[MUSIC] In the previous lecture, we have learned about alternative marketing methods. Some novel ways of creating news about our brand and how we can utilize online platforms to communicate quickly and broadly with our consumers. Social media and internet provide several challenges as well as opportunities for marketing managers. While internet and mobile communication channels make it much easier for marketers to establish and foster relationships with consumers, the interacting nature of these new media platforms allows any negative information to spread very quickly. A crisis is something which poses a threat to the reputation of a company. It may occur when the company makes an error, either deliberately or undeliberately. This could be anything from a member of staff who has behaved inappropriately to a defective or contaminated product that might be harmful to consumers. Sometimes our company does not do anything wrong. But someone targets the company with unjustified or exaggerated negative news. If the crisis is predictable, for example if we are closing a factory or we need to lay off employees, then we can act proactively to prevent the potential damage to our company's reputation. However in most cases, crises are unforseen. The basic steps of effective crises communications are not difficult. The first step is to form a crisis management team with company lawyers and senior executives of major business departments. This team will be responsible for collecting information, assessing the company's position regarding the crisis and deciding on how the company should react to minimize the damage. Ideally, potential spokespersons within the company should have been identified and trained in advance. In a very severe crisis, for example, if there's a loss of life due to technological failure of the company, Chief Executive Officer of the company should be the spokesperson to reflect the company's commitment to solve the problem. We need to establish a monitoring system to see what is being said on traditional and social media. Knowing our stakeholders' reaction against a crisis will allow us to correctly adapt our strategies and tactics. It takes moments for a lapse of judgement or process failure to go viral, trend, and make national headlines. You must be ready to respond to crisis rapidly and decisively. In our communications with the public, we need to show empathy and demonstrate that we understand why people might be angry or upset. We should very clearly, briefly, and honestly outline what our company is doing to deal with the crisis. In 1993, a complaint filed that a consumer found a syringe inside a Diet Pepsi can followed by a second complaint the day after, and the third complaint two days later. Pepsi executives were concerned that these reports could be false, but still investigated the issue. No recall was ordered by the FDA, the American Food and Drug Association because there were no reports of injuries or any indication that the syringes were contaminated. The media was creating panic among consumers with its display of a Diet Pepsi can with a syringe. The company recognized the magnitude of the crisis, and pulled together a team of 12 company executives to form a crisis team. Within a couple of days, company president Craig Weatherup was in front of the media. Additionally, Pepsi instantly circulated a video news release and a press release explaining the mechanics of the production process and the impossibility of inserting foreign objects in cans during that process. Pepsi worked closely with the FDA. Their assistance was important in reassuring retailers, not a single larger supermarket chain pulled off Pepsi from their shelves. The complaints about the Diet Pepsi were proven to be hoax when surveillance cameras in a supermarket captured the woman shopper apparently inserting a syringe into a can of Diet Pepsi. There have been more than 50 tampering claims and more than a dozen arrests for filing false claims. Pepsi put together a reassurance ad in response to the crisis. It explained that the stories about Diet Pepsi were not true and that hundreds of investigators could not find any evidence of support for a single claim. Pepsi kept the public up to date and showed genuine concern throughout the crisis. Their efforts resulted in positive media coverage, which in turn reflected positively on the company's image. When faced with a crisis, companies may react in four different ways, one option is to deny the blame, then the company should very clearly demonstrate that the claims are incorrect and confront the accusers. They usually pursue a lawsuit against the accusers to back up their standing in the situation. Silence maybe considered as an acceptance of the blame so companies need to react quickly and deny the blame before it starts negatively affect the company's reputation. If the company is at fault, the best option is to apologize immediately and not to blame others. An apology is a good strategy especially with the crisis that is not very severe or when the company cannot prove that they are not responsible. People may forgive the company if they perceive the apology as a genuine one. When company accepts the blame and apologizes,the news value of the story dies out. What else is there to talk about, right? Hence, accepting the blame and apologizing, minimizes the repetition and amount of negative publicity. Deflection is another strategy that may be used if the problem is not severe. Companies may try to deflect attention of the consumers from the problem to their other activities, or past good work. For example, a company may start an advertising campaign on a new breakthrough product, or on its corporate social responsibility activities. Finally, impression management is a strategy that is used to project a certain kind of image to others. The company attempts to reduce the negative impact of any event that modify or negatively it's image. Expressions of innocence, try to convince the public that the company and it's leaders are not associated with the event in any way. They provide excuses that are designed to convince the public that the situation could not be possibly foreseen. Crisis happen, and respect can be gained by how they are managed. As long as companies show empathy, demonstrate their commitment and sincere effort to rectify the situation in a timely manner, the negative effects of the crisis might be attenuated. Not every crisis is detrimental for the company. Companies may come out of crisis even stronger with successful crisis management. In the following lectures, we will have professionals from the field give us interesting information on topics such as social media marketing, digital marketing, search engine optimisation, and content marketing. I hope you will find them very helpful. [MUSIC]
