One court reigns supreme when it comes to judging corporate and brand reputation—the Court of Public Opinion. In this court, rulings are swift, often harsh, and carry long-tail financial consequences. That’s especially true in the food sector. According to the Grocery Manufacturers Association (GMA), almost one quarter of food manufacturers facing a product recall over the last five years lost US$30 million on average, and more than half estimated the cost at anywhere from $10 million to as much as $100 million from a single incident.
How important is your company’s reputation? Brand equity and reputation now account for almost half the net worth of U.S. companies, according to PR Week. In a recent global survey, Deloitte discovered that senior executives around the world ranked corporate reputation their No. 1 strategic risk. With stakes like these, crisis communications planning gets elevated from optional administrative exercise to vital reputation insurance. You wouldn’t drive a car without insurance, and you shouldn’t run a business without equivalent brand “insurance" coverage.
New Role for Suppliers
There is yet another compelling business rationale for developing a comprehensive crisis plan: customer demand. High profile manufacturers are no longer interested in flying solo with the media when there’s a major contamination incident or product claim problem. They want all parties involved, including ingredient suppliers, blenders, testing labs, distributors and other members of the go-to-market team to share the media spotlight, take some of the heat and be part of the solution.
This new role requires business partners to become familiar with crisis communications best practices to effectively support their clients. Be prepared to provide customers with materials ranging from the clinical or scientific evidence behind the product, to video B-roll illustrating processing procedures, to third party experts who can serve as endorsers, to detailed FAQs and full-blown web dark sites and more.
Social Media Abhors a Vacuum
With almost limitless time and space to fill, social media abhors a vacuum even more than nature. If you don’t fill the news hole and control that online conversation, someone else will—someone who may not share your point of view.
Adding a layer of complexity and vulnerability to the media equation is the lack of clear guidelines and definitions in the functional food and supplement marketplace. With so much open to debate, everything is viewed as debatable, from the quality to the efficacy of products, from the accuracy of claims to the purity of ingredients. Social media is the perfect forum for these debates, populated by passionate people looking for an outlet.
In an online world featuring a 24/7 news cycle, a story can break anytime, anywhere, triggered by something as minor as one person’s product experience. If that one person happens to have a large or influential social media following, get ready for a wild ride. If you’re lucky and prepared, you might be able to take the discussion offline before it gains traction. If you’re neither, followers will jump on the bandwagon, the topic will begin to trend and before you know it, your product or company name will become a hashtag.
Failing to Plan is Planning to Fail
When a crisis hits, stakeholders expect a response almost immediately. Consider the fact that it takes just one hour for news regarding 28 percent of crises to spread globally. Meanwhile, companies hindered by lack of planning take an average of 21 hours to issue any meaningful information about the crisis. During the 20-hour gap, rumor, innuendo and misinformation have time to saturate social media and convert a single issue into multiple flashpoints. All for lack of preparation.
Every crisis plan begins with a situation assessment that identifies areas of vulnerability, event probability and threat intensity. In the functional food and supplement industries, harm to the physical person from contaminated product is the paramount concern. Product claim challenges, packaging complaints, competitive attacks, offshore sourcing issues and other concerns rank a distant second.
Core Crisis Plan Elements
An effective crisis plan should detail who does what in what order in response to an incident. Detail is the operative word here. Outlines just aren’t good enough when a team is scrambling to respond. Let’s start with the team. The plan should identify each person by name/title and clearly explain their role in the crisis, along with home and business contact information that includes cell numbers in case landlines are down.
For each area of vulnerability identified in the situation assessment, the plan should include:
· a draft fill-in-the-blanks media statement;
· preliminary key messages; and
· a dark website with general positioning and background information on the company and product involved.
Media Relations and Relationships
A solid crisis plan will discuss when to hold a press briefing (or not), when and how to distribute statements or releases, how to create b-roll and video podcasts, how to log and track media coverage, how to set up a press room, how to maintain the issue web site, and a detailed media list that covers who and how to track print, broadcast, and online reporters covering the company and industry.
Ideally, the company already has established an ongoing dialogue with reporters, bloggers and social media mavens covering the industry/company beat so there is a solid foundation of trust.
Media coaching is mandatory for the official spokesperson, in as many stress situations as possible to ensure he or she can keep cool under fire and grow skilled at deflecting loaded questions. It’s always a good idea to have the entire executive team participate in media training. The skills transfer well to handling investor calls and board meetings, and in the event a back-up spokesperson becomes necessary during a crisis, they’re prepared.
Put the Plan to the Test
Having a crisis plan is just good business. Subjecting that plan to a real-time stress test is really smart business. It puts both people and processes under fire, with all the deadline pressure, tension and anxiety associated with handling the media in realistically tight time frames.
Blink uses cloud-based software that mirrors Twitter and Facebook to stress test the plan and team in a confidential, protected setting. Online posts are complemented by more traditional television, radio and newspaper coverage, so the corporate spokesperson encounters different interviewers in different settings.
Foodborne illnesses. Product contamination. Offshore sourcing. Sustainability. Water consumption. Product purity. Executive or employee behavior. Financial fraud. The headlines are filled with crises in the making. Savvy companies will anticipate the inevitable and be prepared with a well-considered response to protect the reputation of their brand and win over stakeholder jurors in the Court of Public Opinion.
Laurel Kennedy is a principal and co-founder of Blink, a crisis communications company for food channel organizations that manages issues from "seed to store"—consumer reaction, contamination, health/nutrition, packaging, corporate responsibility, sustainability and more.
Looking for more information on Crisis Management?
Laurel Kennedy will present the session “Ready to be Judged? The Court of Public Opinion" as part of the Natural Products INSIDER track in the SupplySide West Education Program. Her session will take place on Tuesday, Oct. 6, from 2 to 2:50 p.m. at Mandalay Bay in Las Vegas. Visit http://west.supplysideshow.com/edu-more.aspx for more information and to get registered.