These are some of the results of a Harris Poll of 2,563 adults surveyed online between April 10 and 16, 2007 by Harris Interactive(R). Product recalls, particularly products as fundamentally important as food, can have a significant negative impact on a company's reputation, image and equity in the eyes of key stakeholders, and which can and does often negatively impact its financial health. Over half of consumers (55%) indicated that, if a brand they usually purchase is involved with a recall or safety concern issue, they would at least temporarily switch to another brand. In addition, 15 percent stated they would permanently switch to another brand. These findings suggest that consumer trust is not static. When consumer trust is earned it must be continually reinforced or it can erode, sometimes irreparably, when the brand is under fire.
Recalls Impact Vary Significantly
Consumers have varying levels of familiarity with the six product recalls that were measured in the study (all recalls occurred in the past 8 months). Along with varying familiarity levels, the actual number of consumers able to name the brands involved in the product recalls drops considerably. As an example, the nationwide recall of chicken in February 2007, due to contamination of Listeria monocytogenes, had only 20 percent of those measured stating they were familiar with the recall. Among those familiar, only two percent could actually name the correct brand involved. In fact a much higher percent (17%) named other industry brands not
affiliated with the chicken recall. This is in contract to the 71 percent of consumers stating they were familiar with the peanut butter recall in February 2007. In this case, of those respondents familiar with the recall, 46 percent were able to correctly name the brands involved, and only 12 percent of respondents attributed the recall to other industry brands.
The Role of Research in Crisis
In the event of a product recall, brands need to be certain that they do not respond in panic, but rather go to marketing with an urgent but measured response. By working with a research firm that specializes in crisis situations, such as Harris Interactive, a brand is able to gain a discreet understanding of the response that is required and the communications that will leverage the brand's equities and mediate consumer trust erosion. In many cases, research can be conducted overnight among varying stakeholders, and include analysis of the response directly associated to various communication channels and messages.
Strong Brands Weather Storms
One way smart companies have sought to better manage and mitigate negative events and news is to build a stronger brand. Harris Interactive's Brand and Strategy Consulting Group defines a brand as "a unified set of persuasive promises that, when fulfilled, differentiates that brand from competition in a positive, relevant, believable, and personally compelling way." By communicating that promise and delivering against it, a company builds stronger bonds with consumers and other stakeholders. Over time, those connections become resilient enough to withstand a crisis or negative event. A strong brand is typically a market leader, has a loyal user base, and has a positive image and equity.
According to Mike Dabadie, Division President, Brand and Strategy Consulting, "When there is a strong consumer connection with a brand, we typically see that it is underpinned by both a rational and emotional link with the products personally relevant benefits. Too often, particularly in crisis situations, corporations respond only to the actual events and subsequent claims and comments by the media and other parties. In contrast, brand and reputation management is a proactive, benefit driven strategy that focuses on and communicates a company's core strengths. Executives that employ this strategy must understand and continually reinforce the positive, personally relevant benefits behind their brand and organization to key stakeholders and influences. The more a brand relates to a consumer on both a rational and emotional level, the more likely a consumer will 'excuse' a brand if in question."
Building a stronger brand is the key element of "inoculating" an organization: this is one of the four phases that Harris Interactive views as integral to the ability to proactively manage an organization's behavior before, during and after a crisis event. Armed with a strong brand whose promise and experience strengthens its ties with consumers and stakeholders, an organization needs to prepare: to have a plan for how to respond if a crisis occurs. A week or even a day wasted trying to figure out what to do can exact a huge price in terms of loss of trust and reputation. The third phase of effective crisis management is the response.
When a response is called for, the old PR adage goes, 'tell the truth, tell it all, tell it fast' is sound advice for shoring up an organization's reputation. The final phase is recovery: rebuilding trust and reputation. This phase is most likely one that is on-going and, in a sense, takes an organization back full circle to the first step of inoculation.
