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Herbalife Nutrition - Crisis Communications Campaign

Gold Stevie Award Winner 2018, Click to Enter The 2019 International Business Awards

Company: Herbalife Nutrition, Los Angeles, CA, USA
Entry Submitted By: Sard Verbinnen & Co.
Company Description: Herbalife Nutrition is a global nutrition company whose purpose is to make the world healthier and happier. It has been changing people’s lives with great nutrition products and programs since 1980. Herbalife has over 8,000 employees worldwide, and its shares are traded on the New York Stock Exchange (NYSE: HLF) with net sales of approximately $4.4 bn in 2017. To learn more, visit Herbalife.com
Nomination Category: Corporate Communications, Investor Relations, & Public Relations Categories
Nomination Sub Category: Communications or PR Campaign of the Year - Crisis Communications

Nomination Title: Herbalife Nutrition: Defense Against Bill Ackman

Tell the story about this nominated campaign since 1 January 2017 (up to 650 words). Focus on specific accomplishments, and relate these accomplishments to past performance or industry norms.

Herbalife Nutrition mounted an unprecedented, comprehensive and multi-faceted defense of the Company against Bill Ackman, an investor who initiated a ruthless five-year activist short campaign against the company that ended in February 2018.

We deployed a political campaign approach, understanding campaigns are about defining yourself and your opponent. We used several tactics to communicate our Company’s positive messaging, undermine Ackman’s erroneous claims, and reveal the truth about Ackman’s campaign of manipulation and the questionable tactics he was employing against our Company. These included: multiple websites and social media accounts; advertising campaigns; grass roots support from our millions of customers and supporters; constant, transparent and daily interaction with the press; and direct outreach to stakeholders.

Importantly, we designed a public awareness website, IAmHerbalife.com, to share stories about people from across the country whose lives were improved by the Company. These took the form of videos, member testimonials and customer commentary that spoke to the real Herbalife Nutrition – not Ackman’s depiction of our Company. We used another website, TheRealBillAckman.com, to feature videos about the numerous times Ackman was wrong about investments in the past, the devastating implications of his investments, media reports about legal probes into Ackman’s unprecedented campaign and general Company-generated negative media about Ackman. On this website we also shared a series of videos that showcased commentary from the media and other thought leaders about Ackman’s motives, failed investment strategies and questionable tactics. This unprecedented site garnered significant positive earned-media.

Knowing the facts were on our side for anyone willing to take the time to learn the truth, we invited Fortune Magazine, The New York Times, The Wall Street Journal, CNBC, Fox Business and others to fully and fairly investigate the situation, promising full transparency and access. All publications did and all came to the same conclusion: Ackman simply got it wrong – as Fortune Editor Alan Murray put it “Bill Ackman’s campaign against Herbalife seems a step too far.”

We ran a number of advertising campaigns over the course of the battle, using print, television, radio and online media to ensure our message was reaching our targeted audiences. Our online campaign drove traffic to TheRealBillAckman.com. Furthermore, we created and ran a Captivate elevator ad campaign that ran in 74 buildings around Manhattan, targeting Ackman’s business partners, investors and others in the financial community. In the first week alone, our program delivered more than 3.5 million video impressions.

In an effort to showcase the vast support of our customers, we organized a series of grassroots rallies around the country and promoted these events by issuing a press release, inviting members of the media, and developing website content. We also organized grassroots efforts to counter “Betting On Zero,” a documentary film supported by Ackman, which focused on Ackman’s claims against our Company. At showings around the country, we distributed flyers contesting the veracity of the movie and created BettingOnZero.com, which examined the financing of the film and highlighted unanswered questions about those involved in the making of the film.

The Company also forged partnerships with key thought leaders and organizations around the country to demonstrate the depth of support the Company enjoyed. These individuals and organizations spoke out in favor of the Company and against Ackman.

On February 28, 2018, Ackman finally exited his position. With our stock at an all-time high, media and other thought leaders publicly saying he had lost his campaign and our continuing strong financial performance, his short thesis could no longer hold. Our stock price rose approximately 146% over the course of the five-year campaign, so as the Wall Street Journal reported, “In the end, investors sided with Herbalife and the company won out. […] By the judgment of traders, Mr. Ackman’s campaign was an outright failure.”

In bullet-list form, briefly summarize up to ten (10) of the chief features and results of this nominated PR program since the beginning of 2017 (up to 150 words).

  • Websites: IAmHerbalife.com featured assets that spoke to the real Herbalife Nutrition. TheRealBillAckman.com featured videos, media reports and commentaries designed to expose Ackman. BettingOnZero.com explained the biases in the documentary film.
  • Videos: A series of eight videos about Ackman’s motives, failed investment strategies and questionable tactics, which were rolled out strategically by issuing press releases thereby garnering earned media. Numerous other videos were also created depicting the real Herbalife Nutrition.
  • Media Relations: Developed close media relationships with dozens of reporters covering this story to complement our strategy of securing significant feature stories.
  • Print, Television, Radio and On-Line Advertising Campaigns: Advertising campaigns promoted our company’s messaging and helped define Ackman.
  • Grassroots Efforts: Organized grassroots rallies around the country, all generating significant positive media coverage.
  • Partnerships: Developed partnerships with hundreds of thought leaders and organizations that helped tell our story.