Peloton CEO Addresses Difficult Times

Peloton was hot during the pandemic, barely keeping up with demand for bikes and treads. But sales have tumbled as consumers became more price sensitive and competition increased. The Sex in the City HBO reboot, And Just Like That, and Billions Season 6 episode didn’t help when they killed off lead characters during or after a vigorous workout on a Peloton bike. Company shares tumbled 76% in 2021.

CNBC reported that Peloton is pausing production, but Co-Founder and CEO John Foley denies the claim. In a statement (posted on the website as a “note” sent internally), Foley criticizes an internal leak and subsequent “speculative articles.” His tone is firm when he writes about legal action against the “leaker,” a warning to other employees. Trying to get ahead of more bad news, Foley admits that layoffs are possible, while complimenting the team. He chooses positive data to present: the number of users, workouts, and churn rate. He doesn’t include negative data about revenue or stock price.

The note is part defense and part cheerleader, as Foley props up employees—and the company—against a turbulent time in the company’s history. He demonstrates some integrity, humility, and vulnerability, but his leadership will continue to be taxed in the weeks ahead.

Foley’s full message follows (with the giant logo as it appears on the website):

We have always done our best to share news with you all first, before sharing with the public. This week, we’ve experienced leaks containing confidential information that have led to a flurry of speculative articles in the press. The information the media has obtained is incomplete, out of context, and not reflective of Peloton’s strategy. It has saddened me to know you read these things without the clarity and context that you deserve. Before I go on, I want all of you to know that we have identified a leaker, and we are moving forward with the appropriate legal action. But moving forward, I want to take a moment to talk about some of the changes with you directly.

As a public company that is in a pre-earnings “Quiet Period”, we are limited in what information we can share. However, we issued a pre-earnings press release earlier this evening about our preliminary Q2 results, in order to offer an initial and more accurate picture of our business performance.

As you have heard me and other leaders say over the past few months, we are continuing to invest in our growth, but we also need to review our cost structure to ensure we set ourselves up for continued success, while never losing sight of the important role we play in helping our 6.2+ million Members lead healthier, happier lives.

What this means for our team right now

In the past, we’ve said layoffs would be the absolute last lever we would ever hope to pull. However, we now need to evaluate our organization structure and size of our team, with the utmost care and compassion. And we are still in the process of considering all options as part of our efforts to make our business more flexible.

This team is made up of some of the smartest, most passionate, hard-working and KIND people I have ever met. You have each painted your masterpiece at Peloton in your own way, and your contributions matter. They always have, and they always will.

I am SO proud of everything we have accomplished together, and it pains me we are faced with these tough decisions. I know this is difficult, and I want to thank you for your patience as we work through these times together.

Rumors that we are halting all production of bikes and Treads are false

Notably, we’ve found ourselves in the middle of a once-in-a-hundred year event with the COVID-19 pandemic, and what we anticipated would happen over the course of three years happened in months during 2020, and into 2021.

We worked quickly and diligently to meet the demand head-on at a time when the world really needed us, in large part thanks to how hard you worked every day. We feel good about right-sizing our production, and, as we evolve to more seasonal demand curves, we are resetting our production levels for sustainable growth.

Connected Fitness is here to stay

This past quarter, our churn rate was 0.79%. This means that our Members are sticking with us, again thanks to your brilliance and continued innovation. Connected fitness provides the convenience people need to stay active and centered and will continue to be a key part of the future of fitness. In fact, just a few days ago, we recorded our highest ever number of daily workouts -- over 2.9M workouts.

I want to acknowledge that this does not answer all of the questions I am sure many of you have right now. But, I did want to share what we could at this time.

I know there is a lot of noise and anxiety in our environment right now, which is why I wanted to take this moment to provide some additional context for you all as we navigate the next few weeks together.

John

Activision Acquisition Announcements Omit Information

Microsoft’s acquisition of Activision significantly boosts the company’s prospects in the gaming space. In a statement, Microsoft said, “This acquisition will accelerate the growth in Microsoft’s gaming business across mobile, PC, console and cloud and will provide building blocks for the metaverse.” Games under assets now include millions of players of “Warcraft,” “Candy Crush,” “Call of Duty,” and others.

As expected, Microsoft’s announcement doesn’t include bad news about Activision—reported just the day before the acquisition. Rampant sexual harassment allegations resulted in more than three dozen terminated and another 40 disciplined employees. The day after the acquisition, the Wall Street Journal reported, “Activision Blizzard’s Workplace Problems Spurred $75 Billion Microsoft Deal.” Similarly, Activision CEO Bobby Kotick’s email to employees fails to mention that the company may have been in trouble before the agreement.

As usual, what is not said is often as important as what is said. Both messages announce good news and omit the bad news. This story illustrates that positive business messages are also persuasive messages.

Misrepresenting COVID-19 Study Findings

A study about COVID testing in schools is criticized for its authors’ conclusions. Researchers at Duke, in collaboration with the North Carolina Department of Health and Human Services, studied the “test-to-stay” approach for schoolchildren. With this approach, if a child tests negative after being exposed to someone who tests positive, that child can go to school. Researchers found this strategy to be effective in getting kids back to school—without increasing COVID transmissions.

The trouble, described in a Wall Street Journal opinion piece, is that authors concluded, “in schools with universal masking, test-to-stay is an effective strategy.” The writers explain their thinking:

“That invites readers to assume that test-to-stay doesn’t work without forced masking. But since they studied no unmasked schools, this conclusion is baseless. An honest report would either have said so or not mentioned masking at all.”

The writers believe that study authors are pushing their own agenda for schools to require masking. This is a good example of a study interpretation that is technically correct but omits important information for a fair comparison. In such cases, researchers might hurt their own credibility. On the other hand, do people assume, as the writers say, that “test to stay” doesn’t work in schools without mask mandates?

Quotes from the Elizabeth Holmes Trial

A jury found Elizabeth Holmes guilty of four of 11 charges related to her start-up, Theranos. The jury was convinced that she defrauded several investors who bought into her blood-testing company, but they were not convinced that she defrauded patients.

A Wall Street Journal article, “The Elizabeth Holmes Trial: The 10 Most Quotable Moments,” reveals persuasive language used throughout the trial. Despite valiant arguments on both sides, jurors had a difficult time deciding this trial. They couldn’t agree on three of the 11 counts, causing the trial judge to instruct the group to try harder to reach agreement, but in the end, they did not.

A few of the quotes demonstrate Holmes’ persuasive communication skills. Jim Mattis, former U.S. defense secretary, Theranos board member, and four-star general, said, “There just came a point when I didn’t know what to believe about Theranos anymore.” The CEO of Safeway noted, “When she presented to our board, when she was talking, she owned the room.”

Holmes, however, didn’t own the courtroom. Two of her quotes are included in the list: “I wanted to convey the impact the company could make for people and for healthcare” and “He impacted everything about who I was, and I don’t fully understand that.” She tried to explain her passion for the company and the abuse she suffered from her former deputy and partner. She will get another chance to convince jurors when she likely appeals the decision.

Ask for Help in Rich Media Channels for Better Results

New research confirms what you might already think: you are most likely to get the results you want when you ask someone in person.

Experiments indicate that people are more compliant when communication takes place over richer media channels. Requests made face-to-face are most likely to be fulfilled. Second best is Zoom and then phone calls. Email and text requests are least effective. Survey participants thought richer channels would be more effective, but they underestimated the differences.

Cornell University researcher Vanessa Bohns sums up the results:

“We tend to think people will weigh the costs and benefits and make a measured decision about whether to agree to something, saying ‘yes’ only if they really want to. But in fact, people agree to all sorts of things, even things they’d rather not do, because they feel bad saying ‘no’ in the moment.”

Of course, this raises issues of integrity. Taking advantage of people who feel uncomfortable refusing a request will damage trust and credibility over time.

Peloton Addresses Death (Spoiler Alert)

Sex in the City spoiler alert: Mr. Big dies after a vigorous workout on a Peloton bike. The first episode of the HBO reunion show, “And Just Like That,” has Carrie Bradshaw’s husband sweating with “Allegra,” played by real-life Peloton instructor Jess King.

Company leaders were as surprised as viewers. A spokesperson said they approved King’s role and supplied a bike but had no idea how the scene ended. In a statement, an on-staff cardiologist blamed Mr. Big—a convenient, now deceased fictional character:

"I'm sure SATC fans, like me, are saddened by the news that Mr. Big dies of a heart attack. Mr. Big lived what many would call an extravagant lifestyle—including cocktails, cigars, and big steaks—and was at serious risk as he had a previous cardiac event in Season 6. These lifestyle choices and perhaps even his family history, which often is a significant factor, were the likely cause of his death. Riding his Peloton Bike may have even helped delay his cardiac event."

HBO declined to comment on the situation, and Peloton will be more careful about product placements in the future. Vulture called the episode “the worst Peloton ad ever.” After the episode aired, shares fell 11%, further challenging a company struggling with declining sales and product recalls.

Update: Although Peloton may have grounds for a lawsuit, so far, the company is taking a different approach. In a parody ad produced within just a few days, Peloton hired Mr. Big actor Chris Noth to play the character, alive and flirting with the instructor. A voiceover reminds viewers of the benefits of cycling.

Visualizing Big Numbers

President Biden’s “Build Back Better” infrastructure plan may be difficult to visualize. When we consider trillions of dollars, traditional business charts—bars, pies, and lines—may not be the best choice.

Here are a few visualizations to compare:

• Boxes

• Pie pieces (shown here)

• Bar chart

• Stacked bar chart

These aren’t perfect comparisons because they cover different categories and are from different points in time, but they do give us options to help audiences understand data. What other visualizations can you find, and which are most effective for what purpose?

Robinhood's Breach Notice

In a blog post, Robinhood announced a “data security incident.” Business communication students will notice several examples of downplaying the situation, including giving numbers of people affected more significantly (310) but no numbers for the total.

Language seems intentionally complex, for example, “The unauthorized party socially engineered a customer support employee by phone and obtained access to certain customer support systems.” In other words, someone called a Robinhood employee and impersonated another employee. The employee fell for this deceit without seeking proof.

Robinhood seems to take no responsibility and identifies no plans for future action to prevent a similar “incident.” The chief security officer provides template text: “As a Safety First company, we owe it to our customers to be transparent and act with integrity. Following a diligent review, putting the entire Robinhood community on notice of this incident now is the right thing to do.”

Skewed Chart Example

Dopesick on Hulu includes a great example of a compressed chart scale. The show is about the opioid crisis and features the Sackler family and Purdue Pharma’s role in convincing doctors that OxyContin is not addictive. To prove the point, Purdue shared this graph, showing that the “time release” capsules don’t cause mood spikes (“fewer peaks and valleys”). The trouble, as business communication students can observe, is the Y axis.

In Episode 6 (around 21 minutes), we hear the explanation: “But see what Purdue did? They dramatically compressed the scale.” On the chart, we see that 30 looks to be the midpoint. They used a logarithmic instead of a linear scale to homogenize or “smooth out” the data. (Here’s a good explanation of logarithmic scales.)

In the show, an FDA official says they instructed Purdue Pharma not to use the chart, but the company did anyway. Of course, I’m not sure what happened, exactly, and I didn’t get the court filings to verify the chart.

The show offers many other examples of the company’s persuasive communications and the tragic effect on people’s lives. For more research about Purdue’s misleading communications, see this LA Times article. Also read a fascinating trove of Purdue emails here.

Congressman's "Bizarre" Video

Jeff Fortenberry, U.S. representative for Nebraska, was facing indictment for falsifying and concealing information and for lying to investigators about 2016 campaign contributions. In a video called “unusual” and “bizarre,” Fortenberry speaks to the camera from his truck with his wife and dog in the background. He says they are “out for a drive” in his 1963 Ford pick-up.

The video is an interesting attempt at authenticity to sway public opinion. Fortenberry wants us to believe that he is a trustworthy, everyday man—a victim rather than a criminal. He tells the story of FBI agents coming to his house “on a weekend” after a cyclone hit. With an incredulous tone, Fortenberry says, “We’re shocked. We’re stunned. I feel so personally betrayed.”

I wonder what counsel Fortenberry received or whether it was his own idea to create the video. Either way, based on the news reports and the indictment, which came later that day, Fortenberry’s message did not favorably affect the outcome for him. His arraignment is planned for later this week.

Overblown Generational Differences

Finally, a mainstream article, “The Bunk of Generational Talk,” describes exaggerated differences among age groups. Categorical thinking contributes to imagined “gaps” and tropes. With random year divisions, naming generations only reinforces stereotypes.

The article author, a professor of public policy, provides research showing that most differences among generations are driven by factors other than generation alone. For example, beliefs about climate change have tracked fairly closely over time. He summarizes the issue well:

“Our wrongheaded thinking about generations leads us to focus on the wrong problems. Headlines about spendthrift young people, for example, distract us from the huge shift in economic policy in recent decades toward the interests of older people. We avoid facing up to a challenge like climate change by laying the blame on older generations while placing our expectations for salvation on the coming generation. Across a range of issues, manufacturing fake generational battles denies us the benefits of intergenerational connection and solidarity.”

Business Communication and Character describes ways to work and communicate across differences—not invent differences to mock and scorn.

CDC Director Has a More Nuanced Approach

A New York Times writer compares CDC Director Dr. Rochelle Walensky’s vaccine messaging in different settings. Analyzing a podcast with someone Walensky likely considers a colleague, David Leonhardt describes her tone and approach as more conversational. He also identifies examples of Walensky’s acknowledgment of a “risk-benefit” assessment—more nuanced communication than we hear from the CDC in its official guidance on news media programs.

Leonhardt gave another example of Walensky’s more flexible stance on vaccines:

Walensky began her answer by restating official C.D.C. policy: “We’re not currently recommending it.” But then she added the fuller truth: “I’ll tell you what we do know, and some places where I think people might veer from standard guidance.”

He summarizes what could be more helpful in health communications:

“Health officials are frequently unwilling to take that second step in public. When confronted with uncertainty, they do not acknowledge it. They ignore gray areas and talk in black and white.”

This situation exemplifies humility as a character dimension. Leaders who admit uncertainty—that they don’t know everything and are still learning—may be more persuasive, not less.

Leonhardt is also describing integrity and, more specifically, transparency. Consistency in messaging, including giving a fuller picture, could help people make rational choices for themselves. That might not result in outcomes the CDC wants—or it might, but not in the exact timeframe or terms that the CDC dictates. As Leonhardt says, “the full truth” would give people more agency and could cause less backlash against prescriptive guidelines.

Failing Data Analysis in the Theranos Trial

The criminal trial against Theranos Founder and former CEO Elizabeth Holmes now focuses on testimony from Safeway, Walgreens, and Johns Hopkins University. Questions involve how these companies evaluated Theranos’ blood-testing technology and concluded that it was sound when, in fact, results was consistently false.

At this point in the trail, investors blame Holmes, whose defense is that the companies did due diligence and are responsible for their decisions. A Wall Street Journal article about the arguments highlights the companies’ and the university’s failings and over-reliance on Holmes’ claims.

As the relationship between Safeway and Theranos progressed, CEO Steve Burd wrote an email to Theranos with the subject, “Becoming Discouraged.” He testified, “I think whenever you start something new you’re going to have some rough spots, but we continued to have rough spots. We had samples that were lost. We had results that didn’t make any sense.”

We’ll see how the trial evolves, but clearly, experts needed to ask more questions up front. In some cases, they didn’t test the actual technology themselves. This story is a good example of failures in integrity and data analysis—perhaps for many involved.

Bad-News Message: Hasbro CEO

Toy company Hasbro announced the death of Chairman and CEO Brian Goldner. The press release is typical, quoting leaders and touting Goldner’s contributions to the company. Goldner was with Hasbro for more than 20 years and served as CEO for more than 13, so his death is significant.

Interestingly, the company statement doesn’t include a cause of death. A Wall Street Journal article mentions Goldner’s prostate cancer diagnosis in 2014 and his recent leave of absence.

Visionary CEO Transformed Hasbro into a Global Play & Entertainment Leader

PAWTUCKET, R.I.--(BUSINESS WIRE)--Oct. 12, 2021-- It is with deep and profound sadness that Hasbro announces the passing of beloved leader and longtime Chairman and CEO Brian D. Goldner.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20211012006149/en/

Brian D. Goldner (Photo: Business Wire)

Rich Stoddart, Interim CEO, said “Since joining the Company more than two decades ago, Brian has been the heart and soul of Hasbro. As a charismatic and passionate leader in both the play and entertainment industries, Brian’s work brought joy and laughter to children and families around the world. His visionary leadership, kindness, and generosity made him beloved by the Hasbro community and everyone he touched. On behalf of the Hasbro family, we extend our deepest, heartfelt condolences to his wife, daughter, and entire family.”

Mr. Goldner, 58, joined Hasbro in 2000 and was quickly recognized as a visionary in the industry. He was appointed CEO in 2008 and became Chairman of the Board in 2015. He was instrumental in transforming the Company into a global play and entertainment leader, architecting a strategic Brand Blueprint to create the world’s best play and storytelling experiences. Through his tireless work ethic and unwavering focus, he expanded the Company beyond toys and games into television, movies, digital gaming and beyond, to ensure Hasbro’s iconic brands reached every consumer. The culmination of his pioneering strategy was the 2019 acquisition of independent entertainment studio eOne. Mr. Goldner served on the Board of Directors of ViacomCBS and was the Chair of the Compensation Committee. Mr. Goldner and his wife Barbara were passionate advocates for improving systems of care for vulnerable members of society.

Edward M. Philip, Lead Independent Director of Hasbro’s Board of Directors, said “Brian’s passing is a tremendous loss for Hasbro and the world. Brian was universally admired and respected in the industry, and throughout his over twenty years at Hasbro, his inspiring leadership and exuberance left an indelible mark on everything and everyone he touched. A mentor and friend to so many, his passion and creativity took Hasbro to new heights. Our love and thoughts are with his wife, daughter, and family during this extraordinarily sad time.”

Raiders Coach’s Language and Resignation

The New York Times described emails sent by Raiders Coach Jon Gruden that included racist, homophobic, and sexist language. In his statement, Gruden wrote a short statement on the Raiders’ Twitter account.

The statement isn’t exactly an apology, as we define it in business and corporate communication. Gruden doesn’t describe his behavior or the impact on others.

Raiders owner Mark Davis wrote an even shorter statement: “I have accepted Jon Gruden’s resignation as Head Coach of the Las Vegas Raiders.”

Critics of the decision evoke the “cancel culture,” while others believe Gruden’s comments were outlandish. In a business environment, his language would never be acceptable. The NY Times article quotes Gruden, which I’ll avoid here.

Mark Zuckerberg Addresses Controversy

After weeks of The Wall Street Journal’s posting internal documents criticizing Facebook, CEO Mark Zuckerberg is finally speaking out. The whistleblower, a former Facebook product manager, released the documents, and now the company is participating in U.S. senate hearings to defend its practices. In a Facebook post and in his testimony via video on Capital Hill, Zuckerberg addresses several issues plaguing the company.

First, in his post, which is a copy of an email he sent to employees, Zuckerberg addresses the hours of outages that made Facebook, Instagram, What’sapp, and Messenger inaccessible around the world. Second, he addresses the testimony and defends the company’s policies and practices. Claiming that their work is “mischaracterized,” Zuckerberg denies that teens are negatively affected by their apps as the reports have portrayed.

The post is a study in persuasive communication. He uses a mix of emotional appeal and credibility. Including his hopes for his own children, Zuckerberg presents himself as a concerned, yet confident, parent, reassuring us that all is OK. He cites research and reporting—and transparency—yet the reports uncovered have not been public, and previous testimony contradicts some of the conclusions drawn in internal documents.

Zuckerberg also uses logical arguments, for example, that more teenaged girls who are struggling find the apps helpful. He neglects saying that any percentage find them harmful. With a cursory mention—”It is incredibly sad to think of a young person in a moment of distress who, instead of being comforted, has their experience made worse”—Zuckerberg tries to isolate one case, a classic crisis communication strategy, as though that might be the only one. However, the title of one Facebook report page reads, “1 in 5 teens say that Instagram makes them feel worse about themselves, with UK girls the most negative.” Clearly, he is downplaying his own data.

Mark Zuckerberg 

I wanted to share a note I wrote to everyone at our company.

---

Hey everyone: it's been quite a week, and I wanted to share some thoughts with all of you.

First, the SEV that took down all our services yesterday was the worst outage we've had in years. We've spent the past 24 hours debriefing how we can strengthen our systems against this kind of failure. This was also a reminder of how much our work matters to people. The deeper concern with an outage like this isn't how many people switch to competitive services or how much money we lose, but what it means for the people who rely on our services to communicate with loved ones, run their businesses, or support their communities.

Second, now that today's testimony is over, I wanted to reflect on the public debate we're in. I'm sure many of you have found the recent coverage hard to read because it just doesn't reflect the company we know. We care deeply about issues like safety, well-being and mental health. It's difficult to see coverage that misrepresents our work and our motives. At the most basic level, I think most of us just don't recognize the false picture of the company that is being painted.

Many of the claims don't make any sense. If we wanted to ignore research, why would we create an industry-leading research program to understand these important issues in the first place? If we didn't care about fighting harmful content, then why would we employ so many more people dedicated to this than any other company in our space -- even ones larger than us? If we wanted to hide our results, why would we have established an industry-leading standard for transparency and reporting on what we're doing? And if social media were as responsible for polarizing society as some people claim, then why are we seeing polarization increase in the US while it stays flat or declines in many countries with just as heavy use of social media around the world?

At the heart of these accusations is this idea that we prioritize profit over safety and well-being. That's just not true. For example, one move that has been called into question is when we introduced the Meaningful Social Interactions change to News Feed. This change showed fewer viral videos and more content from friends and family -- which we did knowing it would mean people spent less time on Facebook, but that research suggested it was the right thing for people's well-being. Is that something a company focused on profits over people would do?

The argument that we deliberately push content that makes people angry for profit is deeply illogical. We make money from ads, and advertisers consistently tell us they don't want their ads next to harmful or angry content. And I don't know any tech company that sets out to build products that make people angry or depressed. The moral, business and product incentives all point in the opposite direction.

But of everything published, I'm particularly focused on the questions raised about our work with kids. I've spent a lot of time reflecting on the kinds of experiences I want my kids and others to have online, and it's very important to me that everything we build is safe and good for kids.

The reality is that young people use technology. Think about how many school-age kids have phones. Rather than ignoring this, technology companies should build experiences that meet their needs while also keeping them safe. We're deeply committed to doing industry-leading work in this area. A good example of this work is Messenger Kids, which is widely recognized as better and safer than alternatives.

We've also worked on bringing this kind of age-appropriate experience with parental controls for Instagram too. But given all the questions about whether this would actually be better for kids, we've paused that project to take more time to engage with experts and make sure anything we do would be helpful.

Like many of you, I found it difficult to read the mischaracterization of the research into how Instagram affects young people. As we wrote in our Newsroom post explaining this: "The research actually demonstrated that many teens we heard from feel that using Instagram helps them when they are struggling with the kinds of hard moments and issues teenagers have always faced. In fact, in 11 of 12 areas on the slide referenced by the Journal -- including serious areas like loneliness, anxiety, sadness and eating issues -- more teenage girls who said they struggled with that issue also said Instagram made those difficult times better rather than worse."

But when it comes to young people's health or well-being, every negative experience matters. It is incredibly sad to think of a young person in a moment of distress who, instead of being comforted, has their experience made worse. We have worked for years on industry-leading efforts to help people in these moments and I'm proud of the work we've done. We constantly use our research to improve this work further.

Similar to balancing other social issues, I don't believe private companies should make all of the decisions on their own. That's why we have advocated for updated internet regulations for several years now. I have testified in Congress multiple times and asked them to update these regulations. I've written op-eds outlining the areas of regulation we think are most important related to elections, harmful content, privacy, and competition.

We're committed to doing the best work we can, but at some level the right body to assess tradeoffs between social equities is our democratically elected Congress. For example, what is the right age for teens to be able to use internet services? How should internet services verify people's ages? And how should companies balance teens' privacy while giving parents visibility into their activity?

If we're going to have an informed conversation about the effects of social media on young people, it's important to start with a full picture. We're committed to doing more research ourselves and making more research publicly available.

That said, I'm worried about the incentives that are being set here. We have an industry-leading research program so that we can identify important issues and work on them. It's disheartening to see that work taken out of context and used to construct a false narrative that we don't care. If we attack organizations making an effort to study their impact on the world, we're effectively sending the message that it's safer not to look at all, in case you find something that could be held against you. That's the conclusion other companies seem to have reached, and I think that leads to a place that would be far worse for society. Even though it might be easier for us to follow that path, we're going to keep doing research because it's the right thing to do.

I know it's frustrating to see the good work we do get mischaracterized, especially for those of you who are making important contributions across safety, integrity, research and product. But I believe that over the long term if we keep trying to do what's right and delivering experiences that improve people's lives, it will be better for our community and our business. I've asked leaders across the company to do deep dives on our work across many areas over the next few days so you can see everything that we're doing to get there.

When I reflect on our work, I think about the real impact we have on the world -- the people who can now stay in touch with their loved ones, create opportunities to support themselves, and find community. This is why billions of people love our products. I'm proud of everything we do to keep building the best social products in the world and grateful to all of you for the work you do here every day.

Image source.

Lands’ End Bad-News Message

So many products are delayed these days. In an email to a customer, Lands’ End acknowledged further delays and blamed the issue on labor shortages and high demand. On a flight I took recently, the pilot also mentioned staffing issues (causing us to sit on the plane for a hour waiting for a gate to clear).

I like the transparency. We all know about worker shortages since the pandemic, and it seems logical to name the problem as it is. In normal times, we might see this as a company’s excuse, but the problem is so systemic that no one company can be blamed.

I also appreciate Lands’ End’s usual conversational style. Although I wish the customer were given a timeframe, at least the message is easy to understand.

Mailchimp Acquisition News

Mailchimp’s acquisition announcement is an example of a positive message. In an email and statement on the website, Co-founder and CEO Ben Chestnut reveals the news in the third paragraph. The single sentence is in bold type, but it takes a while for the reader to get the message.

Chestnut provides reasons for the acquisition in this paragraph:

Together with Intuit, we’ll deliver an innovative small business growth engine powered by marketing automation, customer relationship management, accounting and compliance, payments and expense, and e-commerce solutions, creating a single source of truth for your business. We’ll also be able to offer more personalized support and onboarding, expand our international footprint, and scale our teams to innovate faster and deliver the solutions you want and need.

Both sentences, long and jargony, use “we” as the subject. I wish he had explained the decision in more natural, conversational language written from the reader’s—”you”—perspective. Why should I care? How will the change help me manage my business, etc.?

Students could rewrite the entire message and do a better job. The message is positive—and it could be persuasive. Otherwise, it could be interpreted as bad news, not good.

Stunning Trove of Facebook Internal Documents

The Wall Street Journal has uncovered internal emails, reports, and presentations that show Facebook’s communication struggles and contradictions. Some messages are in draft form and illustrate conflicts within the organization about how to manage apps and report on information. In one document, an employee wrote, “We are not actually doing what we say we do publicly.”

A document marked as attorney/client privileged, refers to a “whitelist,” which means that different standards apply to certain elite users. A WSJ writer explains the issue:

At times, the documents show, XCheck has protected public figures whose posts contain harassment or incitement to violence, violations that would typically lead to sanctions for regular users. In 2019, it allowed international soccer star Neymar to show nude photos of a woman, who had accused him of rape, to tens of millions of his fans before the content was removed by Facebook. Whitelisted accounts shared inflammatory claims that Facebook’s fact checkers deemed false, including that vaccines are deadly, that Hillary Clinton had covered up “pedophile rings,” and that then-President Donald Trump had called all refugees seeking asylum “animals,” according to the documents.

Other documents provide research about the negative impact of Instagram on teenage girls, including exacerbating body-image concerns and suicidal ideation. Yet, publicly, company officials have focused only on the benefits. During a congressional hearing, CEO Mark Zuckerberg said, “The research that we’ve seen is that using social apps to connect with other people can have positive mental-health benefits.” A spokesperson for Instagram told reporters that the negative impact on teens’ mental health is “quite small.”

So far, I don’t see a response from the company. This will be a difficult one to downplay, particularly with so many conflicting voices from within the company. This situation illustrates issues of transparency and integrity—inconsistency with Facebook’s stated values and public claims. Facebook might do best to acknowledge challenges and promise to do better, and then we would see whether they do.

Image source.

Opening Statements in the Theranos Trial

Elizabeth Holmes is facing a criminal trial for her role in the spectacular success—and spectacular failure—of Theranos, a startup that claimed to change how people give blood and get health results. The high-profile case involves board members like Henry Kissinger and Rupert Murdoch, who believed in the company and in Holmes.

Opening statements are a lesson in persuasive communication. The prosecution said, ”This is a case about fraud and about lying and cheating to get money.” They accuse Holmes of knowing that test results were invalid and continuing the business as usual. Pointing to the fame Holmes received, prosecutors paint a picture of a desperate, failing executive who would do anything to protect her business and reputation.

The defense team presents Holmes as a victim—a hardworking entrepreneur doing her best and challenged by mental abuse from Ramesh Balwani, the company COO and her former boyfriend.

Each side framed their positions, and now we’ll see what evidence they present to support their claims. Holmes could face 20 years in prison, which is unusual for a corporate CEO. The second day of the trial was cancelled because a juror was possibly exposed to COVID-19. The drama continues…

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