Can Facebook please add a "Dislike" button to its interface? Or just put one on the pages of Cheerios and Betty Crocker?
Interacting with consumers across social media has become an established business practice for companies seeking to develop a rapport, establish social capital, and ultimately grow sales, but for General Mills (NYSE:GIS), that interaction constitutes a legal relationship -- if you "Like" its products, you'll forever give up the right to sue the company, even if it's because of its own negligence.
Whatever goodwill the cereal maker created last year with its push to become recognized as a more inclusive company has undoubtedly just been thrown into the shredder.
As the Times reports, whether it's visiting the company's website, downloading a coupon, entering a sweepstakes, subscribing to a newsletter, or yes, buying some Betty Crocker cake mix, you're effectively agreeing to waive all your rights to sue by simply engaging with the company. Legal experts, though, have a hard time imagining the courts would go along with such a scheme, particularly if it can be shown consumers weren't consciously aware they were giving up their rights.
Moreover, when you engage in these activities with General Mills, it's turning around and selling your personal data to third parties who can then inundate you with advertising. So the cereal maker makes money off your information and then protects its profits with a dubious legal out.
Now there is a way to protect your legal rights by opting out of the scheme in writing, but then you must also stop engaging with the company, which presumably means not buying its products too. That just seems like such a boneheaded way to grow sales. The Times goes on to note that the company recently and unsuccessfully tried to have a suit against it dismissed, for claiming its products were "natural" when they actually contained unnatural ingredients, so it's probably trying to limit its litigation costs -- but the phrase "penny-wise and pound-foolish" comes to mind.
It's should be noted that General Mills doesn't have a Facebook page of its own; the one that appears is automatically generated content created by Facebook. Indeed, General Mills' own website doesn't include a Facebook icon either, but does have one for Twitter, YouTube, and LinkedIn. What the cereal maker does have are pages for its various products. The verified Cheerios page, for example, has over 1 million likes (sorry, folks, you've given up your right to sue). Betty Crocker has almost 2.9 million likes (yeah, you people are out of luck, too).
There is a backlash growing against the cereal maker for its shenanigans as Facebook users begin informing the company they're opting out of the agreement -- and won't buy a General Mills product again. How much the ill will it's generated will cost the company is incalculable at the moment, but however much it costs, it's not going to be a tally they're going to like.
Rich Duprey has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.