Crisis communication: How to preserve the company's reputation

No organisation is immune to crisis. While the nature and effects of a crisis are difficult to predict, it is possible to limit the negative effects by following a few tips. We will look at a few tips for successful crisis communication.

Crisis communication and why is it important?

Crisis communication is a set of actions taken to counteract the effects of an event that may negatively affect an organisation's image. Any organisation can face a crisis and a poorly managed crisis can have serious consequences. To avoid the worst-case scenario, it is important to ensure prompt and effective crisis communications. The purpose of crisis communication is to minimise the risks associated with a ‘bad hype’ and prevent it from happening again in the future.

Goals of crisis communication

In the age of new technology, information spreads very quickly and in the event of a crisis it is important to respond quickly. Therefore, every organisation should have a crisis communications plan ready to help anticipate crises and identify ways to handle and disseminate information. Crisis can have a negative impact on customer loyalty and sales, so the goal of crisis communication is to mitigate and recover different areas of the company including human, financial and commercial. It is important to mitigate the financial impact of the crisis by targeting appropriate communications to both the public and the company's own staff.

The main objective of crisis communication is to preserve the company's reputation and the public's trust in the brand, as a deteriorating image can have a negative impact on future prospects. Trust in the brand and its products is undermined, which can have long-term consequences for the company. Effective communication is about staying visible, being responsive and demonstrating the company's integrity during difficult times. Proper crisis management not only minimises the negative effects, but can also help a company become stronger by enhancing its reputation and image.

Based on this information we can identify the main objectives of crisis communication:

• To resolve the crisis or at least mitigate its effects;
• Reduce financial risks;
• To get out of the crisis quickly;
• Anticipate crises in general;
• Detect weak signals;
• Inform the public;
• Obtain subsequent benefits, including maintaining a good reputation;
• Restore credibility and brand image.

7 tips for successful crisis communication

Crisis communication requires a systematic approach to effectively manage complex situations. Every step of this communication is important to minimise negative consequences and preserve the company's reputation. Let's look at the key steps that will help you successfully manage a crisis:

1. Recognise a crisis: A crisis has just hit and it is important not to panic, but to remain transparent. Transparency will increase confidence in your company and reassure customers, employees and partners. Ideally, the problem should be made public before someone else does;
2. Take the time to investigate: Analyse the origins of the crisis to avoid it happening again in the future. If the situation is not clear, don't react too quickly, but be sure to liaise with customers. Explain that you don't fully understand what happened, but promise to look into the situation and take action;
3. Measure the impact of the crisis: Gather as much information as you can about the current situation before jumping into action. Use monitoring tools to see how many people are talking about it on social media, how many enquiries are coming in through emails and calls. This data will help you assess the impact of the crisis and its possible long-term effects;
4. Choosing the right communication channel: Determine which channels you will use to communicate information: website, blog, social media or press release. Consider the advantages and disadvantages of each channel to ensure that your loyal audience receives the message. Avoid using platforms that are new to you where you have no experience interacting with your audience;
5. Share the message: Prepare a message with three key elements: what happened, what you did to resolve the situation, and what is being done to ensure it doesn't happen again. It is important to take responsibility and explain what steps were taken to prevent the crisis from happening again. Be as transparent and responsible as possible in your communication;
6. Learning from the crisis: After the crisis is over, assess how brand perception has changed. Analyse the success of your communications and learn lessons to better prepare for possible future crises. These lessons will help adjust your crisis management and communication strategies;
7. Things to avoid: The worst strategy is to deny the crisis and refuse to communicate in the hope that the situation will resolve itself. Minimising the effects of the crisis and refusing to be transparent does not pay off in the long run and can be disastrous for the company.

Specific examples of crisis communication

Findus and horsemeat

The scandal broke in February 2013 when Findus, a well-known frozen food brand, explained that traces of horsemeat were found in its lasagne sold in the UK. The scandal soon spread to several other countries and resonated around the world. Despite this, two months later the brand announced a 4% rise in sales, while the beef-based ready meals sector recorded a 40% drop.

Findus managed the crisis through successful communication and transparency. The brand announced the problem while maintaining control of the situation and recalled all incriminated products, despite there being no health risk. The company also committed to DNA testing of all its products containing beef and pledged to join the fight for full traceability. Through such measures, Findus was able to save its brand.

Nutella and palm oil

Ferrero faced a major scandal in late 2012 when French senators introduced an amendment to increase the tax on palm oil, criticised for its harmful health effects and role in deforestation. Nutella, which contains 18% palm oil, found itself in the spotlight. Instead of changing the recipe, Ferrero explained to consumers the reason for using palm oil and pledged to only use an environmentally friendly product.

Ferrero actively used social media to communicate with the brand's main target audience - young people. ‘Touche pas à mon Nutella’ pages were even created to protect the product. Thanks to skilful communication and transparency, Nutella is still produced using palm oil and sales remain stable.

Volkswagen's manipulation of polluting gases

Volkswagen, one of the world's largest car manufacturers, faced a scandal in 2015 when it was revealed that the company had installed software on its cars that allowed them to pass emissions tests. As a result, 8.5 million cars in Europe and 500,000 in the US were affected, and the company set aside €6.5bn to settle fines and lawsuits. Sales fell 5 per cent in the month following the scandal and Volkswagen was late in taking anti-crisis measures, which only made matters worse.

The company revised its crisis communication strategy after the crisis was widely publicised online. The new CEO publicly apologised in a video posted on the brand's website and social media. To demonstrate transparency, Volkswagen commissioned an external investigation, the results of which helped develop an action plan to recall and bring vehicles up to standard. In addition to this, the brand launched an investment campaign to research and develop electric vehicles.

Conclusions on crisis communication

In conclusion, we can conclude that crisis communication plays a key role in preserving a company's reputation, as well as in restoring public trust in the brand. If the crisis is managed correctly, it is possible not only to minimise the negative effects, but also to make the company stronger by strengthening the image. Effective crisis communication includes crisis anticipation, prompt communication and transparency with the audience. We have looked at real examples of how to act in crisis situations in order to stabilise the situation