Penny Wise, Pound Foolish

“You did WHAT?!”

Some companies really don’t get that we live in a connected digital age where a single customer’s voice can do substantive long-term damage to your brand. Last week’s social media fireball around Kaitlynn Fisher’s court case made it painfully apparent that Progressive Insurance is anything but. In trying to save the company a (relatively) paltry $75,000, they ended up blowing MILLIONS in brand reputation.

What the Flo were they thinking?

While the story has been covered extensively in news media outlets (and all you need do is scan user posts on Progressive’s Twitter and Facebook pages to get a sense of just how angry people are about the company’s behavior — both in court and on social media channels), the company’s oh-so-public PR disaster doesn’t seem to be affecting Progressive’s stance on the issue. To wit: when sharing the settlement news, Progressive stuck to the kind of “old school” tactics that served the company so poorly in the first place. Hardly Progressive. (Perhaps they should rename the company Old School Insurance?)

To be fair, the post on Progressive’s site about the settlement uses softer language and a more human tone, but Progressive still defends its actions — both in court and afterwards. From my read, the post was more justification than apology. Yet another missed opportunity, Progressive. If you don’t believe me, just scan the comments.

Never one to criticize without offering an alternate solution, here’s what I think Progressive’s CEO Glenn Renwick should have posted over the weekend:

“We made a mistake. A terrible one. Our actions may have been legally justifiable, but they were not morally justifiable. So, while we have now settled the matter on financial terms, we also wanted to publicly apologize to the entire Fisher family. We cannot undo this tragedy, but we can promise never again to go to court on the other side of the aisle from our customers when we should be siding with them. We will do everything within our power to restore your faith in Progressive and sincerely hope you will give us the chance to do so.”

As Progressive found out the hard way, the game has changed; once-private issues are now out in the open. One-way broadcasts from companies to consumers have been replaced by multi-threaded conversations and commentary from around the globe. Companies like Progressive must recognize that and adapt quickly, or risk ruining the brand they’ve spent millions and millions to build.

It will be interesting to see whether Progressive customers actually jump ship in the coming weeks and months now that the case has been settled, but my bet is many will move to competitors (at least at renewal time). Already, more than 1,000 people on Twitter claim they’ve already dropped Progressive. Penny-wise and pound-foolish, Progressive. Time to get a clue — if it isn’t too late already.