When your customers and prospects compare how they feel about your company to the way they did about BP after the Deepwater Horizon oil spill, you know you’re in a crisis.
Such were the findings from a research study we at LEVEL5 did late last year. The study explored how Canadians really felt about hockey given the ongoing (at the time) lockout between the millionaires and billionaires of the National Hockey League. The results indicated an alarming amount of damage was being done to the NHL brand.
The question for the NHL now is: what is it going to do about this to ensure it doesn’t get cross-checked by its fans? In other words, what’s its best tool to manage through a crisis as effectively as possible?
The answer to that question is relevant to businesses of any size facing a crisis. In my 35 years of experience in branded businesses, I’ve found that your brand is by far the best tool you have to manage through a crisis, provided you leverage it through what I call Smart Brave Action. And one of the great things about brand is that it can be used by SMEs just as effectively as by large organizations like BP or the NHL. Not only that, but your brand can also help you successfully manage through more everyday challenges. It can help you with, say, a bad customer experience or product-quality issues, as well as through a life-or-death struggle.
Your No. 1 Tool in a Crisis
Your brand is such an important tool for managing a crisis because it clearly defines the key strategic elements of your company—what it stands for and how it’s differentiated and valued by consumers and customers—and applies to every function and department within your business. This clarity provides management with a guide for decision-making throughout the company that leverages its strategic advantage to find the optimal solution(s) quickly, effectively and seamlessly. That’s just want you want in a crisis, when emotions are running high, time is short and judgment may be askew.
Read more about brands: How a Promise Can Drive Your Business Forward
Here’s how applying Smart Brave Action to brand management can help make brand an even more effective tool for managing through even the worst crisis.
Smart Brave Action
When I use the term Smart Brave Action, here’s what I mean:
Smart means uncovering unique insight and understanding of your customers and employees that can act as a catalyst for change. This can be done through qualitative or quantitative research, or by simply talking to your customers and employees to learn what they think about your company.
Brave means doing what you know is right and aligned with the brand, even if it goes against conventional wisdom or may have a short-term negative impact.
Action means walking the talk. It means actually doing something by following through on your commitments and remaining consistent with your brand.
Although the above sounds easy, for most companies it’s a huge challenge to do all three at the same time. Over my career, I’ve seen leaders develop very Smart plans, but fail to take action or push the envelope enough; I’ve seen companies be Brave, but without that key catalyst or walking the talk; and I’ve seen leadership teams take Action, but it wasn’t thought through properly or didn’t take enough risk to move the needle.
So can you apply Smart Brave Action in times of crisis at your company? Here are two examples of how others have done it:
The 1998-99 NBA lockout
Smart: A key insight for the NBA was that 53% of fans missed the games just a little—or not at all. The league realized that it needed to take active steps to win back fans—that an apology wouldn’t be enough.
Brave: The NBA realized that it was going to cost it money in the short term to win fans back in the long term. The league was brave enough to take these short-term losses in order to ensure its long-term survival.
Action: Team owners offered two exhibition games for free and opened at least one scrimmage to fans. The following season, each team offered 500 tickets priced at just US$10 in order to woo back fans.
Odwalla’s E. coli crisis
In 1996, a batch of unpasteurized apple juice made by Odwalla Inc., a California-based food processor, was found to contain a strain of E. coli that killed one of its customers and made 66 others very ill.
Smart: The CEO realized that what consumers wanted to hear before anything else was for someone to take responsibility, so he did publicly.
Brave: Not only did the CEO accept responsibility, a brave act that few chief executives would emulate, he also began an immediate recall of US$6.5 million worth of product. He did so even though most of it, it can be assumed, was perfectly fine. The CEO took the hit to Odwalla’s bottom line because he knew it was the right thing to do.
Action: The CEO undertook several initiatives to position his company for long-term success. These included developing a “flash pasteurization” process to guard against similar occurrences in the future, and having Odwalla’s underused delivery drivers conduct outreach efforts to explain the changes to wholesaler buyers. The CEO’s actions, although financially painful in the short term, worked to improve his chances of long-term success.
When managed properly, your brand can guide decision-making throughout your company at times when speed is of the essence and people aren’t thinking straight due to intense pressure. If leveraged through Smart Brave Action, this can also help transform your customers from opponents working against you in times of trouble to teammates working with you towards the same goal.
David Kincaid has been a leader of branded businesses for 35 years and is now managing partner and CEO of LEVEL5 Strategy Group, a Toronto-based firm dedicated to driving profitable growth for its clients through the power of their brand. LEVEL5 was on the 2010 and 2011 PROFIT 200 rankings of Canada’s Fastest-Growing Companies.
More columns by David Kincaid