Perhaps exacerbated by social media, the past few years have seen a lot of major scandals erupt with damaging consequences. In a survey of corporate crises since 2010, the top eight companies involved in a major scandal suffered a 30 percent loss in value since its crisis, and in all but one case, the top executive at the company left.1
From Papa John’s headaches with their namesake spokesman to Facebook’s Cambridge Analytica scandal, one ugly mistake can tarnish a corporate brand and may introduce scrutiny that proves the mistake was symptomatic of a larger problem, leading to an ongoing scandal, a drop in consumer trust, and ultimately a loss in profits. To cite a recent example, United Airlines’ customer perception dropped to a ten-year nadir after employees of the company forcibly removed a passenger, and United failed to handle the ensuing scandal properly.2 United deepened its brand damage and lengthened the recovery process by making PR mistakes.
A certain number of scandals across the life span of a business is inevitable, especially in a world in which continuous engagement with consumers is a must, and digital technology allows for near-constant documentation that may not provide the company’s desired framing. But how the company handles its scandal is completely in the company’s control. Whether a business seems obstinate in defending its mistake and unwilling to address the problem, or communicates care for those affected and a commitment to change, can make all the difference for consumers looking to put trust in a brand.
If you suffer a PR scandal, don’t make the problem worse by confirming the negative press with a defensive posture. Quiet the scandal and regain control of the narrative in a few key steps:
- Admit your mistake openly and with concern for those affected
- Have a crisis plan that puts reputation over profit
- Listen to social media coverage and respond appropriately
- Stand your ground, but only where you have ground to stand on
Admit Your Mistake in the Right Way
If a company admits to a mistake only after being caught, and the public has reason to believe the company knew of the mistake beforehand, the admission can come off as obligatory and insincere. The public will think the apology doesn’t reflect a commitment to change and that the company may commit shady behavior or deceive consumers again—a disastrous perception in a marketplace that depends on brand trust. However, if you admit the issue upon discovery, it shows you’ve made an honest mistake that you’re seeking to repair, which can renew or even reinforce trust.
It also allows you to apply your own messaging before a narrative is set in stone, which allows you to reassure consumers that the issue is a one-time mistake rather than a systemic problem or a nefarious choice.
The fact is, you’ll probably end up apologizing anyway. After the Cambridge Analytica scandal broke, revealing that millions of Facebook users had their data accessed without consent, for days Mark Zuckerberg failed to comment publicly. He ended up testifying before Congress for hours, after days of damage accrued. By apologizing upfront, he could have stemmed the calls for Facebook’s top brass to apologize, which added fuel to the scandal.
But it’s not enough to just apologize quickly. The timing of the message won’t help unless the message is carefully worded to express real concern. Many top executives begin their apology by emphasizing how their company should be trusted or by defending its performance, a major mistake that makes the company seemed callous and concerned only with their bottom line. Instead, start by communicating your concern for those affected and how you plan to solve the problem.
And regardless of how you really feel, don’t think that internal memos are a safe space to express your real thoughts. Be consistent in your approach so that your employees understand they need to act as caretakers of the brand as well. After the United Airlines scandal dominated headlines, the CEO of United wrote an internal communication to his employees, praising the workers who dragged the passenger off the plane. Once the media obtained the memo, the scandal only grew with new material that reinforced the image of the airline company as greedy and unconcerned with passenger well-being.
If United’s leadership had committed to internal communications that addressed the problem, the scandal would have had less to live on. And United learned their lesson. A few months later, when a United employee directed a passenger to inhumanely store their dog in an overhead compartment, United immediately took responsibility, launched an investigation and apologized.
Consider a Crisis Plan that Puts Reputation Over Profit
Companies have crisis plans for all kinds of situations, but they often lack concrete steps for scandals since issues can be complex and unique. But an adaptable crisis plan can provide guidance and reassurance to members of your team when a crisis hits. Even in cases when you’re just monitoring the situation, a plan can identify reliable checkpoints at which action becomes necessary (such as coverage in certain media outlets for a certain period of time), so that your company won’t make the common mistake of waiting too long to address the problem.
Planning out an approach before the incident also gives you space to think calmly and clearly about your greater goals, like how best to serve your brand. It’s much easier to discuss policy in a peaceful situation than while temperatures are running high, and there’s no great approach once you’re caught unprepared in a crisis. Companies that debate in committee as a scandal unfolds can seem slow to respond, and therefore uncaring or irresponsible. On the other hand, when one person makes all the decisions during a crisis, the pressure on that individual can result in rash decisions.
When Equifax, a major credit reporting agency, was hacked, it waited a month to report it, which became a major aspect of the scandal. Although they attempted to make amends after public outcry, they did so with clumsy, halting efforts that came off as obligatory and for their own gain. They set up a website, which didn’t work at first, instead of directly informing those affected. They offered free credit monitoring but required users to wave their right to sue the company, making it seem more like a trap to avoid legal battles than a method to help victims. Free credit monitoring isn’t even the best method of protecting credit; that’s a credit freeze, and Equifax failed to offer it to victims.
Equifax caved on these stances after public outcry made them untenable. They stopped making people waive their right to sue and provided credit freezes for thirty days. Their clumsy efforts ignored consumers’ perspectives and only succeeded in further harming their reputation without providing protection or saving on cost. If they had a proper crisis plan, they could have moved more swiftly and effectively. And if they had put reputation over profit margins, they would not have caused such lasting damage.
Instead, put substantive efforts behind your words. Fix the problem, and make up for any damage that has been done, even if, in the short term, it damages your bottom line. Consumers need to see real change to trust a company again, and a simple apology is not enough. Once the company has re-invested in the experience of the consumer, they can promote their good behavior, but consumers and the media won’t be sold on words alone when the material facts of the case contradict them.
For example, when Toyota had to recall almost 9 million cars due to safety defects, they couldn’t come forward at first because they could not locate the exact problem with the vehicles, causing a public outcry. But media coverage and public perception changed once Toyota made a sincere effort to rectify the problem. They publicly apologized and backed up the apology by offering extended warranties and cooperating with a government inspection of their vehicles. They then promoted their own good behavior, as well as the fact that this was the first major mistake in a long record of success, with a comprehensive PR campaign. Their reputation as reliable carmakers stands today.
Listen to Social Media Coverage
Social media helps you see things from your customer’s perspective, which enables you to adapt quickly and effectively to crises. If there’s a problem with your brand, social media can let you know. Listen to consumers, even ask questions, to find out the problem firsthand and update them on your progress as you work to resolve it.
Even if the incident is a simple matter of miscommunication, a company should understand that the offense or hurt is real, and they should address it with as much seriousness as the unintended message requires. For example, after the 2017 Boston Marathon, the shoe company Adidas sent out an email to participants with the headline, “Congrats, You Survived the Boston Marathon!” Even though four years had elapsed since the 2013 Boston Marathon terrorist attack, the phrasing still recalled the event to some participants. Instead of defensively asserting the headline was misunderstood, the company promptly stated it was “incredibly sorry” for the “insensitive” subject line. The scandal rapidly quieted.
If you aren’t on guard, your social media can run amok, so take active steps to control the narrative rather than letting the whims of the crowd dictate the course of the scandal. JP Morgan learned this lesson at a terrible time for the company. Right after their business experienced a massive financial scandal, they went ahead with a previously planned social media initiative and created the #AskJPM to provide finance education. Instead of people seeking financial advice, the business received angry and mocking questions about the scandal, resulting in a trending hashtag reminding people of their blunder. Instead of acting quickly and replacing the initiative with one focused on damage control, JP Morgan suffered further damage to their brand.
Lean on Your Credibility
There are only two major options when you’re accused of doing something wrong: apologize or stand your ground. In the majority of cases, it’s best to apologize. But when someone accuses your company of doing something it hasn’t done, and you can prove it, then defend yourself. Dampening a scandal is important when the mistake exists, but when someone tries to conjure a scandal out of thin air, it makes no sense to allow that scandal to go forward and damage your brand.
Taco Bell showed it’s possible to fight back when it was accused in a lawsuit of only having 35 percent beef in their product. The company refuted the claims by publicly divulging their ingredients, which contained 88 percent beef, and launched a multichannel PR campaign that included everything from local newspaper ads to YouTube videos. Taco Bell looked at a potential PR scandal and saw an opportunity, even running full-page print ads headlined “Thank you for suing us” because it gave them a high-profile chance to prove the quality of their product.
A Scandal Doesn’t Have to Create Lasting Damage
Scandals are as inevitable as the mistakes they stem from. Thankfully, the true threat to your brand is something you can control: your own actions. How you handle the issue can determine whether your brand is critically damaged, temporarily tarnished or (hopefully) strengthened. By sticking to the values of proper planning, thinking like your consumer and putting your brand before your short-term bottom line, you can turn what looked like a crippling mistake into an opportunity to prove your company’s character and win long-lasting trust from consumers.