Nagging doubts over crisis management

When the horsemeat scandal first broke, most marketers shrugged and assumed it was a small issue. But as the weeks have unfolded, the size and scale of the situation has become apparent. We aren’t talking about a few specks of horse DNA in your microwaved lasagne but 30, 40 and in some cases 100 per cent of the meat being of equine origin.

Mark Ritson

Neither is the crisis reserved for a few dodgy continental suppliers. The nature of global supply chains and the incessant pressure to reduce costs means that it has afflicted a veritable who’s who of British grocery brands: Tesco, the Co-op, Nestlé, Iceland, Findus, Aldi.

It does not get any bigger or more branded than this. So will these big brands survive such a dramatic and serious breach of trust?

The advice is already emerging thick and fast from the PR mavens who have knocked out the usual “How to manage a crisis” claptrap to all and sundry. If I summarise one of these experts I can summarise all of them: recognise the problem, be honest, take prompt and decisive action and keep your customers informed.

It’s not exactly rocket science and none of this is particularly incorrect either. What’s missing, however, is any sense of differentiation or brand positioning in the advice being doled out by PR gurus. Never once did it occur to any of these experts that Tesco’s response to the crisis should be different from Iceland’s. Or that Nestlé’s strategy should be different from that of Findus.

The problem for most PR firms is that they don’t really understand brand. They derive most of their crisis management playbook from the same 30-year-old crisis. In 1982, when seven people died from mistakenly consuming Cyanide pills that had been deliberately inserted into Tylenol bottles, the management team at Johnson & Johnson handled the crisis to perfection.

J&J immediately recognised the problem, informed the public of the threat and - even though it knew the company was not to blame - withdrew its entire supply of 32 million bottles from shelves across America. It was only after the threat of further tampering was nullified through a new triple-seal tamper-proof bottle that Tylenol eventually returned to shelves.

It was a first-class approach to handling the crisis and one that resulted in Tylenol actually increasing brand equity and growing market share in the aftermath of the crisis. But the point missed by the PR industry that uses this case as the basis for its subsequent crisis planning is that it was a very brand-centric response from J&J. Written in 1943 by then chairman Robert Wood Johnson, the J&J Credo which drives every decision the company takes, is famous for challenging the firm to always put the needs and wellbeing of its customers ahead of its own corporate wellbeing.

That was why J&J moved so fast to withdraw Tylenol in 1982 and communicate so openly to customers. It wasn’t best practice, generic crisis management. It was good old-fashioned brand- driven strategy.

The only rule of branding is ‘To Thine Own Self be True’. What worked so well for J&J would not necessarily have the same impact for other brands with different brand positionings. The true challenge for horse-flesh afflicted brands as they survey their tattered reputations is not to follow the generic path but look at their brand positioning and respond accordingly.

Let me give you a good example. When Southwest Airlines ejected film director Kevin Smith from one of its flights in 2010 for being too large he tweeted his disgust to his 2 million followers and the airline was quickly engulfed in a major crisis. Out came the generic crisis management handbook and the airline quickly assessed the issue, admitted that it had ejected Mr Smith, gave him its “heartfelt apologies” and offered him a $100 voucher. Smith was dismissive of the offer and the crisis damaged a brand previously deemed more laid back, genuine and friendly than the big national carriers.

Compare that with Ryanair. When the airline got into hot-water about a half-serious proposal to apply a “fat tax” on heavier passengers, the company ignored the generic crisis handbook and went for a more distinctive, brand-based approach. “Nobody wants to sit beside a really fat fucker on board,” was chief executive Michael O’Leary’s response. “We have been frankly astonished at the number of customers who don’t only want to tax fat people but torture them.” A cheap, aggressive and thoroughly low-end reaction. And one that fits the Ryanair brand.

I’m not advising Britain’s beleaguered brands to follow Ryanair’s approach but also don’t simply follow the generic PR approach. Find a response that is true to your brand values.
So while Tesco should apologise that its spaghetti bolognese contains 60 per cent horsemeat it could also emphasise that the other 40 percent is still beef, because Every Little Helps. I’m joking, but you get the idea…

Readers' comments (10)

  • No offence, Mark, but what nonsense!

    What is your evidence that all PR advisors rely on one case study for their crisis plans? I certainly don't.

    But I do understand brand and my clients place enormous importance on making sure that I do. Every PR message should always be about what do we stand *for* and not what are we defending against.

    In my opinion the most difficult part of any crisis is judging when it becomes a crisis and not just an incident. I think everyone has been taken by surprise by the widespread, and spreading, nature of the horsemeat crisis and I think accusing PRs of taking a generic approach is a bit rich.

    To me it points to a need for a good look into the whole food chain, and the lack of inspection and accountability. That's not a PR problem, that's an industry problem in which PR can hold those responsible to account.

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  • Completely agree. It seems the first step to PR Crisis Management is to take a full page ad in several daily newspapers with a letter apologising the error. It's such a superficial way of handling the issue as the ones that have been affected aren't addressed and it's purely there to show the world that they're 'learning from their mistakes.' For example, Tesco is widely known in the industry (and off it) for having a sophisticated CRM system, why not have a look and who's purchased the affected products and offer something to them. These are the customers that deserve an apology and it'll be a far more genuine way of handling a crisis instead.

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  • The retailers need to blame the suppliers and somehow turn public opinion against those suppliers. The problem is suppliers have no public profile or clear identity (unlike, for example, the vilified estate agent). So, the way forward is this. The retailers should publicly identify, expose and crucify their suppliers to satisfy the public desire for blood (if I can use that phrase). If the retailers can portray the suppliers in a way that conveys the greed, avarice and lack of care that we associate with, say, bankers, then retailers can be seen as victims as much as the value-brand-lasagne-eating consumer. It’s not too late but retailers must act quickly before opinions have time to gel. Otherwise it will be a case of bolting the stable door after the brand has bolted.

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  • Ha ha! Vintage and excellent Chateau Ritson. And I agree with @swemeatballs78 (presumably with no horsemeat?) that the supermarkets should be doing more for their affected customers and using the CRM systems is a great idea. But if you look how long it took CEOs like Justin King to face the cameras about it then you realise just how poor the PR advice was to them. Counter this with Sir Michael Bishop's brilliant handling of the British Midland Kegworth air disaster in 1989 and you realise how cynical, vain and self-conscious many of the CEOs of today are.

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  • Ryanair in the example above is a PR stunt (their proposal was proactive and they would have anticipated some backlash from the PC brigade).

    It is far from me to defend the dark side, but something similar happened to McDonald’s when their beef was seen to be of suspect quality. They revamped the suppliers and followed up with 100% beef from British suppliers campaign.

    Perhaps values and positioning should change in response to a crisis too?

    I do agree that everyone (management, comms and brand) should be more bold and creative. I guess it helps if you have a strong CEO personality. If not, cue full page ads.

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  • I agree. It is true that similar examples are referred to very often, particularly of late.

    To Sarah Taylor: If it's not the Tylenol case, the likes of Perrier, Texaco, Sunny Delight, Toyota, and Starbucks and similar, are used as staple examples of "how to, and how not to" manage PR crises by commentators.

    Anyway, isn't every crisis argued to be "unprecedented, in this media age, where bad news travels so fast" in order to buy 1) offending companies and 2) their PRs a few days grace these days?!

    You can't really argue that there seems to be an overwhelming amount of substance to the way in which some of these companies have responded, which have been nothing if not predictable by the way.

    Consumers demand action that goes beyond token gestures or the (now) usual "we feel your pain and we are equally outraged" and "lessons need to be learned" rhetoric.

    For an industry that prides itself on its creativity, not to mention integrity, shouldn't we be expecting more?

    It seems consumers do.

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  • While a crisis has always been a crisis, it’s the fact that the speed of an online crisis has really exacerbated an age old issue for brands. How do we respond quickly in a way that is authentic and represents the essence of who we are as an organisation? In truth it’s not just an issue at times of crisis, it's an issue for every element of communications. Know your corporate character, understand what your values are and consistently communicate them regardless of audience. Here in the US, the Arthur Page Society is doing some great work on driving thought leadership around this issue. You can find a link to some of the thinking here:

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  • A good article and fair points. That the message and voice used in a response to a crisis should reflect the brand is self-evident but too often ignored. What would be really interesting is an idea of how Tesco’s response should differ from Iceland’s. Or Nestlé’s strategy differ from that of Findus. The brands are broadly similar to one another The last line is a throw away where I would have been really interested to hear how Mark would have varied the messaging.

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  • The supermarkets ARE to blame for holding the supply chain to ransom with ever increasing demands for quicker and cheaper and more fat and more sugar. They are creating the joint problem of c**p food and obesity and it won't stop until they start taking responsibility for the product they supply. They have a moral obligation to support healthy eating initiatives. Why for example are wholesale products more than refined? How much food is wasted by wonky carrots and odd sized fruit that is perfectly good but we've been 'trained' to not accept them? It goes way beyond horse meat in a ready meal

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  • It's certainly the issue of the moment, not just in relation to the horse-meat case but more generally. The old response has to be expanded to include social media, but I'm not sure the Ryanair approach as described is particularly helpful. Being disrespectful to customers, even if it does fit the Ryanair 'brand', isn't good. Why would you create a fight with a potential market? The SM game can go both ways and a cheap shot just shows a lack of style. The second point is that the view of the audience are not necessarily important. Who are they?What do they stand for? If communications is down to satisfying the mob, we've failed. Just getting websitre hits or retweets isn't necessarily a measure of success.

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