How to Counter Fake News

Idea in Brief The Problem Fake news—deliberately fabricated “news” designed to go viral—poses a growing threat to corporate reputations, but traditional responses—ignoring rumors, demanding takedowns, or issuing factual corrections—are often insufficient. Why It Happens Companies struggle to combat fake news in part because even people who know the information is false adjust their own opinions and actions based on what they believe the majority thinks. The Solution Companies should deploy early warning systems to track disinformation and the dynamics of social influence; cultivate proactive transparency with stakeholders and influencers; and activate credible allies to flood channels with supportive narratives. On November 10, 2022, a tweet sent shockwaves through the pharmaceutical industry. A verified Twitter (now X) account claiming to represent Eli Lilly, one of the world’s pharmaceutical giants, announced that the drugmaker would begin providing insulin free of charge. Within hours, the post went viral, garnering over 11,000 likes and 1,500 retweets. The impact was immediate: Online searches for Eli Lilly surged by more than 80% in just one day. For millions of people reliant on insulin, the “announcement” signaled a potential breakthrough in the long-running battle over the drug’s pricing. There was one problem: The tweet was fake, posted from a parody account. Although Eli Lilly’s official account promptly clarified the situation, the damage had already been done. The company’s stock value dropped by 4%, rattling investors who feared a significant hit to profit and reigniting heated public debates about the cost of insulin. That wasn’t the first time the industry had been rocked by a fake news scandal. Several months earlier, a manipulated video appeared online of Pfizer’s CEO, Albert Bourla, in which he appeared to say, “By 2023, we will reduce the number of people in the world by 50%.” Outraged viewers demanded his arrest, labeling pharmaceutical companies as “evil.” Of course, the video had been edited. Bourla had actually stated that “we will reduce the number of people in the world who cannot afford our medicines by 50%.” Fake news isn’t a problem just for the pharma industry. It has targeted the financial sector (Metro Bank), consumer goods (Coca-Cola), restaurants (McDonald’s), airlines (Delta), entertainment (Disney), the fashion industry (Victoria’s Secret), the automotive industry (Tesla), and others. Fake news has also proven disruptive in politics, eroding trust in democratic institutions, deepening polarization, influencing voting perceptions, and swaying results in closely contested elections. Unfortunately, fake news is a stubborn problem that is unlikely to go away. While many U.S. adults feel confident in their ability to detect fake news, 38% of U.S. social media users have accidentally shared a fake news story, according to the Trusted Web Foundation. Complicating matters, fake news spreads significantly faster than real news—it is up to 70% more likely to be shared, according to a study of news stories on Twitter by MIT researchers. And with each share, it gains momentum: The more it gets shared, the more it looks true, and the more people share it. Fake news is likely to be an even bigger problem in the coming years as trust in legacy media continues to erode, advances in AI and video-editing technologies make fabricated content nearly indistinguishable from reality, and social media companies abdicate their content-moderation responsibilities, as Meta did in early 2025 when it announced that Facebook would stop fact-checking content on its platforms. Fake news is distinct from misinformation or false rumors, which can be defined as false content shared regardless of intent. In contrast, fake news is a specific type of disinformation: It is deliberately fabricated as a “news” story with an intent to deceive, transmitted by social media, and characterized by virality. The traditional corporate playbook for responding to misinformation or false rumors assumes that a company is engaging with actors who want to set the record straight or are open to fact-based persuasion. It calls for companies to ignore the information, scramble to have it removed, or provide facts and accurate information to debunk false claims. This fact-checking approach typically involves issuing statements through its own media channels, such as corporate Facebook pages or X accounts, as Eli Lilly did. When it comes to fake news, all those approaches are insufficient. Through our own research and decades of experience in studying and advising on reputation management, we’ve found that conventional methods fail to address the full scope of the challenge, for several reasons. First, ignoring fake news is rarely effective. Managers often assume that a solid reputation serves as a natural defense, believing that fake news will not be taken seriously enough to affect the company. However, in an era where disinformation can spread with unprecedented speed and reach, silence can be risky. Second, asking news outlets and social media platforms to swiftly remove or correct harmful content is an important first step, but it is insufficient to staunch the flow. Fake news often resurfaces through screenshots, reposts, or alternative formats, making it nearly impossible to contain its spread entirely. Third and more frustrating still, correcting the record with facts does little to change the narrative. For instance, when Wayfair faced baseless accusations of child trafficking in 2020, the company’s clarifications failed to prevent the rumors from going viral and ultimately reaching some 4.5 million people. And when the Arab airline Saudia faced false accusations of segregating men and women on its flights, company spokespeople denied the claims in newspaper interviews. Despite their efforts, the fake news took on a life of its own, sparking ongoing online debates about Islamophobia, sexual harassment on airplanes, and cultural misunderstandings—conversations that continued to propagate the fake news story. The Appeal of Fake News What’s happening here? Many executives don’t understand the viral nature of the problem and can often inadvertently amplify fake news by discussing it. This phenomenon is known as the “Streisand effect,” named after the actor-singer Barbra Streisand, whose unsuccessful attempts to prevent knowledge about her home address from spreading inadvertently made it more widely known. Once a piece of fake news reaches a certain threshold, efforts to suppress it will be largely in vain. For example, in 2016, PepsiCo faced a viral fake-news crisis when stories circulating on social media falsely claimed that CEO Indra Nooyi had told Trump supporters to “take their business elsewhere.” The disinformation spread rapidly, sparking calls for a boycott and temporarily driving down PepsiCo’s stock. The company’s response—a brief clarification—was too slow and subdued to counteract the viral outrage, damaging consumer trust. Fact-based efforts to combat fake news ignore a key insight into human psychology. People’s opinions are often shaped less by their own point of view than their perception of what others believe—a phenomenon that behavioral psychologists call “social proof.” We tend to be overly and subconsciously influenced by what we think is the majority opinion. That’s a problem when it comes to fake news, because people believe that others are more affected by fake news than they are themselves. A 2023 Ipsos survey of 29 countries highlights this disparity: While 66% of respondents expressed confidence in their ability to distinguish real news from fake, only 44% believed the average person could do so. Because people think and act according to what they perceive to be the majority opinion, they can still be affected by fake news, even if they know it is false. Our research, which examines the impact of fake news on corporate reputations, reveals similar findings but goes even further in showing the troubling effect of fake news on individuals’ judgments and behaviors. In a series of experiments, we exposed participants to fake news about different companies and then measured their judgments about the companies’ reputations as well as what they thought others’ judgments were before and after the exposure to the fake news. The fake news items were modeled after stories that actually circulated online to enhance realism but were slightly modified to avoid memory biases. In our first experiment, each participant read a description of an airline that was positive, negative, or neutral and then read a fake news story in which the airline was accused of removing passengers from a plane for speaking Arabic. The story was based on actual fake news that had been shared online about Delta in 2016 and flagged as fake by Snopes.com. We then measured how the story affected the participants’ personal judgments of the airline, as well as their beliefs about how others saw the airline. We also tested whether awareness that the news story was fake influenced judgments: Half of the participants were shown a “fake news warning,” and the other half received no warning. We found that the warning had a minimal effect on reputation judgments. In another experiment, we followed a similar approach but changed the company (a hardware manufacturer) and the fake news story (exploding batteries). Across both experiments, we consistently found that individuals believed that the fake news would affect others more than themselves. This effect was especially pronounced for companies that had a positive reputation. In an age where information is abundant and untrustworthy, Sideline Collective’s Joseph Ernst imagines a world in which there’s nothing in the news. In a third study, we found that individuals adjusted their own reputation judgments and behavioral intentions based on what they believed others thought. Participants were placed in a simulated group chat where everyone was asked to discuss a news story about a restaurant chain. The story falsely claimed that rat poison had been found in the company’s food. Before joining the chat, some participants were told that the other members in the group held a good opinion of the company; other participants were told that the group judged the company more harshly. The results were striking. Even when participants knew the story was fake, their own opinions and behavioral intentions shifted in accordance with what they thought others believed. Overall, our findings tell us that it is not enough to flag fake news as being false: People assume that others still believe the fake news—and this perception influences how they themselves think and act. Despite these daunting findings, our research suggests several ways companies can improve their response to fake news. By leveraging social proof tactics—a powerful yet often overlooked complement to traditional fact-based responses to fake news—companies can build a more resilient defense against disinformation. Harnessing the Power of Social Proof To effectively combat disinformation, organizations must spread the perception that fake news lacks widespread credibility not only because it is demonstrably false but also because others don’t believe it. That means crafting a multichannel strategy that addresses the falsehoods while also signaling that experts, peers, and other key stakeholders recognize the disinformation. The goal isn’t just to correct the record; it’s to show that the company’s reputation remains intact in the eyes of those who matter. When a company demonstrates that stakeholders’ opinions are unaffected by the fake news, it can effectively neutralize—or at least soften—the reputational damage. Social proof tactics are not a replacement for information-based strategies such as corrections; rather, they enhance them. By integrating both approaches, companies can develop a more robust and effective response to fake news. Drawing on our research, we offer three ways to leverage social proof to counter disinformation: monitoring social resonance, ensuring transparency, and activating allies. To illustrate these principles, we present a plausible scenario of a fictional organic food company—Vero Organics—whose reputation for pesticide-free products is challenged by a fabricated video alleging that it secretly uses synthetic and harmful pesticides on its farms. The video claims that certain pesticides—banned worldwide because of their links to birth defects and terminal illnesses—were used with the knowledge of the company’s management. According to the footage, which shows workers spraying chemicals on crops using equipment bearing Vero’s logo, leaders not only ignored the risks but also pressured workers to apply the synthetic pesticides and allegedly threatened them with termination if they spoke out. Vero navigates the unfolding situation using the three principles. 1. Monitor social resonance. It is critical that companies understand the dynamics of social influence—who is influencing the conversation and who is being influenced—in addition to simply monitoring social media for problems. In accordance with the traditional playbook for countering disinformation, Vero has social-listening tools in place. Some of these are automated, but employees and key partners (such as suppliers) are also trained by IT and internal communication staff in how to spot fake news quickly and how to report and respond to it. Through this early warning system, the alarm is first raised over a spike in mentions of “synthetic pesticides” and Vero’s brand name, which draws the crisis management team’s attention to the fake news story. Key players on the team include the chief communications officer, the social-media intelligence lead, legal counsel, a crisis PR specialist, and a senior executive spokesperson. The customer service and internal communications teams provide additional support. Given the nature of the disinformation, specialists in cybersecurity and food security are called in as well. Instead of continuing to follow the traditional playbook and immediately crafting a defensive reply, the crisis management team applies an important test to avoid the Streisand effect: Has the news reached the company’s visibility threshold? Resisting the urge to publicly refute fake news can be difficult, so Vero has established a predetermined threshold to prevent knee-jerk reactions that might inadvertently amplify disinformation. After ascertaining that the crisis has reached the threshold, the team analyzes the data to identify the key groups that are spreading the fake news. Social media is rife with self-proclaimed experts, bloggers, and celebrities, so companies have to invest resources in advance of a crisis to understand who the influencers are on topics relevant to them. In Vero’s case, the origin of the video is traced to an anonymous activist account, and the communities engaging most with the content are health-conscious consumers, organic food bloggers, and sustainability advocates. Understanding who is shaping the conversation allows the crisis management team to better decide how to enter the conversation and establish social proof in a tailored way. Joseph Ernst/The Sideline Collective The importance of early monitoring is seen in the case mentioned above of Wayfair, which in July 2020 became aware of a conspiracy theory alleging that the company was involved in child trafficking. Social media posts claimed that extremely high-priced cabinets and pillows on Wayfair’s site were actually fronts for selling missing children, pointing to product names that coincidentally matched the names of missing kids. What started as a conversation on Reddit quickly spread across Facebook, Instagram, TikTok, and YouTube. Wayfair monitored social media chatter and trending keywords as the story gained traction, with “Wayfair” being mentioned alongside trafficking claims and hashtags like #WayfairGate. Within a few days, the conspiracy posts amassed millions of views on TikTok and other platforms. An analysis showed that amplifiers were known information influencers who had previously spread conspiracy theories, confirming the need to respond—rather than remain silent—to avoid long-lasting reputational damage. Now consider the example of a company that didn’t recognize the spread of fake news quickly enough. In November 2024, the Danish-Swedish dairy company Arla Foods became aware of fake news spreading about its use of the cow-feed additive Bovaer, which the company trialed to reduce methane emissions in dairy herds on UK farms. The supplement had been approved by the European Food Safety Authority and the UK’s Food Standards Agency, and it had been in commercial use since 2021. Despite scientific evidence that Bovaer didn’t pose a health risk to humans or animals, social media posts on X accused Arla Foods of poisoning consumers. Videos showed angry customers pouring Arla milk down the sink and throwing Arla butter in the trash. The baseless concerns were amplified and legitimized by farmers, many of whom posted on social media that they opposed the use of Bovaer, and by a member of the UK parliament, who demanded on X that authorities carry out an urgent review of it. Although other dairy brands also used the additive, the fake news targeted mainly Arla Foods. The company eventually responded but only after the story had been widely amplified. 2. Ensure transparency. To effectively fight fake news, companies must demonstrate their credibility. The best way to do that is to expose their processes to customers’ and other stakeholders’ scrutiny before a crisis hits. Companies can then enlist those stakeholders, who can offer their personal validation to efforts to dispel false information. Here’s how Vero successfully orchestrates this. As a preemptive strategy, Vero has cultivated relationships with key allies across the organic food ecosystem: agricultural scientists, sustainable-farming advocates, health influencers, consumer groups, and supply chain intermediaries such as retailers aligned with its values. Vero has invited these stakeholders to visit production sites and learn about its rigorous processes, ensuring that they are well-acquainted with its zero-pesticide policies and have seen the supporting documentation. To further build trust, Vero has welcomed external and independent certification agencies to assess its production processes, providing guarantees that the company meets the highest standards of organic production. Ordinary customers have also participated in tours of its farms, which showcase its sustainable practices. To further reinforce its credibility, Vero and its retail partners conduct educational sessions at points of purchase and on social media platforms to reassure consumers about the authenticity of its pesticide-free claim. “Know Your Fruit” stands are periodically set up in major retailers’ stores, where produce is displayed alongside descriptions of the characteristics of organic products, comparing them with nonorganic produce and featuring tasting sessions. Additionally, Vero maintains a dedicated online transparency platform, “Vero Transparency,” where customers can access organic certification details, farm practices, sustainability initiatives, and customer endorsements. This platform includes myth-busting FAQs and educational content on organic farming standards. Such transparency has been adopted by real companies in a range of high-scrutiny industries. For example, to counter persistent urban legends—such as claims that its burgers contained earthworms or “pink slime”—McDonald’s launched the transparency campaign “Our food. Your questions,” inviting customers to ask questions and providing clear answers. As part of the campaign, McDonald’s invited camera crews into its factories, hosted live Q&A sessions on social media, and published detailed information on its website. Similarly, Starbucks has a webpage, “Starbucks for the Record,” where the company directly addresses misinformation targeting the coffee maker, using CEO letters, statements from other company leaders, and FAQs. Other companies have used more-sophisticated approaches to authenticate their claims. For instance, some fashion companies have adopted digital tools that allow consumers or other stakeholders to trace the origins of their products, see where they are produced, and gather important information about suppliers. Players in the precious metals industry have started very ambitious programs to make the supply chain—from extraction to the sale of end products—more transparent by allowing consumers, investors, and other stakeholders to digitally monitor the path of precious metals as they move along the chain. Domino’s Pizza turned skepticism into a marketing advantage by openly sharing real customer feedback—even negative reviews—while live-streaming the preparation of its pizzas to prove quality claims. By making transparency a proactive strategy rather than a reactive defense—“prebunking” versus debunking—organizations create an environment in which fake news struggles to take hold in the first place. 3. Activate allies. Although radical transparency lays the groundwork for establishing social proof, it is not enough on its own. When fake news emerges, companies must actively enlist credible voices—experts, industry allies, and engaged consumers—to flood the information landscape with accurate and supportive narratives. In our hypothetical scenario, Vero mobilizes its community of partners and experts with whom it has built a relationship through its transparency campaign. Vero alerts these stakeholders that the fake news about pesticide use threatens their own reputations as well. For example, retailers selling Vero products might find that consumers who believe the story are starting to question their reliability. Experts who had previously lauded Vero’s zero-pesticide policy might find themselves accused of industry capture—working in the interest of the industry and not the public good. So instead of hoping that its partners will come to its defense, Vero makes sure they understand what the stakes are for them and asks for their help in quashing the fake news. Here’s how the mobilization campaign plays out: Alerted by Vero, certification agencies issue statements verifying that Vero’s farms meet organic standards, while agricultural scientists explain why the viral video’s claims are implausible. On social channels, Vero encourages customers who participated in the transparency campaign to release videos of their experience at its farms—an authentic type of content that resonates with other consumers. Curated collections of the consumer-generated content are reposted on Vero’s social media channels. And Vero’s outreach goes even further. The company engages its loyal customer base, suppliers and employees through a campaign called #RootedInTruth. The campaign involves suppliers and employees who share personal stories about why they trust Vero, alongside photos of their favorite Vero products and their own recipes that use them. The #RootedInTruth campaign has two key strengths. First, it encourages spontaneous storytelling driven by emotions and personal experiences, which effectively captures attention and builds trust. Second, and most important, it creates a perception that ordinary customers (and not just elite experts) do not believe the fake news, further reinforcing social proof. In 2011, Taco Bell faced a fake-news crisis when a class-action lawsuit falsely claimed that its taco filling contained only 35% beef. The fabricated allegations spread rapidly. Faced with declining public trust, Taco Bell acted quickly, launching a multichannel response emphasizing transparency and credible voices. As part of its traditional PR crisis playbook, the company published full-page newspaper ads with the bold headline “Thank You for Suing Us,” using humor and hard facts about the chain’s actual ingredient components to combat the false narrative. It also leveraged third-party validation by the USDA, ensuring that consumers saw the claim debunked by a recognized authority rather than just by the company itself. Going beyond traditional methods, Taco Bell’s then-CEO, Greg Creed, addressed concerns in a YouTube video, and employees and franchise owners spoke directly to customers in local media interviews, reinforcing that the brand stood by its product. On social media, Taco Bell actively engaged customers, responding in real time to questions and encouraging satisfied consumers to share their experiences, creating a wave of organic social proof. The strategy worked. Negative online sentiment quickly declined, and within a few months, the lawsuit was withdrawn. When facing entirely false allegations, companies must not only correct the record but also mobilize credible voices—customers, employees, and authoritative third parties—to actively shape the narrative. . . . The growing sophistication and reach of fake news pose a threat to corporate reputations—even when the disinformation is blatantly false. Traditional crisis response strategies, which focus on presenting factual evidence to refute false claims, are insufficient. A robust response combines the credibility of factual evidence with the persuasive power of social proof—ensuring a stronger and more resilient defense against reputational threats.

How to Counter Fake News

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