Why Did Zappos Fare Better than Sony when Customer Data was Released?

On January 16, Zappos.com became the latest in a series of large brands affected by hackers. In an email to customers, CEO Tony Hsieh announced that the information from 24 million customers was exposed after their server was hacked. But how did online consumers respond? Despite Zappos’ stellar customer service reputation, only 6% of the conversation chose to defend the retailer. Zappos’ silver lining: the percentage of consumers announcing their decision to “never use Zappos again” was the same size.
The positive sentiment about Zappos this week may be small, but they’re fairing better than Sony Playstation did last April.
In late April 2011, Sony’s PlayStation network was hacked, exposing millions of customer accounts. In the first four days after their official announcement, the brand saw no measurable positive sentiment from consumers.
 

The closest Sony came to positive sentiment was when consumers expressed frustration at the hackers, or missed playing specific games. The reaction to Sony’s apology provoked frustration.

 
Although Sony’s conversation wasn’t positive, it lacked a negative theme of the Zappos’ conversation: there was no measurable discussion of ditching their PlayStation console.
 
6% of the conversation for Zappos said “I’ll never buy from Zappos again.” A comparable theme was not present in the conversation surrounding PlayStation.

 
Beyond the overall tone, the specific words and phrases used in these conversations are very different. The language surrounding the Zappos hack is quite actionable: the phrase “change your password” makes a number of appearances in the conversation.
 

Clusters shows the most common words, and highlights the connections between words that are commonly used together.

 
When Sony was hacked, the language didn’t include the same kind of empowering language. Instead, Sony PlayStation was the focus:
 

Clusters shows the most common words, and highlights the connections between words that are commonly used together.

 
Why are these conversations different? We have a few hypotheses:
1) By alerting its customers early, Zappos framed the conversation in an empowering way; they informed customers on how best to help themselves. Sony waited almost a week after its system went down before explaining the problem; it allowed both traditional and social media to form opinions first.
 

By not framing the conversation early, Sony allowed the conversation to continue—with the same proportion of negative sentiment—for over two months.

 
In comparison, Zappos’ early action has reduced volume each day; it’s slowly falling out of the news cycle and out of consumers’ minds.

 
2) It’s an obvious statement, but Hardware (like a PlayStation) is naturally “stickier” than service brands. It’s much easier for consumers to ditch Zappos than the PlayStation network. In this way, service brands absolutely must act early to frame the conversation.
3) Timing is everything, and Sony fell first. During the first four days of the incident, Sony’s volume is almost 6x larger than Zappos’. And much of the neutral “sharing news” category discusses the future of cyber security through the lens of Sony PlayStation. In this way, Sony softened the blow—at least in the near term—for brands with similar incidents. Leaked information no longer new news.
Brian Sullivan and Mitch Brooks also contributed to this analysis and blog post.

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