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Social Media Blunders Abound: Hasbro

This week saw two major PR blunders in the online world that are worth noting: Hasbro and Cuil. These are two very different companies and two very different business models, but both made some basic mistakes that could lead to long-term problems. I'll talk about Cuil in another post, but Hasbro is the bigger current problem.

Hasbro is a big name here in New England, especially in Rhode Island where they essentially own the state. One of the biggest attractions on the way to see the Pawtucket Red Sox is the large Hasbro facitlity featuring a statue of Mr. Potato Head.

A major staple of this brand are the board games, an area notorious for its copyright issues. Over the years I've spoken to many people with board game ideas who say they can't sell into Hasbro because games are so easily copied that the company won't even LOOK at outside ideas. So it's no surprise that Hasbro took a page from the RIAA handbook and called in the lawyers to shut down Scrabulous. For the uninitiated, Scrabulous is the Scrabble-like Facebook game that has become an addiction for many.

The problem? Scrabulous infringes on the Scrabble copyright. The other problem? It was written by two brothers in India. More problems? Mattel and Hasbro share copyright, so Hasbro only has it in North America. So what does Hasbro do? It shuts down Scrabulous in North America and releases its own game.

The key problem here is that Scrabulous has a rabid fan-base. Apparently Hasbro tried buying the game, but failed and then turned to lawyers. The results has been a backlash against Hasbro and Scrabble.

Of course, this could have been avoided. Instead of shutting down the game, Hasbro could have started to market its boardgame to the Scrabulous players. Some people have said that playing the online game renewed their interest in playing the board game. They could have used the online game to boost their tournaments and meetups. They could have tried harder to purchase the game or invite the developers to help them create an official version. They could have used the Scrabble brand and extended it to Boggle and Upwards, two other games. They could have developed a series of word and letter-based games on the Scrabble brand, all building on the viral success of a game they didn't create.

All of that would have been a better PR move than shutting down the game, which now has people trying to boycott the company and refusing to buy the board game. Worse, hackers apparently attacked the official version of the game, shutting that down.

What could have been a resurgent interest in an old-standby of a game has, instead, turned into a crisis situation by trying to protect copyright.

This story also shows the true power of social media. A pair of brothers in India managed to create a game that attracted users around the globe, something that the gaming powerhouses Hasbro and their online parnter Electronic Arts failed to do. In this world it's not about size, it's about ideas.

Posted by Chuck Tanowitz on July 30, 2008 at 9:58 AM