What is Crisis Management in PR? + Your Free Crisis Plan
Reputational damage can be managed, and often mitigated, with smart planning and quick intervention, but what steps should you take? In this article, we discuss what crisis management is and how you can mitigate reputational damage in just a few simple steps.
So, what is meant by ‘crisis management’? Crisis management refers to the process of handling a disruptive and unexpected event that threatens an organisation's reputation, financial stability, or operations. It involves identifying, assessing, and resolving the crisis as quickly and effectively as possible to minimise damage and ensure business continuity.
This piece will further discuss Crisis Management and how to save your business from disaster.
What Are The Three Types Of PR Crisis?
A ‘PR Crisis’ can look like a number of different situations, each with their own downsides. We deep-dive into the three most common types below:
Reputational Crisis
A reputational crisis is a situation in which an organisation's reputation, brand image, and public trust are threatened by negative publicity, actions, or events. This can be caused by a variety of factors, such as a product recall, ethical misconduct, or a social media scandal. Reputational crises can have significant long-term effects on an organisation's credibility, customer loyalty, and financial performance.
Public Safety Crisis
A public safety crisis is a situation that poses a threat to the safety and wellbeing of individuals in a particular community or region. Examples of public safety crises include natural disasters, terrorist attacks, and public health emergencies such as pandemics. The primary focus of managing a public safety crisis is to ensure the safety of individuals, prevent further harm, and restore order as quickly and efficiently as possible.
Financial Crisis
A financial crisis refers to a situation where there is a significant disruption in the financial system that impacts the economy at large. It can be triggered by a range of factors, such as a stock market crash, banking system failures, or a currency devaluation. A financial crisis can result in a widespread loss of confidence and trust in the financial system, leading to a reduction in investment, lending, and economic activity.
What is an Example Of a PR Crisis?
PR crises’ happen more often than you think, and many large corporations have had to put a plan in place to rectify the unfortunate situations. We’ve outlined some brilliant examples below:
1- KFC's FCK Bucket
In 2018, KFC experienced a supply chain issue that caused a shortage of chicken in its UK restaurants. This led to the closure of hundreds of stores, leaving many customers disappointed and angry. KFC used the power of social media as part of its crisis management strategy. They used it to open lines of communication and keep their customers informed at every stage.
The company’s response was to turn a negative story into a positive PR campaign, by rolling out brilliant ads in newspapers with the KFC letters rearranged on the bucket to own their ‘FCK’ up. A great example of ‘owning’ a PR crisis.
2- Tide Pod Challenge
The Tide Pod Challenge took everyone by surprise as an unforeseen event that no person could have anticipated. Teenagers would eat Tide Pods as a means of entertainment as influenced by online sources. Tide dealt with this incredibly well however and they had prepared for the unexpected.
They put disclaimers on their website and packaging warning against the dangers of consuming laundry detergent. On top of this, they added locks on the packaging, and recommended keeping the pods away from children. Because Tide were ahead of the game, their reputation never took a hit, as they had done what they could to prevent and warn against the consumption of their pods.
3- Johnson & Johnson's cyanide-laced Tylenol capsules
Starting on September 29, 1982, seven people died in America after taking cyanide-laced capsules of Extra-Strength Tylenol, Johnson & Johnson’s best-selling product. The company immediately recalled 31 million bottles of Tylenol and offered free replacements in the tablet form of the product.
This was the first major example of a business recalling a product, and despite this move costing the company over $100 million, Johnson & Johnson’s share prices only took a two-month hit as they were seen to be on top of the situation.
4- PepsiCo's can tampering rumours
In 1993, PepsiCo faced a major PR crisis when it was alleged that a syringe was found in a can of Diet Pepsi in Washington. The incident triggered widespread panic and led to a nationwide recall of Pepsi products. However, subsequent investigations revealed that the claim was a hoax, and no evidence was found to support the accusation.
Pepsi responded quickly to the crisis by collaborating with law enforcement, issuing public statements, and launching a marketing campaign to restore consumer confidence in its products. The marketing campaign was bold and assertive stating “Pepsi is pleased to announce ... nothing.” going on to confirm that the syringe claims were - in fact - a hoax. The advert ended with "Drink All the Diet Pepsi You Want. Uh Huh.", a witty, and blunt, invitation.
5- Aldi’s caterpillar war with M&S
In April 2021, Aldi faced a legal challenge from Marks & Spencer (M&S) over the sale of its Cuthbert the Caterpillar cake. M&S claimed that Aldi's cake was too similar to its own Colin the Caterpillar cake and that it infringed on its trademark. The dispute quickly became a social media sensation, with other retailers joining in the fun by promoting their own caterpillar cakes.
Aldi responded by humorously defending its cake on social media and offering to donate profits to charity. The dispute highlighted the power of social media in shaping public opinion and demonstrated the importance of brand differentiation and protection in the retail industry.
How Damaging is a PR Crisis?
A PR crisis can be highly damaging to an organisation, as it can harm its reputation, credibility, and financial performance. It can also lead to a loss of customer trust and loyalty, negative media coverage, and legal or regulatory consequences. The impact of a PR crisis can be long-lasting and difficult to recover from, requiring effective crisis management strategies and communication to mitigate the damage.
What is Crisis Management?
Crisis management is a strategic process that organisations use to prepare for and respond to unexpected events that could potentially harm their reputation, operations, or financial stability.
The crisis management process typically involves several phases, starting with risk assessment and identification of potential crises that could affect the organisation. Once a crisis has been identified, the organisation must then develop a comprehensive crisis management plan that outlines how it will respond to the crisis.
The next phase involves responding to the crisis as it unfolds. This requires quick and effective decision-making, communication, and resource deployment. The crisis management team should work closely with relevant stakeholders, such as employees, customers, partners, and regulators, to ensure that everyone is informed and understands the situation.
The recovery phase involves returning the organisation to normal operations as quickly as possible. This includes assessing the damage caused by the crisis, implementing corrective actions, and monitoring the situation to ensure there has been a full recovery. Lessons learned from the crisis should be incorporated into the organisation's crisis management plan to improve future responses.
How To Create a Crisis Management Plan
Step 1: Risk Assessment and Identification
The first step of a Crisis Management Plan involves identifying potential crises that could impact the organisation and assessing the likelihood and potential impact of each one.
Risk assessments should be conducted regularly and involve input from various stakeholders to ensure that all potential risks are identified and evaluated. The goal of this step is to proactively identify potential crises so that the organisation can develop an effective crisis management plan and be better prepared to respond if a crisis occurs.
Step 2: Assess Business Impacts
After identifying the risks that are most likely to affect your company, it's important to determine the potential business impact of each risk with the assistance of your crisis leadership team. As each risk can lead to different consequences, it's crucial to analyse them independently. The potential business impact may comprise of several factors, such as customer attrition, harm to reputation, postponed sales, revenue loss, or regulatory penalties.
Step 3: Plan a Response
For each identified risk, identify the necessary actions that your team needs to take to respond to the threat in case it materialises. For instance, if you're in the software industry and your company is hit by a cyberattack, you may require individuals to secure the network, inform customers, and evaluate the damage caused. These actions can also include those that might prevent an identified risk before it happens.
Step 4: Cement the plan
A crisis management plan is more than just a verbal or written strategy. It should incorporate essential elements such as an activation protocol and any emergency contacts, which will be discussed in detail later. Additionally, it's crucial to work collaboratively with key stakeholders to ensure that everyone understands their roles and responsibilities in implementing the crisis management plan.
Step 5: Evaluate
Upon completion of your crisis plan, it's crucial to review the final product meticulously to eliminate any potential gaps. It's recommended to review and update your crisis management plan at least once a year since potential risks can evolve with time.
Create an Effective Crisis Management Plan With Altitude PR
Sometimes things can and will go wrong, and when that happens we will be there, on your side with our professional crisis management services.
As a team of experienced media professionals, we’ve diffused a variety of potential crises. We’ve helped organisations to formulate their response, develop crisis management strategies and we have delivered media training to key company spokespeople.
The key to managing crisis communication is good planning. We work with clients to fully ascertain their potential crisis points and then develop an appropriate plan.
We predict, evaluate potential scenarios, and consider every possible reputational risk. We encourage active work on continuity and reputational planning by businesses and give them the tools to implement strategic planning.
At Altitude, we develop strong crisis plans and the resources required at your side and give senior leaders the skills and confidence to engage with the media effectively.
If this sounds like something that would suit your needs, we offer a free 30-minute consultation for corporate crisis management. Get in touch with one of our friendly team members today to start preparing.
