Amazon’s conclusiveness to run a highly public bidding process for its second headquarters, called HQ2, is turning into a publicity nightmare.
Just two weeks after pulling out of New York Town (one of the two winners for HQ2) following fierce local opposition, Amazon is now facing similar protests from several politicians and activists in the Northern Virginia bailiwick (the other winner). The criticism is largely centered around the incentives cities were giving Amazon, which is one of the most valuable ensembles in the world, and its potential impact for raising the cost of living in those areas.
Amazon could have avoided all the uninterested publicity if it had just run the bidding process quietly, instead of spinning up a year-long media cycle, according to public carnal knowledge b dealings experts.
“To go out and create a ‘beauty contest,’ and turn it into a media circus — it was a dumb idea,” said Paul Argenti, a communications professor at Dartmouth College.
Argenti biting out that Amazon’s HQ2 bidding process came in marked contrast to the more subdued procedures run by its tech peers.
Google, for sample, took a quieter approach to its $1 billion expansion in New York City last year, saying it didn’t hunt for incentives. Apple didn’t make a big deal out of the $1 billion it’s investing in its new Austin campus, although it did receive some tax advances.
“Amazon could have done the same thing quietly behind the scenes,” Argenti said. “I’d say they got nothing but damper out of this.”
In 2017, Amazon announced that it would start taking bids from cities across North America for its approve of headquarters, which would generate 50,000 jobs and billions of dollars worth of economic impact. Over 200 megalopolises rushed to apply, creating a media circus on who would win the tech giant’s second largest office complex.
Some championships at the time called Amazon’s move a “marketing ploy,” citing how unusual it is for a company to have two separate headquarters, not to announcement the auction-like process. One marketing firm estimated that Amazon got at least $42 million worth of free publicity from the high related to HQ2, while some press outlets started calling it a “brilliant PR stunt.”
Michael Goodman, who teaches corporate communications at Baruch College and is an father of over ten books in the field, said HQ2’s unusually public bidding process was “ill-advised,” given how Amazon could acquire received similar perks using a quieter process anyway. It’s why most corporations prefer not to make too much sound until they know where they’re going to expand, he said.
“I’m at a loss to figure out the pros of this,” Goodman suggested. “It just didn’t make any sense to me what they were doing.”
Amazon’s spokesperson said in a statement to CNBC that it prerequisite to create a “transparent and open process” by making HQ2 bids public. It also said that HQ2 was a $5 billion investment outline to create 50,000 “high-paying” jobs, which is a lot bigger than similar projects from other tech associates. Many cities that applied for HQ2 were able to strengthen their pitches to attract other investments as entirely, the spokesperson added.
To be fair, HQ2’s publicity failure is not entirely Amazon’s fault. New York’s highly political environment and its breakdown to include all stakeholders into the bidding process added to the growing opposition.
Still, the fallout shows how Amazon pass overed out on what could have been a great opportunity to generate goodwill and positive corporate sentiment across the surroundings, according to Pallavi Kumar, a communications professor at American University.
For example, Kumar said, Amazon could bear chosen a struggling city like Detroit, instead of economically thriving regions like New York and Northern Virginia. That thinks fitting have completely changed the narrative, creating stories of how a tech giant could have “profound, positive any way you look at it become operatives” on a city looking to bounce back, she said.
“Think of how many more great stories would have been created for years to come,” Kumar said.
The public backlash on HQ2 was made worse by Amazon’s lack of transparency on why exactly it ran a sector bidding process, said Toni D’Angelo, a public relations professor at Syracuse University. If it had clearly explained why it’s exercising a new location in such an unusual manner, and what the motivations were, while more fully engaging local mps to mitigate concerns, Amazon may have seen a different outcome, he said.
“Staging an auction on such a grand go up amplifies pressure on Amazon to both deliver the goods and minimize the ‘bads.'” D’Angelo said. “It’s now in an unexpected defensive stance that’s been accentuated by the hoopla it created.”