Making Money On-line: Picking Up the Pieces: How Companies Rebuild Brands Post-Crisis

Every company makes mistakes every now and then. It’s inevitable. Whether it’s a marketing campaign that falls flat and generates backlash, a serious collapse in services or a faulty product, it’s bound to happen sometime. Careful vigilance will prevent many of these disasters before they explode, but eventually one will get through and everything will go wrong. And once crisis strikes, no matter how you’ve defined and cultivated your image over time, confidence in the brand is going to take a hit. It doesn’t last forever, however, and it’s certainly possible for a brand to fully recover from such a crisis.

Being able to recover from a brand crisis or a public relations disaster requires distinct actions in three phases. It helps to have an active reputation management system working before the crisis itself, it requires a measured response in the immediate aftermath of a crisis, and it depends on a longer-term strategy afterward for the recovery. You should take the crisis seriously and make an effort to honestly and transparently listen to customers and respond. For the long-term strategy after the crisis you need to be patient and careful about going back to marketing-as-usual, and you need to take real action in the long-term to prevent similar crises.

Some companies even consider re-branding entirely, although this may look suspicious to consumers if it attracts attention, and it has the potential to backfire. It might help to look at a few examples of how companies have handled this recovery for better or for worse.

Takata Airbags and Automakers

When something serious goes wrong with one brand, it can have dramatic effects not just on confidence in that brand but on all brands that are linked to it. The Takata airbag recall is the biggest car recall in U.S. history, and it involves airbags in vehicles from 19 different automakers. These airbags have the potential to malfunction in the event of a collision and explode upon inflation, shooting deadly shrapnel around the inside of the vehicle. In the United States at least 15 deaths have been linked to Takata airbags as well as hundreds of injuries. The recall is still ongoing, meaning that many of these cars are still on the road. The problem is that there are so many airbags that Takata and automakers are not able to rapidly provide fixes.

For car companies including GM, Mazda, Toyota, Fiat Chrysler and more, however, this is a dangerous brand crisis that came about through no obvious fault of their own. But compared to these auto-makers, Takata is a relatively unknown brand that consumers will rarely interact with directly. Takata may have a long way to go to win back confidence from car manufacturers, but those car manufacturers will also have their hands full rebuilding their brands with upset consumers.

In a crisis like an automotive recall, the recovery from the brand crisis depends a lot on the immediate response. Some automakers are getting little to no press attention on their brand and have had few or no reported accidents so far that can be linked to them. For them, dealing quietly and effectively with the recall and then waiting for the media coverage to pass is the best thing they can do. For the car companies getting more attention, however, their image depends on the quality and speed of the recall and their service to affected customers. This isn’t going well so far for many of the car companies, which may make for a long recovery and a drop in sales and loyalty, at least among affected customers.

Chipotle and the E. Coli Outbreak

Popular Tex-Mex restaurant chain was hit by a serious string of E. coli and norovirus outbreaks in 2015 in locations across the United States, producing a serious drop in confidence in the brand. After many locations closed and customers in seven states reported getting sick after eating Chipotle, Chipotle’s sales dropped 14.6 percent and its income dropped 44 percent in the final quarter of 2015.

This outbreak became a serious issue for the Chipotle brand because of how widespread media coverage of the issue was, and because the problem seemed to clash so directly with Chipotle’s existing brand identity. The quality and integrity of the ingredients of their food has always been one of the core values in Chipotle’s marketing, from the ethical sourcing to the way the food is prepared. This led to an even greater drop in consumer confidence after the crisis, and it created more media interest and thus widespread coverage.

In the wake of the crisis, Chipotle temporarily closed many restaurants and put some operations on hold. They returned to business as usual by December 2015, but largely kept their heads down in marketing and public statements. Several months after it was over, they closed Chipotles across the country for a morning of training and planning. That event, plus an open letter to the public from the CEO, marked Chipotle’s attempt to begin moving forward and leaving the crisis behind them. Not only did the letter accept responsibility for the food safety failure, but it promised a wide range of specific measures they were taking to improve food safety.

After these statements and actions addressing the crisis, Chipotle almost immediately started a new marketing blitz to encourage customers to return to Chipotle, including promotions for free entrees. Several years after the crisis, Chipotle has now fully recovered and restored their brand to what it was before without falling into another disaster since.

Restoring brand reputation starts with rebuilding trust. There is nothing more important than creating exceptional customer experience to help rebuild trust and build a strong brand reputation. Download Customer Experience Simplified: Deliver The Experience Your Customers Want to learn how to craft an outstanding experience for your customers.