Recognizing the CMOs role when it comes to crisis

Crises are particle accelerators for brands that reveal their fragility and catastrophe reveals four cardinal rules CMOs can help deploy with PR.

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Recognizing the CMOs role when it comes to crisis

Dean Crutchfield, Article, September 14th, 2009, Advertising Age

http://adage.com/cmostrategy/article?article_id=138995

Crises are particle accelerators for brands that reveal their fragility as we’ve just witnessed with bankrupt banks, tampered-with pizzas, poisoned pistachios, dodgy cookie dough and lethal drugs. In light of the innumerable gaffes “brands” make when dealing with crisis, catastrophe reveals four cardinal rules CMOs can help deploy with PR.

1: Expect the best, Plan for the worst

“I don’t think anybody anticipated the breach of the levees.” George W. Bush, September 1, 2005.

When crisis strikes, news and social media burst and formal statements are rendered useless. Stocks don’t have a memory recall button, but the public do. The problem isn’t resources; it’s about managing the crisis with a can-do culture and strong values of trust. Many claim it, but few deliver: J&J’s $100M rapid response to the contaminated Tylenol crisis in ’82 prepared J&J for the acetaminophen overdosing debacle in ‘09, but (what) did we learn?

Failing to prepare is preparing to fail. Captain Sully’s preparedness for the “Miracle on the Hudson” was a far cry from the sludge bank of stoic corporate puff supplied in the (delayed) response of US Airways’ CEO, Doug Parker. The same rang true for Merck’s smoking gun with Vioxx that demonstrated how much the company’s leadership was in disarray. Merck communicated greater interest in maintaining their $2.5B brand than their vision “To preserve and improve human life.” Their disdain for the facts took them 4 weeks to withdraw Vioxx!

Consumers may be forgiving, but a crisis can cost a brand’s reputation in a single battering: “The court of public opinion can put you out of business even faster than a court of law.”

2: Decentralized decision-making

Crises are too quick for lengthy procedures; you can’t hide in bureaucracy, you can’t be pusillanimous and trust is vital. Mississippi Power’s success restoring power in 12 days during Katrina was twenty “Storm Directors” with crystal clear assignments and a phone directory of people who could get things done. As the Storm Director, Robert Powell said, “If you don’t know what you’re supposed to do, the manual is not going to help you now.”

Mattel had experienced 28 product recalls prior to the lead paint scare in ’07. When the news broke a team of sixteen opened all lines of communication with 300 media channels and its CEO, Robert Eckert, made 14 TV appearances and 20 calls to journalists in one day, a model for decentralized decision-making. A similarly integrated, multi-platform response strategy resulted in favorable customer opinion to Nestlé’s immediate action to withdraw its Toll House cookie dough brand this summer.

The Fortune 100 favor Twitter as a key communication tool according to a study by Burson Marstellar. As social media becomes ubiquitous and customers participate more, the role of the CMO is crucial in crisis as they’re able to inculcate social media to empower customers to play a key role: South West Airlines this summer, immediately posted updates on Twitter as the damaged plane landed, which illustrates the ability to handle the urgency of crisis communication.

3: Disaster begs a bold response

Marshalling a crisis team and a response plan are critical, including weighing the need for autonomy over the preferred unified leadership approach. Citi was the largest US bank prior to the meltdown and its fall from grace was accelerated by Robert Rubin’s “probabilistic” approach to decision-making that clearly misrepresented the severity of Citi’s exposure to the crisis that broke the brand and the bank.

Rest assured, when you need an ambitious, audacious and imaginative response, being forced on ineffective policies by some species of corporate bureaucrat creates a morass. During Katrina, with the cash economy broken, Mississippi Power’s head of marketing helped instigate a bartering system: electricity for fuel supplies with Chevron; consequently supplying the Eastern US and Gulf coast with fuel! Evidently, the more you want to achieve the more you achieve.

4: Check, Test, Check, Test

Brand integrity is compromised through fear. Studies show that companies who handled a catastrophe well have recovered and even exceeded pre-catastrophe stock price.

In a crisis fear is often the company’s first reaction that culminates in either a lack of compassion and/or stubborn refusal of the facts. Firestone tire treads were causing fatal crashes on the Ford Explorer, but customers were blamed first for over inflating the tires, then both brands publicly defenestrated each other for faulty designs and concomitantly fell into silence until dragged before Congress. Propitiously, Ford employees are currently being trained on how to better present the company via the use of Twitter to interact with customers.

Post adhoc ergo propter hoc (after this, therefore because of this)

Decontaminating a brand doesn’t need a weatherman to know which way the wind blows. Bad news is good news to the prepared. When you need to be big, strong, fast and mobilize a massive, sweeping redistribution of information to the public: Hide Nothing, Tell All. With that mantra in hand, there’s a phrase popular in the Whitehouse: “Never waste a good crisis.”

Author: Dean Crutchfield

In an award-winning career spanning two decades, Dean Crutchfield has created, built and re-invigorated some of the world's most iconic brands.

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