Subway has spent millions upon millions of dollars in advertising and marketing in an effort to cultivate its “eat fresh” image.

It carved out a niche for itself as a purveyor of healthy options, a shining light in a processed-food-heavy world that’s staying afloat thanks to the cash cows and cheap production methods of lard, pink slime, and high fructose corn syrup.

It has portrayed itself as a chain that is so healthy it can fuel Olympic athletes like Nastia Liukin, Michael Phelps, and Apolo Ohno. It helped one man go from overweight to lean and trim thanks to a strict diet of Subway turkey subs (Jared, if you’ve forgotten). Even Phelps’ little sister got in on the Subway action, proclaiming those healthy subs the food that fueled her through her NYC Marathon training efforts. During the London Olympics, it pushed that avocado-super-food business hard. (Remember this commercial with Michael Phelps and his mom Debbie that was so horribly corny it practically begged for an SNL spoof?)

Chalk it up to gullibility or my easily condemnable willingness to believe almost anything that comes out of a U.S. Olympic gymnast’s mouth, but I for one bought, to a certain extent, Subway’s “eat fresh” image.

Subway is inarguably far healthier than other fast food chains. And the chain is rated as a provider of healthy options on Zagat.

But, it’s really not very healthy or fresh at all. I did some investigating (read: examined the nutritional info section of Subway’s website), and a few disconcerting findings I came across: the plain chicken breasts have fructose in them, the roast beef contains caramel color, and if someone can comprehend even half of the ingredients in Subway bread, I will truly be impressed. Maybe I should have known this all along, and maybe I should greet every single advertising campaign with a heavy dose of skepticism, but realizing that there’s a certain inauthenticity around the Subway brand disheartened me.

Arby’s and Subway: We’ve Got to Stop Meating Like This

What are behind these Subway-induced speculations? My coworker recently wrote on an ad campaign launched by Arby’s in which former NYPD detective Bo Dietl attempts to expose the falsity behind the “eat fresh” motto and in doing so, paint a new picture of Arby’s: a picture pieced together with fresh meat…sliced in the store.

Have a look at Dietl’s exposé:

Whether or not such mudslinging is decent or even effective is up for debate. Arby’s ad, in which Deitl parts the curtain that conceals the falseness of Subway’s well-executed marketing myth, is as much about Subway dropping the fresh image as it is about Arby’s assuming it. It’s a juxtaposition of fact and fabrication, an attempt to tear down Subway, the ultimate (alleged) paragon of healthy fast food, and in doing so, build up Arby’s.

Are people foolish for actually believing Subway slices its meat in the store? Maybe. And I think Arby’s is missing the point entirely: it’s not about where the meat is sliced; rather, it’s about what’s in the meat. But even if the thought of someone buying into Subway’s advertising is laughable, the point is that there’s a discrepancy between the representation Subway projects and the reality it lives. Subway casts itself in a certain light, but is its brand image mainly a façade?

This discrepancy prompted me to start thinking about the concept of brand transparency.

Brand transparency seems to be a trend as of late, with pizza chains, movie-streaming businesses, and fast-food establishments all holding themselves up to the looking glass and offering customers a crystal clear look into their modi operandi. However, the mirror brands stand before isn’t always as polished and clean as they purport. In an attempt to appear transparent, some brands actually come across as calculating, scheming, or out of touch; their looking glass is spotted, slightly smudged and mildly distorted. Which brands have provided us with an unaltered, truthful reflection and which have promised us such but in reality provided us with only a carefully illustrated company image?

Brand Transparency of Past and Present

The most famous recent example of brand transparency might be Domino’s famed mea culpa campaign. Launched in early 2010, the campaign commenced with commercials showing individuals in focus groups delivering absolutely abysmal reviews of Domino’s pizza (one review compared the crust to cardboard; another likened the sauce to ketchup). There was the website, where Domino’s customers uploaded pictures of delivered pizza; when one customer posted a photo of a mangled pizza with toppings and a mess of cheese stuck to the inside top of the delivery box, a chef and trainer at the Domino’s headquarters flew out to this person’s home and presented him with two pizzas made at a local Domino’s, a letter from the CEO, and $500 worth of gift cards. The pizza chain also developed commercials in which Domino’s chefs ambush unsuspecting focus-group individuals, who derided the chain, with their new pizza. One individual’s response: “I’m eating my words.”

Domino’s corporate candor campaign had its critics: some said that by broadcasting the poor quality of its pizza, the chain would alienate and anger those individuals that thought the original pizza was just fine. (To which I might reply, did anyone think the original Domino’s tasted good? But seriously, wasn’t Domino’s big attraction the convenience and speed of its delivery, not the tastiness of its pizza?)

I think the Domino’s campaign was excellent, and not just because it’s something novel and different and is guaranteed to grab people’s attention. We don’t really hear big brands own up to their flaws all that often. When brands do, they become stunningly human in their vulnerability. Greg Ciotti of Sparring Mind points to research that admitting shortcomings is a great way to simultaneously highlight strengths.

He cites a study that aimed to measure the effects of admitting to missteps and blunders, and how such an admission would affect stock prices. Researchers had study participants read one of two fictitious company reports. Both reports listed reasons why the company performed poorly last year, but the first report emphasized strategic decisions, while the second emphasized external events.

Participants viewed the first company far more favorably than the second, and that companies that admitted to mistakes showed that they were still in control, despite their faults. When companies blame outside forces (even if such blame is legitimate), people think the company might just be making excuses, and such blame shifting gives skeptics a reason to view the company as inept or incapable of remedying the problem.

After examining hundreds of statements and real companies, researchers found that companies who owned up to flaws had higher stock prices the following year.

Is this true for Domino’s? How did its attempt at transparency affect (if at all) its stock prices?

According to Bloomberg, sales at U.S. locations rose 14 percent in the first quarter of 2010 from a year earlier.

In November 2008, the stock price hit a record low of $2.38; it rose to $15.95 at the beginning of 2011; and it’s currently sitting at $40.38.

Netflix: Kind of, Almost, But Not Quite Transparent

Netflix’s attempt at authenticity and frankness succeeded Domino’s, but it wasn’t quite as effective or well-executed as that of the pizza chain’s.

Netflix is one business that waited until it was embroiled in crisis to try its hand at transparency. It failed miserably. After Netflix users expressed outrage at the 60% increase in prices, which manifested into a 19% plunge in share prices, Netflix attempted what can best be described as an ersatz form of transparency. It announced it would be splitting its business into a streaming-only service and a DVD-mailing service—and charging separately for both.

However, rather than assuring people that the company was still in control and possessed the ability to deal with its problems, Netflix’s pseudo-genuineness caused another PR disaster for a business already engulfed in the fury and ire of its consumer base.

About eight weeks after the price increase, the co-founder and CEO of Netflix sent an email to subscribers (this email was also posted on the company’s blog) that began with this:

“I messed up. I owe everyone an explanation.”

He offers a “sincere apology,” but what he (or presumably some individual in the PR department) presented was solely an admission that Netflix did a poor job of communicating the recent changes. He explains the rationale behind the DVD-streaming split, dwelling on the Netflix business model. This would be useful for businessmen, and maybe stockholders, but it doesn’t do much of anything for the everyday consumer.

One of the major problems with Netflix’s blundered exercise in transparency is that people expected some type of offer from Netflix. What they received was a lengthy explanation of the new services. Contrast this to Domino’s campaign, which works like this: we messed up; we produce bad pizza; and we promise to make better pizza. Netflix takes a step in the right direction, but quickly stumbled and lost its footing by failing to acknowledge how changes will benefit (not affect) customers and failing to offer customers anything better.

According to YouGov BrandIndex, this announcement generated an immediate negative reaction, and most of the perception gains Netflix made in the eight weeks since its new price-increase announcement were lost in just one day. (Since then, Netflix stock has been slowly declining; in July, it reported a 91% reduction in second-quarter earnings.)

McDonald’s: Better Than Netflix, But Still Not Quite There

The most recent instance of brand transparency that I’ve encountered involves McDonald’s Canada, which is currently running a campaign entitled “Our Food. Your Questions.” People who live in Canada can ask questions about McDonald’s food (after signing in through Facebook or Twitter); they then receive an email notification if their question is approved, and the McDonald’s Canada team (this includes anyone from the CEO to partners and suppliers) develops an answer.

McDonald’s answers some questions in the form of brief written statements and others in the form of videos. One individual inquired, “Why does your food look different in the advertising than what is in the store?” To answer this, McDonald’s posted a video in which the Director of Marketing shows viewers what goes on behind-the-scenes in a product shoot, including the methodical, meticulous food styling and the computer alterations/enhancements performed post shoot.

The reasons behind this campaign are obvious: McDonald’s is quite often regarded as the embodiment of unhealthiness with their cheap, convenient, and culinary-corrupt cuisine comprised of cheeseburgers and craptastic chicken. Rumors and speculations abound regarding the fast food chain’s methods of production and food products. One way to set those rumors straight: address them directly. Lifting the veil that surrounds McDonald’s food and allowing people to physically see exactly how McDonald’s goes about making the products they sell is a great exercise in brand transparency—in theory. The problem is that it’s painfully obvious that this campaign isn’t really about transparency for the consumer’s sake; it’s all about McDonald’s trying to establish itself as a supplier of healthy, wholesome food. In a society with health and weight and obesity and diabetes on the brain, McDonald’s has a struggle in making itself (and its food) relevant.

Secondly, one has to wonder: does McDonald’s reject those questions that are controversial, or those to which the company can’t craft a response that will paint it in a favorable light? And thirdly, comments are disabled on the videos McDonald’s posts. This campaign feels very orchestrated and staged; on the surface it looks like transparency, but if people can’t even have a discussion around the material presented in the videos because comments have been disabled, is it really transparency?

Why It All Matters

What does transparency really mean for brands, and what can we learn from transparency efforts of past and present?

Apparently one of the reasons the Domino’s campaign worked was because “trust has evaporated” in the modern marketplace.

According to the 2012 Edelman Trust Barometer, only 50% of Americans have confidence in businesses. Over the past year, the percentage of Americans who deem CEOs credible dropped 12 points, the biggest decline in Barometer history.

As CEOs become less of a source of trusted information, people turn to their peers. “A person like me” re-emerged as one of the three most credible spokespeople, with its biggest increase in credibil­ity since 2004.

Who else is becoming increasingly trustworthy in contemporary society? Social media witnessed the biggest percentage increase in trust among media sources; 75% of people trust social media as a source of information about a company.

Couple this increasing reliance on peers with the increasing reliance on social media, and transparency becomes more and more relevant.

People use social media to shine the light on brands with or without that brand’s consent: they voice complaints, they praise, and they ask questions. Social media fosters conversations; sometimes this works to a brand’s advantage, and sometimes it works to a brand’s detriment. And individuals trust the information that’s out there in the giant social swirl of blogs, Facebook, Twitter, and online review sites. People will try and lend a level of transparency to brands, whether or not that brand does the same. Isn’t it better if the brand joins in?

As well, all of the examples I’ve discussed are ones in which a brand tries to imbue itself with a level of transparency, honesty, and authenticity after something has gone wrong. Isn’t it better if a brand makes truthfulness and frankness part of its founding principles and is sincere from the start?

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