Three Minds On Digital Marketing @ Organic

Yesterday evening, the Wall St. Journal broke a scandal involved John Mackey, CEO of Whole Foods.  It seems that over the course of six years, Mackey posted dozens of comments about the performance of his company on a Yahoo Finance forum, using a pseudonym to mask his identity.  It gets even more interesting. Other regular commenters on Yahoo guessed his true identity last year, and Mackey posted his final “anonymous” comments in August 2006.  The reason the story became national news at all is that the FTC published some of these comments in a anti-trust suit filed against Whole Foods on Tuesday, which seeks to block Mackey’s acquisition of Wild Oats, a much smaller competitor in the organic grocery business. 

Incredibly, Mackey used his anonymity to hammer the Wild Oats stock, to pump up his own company’s performance, even to remark that the CEO’s new haircut (his own) “looks cute”.

This is more than a case of a quixotic CEO having some fun online.  It’s a clear breach of trust and a real misuse of the medium from a communications perspective.  There’s nothing wrong with a senior executive expressing his views on Yahoo.  In fact, investors would have welcomed a direct line to the major decision-maker in the company.  What’s unethical is that he hid his identity. As a major shareholder, the chief executive, and a public figure, it’s completely shocking to behave as he did.

The bottom line here is that communications technologies are evolving more quickly than people’s ability to understand the often-unspoken rules of engagement.  You probably remember the controversy after Walmart’s flog, Walmarting Across America.  Walmart and their PR agency, Edelman, didn’t understand how important it was to come clean about their direct sponsorship of the content.  In Mackey’s case, he keeps a personal blog on the Whole Foods site, so he clearly has no problem being identified with his opinions.  But on it he often espouses his desire to reach beyond his circle of professional handlers – PR people, lawyers, marketing advisors – to speak directly to his customers.  From his remarks following the FTC accusations, it’s clear that he really doesn’t get what he did wrong. 

This is a darker version of the fairytale where the king dresses as a commoner, goes out among the people, and listens to what they have to say.  Only in this case, the king took the opportunity to try and speak out as well.  My guess is that this is more common than we think, and that Mackey is only the first senior exec to get caught trying to influence public perception through deceit.

More on the story from ABC7 News, where I did a quick interview on the controversy.

Misha Cornes