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| Version 1 | Version 2 |
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| How can consumer panic be quelled? | How can consumer panic be quelled? |
| (about 1 hour later) | |
| WHO, WHAT, WHY? The Magazine answers... | WHO, WHAT, WHY? The Magazine answers... |
| Queues have formed dailyNorthern Rock customers are continuing to besiege branches to withdraw savings, despite assurances their money is safe. So how can such panic be quelled? | Queues have formed dailyNorthern Rock customers are continuing to besiege branches to withdraw savings, despite assurances their money is safe. So how can such panic be quelled? |
| James Stewart managed it in the film "It's a Wonderful Life". | James Stewart managed it in the film "It's a Wonderful Life". |
| He convinced worried savers not to withdraw their money from his family's savings and loans company and cause its collapse. "We can get through this thing all right, we've got to stick together," he implored. | He convinced worried savers not to withdraw their money from his family's savings and loans company and cause its collapse. "We can get through this thing all right, we've got to stick together," he implored. |
| But this is not the movies and some Northern Rock customers have refused to believe their money is safe, despite assurances from the government and the Financial Services Authority (FSA) | But this is not the movies and some Northern Rock customers have refused to believe their money is safe, despite assurances from the government and the Financial Services Authority (FSA) |
| So how can consumer panic be quelled? Clear, simple, empathetic language is vital and avoiding pomposity, say some behavioural experts. Also, going the extra mile to reassure people. | So how can consumer panic be quelled? Clear, simple, empathetic language is vital and avoiding pomposity, say some behavioural experts. Also, going the extra mile to reassure people. |
| THE ANSWER Communicate clearly and simply, show empathy and issue strong reassurances | THE ANSWER Communicate clearly and simply, show empathy and issue strong reassurances |
| "The initial mistake Northern Rock made was to discuss the situation in very technical terms," says Richard Alberg, the senior vice president of Kenexa - a firm of occupational psychologists. | "The initial mistake Northern Rock made was to discuss the situation in very technical terms," says Richard Alberg, the senior vice president of Kenexa - a firm of occupational psychologists. |
| "It's the type of language that would have made sense to an audience working in the City's Square Mile, but not to your average bank customer." | "It's the type of language that would have made sense to an audience working in the City's Square Mile, but not to your average bank customer." |
| From those in the board room to those working in local branches, all of Northern Rock's employees should be doing the same. | |
| Not rational | Not rational |
| "From the top to the bottom, if people feel they are being listened to they will calm down," says Mr Alberg. | "From the top to the bottom, if people feel they are being listened to they will calm down," says Mr Alberg. |
| The reason the situation has spiralled is because in times of commercial panic no official source is considered credible by consumers. | The reason the situation has spiralled is because in times of commercial panic no official source is considered credible by consumers. |
| "What does become credible is other people's behaviour," says Cary Cooper, professor of organisational psychology at Lancaster University Management School. | "What does become credible is other people's behaviour," says Cary Cooper, professor of organisational psychology at Lancaster University Management School. |
| WHO, WHAT, WHY? A regular part of the BBC News Magazine, Who, What, Why? aims to answer some of the questions behind the headlines | WHO, WHAT, WHY? A regular part of the BBC News Magazine, Who, What, Why? aims to answer some of the questions behind the headlines |
| "People see others queuing up and decide to do the same. Normal reassurances are often useless because people are not behaving rationally." | "People see others queuing up and decide to do the same. Normal reassurances are often useless because people are not behaving rationally." |
| Which is why something out of the ordinary is needed. | Which is why something out of the ordinary is needed. |
| Today's unprecedented government step of issuing an explicit guarantee to all Northern Rock savers moves reassurances beyond what is normal and should help quell panic, says Professor Cooper. | Today's unprecedented government step of issuing an explicit guarantee to all Northern Rock savers moves reassurances beyond what is normal and should help quell panic, says Professor Cooper. |
| The initial signs are positive and the bank's shares - which had been plummeting - have recovered some ground. | The initial signs are positive and the bank's shares - which had been plummeting - have recovered some ground. |
| Northern Rock has also taken out full-page newspaper adverts in most major newspapers today, emphasising it is "business as usual" at the bank. | Northern Rock has also taken out full-page newspaper adverts in most major newspapers today, emphasising it is "business as usual" at the bank. |
| This is a good course of action because it appeals directly to people, says Mr Alberg, in language they understand. | This is a good course of action because it appeals directly to people, says Mr Alberg, in language they understand. |