Knowing that its name and future are at stake, BP has had to walk a fine line. Doing nothing to quell public outrage over the Gulf of Mexico oil spill would quickly erode the company's image. But undertaking aggressive and overt marketing to downplay the effects of the incident could just as easily paint the company as more concerned with profits than ecological impact. Instead, executives have attempted an alternate kind of crisis management: laying low while trying to drive the narrative locally, rather than internationally.
According to a leaked internal message, initially obtained by industry newsletter Oil Express, from BP corporate to its marketers in the field, including some gas stations, the company instructed its affiliates not to partake in any new independent advertising that could disrupt the company's efforts to paint itself as humble and helpful. "During this sensitive time, we hope you will join us in reviewing marketing initiatives in light of the current situation, and place additional focus on supporting the BP brand by primarily connecting with consumers on BP premises and in local communities," company officials wrote to affiliates. They advised creating "a word-of-mouth network that can help diffuse or deflect negative commentary and help support the BP brand." Usually, the London-based company pays 50 percent of all local advertising costs, but if a partner uses prepackaged advertising directly from London, the company will cover 100 percent of the costs.
Since the incident, the company has undertaken efforts to limit the public perception of the problem, and its liability. But the attempts have almost uniformly backfired. Initial company estimates of the quantity of oil spilled appeared to be grossly low-balled, according to analyses of independent scientists. Just days after the spill, the company was caught trying to get Gulf Coast residents to sign a settlement agreement limiting how much they could claim in damages (a federal judge ordered the company to cut it out). And early this week, a tourism campaign funded by BP aimed at convincing people that the beaches were clean and that vacations shouldn't be canceled, left gulf residents suspicious that they were being used as plants in photos showing the extent of the spill was not nearly as extensive as had been reported.
There's a logical reason why the company, whose shares have fallen 19 percent since the incident, wants to downplay the extent of the spill. According to the federal Clean Water Act, administered by the Environmental Protection Agency, BP could be liable for considerably more than has been reported widely. Under the act, any owner or person operating "an offshore facility from which oil or a hazardous substance is discharged" is liable up to $1,000 per barrel spilled (up to $70 million a day in BPs case). The federal statute, however, stipulates that the number balloons to $3,000 per day (meaning a $210 million daily price tag) in the case of "gross negligence" prior to the incident. BP may find itself under the heightened liability cap after a damning set of revelations about the days leading up to the blowout were reported on CBS's 60 Minutes, including a dead battery in the control pod of the blowout preventer and several leaks in the hydraulic system attached to the rig.
The environmental community, meanwhile, hasn't been impressed with BP's sleight of hand. Earlier this month when a person working for a group that had taken money from BP was quoted by The New York Times as head of "a conservation group," the outrage hit fever pitch.
"With high fines per barrel of oil spilled, there's a temptation to minimize the extent of the spill," says Chris Mann, a senior officer with the Pew Environment Group. "There is understandable uncertainty about the volume of oil flowing, but that should be sorted out by qualified scientists using the most appropriate techniques, not by lawyers and M.B.A.s."
The numbers, for now, are still small compared to BP's first quarter profits—$6.08 billion, the company reported—but after executives vowed to the Obama administration to cover all long-term environmental and economic damage, its liability is sure to creep upward, and quickly. Aside from the impact on the planet, it's also awful for business