Stratfor’s Brand Image Sinks by Lack of Crisis Communications
Whoever maliciously hacked into the servers of Stratfor.com on Christmas Eve must have known something about news cycles during the holiday season. Mainstream media, with skeletal and junior staff during the holidays, would jump on such a bold act of cyber sabotage. And, that’s happened … big time.
The company says it “cannot discuss any details because several law enforcement agencies are investigating the incident,” which is simply not a genuine statement. Meantime, many mainstream news media are running the story. It’s being called, “The hack of the year.”
The media coverage snowball rolls on while Stratfor is silent.
Copyright 2010 Mark Alan Stamaty. Republished with permission of the artist.
The hackers reportedly struck Stratfor’s three servers located at a small web hosting firm in Austin, Texas, Stratfor’s homebase. According to what has been pieced together, they were seeking access to the company’s confidential emails.
Not only did they find about 3.3 million emails, they also captured the credit card information – including pin numbers – of thousands of Stratfor subscribers, including Homeland Security, police departments, foreign governments, government officials, private individuals, and … well, you get the idea. The credit card information had been stored on the servers in unsecured, open and unencrypted in plain text files, possibly in violation of law by Stratfor.
Click here for a detailed analysis of personal information stolen.
What the hackers did then was to completely erase the company’s servers, possibly including any backup of the website. At this writing, Stratfor is dead in the online water – no website, no email, faltering subscriber trust and shattered reputation among many high profile subscribers.
What’s now hurting the most for Stratfor – an expensive, premium online news and analysis aggregating service – is not necessarily the hacking but rather their own lack of crisis management and prompt, transparent communications. The fact that as we head into “Day 4″ since the attack they cannot get their website back online exacerbates the situation.
The company’s last communication with subscribers was on Christmas day (see below). Since then, nothing except for a couple of rambling posts with poor grammar on Facebook. In none of the spattering of statements has there been any accountability or acceptance of responsibility by the company, probably the result of bad advice from an attorney. Let us not forget that Stratfor’s careless security practices have compromised the credit cards of thousands of clients.
Stratfor's last alert to subscribers on Sunday, December 25, 2011.
The incident is causing many Stratfor subscribers to take a second look at whether the company’s daily email service of news summaries is still worth the hefty fees, especially when much of the same news and information is already online for free through Google and the plethora of online news resources.
Stratfor was created by Austin-based entrepreneur and salesman George Friedman. In his analysis of Friedman and Stratfor, David P. Goldman wrote in The Tablet in early 2010:
Friedman’s thriving business targets a key market niche: corporate types with geopolitical exposure who are too busy or too ill-informed to use Google.
“Controlling costs but without skimping on quality” is the secret to the McDonald’s-like commercial success of Stratfor, Friedman explained during a break from his New York book tour. “The secret is the division of labor: we have people who collect intelligence, people who analyze intelligence, and people who write,” he says. “It’s designed to give the subscriber a consistent product.”
“Friedman is not selling sophistication,” Goldman writes. “Subscribers to his premium service get more items in their inbox than the most avid geopolitics junkie could digest.”
Friedman today needs to sell believable crisis communications. It would have been easy and quick right after disaster hit:
- News blog to deliver a steady flow of updates and assurance to subscribers, the media and public.
- Engaging in the online social media discussion of the hacking and fallout. Stratfor’s voice is absent there.
- Genuine acceptance of responsibility and empathy for subscribers whose credit cards have been compromised.
- Clear and sincere messages, free of typos and grammatical mistakes.
“Global information” Stratfor has done none of this.
In a crisis situation, effectively managing communications may help to save a company’s reputation, image and viable future, regardless of what the lawyers might advise. At least expeditious crisis communications won’t get you sued, one way or the other.
Special thanks to Mark Stamaty for use of his illustration. Click here for his website.
Related posts:
- Stratfor Hacking Underscores Need for Fast Communications Response
- How PR People Rebuff the Media, Risk Brand Image
- Crisis Communications: It’s Online
- Crisis Communications Online During an Oil Spill
- How to Damage a Good Brand Image
Category: Featured, Reputation management
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This so much reminds me of Monty Python’s Dead Parrot sketch, with Stratfor as the Pet Shop owner.
Jim,
Ha! Perhaps apropos. Here is a link to Monty Python: http://youtu.be/4vuW6tQ0218
David
Just because law enforcement agencies are investigating the mater does not mean Stratfor had to remain silent. It could have and still should keep in touch with its customers letting them in general terms that it is doing all it can to make sure it does not happen again, and to let their subscribers know that in fact they are cooperating with law enforcement to help bring those responsible to justice. Doing that will not hamper any investigations. I do think Stratfor serves a niche and is needed for the very reasons mentioned above, most execs doing international business do not have the time to google all news that may be germane to their line of work, and ponce gathered analyze it. Stratfor does just that. Nothing on the internet is truly secure and we know business after business has been hacked as wel as governments, including their dense agencies. That Stratfor was hacked is unfortunate as it is an intel based company, but it has learned a a lesson and will make sure more secure means are employed. It would be hoped that after this event and it aftermath, the company will also understand the need to be, open and out front with the public in general, and especially its subscribers in particular. Crisis communications is real and Stratfor needs to learn, understand it, and engage in it.