Crisis Management: What You Can Learn From These 5 Brands
We’d all like to think we respond well under pressure. That we rise to the occasion. That we handle criticism like the professionals we are. That we can respond appropriately when the $#!% hits the fan. Unfortunately, that’s not always the case for brands and the humans who run them. That’s why a crisis management strategy is so crucial.
The last few months have seen some of the world’s preeminent brands come under fire from the media, and even their most devoted followers. We’ve seen Uber lose 200,000 users in the wake of #DeleteUber and United lose $800 million in value in just a few hours. That kind of response to brand crises is pretty remarkable, and it also says something about each brand’s crisis management strategies.
What is crisis management? Shift Communications defines it as:
… analogous to putting out a fire … A fire requires three things to burn – heat (energy), fuel, and oxygen or a catalyst like oxygen (speed). Take away any one of those elements and the fire goes out. In a crisis communications situation, something has gone wrong and your brand is on fire. There’s the something you did or something you’re responsible for – the fuel. There’s the tide of public opinion – the heat, the energy. There’s your speed of reaction to it – the catalyst. As with real fires, if you deny the fire any one of these sources, you break the chain reaction that causes fire and it burns itself out.
And Brandfolder CEO Steve Baker defines crisis management as:
Crisis management is like your Dad stockpiling MREs before Y2K (come on, we all knew someone’s parents who were doing it). It seemed like overkill, like preparation for an event that was never going to happen. But they had a strategy, supplies, even communication plans mapped out and documented so that if the worst happened, they were ready. As brands you hope that, like Y2K, a crisis never happens, but if it does, you want to have the mother of all crisis management plans ready so that your company and your brand are protected.
Below, we’ll take a look at five brands who’ve recently experienced PR fallout and how they’ve managed the crises. Does your brand have a strong crisis management strategy in place?? If not, this list might give you the incentive you need to get started.
Uber went from one of the most celebrated brands in the world to one of the most reviled in a matter of months. The ride-hailing company started 2017 off in hot water when it was revealed that CEO Travis Kalanick was serving on an advisory council to President Trump. The hashtag DeleteUber was born and Kalanick announced that he would be stepping down from the council shortly after.
The hashtag made a comeback in February, first when Uber continued operating at JFK International Airport during a taxi strike in protest of President Trump’s immigration ban. And second, when ex-employee Susan Fowler Rigetti leveled claims of sexual harassment and gross HR misconduct at the company. Kalanick announced an immediate investigation into the issue, but early investors voiced concerns over the impartiality of the internal investigation and the company’s private arbitration clause.
The hashtag really gained momentum a few days later, however, when video surfaced of Kalanick arguing with an Uber driver about a drop in driver pay. Kalanick released a statement on Uber’s website saying, “I must fundamentally change as a leader and grow up.” But for many Uber customers, the damage was done and the video was viral.
February 2017 also saw Uber slapped with a lawsuit from Google. The technology giant claimed Uber stole technology from their self-driving vehicle division, Waymo. So far, this case isn’t going in Uber’s favor either. The tech darling is also in hot water for using technology called Greyball to elude authorities worldwide, and has seen several executives, including their head of communications, step down.
Uber’s Crisis Management
How has Uber handled the negative attention? While the company continues to release statements concerning each incident, it’s hard to ignore the fact that missteps keep piling up. A lack of transparency has been Uber’s biggest failing in handling much of the public interest. A heartfelt letter from the CEO promising to be a better leader won’t get the company far unless the public sees steps and actions taken to get there.
2. Cracker Barrel
You never know what the internet is going to find and amplify, but for Cracker Barrel, it was Brad’s wife. In February 2017, Bradley Reid posted on Cracker Barrel’s corporate website asking why his wife Nanette had been fired from the retail-manager job she’d held in an Indiana Cracker Barrel for 11 years.
It wasn’t long before The hashtag #JusticeforBradsWife began trending. Someone even started a Change.org petition for answers that garnered over 17,000 signatures. People began adjusting Yelp and Google pages for the brand to reflect well, Brad’s wife. And other fast food chains began capitalizing on Cracker Barrel’s bad press, including a Chick-fil-A sign emblazoned with “Now Hiring Brad’s Wife!”
Cracker Barrel’s Crisis Management
The restaurant’s crisis management was, apparently, not to treat this like a crisis. They kept quiet on the issue, never publicly addressing the movement or Brad’s Wife. While you’ll still find a few #NotMyCountryStore hashtags littering Cracker Barrel’s social media channels, the firestorm has mostly passed. And, according to the company’s latest numbers, they’re doing just fine.
In July 2015, the E coli outbreaks started for Chipotle and lasted through January 2016. It began in the Northwest and spread across dozens of states. The result was an 82% decrease in profits over the course of a year and Chipotle stock down 15%. 2016 also saw an executive arrested for cocaine possession and 10,000 workers suing the company for unpaid compensation.
Chipotle’s Crisis Management
The burrito company’s crisis management strategy has been a long and often criticized one. In the midst of the 2015 outbreaks, co-CEO Monty Moran spoke at an industry conference for investors saying:
It’s been fueled by the sort of unusual and even unorthodox way the CDC has chosen to announce cases related to the original outbreak in the Northwest,” he said. And: “Because the media likes to write sensational headlines, you’ll probably see, you know, when somebody sneezes … ‘Ah, it’s E. coli from Chipotle’ for a little bit of time.
While truthful, as journalists at Fortune pointed out, “this is not how you win back the world’s confidence.” A few days later, Chipotle founder Steve Ellis appeared on the Today show apologizing to consumers and promising that “The procedures we’re putting in place today are so above industry norms that we are going to be the safest place to eat.” It was a bold promise, and one that made some PR professionals nervous for the already queasy company, but Chipotle’s stock made a 5% climb after Ellis’ speech.
In 2017, Moran stepped down as co-CEO, a move that was heralded by many. However, finger pointing, wishy-washy answers and apologies, and a lack of company representation at the 125 food safety cases that were settled in 2016 has some feeling that the brand could have done a better, more authentic job of recovering its image.
Another head-scratcher? Chipotle’s latest ad campaign in which comedians tout the virtues of Chipotle’s “real food.”
The joys of flying under the radar have probably never seemed so blissful and sweet to Pepsi execs. In April 2017, Pepsi kicked off a new ad campaign with a commercial starring Kendall Jenner. Over the next 48 hours, the “short film” received nearly 1.6 million views on YouTube.
That might seem harmless enough, but by this time we all know what followed. The world was treated to Jenner leaving a modeling gig to “join the conversation” which she and her fellow marchers seem to “win” after she hands a police officer a Pepsi. The backlash was immediate and fierce, but in Pepsi’s defense, so was their crisis management.
Pepsi’s Crisis Management
The brand did initially release a statement defending their campaign by saying, “This is a global ad that reflects people from different walks of life coming together in a spirit of harmony, and we think that’s an important message to convey.”
However, less than 24 hours later the soda company had pulled the ad and paused the campaign entirely. A second statement followed: “Pepsi was trying to project a global message of unity, peace, and understanding. Clearly, we missed the mark, and we apologize.” The response was heralded for its speed and straight-forward nature, but it will take a while for the brand to recover from this internally created “worst ad ever.”
You knew it was coming. You expected this. And here we are. Fasten your seatbelts because it’s been a bumpy ride for United, and it’s likely going to stay that way for a while.
In early 2017, social media erupted with the news that United barred two teenage passengers from boarding a flight because of the leggings they wore. The situation quickly escalated as a nearby traveler tweeted about the incident. Far from apologizing, United released a series of tweets defending the gate agent’s actions and claiming that this was standard procedure for passengers flying as “pass holders.” The “pass holder” reasoning seemed to mollify some, but all agreed the that the situation had been poorly handled.
The leggings scandal was nothing compared to what happened a few weeks later, however, when video surfaced showing a United customer being brutally dragged and bloodied from a flight. While initial speculation was that the paying passenger had been asked to give up his seat because of overbooking, it was soon revealed that the seats were being repurposed for United’s own employees.
United’s Crisis Management
One would think that the response from United would be swift and sincere, but one would be wrong. Instead, the airline’s CEO, Oscar Munoz, released a statement in which he defended the actions and protocol taken by the flight crew and apologized for having had to “re-accommodate these passengers.”
Within 24 hours of the incident, United Continental had lost $800 million in total value. By comparison, Pepsi’s value changed very little as a result of their controversial ad. What followed was too little too late. Munoz made several follow-up statements and apologies to attempt to make up for his first, but public sentiment only worsened. At publish of this article, a lawyer for the brutalized passenger announced that his client had lost two front teeth, suffered a concussion and a broken nose, and required reconstructive facial surgery.
It’s easy to see what a rapid and genuine response to situations like this can do to gain back a brand some semblance of control. It’s also easy to see what the lack of the former can do to a brand. Time will tell what the road back to customer and industry trust has in store for United, but some experts say this may spell irreparable brand damage for the airline.
Crisis Management 101
All brands hit bumps and PR nightmares in the road, but a quick, transparent, and genuine response may lead to a far faster and more holistic recovery than trying to hide, defend, or ignore your missteps.
Another way to be prepared for your brand’s bad days? Having a Digital Asset Management (DAM) platform that’s populated with brand guidelines, PR strategies, and press kits to make swift responses possible when you need them most.
Not quite sure where to start while shopping for the right DAM? Click below to access our free DAM Buyer’s Guide!