In the current scenario of assigning relatability to brands, customers are divided into the dichotomy of right and wrong, love and hate. People have staunch opinions about everything, and they support brands that share the same views as them. Many brands have started addressing issues of social importance like sustainability, diversity, feminism, etc. You can see the implementation of these themes through marketing campaigns.
But there’s more to it, a brand’s business practices, decisions, and partnerships also affect their brand image. Customers quickly call out brands whose business practices differ from what their marketing campaigns say. This reduces the campaign messaging to a marketing ploy. This is most commonly seen with brands that endorse queer rights during pride month but don’t stand against gender discrimination at their workplaces the rest of the year.
And with the widespread use of social media, brands are exposed to ‘cancel culture’ and boycotts if their ethics don’t align with the customers’ ideals. They need to tread carefully so they don’t offend liberals or conservatives. For example, in April 2023, Bud Light, a top beer brand in the US was subject to much hate when they collaborated with transgender influencer Dylan Mulvaney. The brand received backlash from prominent conservative figures and groups. This triggered a consumer boycott of the beer.
Image source: The Philadelphia Inquirer
After the controversy, the company lost $27 billion due to diminishing sales. One year hence, the once number 1 beer brand in the US, Bud Light is now in third position. However, it’s not just marketing campaigns that can spark controversies and affect sales. A brand’s stand for social issues and its actions are also under constant scrutiny. Customers’ perception of a brand is formed through its business decisions, and not just through its marketing strategies.
The ethics and morals of a brand are tested during sensitive geopolitical issues. Like in the case of Starbucks, one of the many brands that got boycotted due to their support for Israel. This caused Starbucks to lose $11 billion in sales due to heavy customer boycotts. Starbucks stocks declined for 12 consecutive stock market sessions, the longest streak for the company ever since it went public in 1992.
When faced with such a crisis, brand leaders should acknowledge and apologise. They should take steps to address the underlying issue. Brands must communicate their plans to change and take accountability for the same. While doing so, brands should stay transparent and authentic. The brands should release statements and communicate their next steps publicly.
However, an apology isn’t due in all cases. If reversal will stray the brand from its values, it should stand by its decisions. In such cases, apologising is the real mistake!
But what would you do if caught in such a crisis unaware? When you only meant good, but it backfired? Staying away from such situations and avoiding conflict is your best bet. Here’s how you can predict and tackle a crisis before it blows up –
- Keep track of brand sentiment: Always track how customers feel about your brand. This helps you understand the emotions attached to your brand reputation. Ensure that your audience always thinks positively about your brand.
- Resolve at the root: You must resolve even the smallest complaint or feedback at the root. You need to close the loop of a conversation and make your customers feel like they are heard. Unsatisfied customers are bad for both business and reputation.
- Monitor negative brand mentions: You need to know what your customers are talking about, and if it’s negative – you need to act quickly. It doesn’t take long for a negative comment to gain traction.
- Set up alerts: Keep an eye on viral posts or influencer comments that might blow up and cause a crisis. Set up alerts so you know when a response is going out of hand. This also helps you stay ahead of the customers and predict crises.
Finally, brands should stay true to their values and take responsibility for their actions. We at Germin8 keep track of what your customers are talking about, and address their concerns so their trust in you is maintained!
