughtless comments by your CEO today regarding the National Disability Insurance Scheme’s supposed negative impact on Myer profits mean that Myer is instead now synonymous with insensitivity, ignorance, elitism and greed. Shame on you, Bernie Brookes. Shame on you Myer.”
Many people were angry that Brookes did not take into account that many of his customers were disabled when he said the levy would be bad for his customers.
A mother of two children with special needs, Chantelle Jary, told Myer via Facebook that she had shopped at Myer for most of her life and wouldn’t ever return. She added that the store should be more concerned about the poor levels of customer service in its stores than the NDIS levy.
While the impact of a consumer boycott is not clear from one night of outrage in social media land, the level of negative sentiment far exceeds other recent controversies such as the Woolworths doughnut billboard. There were hundreds, if not thousands, of messages sent on Wednesday night and it is continuing on Thursday morning.
My own reading of it is that Brookes’ comments genuinely touched a raw nerve for mainstream Australians. While it is true that a raise in taxes can dent consumer confidence and an already-struggling retail sector, the way his comments came across was that he wanted the money to go to Myer instead of the NDIS.
This is not something that Myer can afford from a public relations point of view as it tries to win back hearts and minds amid an onslaught of online competition.
Hopefully Myer has people on its board and in the C-suite who understand social media and have the policies and plans in place to deal with a crisis. Certainly organisations like Regnan Governance Research and the Australian Council of Superannuation Investors have been urging listed companies to improve management of environmental, social and governance risk for some time.
Myer will have to act quickly to minimise the damage, and I imagine that any apology would have to be backed by a meaningful gesture in order to be effective.
Myer (@myer_mystore) monitors its Twitter account 9am to 5pm, according to its profile bio, but it had not responded on Twitter by 9.30am on Thursday.
On Thursday morning, around 7am, it posted the following message to its Facebook page:
“Thank you all for your Facebook posts and messages. To clarify comments made yesterday, like everyone we are absolutely supportive of any well constructed support for those with disabilities and that view seems reflected across the community. As a business however, we remain sensitive to imposts on the consumer by the government generally, for whatever purpose, as this adds to negative consumer sentiment and that adversely impacts sales, profit and jobs.
“Ideally we would like any government initiative to be funded within the revenue stream it has, rather than through a new or additional tax take.
“Thank you for the opportunity to give some substance to comments perhaps taken out of context.”
As the story develops on Thursday, it will become apparent whether or not that is enough. I don’t think it will be – I think the scale of the outrage will require an apology from Brookes himself, rather than a clarification of remarks "taken out of context”. It would help if the apology is accompanied by a meaningful gesture, such as a partnership with a disability charity, and if Myer is already doing good work for people with disabilities, they need to communicate that.
Of course, the risk is that an apology could inflame the situation and give further publicity to the original remarks – but I think we’re past that point already. Watch this space.
The Coalition would do well to pay attention too – there seems to be a groundswell of support for the NDIS and preparedness to pay for it through a levy.