Brands: How to Re-claim Your Strings

In the dynamic and competitive world of business, brand leaders are expected to serve as the face of an organization, representing the entity's unified values, beliefs, and reputation to the public. A brand is merely a puppet in the hands of its decision-makers, its puppet masters. Employees at the top of the corporate hierarchy - the C-suite executives and board members - wield significant influence over how a brand behaves and is perceived and hold the brand's puppet strings.

When a brand missteps or faces public scrutiny, it is not uncommon for these key players, these puppet masters, to deflect responsibility and distance themselves from the situation. It is easy to point fingers outwardly or to reprimand the fall guy that management frames culpable for the brand dilutive debacle the corporation is being held accountable for, but all that does is diminish the agency of those in charge. Rather than taking ownership of their mistakes, and resolving matters by exploring how everyone at the company could have performed more mindfully and synergistically to prevent the problem, senior management opt to shift blame onto lower-level employees, external factors, or even the brand itself. This tendency to deflect responsibility can have damaging consequences for a brand's credibility and reputation.

However, in this article, I wish to hone in on those brands that have managed to course-correct their mistakes in the court of public opinion and regain credibility. One notable example is Johnson & Johnson, which faced a major crisis in 1982 when several individuals died after consuming cyanide-laced Tylenol products. Rectification entails implementing measures to prevent a future recurrence of a crisis, to effectively nip a concern in the bud in perpetuity. The brand promptly executed a mass recall of 31 million bottles and introduced tamper-proof, triple-sealed packaging serves as a prime illustration of rectification.

Johnson & Johnson incorporated a sympathy strategy, positioning itself as an unjust victim of an external threat, to garner public support, however it was the brand's readiness to incur losses through the mass withdrawal of the Tylenol product that elicited sympathy from the public. Playing the victim seldom benefits anyone, let alone a corporation, all it does is attempt to manipulate people to align with the perpetrator instead of the actual victim/s, which people always perceive. What proved more effective in the end was the company's leadership in demonstrating a commitment to public safety, highlighting the company's primary goal of enhancing public health and well-being.

Prior to the crisis, Johnson & Johnson lacked a proactive public affairs program, with media relations being primarily handled within the realm of advertising and marketing. The absence of a positive relationship with the media, a vital stakeholder, compelled Johnson & Johnson to respond to the crisis in a disingenous, ad-copy-sounding manner. The company faced criticism from the media for lacking authenticity in their slick, sales-oriented response ads during the crisis. Ultimately, it was the humble, direct communication with the media by the CEO that enabled Johnson & Johnson to address this issue effectively.

Johnson & Johnson has since fully regained the market share lost during the crisis, successfully reestablishing the Tylenol brand as one of the most trusted over-the-counter consumer products in America. However, we flash forward to 2024, and Johnson and Johnson is in the news again, under an unflattering spotlight, with the Washington state attorney general announcing a $149.5 million settlement in January of this year with drugmaker Johnson & Johnson, over four years after the state sued the company for its role fueling the opioid addiction crisis. Like me, you might ask, why would a brand that steadfastly asserted it's conviction for public safety, health, and wellbeing both through its words and actions even find itself in this compromising position? For one, the CEO is different, in 1982, James Burke was at the helm, now the Chairman and CEO is Joaquin Duato.

Johnson and Johnson's involvement in the opioid crisis involves allegations of misleading marketing practices related to their opioid products. They have been accused of downplaying the risks of addiction and overstating the benefits of their opioids, contributing to the widespread misuse and addiction to these drugs.

To handle this situation better, Johnson and Johnson could have been more transparent in their marketing efforts, provided accurate information about the risks of their products, and implemented stricter controls to prevent misuse and abuse. They could have also worked closely with healthcare providers and regulatory agencies to closely monitor and manage the distribution of their opioids.

To prevent being complicit in enabling addiction, Johnson and Johnson could have put more emphasis on developing and promoting non-opioid alternatives for pain management. By actively researching and promoting safer and more effective pain management alternatives, they could have played a role in curbing the opioid crisis.

To benefit society, Johnson and Johnson could have invested in addiction treatment programs, supported initiatives to raise awareness about the risks of opioid misuse, and worked towards improving access to mental health and addiction services. By taking a proactive approach to address the negative impacts of their products, they could have positioned themselves as a responsible corporate citizen dedicated to public health and safety. This was an incredible failure on the brand's part, and the responsibility for it squarely falls on its myopic, legacy-oblivious leadership.

Another example is Starbucks, which came under fire in 2018 following a highly publicized incident in which two black men were arrested at one of its stores for simply waiting for a friend. In response, Starbucks CEO Kevin Johnson issued a public apology, announced plans to close all stores for a day of racial bias training, and launched a series of initiatives aimed at promoting diversity and inclusion within the company. By acknowledging the mistake, demonstrating a commitment to change, and actively engaging with stakeholders, Starbucks was able to successfully navigate the crisis and rebuild its reputation.

In the past, Starbucks also faced challenges due to rapid expansion that led to a loss of its unique value proposition of being a "third place" where people could gather, i.e. a haven between work like a pub, town square, bar, and in recent times coffee shops. The brand began to act more like a fast food franchise that prioritized catering to convenience above convening, but what Schulz realized was he needed to offer up a blend of both to retain both markets. What initially made the brand successful was creating a welcoming atmosphere for the community to congregate and converse around coffee. After founder Howard Schultz realized the mistake of diluting the brand's essence with mass-market initiatives, Starbucks closed stores and refocused on creating a modern yet cozy atmosphere for people to gather in with expedient, excellent service. Schultz's strategy emphasized customer accessibility and ease, prioritized personalized experiences, and strived to achieve a balance between niche and mass-market appeal.

Under the leadership of CEO Laxman Narasimhan, Starbucks has continued to build upon the strong foundation laid by Schultz. The company's "Triple Shot Reinvention Strategy" focuses on accelerating global expansion, driving cost savings, and investing in barista wage increases to enhance efficiency and employee well-being. Narasimhan has successfully driven sales and efficiency improvements by simplifying operations and introducing new equipment and store formats.

Looking ahead, Starbucks aims to expand its global footprint to 55,000 locations by 2030, with a focus on international growth. The company's commitment to enhancing the customer experience, driving profitability, and investing in its workforce reflects a balanced approach that honors the brand's heritage while adapting to evolving market trends. By staying true to its core values and continuously innovating, Starbucks under Narasimhan's leadership is poised for sustained growth and success in the competitive coffee industry.

I still maintain they could look to address their environmental waste impact by implementing the following strategies:

1. Offer incentives for customers to bring their own reusable cups, such as a discount on their drinks.

2. Provide in-store ceramic mugs or glasses for customers who are dining in.

3. Launch a robust marketing campaign to encourage customers to use reusable cups.

4. Introduce a deposit-return system for reusable cups, where customers pay a refundable deposit when they purchase a drink in a reusable cup.

5. Use eco-friendly disposable cups made from compostable materials.

6. Partner with local businesses to host cup-sharing programs where customers can borrow and return reusable cups.

7. Educate customers about the environmental impact of disposable cups and the benefits of using reusable cups. Partnering with firms like Turn to make the recapture of used cups fun and engaging, and by extension striking a balance between convenience and conservation efforts as well.

These examples demonstrate the importance of transparency, accountability, and proactive decision-making in managing brand reputation. Rather than deflecting responsibility, brands should empower their decision-makers to take ownership of their mistakes, course correct as needed, and communicate openly and honestly with stakeholders. By doing so, brands can earn the trust and loyalty of consumers, even in the face of adversity.

In conclusion, brands are indeed guided by the decisions and actions of their key players, who hold the power to shape corporate behavior and reputation. These decision-makers need to take ownership of their mistakes, course correct when necessary, demonstrate a commitment to ethical business practices, and think ahead in productive, socially inclusive, ecologically conscientious ways. Only then can brands reclaim their credibility and rebuild trust with their stakeholders.