Preventing a brand crisis from grounding your dream!

In the era of social media, brand crisis can become a source of heightened customer anger and at times existential threat. Crisis to a brand can come from any quarter, ones employees in the case of Indigo or United Airlines, manhandling its customers. From Quality control issues such as Nestle Maggi episode, pesticides in Coca Cola or from its belligerent CEO and founders in the case of Volkswagen emission standards or Housing.com public spat with investors.

When faced with a brand crisis incident that affects the perceptional value of the brand, one must consider doing the below:

1.     Identify the key stake holders & its varied impact on the ecosystem:

• Shareholders see the first meltdown and hence it was just natural for Ratan Tata to walk up to the PMO during Mistry crisis as Govt. bodies such as LIC among others are the largest stakeholders.
• Employees & distributors have different impacts in terms of morale and trust and hence the treatment should also be different else one can see exodus and building an effective team is like rebuilding an enterprise from the scratch.
• Customers are essential for continuity and growth, hence the moment a crisis like in Infosys happens account managers are briefed to reach out to key clients in US and convey that the status quo will be observed.

2.     Identify the source & cause of the problem:

• What went wrong and why?
• Was the risk pre-identified and can it be mitigated now?
• What efforts can be taken to prevent it from re-occurring?

One way to contain the issue from snowballing is to localize it. For example when Pan masala packet is found in a Coca Cola bottle, the reason must be factually identified to a process failure in a certain bottling factory say in Nashik and thus insulate a stray incident from becoming a nationwide brand issue.

3.     Communicate adequately & do it honestly: Most managers are not trained in crisis management and tend to over react, hide or become defensive. Demonstrate that you are in control of the situation. Hire a PR firm, select multi-channel communication medium for specific target audience.

Hire a credible brand ambassador or getting a credible investor (example: Warren Buffet’s investment in Bank of America during financial crisis) in the face of crisis acts as a circuit breaker to the downward spiral of a brand and the institution itself.

4.     Put people first: Quality of an organization is quality of its people. Internally use this situation to build a fortress where every single employee and stakeholder aligns and identifies himself to the organizational goals. Great teams are built during crisis and such teams go on to build greater enterprises of tomorrow!!

ABOUT THE AUTHOR:

Abhijit Banerjee is the Managing Partner at Stratcap Corporate Advisors LLP covering the Consumer sector and serves as a Strategy Adviser on the boards of emerging consumer enterprises in the $50m category.