The Vodafone brand

NZ Herald reports:

Vodafone has been slapped with more fines for Fair Trading Act breaches than any other company but a brand specialist says the telco has dodged major reputation damage by owning up to the wrongdoing.

The phone and internet company was fined $960,000 yesterday after pleading guilty to 21 charges for misleading advertising.

This brought the total fines Vodafone has copped for Fair Trading Act breaches to almost $1.5 million, the highest imposed on a single defendant.

Despite this milestone, Interbrand managing director James Bickford said Vodafone’s apology for its actions would mitigate the harm the offending could have done to its brand.

“They’ve come out and said ‘we’ve made an error’ and apologised for it,” Bickford said.

“As far as the brand is concerned, that’s what it should be doing,” he said.

Vodafone fines

Yesterday: $960,000 for misleading advertising over a free air-time deal and the coverage of its wireless broadband network.
November 2011: $81,900 for misleading customers over “$1 a day” mobile data charges.
August 2011: Fine $400,000 for misleading customers over its Vodafone Live! service.

While it does mitigate the damage to have Vodafone admit their mistakes and apologise for it, I think their brand is being damaged by the third fine for misleading advertising in a year.

Telecom are no longer the big bad bully. Having lost Chorus, they no longer have a structural advantage. Vodafone is the giant global brand, and they need to be careful that their brand doesn’t suffer any more damage. With 2 degrees also in the market, loyalty is far from guaranteed.