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Here's how to deal with a brand crisis

Businesses, big or small, have to be prepared for a crisis. The ability to manage the challenge can make or break a company. Putting in place a communication strategy is a good start

April 27, 2022 / 06:11 AM IST
(Image: Shutterstock)

(Image: Shutterstock)

Not too long ago I bought an expensive pen from an upmarket mall in Bengaluru but when I got home, I found the pen had scratches and the paint was patchy. The store won’t take the pen back nor would it replace it.

After seven months of stonewalling by the store staff, countless phone calls and some legal advice, I managed to get a refund but the damage was done—I am not going back to that mall again.

What the mall lacked was crisis-management ability at every level. According to the general manager, his floor managers did not have the power to refund the money and that resulted in the delay but that could have been explained to the customer politely and quickly.

You don’t make the customer run around even if your floor managers don’t have the power to make decisions. You immediately refer the matter to your superior and make the customer feel good.

Crisis mode on 

Close

Every business or brand should anticipate at least one crisis a year, if not every month. These could be minor ones such as excess inventory or big ones like being named in a lawsuit or an executive accused of impropriety. Other nightmares include sudden financial decline, serious accidents and product, shop or service boycott.

Few firms have a crisis communication plan in place. In India, even big names don’t have such a plan. Imagine the situation with small and medium enterprises.

Management often responds to adversity by circling the wagons in the belief that curtailing the information flow would minimise the damage. But the opposite is true. Effective crisis management means facing the public with accurate information while laying down the ground rules.

Here’s a case that shows how corporations can move quickly to control the damage. When a leading daily reported on its front page that DHL had dismissed a few employees who were growing beards, it was old news. The company had by then reversed the decision and newspapers reported the development in the next edition itself, saving DHL from a major crisis.

Pre-emptive strike 

According to brand specialist David Aaker, the best way to handle a disaster—besides being lucky—usually is to avoid it.

It is useful to create worst-case scenarios about what could happen if a product is misused or a promotion misinterpreted.

With such scenarios in place, action can be taken to reduce the probability of such occurrences.

Another line of defence is to detect the problem early and act immediately before it blows up. When faced with adverse publicity, one should act quickly to reduce its duration.

Communicate, communicate, communicate

Consumers tend to judge businesses as guilty until proven innocent. Identify every downside risk inherent to the business before a disaster strikes. Perform mental fire drills, with probable procedures and responses.

Decide who should speak for your company and name spokespersons. Make sure they are people who will remain cool. Commit your plan to writing; tools like risk heat maps will be beneficial.

Once a crisis hits, begin implementing the plan while asking, “What now?” Your goal is to stay ahead of the events while conveying to the public that the company is dealing with the situation responsibly and effectively.

You may not have all the facts or answers but you are getting to the bottom of things. Respond courteously to the media, no matter how confrontational reporters become.

Employees unauthorised to speak should say so respectfully and help the media to contact a designated spokesperson.

The designee should always have a prepared statement, even if it says that accurate information isn’t available but will be provided the moment it’s confirmed.

For peak credibility, your spokesperson should indicate when specifics are anticipated. This person should also politely but firmly refuse to be sidetracked into offering unplanned information.

“I am not at liberty to discuss that at this time since it does not pertain to the immediate issue,” should be the reply.

Being candid about the actions of a deranged employee does not obligate your spokesperson to reveal the company’s tenuous financial position or unveil its R&D project.

The media’s focus should be on the employee and the events leading up to their action. Ideally, a basic crisis communications policy should be included in the employee handbook and discussed with every recruit.

The rank-and-file will appreciate that a plan is in place to guard them against the media firing line.



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M Muneer is the managing director of CustomerLab Solutions, a consulting firm.
first published: Apr 27, 2022 06:11 am
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