Crisis Management
Case in point: After the launch of the Fitbit Force, a wrist-worn product that tracks fitness activity, 1.7% of more than 100 million users began developing skin rashes where the device was being worn. CEO James Park, responded almost immediately to the news, delivering an apology and initiating a product recall with a full refund for all of the devices. Later, test results showed that users were likely experiencing allergic contact dermatitis which is an itchy rash and caused largely by a substance that comes into contact with the skin. The likely cause of the rash, in these instances, was users not properly cleansing the area of their skin beneath the device, which was very often worn all day, every day. The Fitbit Company could have easily blamed the rash on user error, but instead decided to take full responsibility and issue a recall. Instead of dealing with customer backlash, due to the company’s timely, and proactive response, the company continues to do well, having maintained their integrity in the marketplace as well as the trust of their customer base.
At the other end of the spectrum, Kryptonite, a leading manufacturer of bicycle locks, had a crisis in 2004. After an internet video had surfaced of a user hacking the well-respected company’s lock, many more videos and complaints began forming. The videos showed how the lock could be easily unlocked by jamming it with a plastic pen. Kryptonite eventually did address the situation, but weeks later, with a product recall and an explanation that the issue dealt with all types of cylinder locks including those associated with vending machines and some automobile ignitions. Because it took the company an extended period of time to respond, customers and the media continued to smear the company’s brand for days. This led to a loss of customer trust and a near irreparably tainted brand. Beyond the cost of the recall, millions of dollars have been spent to rebuild the company’s reputation.
When dealing with a crisis, the focus is centered on brand trust and risk. A crisis should be addressed through direct contact whenever possible as in the case of Fitbit where users received an email from the CEO about the recall versus the use of mass social media. It is also important to recognize that media outlets and third parties have the capability to either preserve or damage customer-to-brand trust. Consumer relationships and widespread brand trust are essential during a crisis, and your business cannot afford to neglect the element of the media if you want to retain customers. Marketing strategies during a crisis should also project that your company remains adaptive and is present during the crisis.