According to actor Keith David, “publicity is publicity, controversy and all that, it’s all good”.
Most marketers and business leaders would probably disagree.
A lot of us like hearing about controversy, but we don’t necessarily want to be associated with it. If the news blacklisted our favorite clothing line, chances are we’d be less keen to wear it.
Unfortunately, brands make mistakes. It’s easy to stumble, especially now. For starters, companies have been forced to raise prices, leaving many buyers skeptical. And social media allows brand interactions to spread like wildfire, which often leads to them going viral or being “canceled”.
In today’s fast-paced environment, businesses should keep taking data-driven steps toward building consumer trust. But they also need to know how to navigate a reputation crisis in case the worst should happen.
Minimizing the risk of reputational damage
Many companies have pulled back on spending and chosen to focus on surviving in the short-term, rather than fine-tuning their online presence or building a good reputation, and it’s easy to see why.
With the cost of living crisis raging on, we’d assume consumers are obsessed with price, and less bothered by brand image. This is especially true in sectors like food and drink, given the recent rise in Europeans saying they buy own-label supermarket products.
But brand reputation does matter, especially in the long-run.
Whether people trust a logo is usually high on their list of purchase drivers; and B2C relationships have strengthened over time, alongside buyer expectations.
The number of Westerners saying they’re most motivated to promote a company they have a close bond with has risen by 31% since 2015, and a third would simply out of love for a brand.
Harry Lang, the VP of marketing at Kwalee, suggests that some businesses belong in the “Champion’s League of brands”: those that are so well-liked they seem untouchable. By the time we get to the Conference division (i.e. the lowest one), relationships are entirely based on price and therefore replaceable.
Companies should aim to keep scoring points and move up these tiers, as people who engage with brands on a deeper level are more likely to be satisfied when they apologize for a mistake.
Loyal customers are ultimately more likely to give brands the benefit of the doubt, hear them out, and quickly put a misstep behind them when a company makes amends.
Why a crisis management plan is necessary
If there’s one downside to trust, it’s that fans are more motivated to call out a brand they like in the first place because their expectations are so high. And even those who aren’t loyal to a company want to hold it accountable when it leaves a sour taste in their mouth. They do this by sharing online reviews, occasionally leaving a negative comment or boycotting a brand.
Boycotts aren’t rare incidents that inevitably end in disaster; they’re actually fairly common. Social media boycotts in particular have become more frequent lately, with companies in the ‘Champion’s League’ having survived a fair few themselves.
To put this into perspective, 63% of consumers say they’ve boycotted a brand before, with 16% of Americans doing so in the last 6 months.
That’s partly why some companies don’t always take them seriously. As Ms. Brantley, the author of ‘Brewing a Boycott’, explains, “unless you have a really well-organized boycott with clear messaging”, it probably won’t catch on. Plus, most of them aren’t long lasting and only have a temporary effect on sales.
This doesn’t mean businesses should start thinking like Keith David, though. Even when they don’t have a clear impact on profits, protests can damage brand equity over time, pushing companies down a tier. They should be seen as a penalty, even if they don’t mean game over.
To avoid a PR crisis, you have to check for holes
Bud Light’s partnership with transgender influencer Dylan Mulvaney has led some conservative critics to push for one. They’ve made the headlines, but Bud Light’s total sales over the first five months of 2023 were still higher than any other beer.
While we don’t know whether it’ll stick, endorsing a political cause that goes against their values is fairly low on consumers’ list of reasons for boycotting, and 75% of US Bud Light drinkers describe themselves as open-minded.
With 2 in 5 wanting brands to be socially responsible, it’s generally more damaging to be seen as uninclusive than “too woke”. The most compelling incentive people give for jumping ship are actions that harm a specific community, with transphobic, homophobic, and racist behavior driving many shoppers.
Unethical manufacturing practices and wrecking the environment are also high up there. The former even ranks above data breaches among clothing buyers, with many speaking out against fast fashion for both reasons. Clothes brands should address these issues in particular, as any movements they inspire have the potential to get off the ground.
And you can do this kind of analysis with just about any target audience. Those who use takeaway apps, for example, are 17% more likely to be put off by employees being treated badly, with online grocery shoppers standing out most for condemning illegal activities like tax evasion.
This research helps companies prioritize when working to avoid a reputation crisis. But sometimes even when brands put safeguards in place, data breaches, product recalls, and celebrity scandals happen anyway. So, it’s always good to have a backup plan.
Avoiding a brand crisis with actionable insights and a communications strategy
As we hinted at, the power of a boycott will depend on various things like the severity of the problem and the trust brands have racked up. Another key influence is how companies respond, and crisis communications should be seen as a chance to show integrity.
Price rise messages are a good case study as they demonstrate the power of good storytelling.
According to our data, people most want to know when (30%) and why (28%) a price rise is happening. This is a sign they expect an honest, value-driven story that goes beyond how much they’ll be paying – which is actually the last thing they’re keen to know (16%). When done well, these updates can even inspire loyalty, and the sustainable toilet paper brand Who Gives a Crap has been praised for doing just that.
The most highly rated response to potential crises is companies issuing a statement. And just like price rise messaging, how they frame it really matters.
In 2020, the software company SolarWinds suffered one of the biggest hacks in history. Two years later, customer retention rates are at historic highs, and the company’s key stakeholders put this down to being clear, open, and proactive during a setback.
Brands should use these blueprints when making a crisis plan, but come up with their own design
When dealing with discontent, brands should generally aim to double or triple-up on the above solutions for maximum effect. It’s rarely best to ignore the problem and hope it goes away.
Balenciaga hit the right notes when responding to protests against its controversial campaign. They issued a statement, apologized, promised to take legal action against those involved, and even partnered with a relevant charity to show they’d listened and learned from the experience.
Yet, each boycott calls for its own unique blend of responses, as what dissolves one PR crisis might not work as well for another.
Alongside statements, many people rate public apologies highly, but the decision to make one should be mulled over.
In our Bud Light example, saying sorry might not have been deemed necessary by most of its drinkers and could even work against the brand reputation they’re building. On this occasion, CEO Brendan Whitworth made a statement, not an apology.
Companies’ reactions should also depend on what they’re accused of. Those who say they’re likely to boycott a brand for harming a community or due to homophobic/racist behavior stand out most for wanting brands to donate to a charity affected by the mistake.
On the other hand, data breaches, eco scandals, and product recalls are distinct for creating demand for apologies. And relatively more people expect businesses to cut ties with those responsible when employees have been mistreated or brands have endorsed a political cause they’re against.
Speaking of cutting ties with those responsible, unless you live under a rock, you’ll be able to recall at least one celebrity-brand partnership that ended badly; Kanye West springs to mind. Many expect brands to break up with those behind company crises, and the stakes are even higher when they’ve got under people’s skin.
In fact, 74% think brands should stop working with celebrities immediately if they do something offensive. In these cases, brands need to act quickly – clearly explaining how they responded, and why.
Turning potential customers and boycotters into brand ambassadors
In a nutshell, here are the main things brands should consider when working to avoid a crisis situation:
- First up, don’t underestimate the power of a good reputation, especially during hard times.
- If there’s one downside to trust, it’s that fans are initially more motivated to boycott a company. So, brands need to have a strategy in place and spot potential risks.
- Finally, the best brand reputation management plans cover all bases. They identify the top motives for shunning businesses, lay out steps to avoid them, and underline the best ways to respond in the worst-case scenario: namely, get control of and rewrite the narrative.