How to Save Your Brand In the Face of Crisis

When bad things happen, companies need the right strategy for talking their way out of a mess and avoiding a calamitous pummeling of their corporate image. Choosing the best response can spell the difference between a brand’s survival — even enhancement — and its irreversible tarnishing.

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In 2009 and 2010, Toyota Motor Corp. was the target of much adverse media attention after a series of accidents due to sudden acceleration incidents and brake faults that led to deaths and injuries. What started as a smoldering issue in 2005 with incidents of unintended acceleration and consumer complaints about sticky accelerators culminated in massive recalls of Toyota vehicles, totaling 8.5 million vehicles recalled by February 2010. It turned out that Toyota knew about possible safety issues much earlier than 2009, but refrained from issuing large-scale recalls. Consumers and media were harshly critical, and included comments such as: “House Panel Says Toyota Misled Public on Safety”1 and “Shame on you, Toyota.”2

The Toyota brand’s reputation — which had been closely linked to safety and quality and was a key element in the company’s success — took a serious battering. Toyota management had a choice — to be resigned to this fate or to use effective communication strategies to recover from the crisis. Crises such as the one Toyota experienced are business disturbances with potentially negative outcomes that stimulate extensive media coverage and marketplace scrutiny. The goal of a communication strategy in the face of a crisis should be to prevent severe damage to the brand’s reputation and eventually to restore consumer trust.

The Leading Question

How should a company best communicate with the public during a crisis to protect its brand from damage?

Findings
  • If the brand is at fault and the crisis is severe, come clean quickly.
  • If the brand is not at fault but the crisis is severe, defend yourself.
  • If the accusation against the brand is not true and not severe, denial is a useful strategy.
  • In normal, noncrisis times, work to bolster your image and enhance consumers’ brand identification.

Drawing on scientific research on persuasion, we have assembled a comprehensive crisis communication framework that highlights when specific communication strategies should be used to help a brand recover from a crisis and restore trust and brand image with customers. While other stakeholders, such as investors, need to be considered as well, we focus here on practices in response to customers and consumers in general.

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References

1. M. Maynard, “House Panel Says Toyota Misled Public on Safety,” New York Times, Monday, Feb. 22, 2010, sec. B, p. 5.

2. “Toyota Victim Recounts ‘Near Death’ Trip,” Feb. 23, 2010, www.cbsnews.com.

3. G.V. Johar, “Intended and Unintended Effects of Corrective Advertising on Beliefs and Evaluations: An Exploratory Analysis,” Journal of Consumer Psychology 5, no. 3 (1996): 209-230.

4. A. Roggeveen and G.V. Johar, “Perceived Source Variability Versus Recognition: Testing Competing Explanations for the Truth Effect,” Journal of Consumer Psychology 12, no. 2 (2002): 81-91.

5. S.A. Einwiller and M.A. Kamins, “Rumor Has It: The Moderating Effect of Identification on Rumor Impact and the Effectiveness of Rumor Refutation,” Journal of Applied Social Psychology 38, no. 9 (September 2008): 2248-2272.

6. S. Fournier, “Consumers and Their Brands: Developing Relationship Theory in Consumer Research,” Journal of Consumer Research 24, no. 4 (March 1998): 343–373.

7. R. Ahluwalia, R.E. Burnkrant and H.R. Unnava, “Consumer Response to Negative Publicity: The Moderating Role of Commitment,” Journal of Marketing Research 37, no. 2 (May 2000): 203-214.

8. S.A. Einwiller, A. Fedorikhin, A.R. Johnson and M.A. Kamins, “Enough Is Enough! When Identification No Longer Prevents Negative Corporate Associations,” Journal of the Academy of Marketing Science 34, no. 2 (spring 2006): 185-194.

9. J. Sengupta and G.V. Johar, “Effects of Inconsistent Attribute Information on the Predictive Value of Product Attributes: Toward a Resolution of Opposing Perspectives,” Journal of Consumer Research 29, no. 1 (June 2002): 39-56.

10. S. Einwiller and G.V. Johar, “Preventing Damage from Accusations — The Case of WalMart” (presentation at the 36th Annual European Marketing Academy Conference, Reykjavik, Iceland, May 22-25, 2007).

11. G.V. Johar, J. Sengupta and J.L. Aaker, “Two Roads to Updating Brand Personality Impressions: Trait Versus Evaluative Inferencing,” Journal of Marketing Research 42, no. 4 (November 2005): 458-469.

12. W.T. Coombs, “Impact of Past Crises on Current Crisis Communications: Insights from Situational Crisis Communication Theory,” Journal of Business Communication 41, no. 3 (July 2004): 265-289.

13. Einwiller, “Preventing Damage from Accusations.”

14. V. Mittal, R. Sambandam and U.M. Dholakia, “Does Media Coverage of Toyota Recalls Reflect Reality?” Harvard Business Review blog, Mar. 9, 2010, http://blogs.hbr.org.

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