FedEx: When it Absolutely, Positively, Tries to Deceive the Public

By Ethel the Ethics Evangelist, AKA, Gail Kent, ABC

Words matter - they have power. And they are not interchangeable.

As PR and marketing people, we know that perhaps better than others. That makes us especially responsible for how we use them.

Perhaps no word has become more loaded over the past six months than "bailout." It's no accident that FedEx chose that word to characterize U.P.S's action to change a federal law that it claims is a legal loophole that has provided preferential labor benefits to FedEx for years.

FedEx has launched a Web site called BrownBailout.com, where it says that U.P.S is "quietly seeking a Congressional bailout designed to limit competition for overnight deliveries." It features a "bailout-o-meter" showing UPS's revenue, along with a faux version of U.P.S's commercial series that feature Martin Agency SVP-Creative Director Andy Azula, who developed the whiteboard U.P.S ads. The Azula look-alike-sound-alike calls UPS a "monopoly" and accuses the company of trying to get legislation passed that puts FedEx at a disadvantage by giving itself a government "bailout."

Through the Web site, part of a multi-million-dollar campaign, FedEx says, "This is a bailout, plain and simple, and the American people won't stand for it."

According to a June 9 New York Times article, "The real issue here is not government-supplied cash for U.P.S., but the labor laws under which U.P.S. and FedEx are classified."

The real issue, says the Times, is this: U.P.S., which is heavily unionized, is governed under the N.L.R.A. and has been lobbying to get FedEx's Express division classified under that act. But FedEx objects to a provision in a Federal Aviation Administration reauthorization bill the House passed in May to reclassify some nonairline employees in FedEx's Express division, making it easier to unionize the division.

Launching a counterattack, the Teamsters issued a press release through PR Newswire with the headline: "Teamsters: FedEx Launches Deceptive Campaign to Protect Special Deal in Congress."

The release says FedEx is attempting to "preserve the legal loophole it has exploited for decades," and claims that FedEx is "the sole beneficiary of a provision that its lobbyists quietly slipped back into legislation in October 1996, making FedEx Express the only freight and package-delivery company in the United States whose non-FAA-certified employees are regulated under the Railway Labor Act governing airlines and railroads."

Continues the release:
"The real victims here are FedEx's own workers," said Teamsters General President Jim Hoffa. "Fred Smith would rather spend millions of dollars on misleading ad campaigns and high-priced lobbyists than allow workers a real chance to form a union."

Regardless of what you think about unions or bailouts, for FedEx to call this matter a "bailout" is a real stretch of the imagination. "Bailout" has come to mean a big government cash handout, and to call a fight over labor legislation a "bailout" is nothing short of deceptive.

And a stunningly bad PR decision for FedEx. One that has and will continue to cause a huge public backlash.

I'm not alone in this. While one business school dean quoted by the Times said she found FedEx's arguments persuasive and that the company has a right to be concerned about they way their workers are classified, most experts questioned were negative about FedEx's tactics.

The New York Times quotes Scott Elser, a partner in LaunchPad Advertising, saying: "Hinging so much of this - even the site itself and the URL name - to a bailout brings some pretty significant risks. It's arguably one of the most controversial terms that you can define in politics today. They draw you there based on that, and you don't have to surf very long to realize that this is clearly not a bailout as most consumers and business people would define it, which is writing a check to a troubled business."

He says, "It's a little bit of a bait and switch," which "has the ability to potentially harm their brand."

Steve Centrillo, a principal at A-Team Advisors, an ad agency consultant, says, "I give them (FedEx) credit for inventiveness." He called the use of bailout "the most questionably ethical thing on the site. It's taking a word that is extremely loaded right now, and implying that somehow, the government is writing a check to U.P.S., which is clearly not the case."

An anonymous commenter on the story "FedEx Campaign Delivers Controversy" on PRWatch.org says that FedEx has made a huge PR mistake.

"What huge 'respectable' corporation attacks their competitor in such a immature, slanderous way? They are spending millions of dollars on this silly smear campaign when they had to cut their salaried workers compensation by 5%. If I worked for FedEx, I would wonder why they had to cut my pay when they had millions of dollars laying around for a PR experiment."

There is nothing wrong in strongly advocating your company's position on an issue. Our system allows open debate and the free exchange of ideas.

There is, however, something wrong with using words that have come to mean one thing to say something else entirely. That is unethical and beneath the practice of business communications.

Let's play fair. We've got enough real words to do the job.