Social Scandal: Strategic Brand Crisis Management Supports Growth
Peter Caswell |
 03/28/16 |
5 min read




The interactive and fast-moving nature of social media means situations are often blown out of proportion – but as quickly as crises can arise, they can dissipate. Here’s how brands can strategically manage crises using the Pareto principle:

Conserving resources

The Pareto principle – also known as the 80/20 rule – states that 20% of actions produce 80% of results. When applied to crisis management, this can help brands decide when to speak up and when to keep quiet.

First, what constitutes a crisis, or scandal? Scandals can be self-generated, competitor generated and market generated. In all cases, clients monitor the potential impact of the scandal to understand how to respond – or whether they even should.

By attempting to control an incident that isn’t quite a crisis, it’s easy to tip the balance and exacerbate the situation. This morning’s news may well be old news. Issuing a formal apology for something that consumers have already forgotten about will only add fuel to the fire.

Social media listening is front and center in enabling brands to monitor incidents closely in near real time and assess the scale of a situation before deciding whether or not to intervene. Rifts in a fan-base will often resolve themselves – and even if they don’t, it’s not the brand’s place to get involved. If something inappropriate has made its way onto a business’s Twitter feed, the appropriate action depends entirely on public response. If social media listening reveals that a Tweet has sparked an unflattering debate, it may be time to step in, or it may not.  How to tell the difference?

When assessing the impact of a scandal, the best in class of our customers do the following:

  • Create three audience sets –  My Fans; My Competitors’ Fans; And the Target Market(s) I’d like to make My Customers
  • Within the first and second audiences, they create two segments – let’s call them “fanatic supporters” (an example would be folks scoring highest on NPS scores), and the rest as the second segment

When any type of scandal arises, the first place to check is your own customer base. If they’re not reacting negatively, it’s usually best to leave things be from a crisis standpoint (Note; there may be an opportunity to leverage the situation – think Apple and Privacy right now. But that’s another story).  If they are, you must work to influence your customer base through your “Positive Fanatics”. As soon as your customers begin to ignore the issue, it’s time to stop – avoid throwing gasoline on the fire.  Don’t wait until the noise has died down – that’s counterproductive and wasteful.

Some things are best dealt with internally. Entering damage-control mode after an intern’s Tweet sparks a meme is only going to draw attention to something that should be forgotten. In these cases, privately and rapidly correcting the culprit is best practice. We have many customers who’ve caught a potential crisis within minutes of it occurring, allowing them to correct the situation before it ever even got to crisis point.  The speed of a Social Crisis Center can enable you to avoid crises – always the best result.

Often the difference between something you react to something you don’t, is when competitors pick up on the scandal and try to prolong it for their own gain. When our customers assess the social damage around a scandal, they look at their target market(s) and their competitors as well.

If a competitor continues to spend against the issue, it’s time to change the game in your target audience.  Generally you will do this through your fanatics again.  This often results in market share increases – your Positive Fanatics are the best promoters and influencers and they get fired up if your brand is being treated unfairly or unreasonably.  If you do this consistently, you will continue to drive competitive growth.

Letting go

If 20% of crises cause 80% of the damage, and 20% of crisis management produces 80% of results, the most valuable thing PR professionals can learn is when to let go. Real-time social media listening is key to determining which scandals will blow over and which will need attention. Things that initially seem bad might easily be tempered with humor, and time spent on reputation management is wasted if consumers aren’t even upset.

Often, brands plagued with online trolls find that the comments trickle off when they stop responding. Likewise, when a brand has done something particularly offensive, repeated attempts to justify or explain their wrongdoing will further enrage consumers. One short and meaningful apology is all that’s necessary.  But monitor all your segments carefully – if the Social Noise is coming from your competitors “fanatics” and your customer base and target market is not picking up on the noise, it’s really best to do nothing.

This is something Chipotle seems to be experiencing right now. They appear to be spending on PR to combat their crisis, but their customers and the market are taking their response badly, and it’s possible their competitors are throwing “gas on the fire”. They may well do better to keep almost silent.

Growth from disorder

Analyst and statistician Nassim Nicholas Taleb coined the term “anti-fragile” to describe things that thrive on disruption. Crises are typically unpredictable – if it was possible to see them coming, they wouldn’t be crises – and preparing for the unpredictable is an impossible task.

But preparing for the likelihood of a crisis occurring is a different matter, and can easily be achieved by keeping an ear to the ground and listening for shifts in customer sentiment. While predicting a situation is impossible, growing from it is not.

Taleb explains that even our bodies require stress to function properly: without low-level exposure to threats, our immune systems are less able to protect us from more serious contamination.

Likewise, brands that are exposed to public scrutiny often become more resilient. We’ll see over time if Chipotle falls into this category. Online, any brand can be the subject of a social media scandal – but a crisis dealt with successfully can leave the brand in higher standing than before. “There’s no such thing as bad publicity” is a lie, but bad publicity handled well has the potential to support growth.

Applied correctly, social media can tell brands exactly which 20% of their strategy is producing 80% of their results. And it can break the bad habit of overspending in the marketing world. This is generally due to lack of insight into what’s working, but with the tools available to harness social data, brands have no excuse not to tune in to consumer conversations to gather those insights.

Not every crisis needs addressing, and the time and money saved by letting minor incidents pass by can be redistributed to bolster more effective marketing strategies.

Does your brand have real-time insights on consumer sentiment? Get in touch to start monitoring your audience today.

Image from Lieven Van Melckebeke

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