Fake stories are all over the internet. We all know this, but we are still inclined to trust what we read online. The first instinct most people have when they want to know more about something is to Google it. Fake stories lurking in their search results can present a real threat to brands.
French construction giant Vinci discovered this painfully over the past few days. Its shares fell by more than 18% after a fake press release said the firm would restate its accounts and sack its chief finance officer, Christian Labeyrie. Leading financial publisher Bloomberg published the story on Tuesday afternoon. After Vinci issued a denial and had Bloomberg pull the story, the company's share price recovered to end the day down just 4% at €58.80.
Fake news stories are very easy to create, and in today’s social media-focused world, news travels faster then ever. It is much harder to stop a fake story from spreading. It is also harder for journalists and editorships to spot fake stories. Editorships have shrunk in the past years, and are challenged to produce news faster then ever, to be ahead of the competition. This means there is less time for one of the oldest journalist principles in the world: ‘checking your sources’. You would have thought that a leading medium like Bloomberg would not spread such a damning story without checking the facts with the issuing company first. But I guess it is a question of speed winning over the truth once more.
The release was issued with the company logo on it and looks credible, so the journalist chose to share the news fast and be ahead of the game.
Companies have to make sure their crisis preparedness plans have monitoring and measures in place to face this new reality. Vinci was quick to deny the Bloomberg piece and limit the damage. This is only possible with 24/7 media monitoring and great speed in taking action. A close relationship with the media also helps, to be able to engage quickly with relevant journalists and be heard.
But however prepared a brand is, fake news will unfortunately always pose a risk. As bad news, even if is it fake, casts an ugly shadow of doubt. Many people believe that where there is smoke there must be fire. This doubt will linger on for a while, and this is why the Vinci share price is still down. The company should focus on spreading a lot of positive news in the next weeks and months to offset the negativity caused by the hoax. And try to get to the bottom of who spread this story and why. It will only regain full credibility once the culprit has been found and it can produce evidence of this hoax.