Broadsided

A new book by two researchers explains how companies' reputations can be tarnished by the cacophony of Internet commentary, and how they can fight back

At business powwows in the 1990s, it was common to hear that "the Internet changes everything." This was meant as a warning that companies dawdling in putting up websites and hawking their wares online were doomed to be road kill on the information superhighway.

Ten years later, the superhighway has ballooned into something more akin to a data galaxy. Most companies of size have websites, traffic in e-commerce, and dabble in e-mail marketing. But there's a new fear afoot: that despite all these moves, businesses are in danger of losing control of the Internet-fueled conversation about their products and services, putting their corporate reputations at risk.

The explosion of blogs, wikis, podcasts, online videos, social networking sites, and cyber chat rooms that has upended the traditional relationship between companies and their customers is the subject of a new book by a pair of top analysts from Forrester Research Inc.

In "Groundswell - Winning in a World Transformed by Social Technologies," published this spring by Harvard Business School Press, Josh Bernoff and Charlene Li lay out the threats and opportunities posed by this unmediated, 24/7, often anonymous cacophony.

Bernoff and Li define the groundswell of their title (the word literally means a growing wave or a rolling of the ocean) as a grass-roots movement of people deploying online tools to connect and swap information, tips, and rumors about products and support.

"Simply put," they write, "the groundswell is a social trend in which people use technologies to get the things they need from each other instead of from companies. If you're in a company, this is a challenge." But, of course, there's no turning the clock back. The trend can't be ignored by executives responsible for their brands.

"This is the largest thing to happen to American business since the Internet came in," Bernoff, a vice president and principal analyst for Forrester in Cambridge, suggested. (His coauthor, Li, who is based in the San Francisco Bay Area, left Forrester last week to devote more time to her family, she said in a blog post.)

Companies can get broadsided by the groundswell.

Dunkin' Donuts, based in Canton, learned the new rules of engagement the hard way last year when a blogger employed by a South Korean supplier posted a photo of a rusty boiler and accusations that doughnuts were prepared in unsanitary conditions. Not only was the company unable to prevail upon the host website to pull the offending blog entry, but the controversy was chronicled in The Korea Times newspaper. Dunkin' Donuts ultimately sent its own statement to bloggers, refuting the post.

Computer maker Dell Inc., which had similarly been tarred with criticism and inflammatory comments on blogs, got out in front of the groundswell in 2006 when a Dell notebook computer caught fire at a conference in Japan and ignited a global scare. Company officials empowered a "blog resolution team" to post the company's side of the story on technology websites and in Internet discussions. They explained the malfunction appeared to stem from a lithium ion battery cell and outlined how Dell was working to fix the problem.

The approach of Dell, which has set up an online "idea community," IdeaStorm, and of coffee roaster Starbucks Corp., which has similarly rolled out My Starbucks Idea, are models of what Bernoff and Li call "groundswell thinking" for companies seeking to open a dialogue with customers.

Other corporations, like technology giants Microsoft Corp. and Sun Microsystems, have deputized bloggers to participate in Internet conversations about their operations. Closer to home, Massachusetts General Hospital has installed CarePages, an online system enabling patients to communicate with family and friends about their treatment.

Companies that grasp the new dynamic can use a kind of "jujitsu" to turn the groundswell to their advantage, the analysts maintain. By "listening, talking, energizing, supporting, and embracing" the new social technologies, they wrote, businesses can make sure their voices are heard. But they can no longer expect to own the conversation, Bernoff cautioned. (Even defamation laws, which vary from country to country but often require proof of malice, don't guarantee protection.)

"The traditional relationship between companies and consumers was unbalanced, because companies had all the power," he said. "The groundswell has tilted the balance toward consumers."

Bernoff said businesses across the spectrum are reassessing their strategies in light of the new balance. But most of the innovative responses cited in the book are coming from the big consumer-facing companies with the most at stake - and with the largest pools of cash to spend experimenting with new multimedia marketing techniques.

Smaller companies, for the most part, remain on the sidelines.

"It doesn't come up on our radar screen," said Bouzha Cookman, partner at Catlin & Cookman Group, a Concord consulting firm advising businesses with under $100 million in annual sales. "For the companies I work with, it's not a critical issue right now. This is playing out with companies that are fiercely protective of their brands."

But like previous technology waves, such as the arrival of the Web and the growth of Internet commerce, a new crop of vendors has sprung up - including many in the Boston area - to help businesses trumpet their messages on blogs and social networks and capitalize on the anxiety they cause in executive suites, Cookman said.

"This is a new way to connect with customers, but it's still evolving," she said. "What chief executive has the time to sit around and write a blog? They're looking to external help to do that."

Robert Weisman can be reached at weisman@globe.com.