What Marketers Can Learn About Brand Risk From Charlottesville
There’s no question that we are living through strange and unfamiliar times. Regardless of where one stands on the political spectrum, we all feel a seismic change in the laws that govern political and social discourse. The same is true for brands, as corporate leaders find themselves increasingly caught up in a swirl of social crises, seemingly unprepared and groping for appropriate responses. The recent dissolution of the Presidential CEO councils is but one recent illustration of these challenges.
While many timeless truths of brand and reputation management remain intact, several new dynamics have dramatically escalated the risks. CEOs, boards and marketing leaders who are responsible for stewarding an organization’s good name — and the health of the business the depends on that name — must understand and address these new risks.
Consumer boycotts began over a century ago, and corporate reputation crises data back even earlier. But two recent examples showcase some of the dramatic changes in the environment for managing reputations and brands. At Google, an engineer wrote an email mere days ago, that expressed detailed, and often objectionable, views of women’s suitability for technology roles. Within hours, this single document created an epic crisis and focused global attention on the company and on the choices leadership made in dealing with it. The Google incident highlights what David Mayer, a veteran brand strategist and president of ChaseDesign, calls “the grain of sand that can trigger a landslide.” We’re used to social media accelerating the speed of dissemination of indignation, but the highly energized, polarized, politicized environment allows micro-events — like an internal email — to set off a tsunami of social and media consternation.
The Google memo highlights another new risk that organizations must confront: the reality that objectionable material will be generated, circulated and disseminated from within their virtual four walls. Anthony Johndrow, co-founder and CEO of Reputation Economy Advisors, points out that in many ways, the fact that the offending document was an internal email creates a greater challenge for Google than if it had been posted on a personal website. As a “company” document, the memo is more closely associated with Google and ties them more directly to the controversial message. The fact that it was widely circulated and quickly went viral, the memo gives the impression of shedding light on the inner workings of a company that is so fascinating and yet so hard to understand. All these factors raise the stakes on the speed and direction of Google’s response. In this regard, information security, policies and internal monitoring become critical to a company’s ability to understand, anticipate and respond to reputation risks.
In an even more troubling and tragic way, the recent events in Charlottesville demonstrate other uncharted territories in brand risk. Following the heartbreaking violence, a movement arose to identify members of the Unite the Right march, powered by the Twitter handle @YesYoureRacist. Using photos and videos of the event, the group crowdsources intelligence on who appears in the pictures. As these individuals have been publicly named, both correctly and erroneously, the companies that employ them face an entirely unfamiliar challenge: how to respond when you’re told of an associate that engaged in activities that are technically legal, but generally considered objectionable.
Illustrating another form of brand risk is TIKI Brand Products, whose torches were used by the “alt-right” marchers. Given the prominent role their product played in the event, TIKI felt the need to publicly distance itself from its customers — the flip side of the drive to create bonds of community customers.
Looking at even just these two examples, it’s clear that leaders responsible for stewarding corporate perception and brand health now face a perfect storm of challenges:
• An energized, polarized consumer poised for indignation
• Proliferating social media and technology that allows no room to hide
• A blurring of private and corporate life where personal actions have brand implications
• A growing expectation that companies and CEOs engage in critical issues of the day
• Which all create an environment where a micro-event can cause a macro-storm at a moment’s notice
As the Trump CEO Councils make clear, even executives who have no plans to take a personal or corporate stand on social issues can find themselves thrust into a situation where there is no place to hide. Clearly no amount of scenario planning can possibly anticipate every eventuality and dictate a crisp response plan. This new world is too fast-moving and unpredictable to ever hope to achieve perfect readiness. There are, however, several proactive steps that organizations can take to set themselves up to be resilient and ready as possible.
Dig deep and define core values. As Johndrow says, “brochure-worthy corporate values are not enough to guide action in this environment.” Leaders need to go through an introspective soul-searching exercise to understand and articulate the held values and beliefs they hold deeply enough to stand up and be counted when the time comes. Unlike most times when the objective is to divorce personal feelings and focus on market data, this is the moment to assess personal, visceral beliefs of leaders, founders, boards and other constituents who must stand together when the going gets tough.
Build a values-based culture. The most potent protection of all is an organization that lives and breathes a culture of doing the right thing. Just as the values articulation must go beyond a pat statement in an annual report, company values must be driven deep and woven into every facet of the organization. Leadership must make clear that their values are not to be traded off situationally, but rather are an unwavering path which all associates must challenge each other to follow passionately. Employees must see choices made at the top of the house that represent living the values, even when it causes some form of pain. Every associate working at Capital One fully understands the depth of founder Rich Fairbank’s commitment to the values, and employees use the values as a litmus test for daily decision-making.
Re-look at information risk and personnel policies. When personal actions become corporate problems, organizations must start by defining their positions on how they will handle a range of objectionable behaviors, such as: personal views expressed onsite; participation in events; writing in blogs or on social media; and membership in objectionable organizations. Having done that, companies will also need to come to grips with how they will monitor internal activity, such as emails and other writing, that may ultimately land in the court of public opinion.
Generate preventative good will. While it’s impossible to predict when and which mess will hit the fan, it is possible and essential to “build up good will that can be paid down in a crisis,” according to Mayer. In the absence of a reason to think better of a company, consumers will generally assume the worst. Specific and credible proof points and ongoing reinforcement of an organization’s values can be literally money in the bank when times get tough. Uber, a poster child for so many unfortunate things, had no positive good will in the bank. So when consumers saw them discontinuing surge pricing during the Kennedy Airport taxi strike, rather they perceived an intent to break the strike, rather than to avoid appearing to profit from it.
No doubt next month this highly charged consumer environment will bring a new set of brand challenges to light, and next quarter will bring some new bit of technology that will add to the mix. But the good news is that much of the answer lies in returning to the timeless foundations of values, culture and honest communication. And by doing so, companies can find their way to even more trusted and resonant relationships with their customers and their communities.
Originally publishes in Forbes