Crises are an inevitability that can strike any business at any time, even the biggest and most successful brands. Such crises can range from economic downturns, natural disasters, accidents, and public relations scandals.
These events can cause significant risk to a company’s reputation, causing customers to turn away and investors to grow wary. Therefore, having a crisis management plan in place is crucial to mitigate the damage to both your brand’s reputation and the bottom line.
Here are some examples of companies that have suffered from crises and how they managed to get out of them:
In 2017, United Airlines faced massive criticism after a video surfaced of a passenger being dragged off an overbooked flight. United’s initial response was defensive and dismissive of the passenger’s situation. However, the public backlash showed the company that it needed to change its tactics in crisis management. The airline later issued a heartfelt apology and took steps to ensure that such an incident never happens again, such as offering more compensation to volunteers who relinquish their seats.
When Samsung’s Galaxy Note 7 phones began to explode, the company was faced with a credibility and safety crisis. Samsung, however, responded quickly by investigating the problem and issuing a voluntary recall for the faulty devices. The company also apologized, offered exchanges, and created a website where customers could access information regarding the recall.
In 2015, Chipotle faced a foodborne illness crisis, which led to multiple food poisoning incidents in different parts of the country. The company is facing litigation and loss of sales that nearly bankrupted it at the time. To resolve this, Chipotle adapted its food safety procedures by instituting a new protocol to test ingredients before serving, creating a rewards program, and changing the content and tone of its communications to regain customer trust.
When an auto defect led to the deaths of 23 people, Ford faced a severe reputational crisis. In response, the company issued a recall and took a new tack, acknowledging the crisis and stating that Ford would do everything possible to provide a solution. The company also introduced new safety protocols and put in place better communication from management to further satisfy concerns.
Your Brand and Crisis Management
It is crucial for companies to have a crisis management plan in place to mitigate damage to both reputation and the bottom line. United Airlines, Samsung, Chipotle, and Ford are examples of how successful and critical crisis management is for a company, especially when it comes to protecting your brand in times of crisis and economic downturns.
The key is to prepare in advance, be proactive, transparent, and timely with information, and adapt to customer sentiment and expectations. Finally, reputation management and communications are essential parts of crisis management; it’s about being prepared, proactive, and authentic to manage situations no matter the magnitude.