Learning opportunities from the Gulf oil spill

So far, I have not written much (for this blog) about this summer’s events in the Gulf of Mexico. For one thing, the matter was given adequate editorial coverage elsewhere, and until recently, the story has not sent clear signals with regard to its impact on consumer trends and related issues (the focus of this site). But at this writing, a cap is in place, permanent relief-well solutions are weeks (not months) away, and enough distance has passed since the initial event that trend issues can be considered; not in such a way as to allege firm answers but in ways that allow us to consider a range of possibilities… which is often the case in trend watching. Let me share a half-dozen observations, along with corresponding implications. You’ll note that I have some contradictory points of view. That, too, is often the case when it comes to trend watching. In no particular order:

Observation 1: This incident has been a huge reality check for a lot of people. Every once in a while, something happens to make us more aware of vulnerabilities that few of us had even imagined. Think Great Depression, Pearl Harbor, the Challenger explosion, 9/11, and more recently, the Great Recession. One thing each of these incidents had in common was their epiphany effect: We were made aware of a vulnerability that few (if any) had even considered before the event… and it stunned us.

As we watched millions of gallons of sludge spewing into the Gulf un-checked—with no prospects for slowing or stopping the environmental carnage—I think many on-lookers were caught completely off-guard. There was a sense of guilty ignorance: We had no realization of the risks were being taken in the pursuit of oil, without some “what if” thinking and worst-case scenario planning in place.

Implication: Consumers will be less likely to assume that companies are acting responsibly. And they will be more likely to insist that companies consider, “What if.” Some folks—even those who are usually against the heavy regulation of industry—might look more favorably on legislation (and legislators) that scrutinizes big business (not just energy) more closely. If you disagree, please note that financial system reforms were signed into law this week; even before there has been any official announcement that the recession is over and a recovery is well underway.

Observation 2: People realize it’s not just the environmental ecosystem that was harmed… but the business ecosystem, too. I don’t think people really care whether BP has committed $20 billion to an escrow account to pay for damages (I’m not sure the typical consumer can grasp what a billion dollars looks like). But I think it does occur to us that thousands of people are jobless as a result of this incident, whether they are the oil platform employees who were out-of-work in response to a drilling moratorium, shrimpers and boat hands whose oyster beds and fishing waters were tainted or banned, or tourism employees whose hotel, restaurant or store had streamlined or shuttered in response to the lack of Gulf coast vacationers. Even the BP gas station down the street is likely operated by a local, independent owner; someone who did not cause the spill but who serves, in a way, as its face.

Implication: A strong sense of empathy for the people directly affected by the spill. Of course, this spill affects almost everyone in some way. But even many of the consumers who jumped on the “boycott BP” bandwagon, early on, realized they were harming a local gas station owner much more than the corporate giant behind the logo. There were many innocent victims in this mess, and I think consumers had a sense of empathy for what they were (and are) going through… especially those dealing with the already difficult effects of the recession, and even more-so, those people who had been impacted by Katrina so recently. Watch for public support to be strong, as the affected areas seek assistance in recovering from this event.

[Note: When we refer to people directly affected, we mean not least of which are the families involved with the original human tragedy, here. Eleven lives were lost when the explosion occurred on the Deepwater Horizon on April 20th, 2010.]

Observation 3: The spill has energized the environmental activist in some of us, while it has had a de-motivating effect on others. The broad coverage of the oil spill has made some folks aware of how fragile the environment can be, and how quickly human behaviors can have a negative impact. While I think the widespread awareness of this event has caused more people to engage in environmentally-related activities—or at least, thinking—I think it has also generated a sense of hopelessness among others. (What this might sound like: “Does it really matter that I’ve reduced my personal carbon footprint when they’re burning-off thousands of barrels of oil a week, after it has been skimmed-off the water?)

Implication: While more consumers might be motivated by “green” marketing, prepare for a new kind of skepticism. Not just skeptics who question the deeper motives of your company and its environmentally-friendly message… but people who wonder whether what you’re doing really matters, in the big scheme of things. (You might have to do a better job of explaining it.)

Observation 4: This event has released the inner cynic in a lot of consumers. Over the past few years, BP had tried to position itself as an environmentally-friendly energy company, with campaigns that implied cleaner gas (note wind turbines in the background of this commercial), the pursuit of renewable energy sources (“beyond petroleum” was one of the favorites in their arsenal of slogans, as seen in this commercial)… and the now much-maligned sunflower logo. In hindsight, all of this branding led to the perfect marketing irony, as the widely-declared “worst environmental catastrophe in history” has made one oil company the poster-child for the term, “greenwashing.”

Implication: This might be a good time to review all of your marketing communications… from your in-store signage to your external advertising and even the dialogue you hear from sales people on the showroom floor or bank lobby. Is your company making any statement—either implicitly or explicitly—that cannot be reconciled in actual performance? Do you live up to your marketing claims? What potential risks, including those beyond your control, could serve to mock any claims you’re making right now?

Let me give you an example: On July 11, 2010, I stopped for gas, thoughtlessly, at a gas station in Elk River, Minnesota. There, on the rubber cover of the gas pump handle… I saw the most ironic of warnings. “PLEASE DO NOT TOP-OFF. Topping-off after automatic shut-off may result in spillage and cause a hazardous condition.” Until I read that warning, it had not occurred to me that I had pulled into a BP gas station. I thought it ironic that a BP gas pump was warning me not to cause a petroleum spill.

Don’t be that business owner.

Observation 5: People are good. (I realize this could be seen as somewhat of a contradiction to the previous observation.) Volunteers came out of the woodwork when it came to the task of cleansing oiled birds and walking countless miles of shoreline. Yes, many of the crews we saw in television reports were paid participants. But there were thousands of folks who just wanted to help.

Implication: Does your product or service help people help? Are you involved with a cause marketing project that raises money for a non-profit or does some other good in your local community? You can do good as you do well… sometimes, simply by facilitating the relationship between consumer and cause.

Observation 6: Nothing is as easy as it looks. From "top kill" to "junk shot," we've seen many attempted solutions not work out as hoped. Even today, many of the ships working to solve the spill are having to leave the site because tropical storm Bonnie, which is headed for the area.

Implication: Hedge your bet. With the rough news about the Gulf Spill--and on the heels of three years of rough financial news related to the recession--consumers are being taught to hope for the best, but expect the worst. That it's smart to hedge everything. Have a "Plan B," if not a C, D, and E.

There will be plenty of other lessons to learn from this multi-faceted business and environmental event. If you have consumer trend observations to suggest, related to this or any other topic, please feel free to drop me an email.

Mike Anderson