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How Crisis Affects Brand Reputation

December 1, 2017

 

A study from Clutch.co, updates data we use in crisis management and communications training that shows how companies’ responses to PR crises affect their brand reputation.

 

Using United Airlines, Pepsi, and Uber as examples, Clutch surveyed 500 consumers to measure their willingness to purchase products or services from United, Pepsi, and Uber before, immediately after, and seven months after each brand experienced a severe PR crisis.

 

For United Airlines, consumers lost a sense of trust and safety with the airline immediately after witnessing the violent removal of a passenger from a flight.

 

Consumer willingness to purchase a UA flight dropped from 68% to 42%.

 

Seven months later, United Airlines recovered its consumer following slightly, with 52% of consumers saying they’ve “moved on” from the crisis. However, 30% still said they distrusted the brand and would no longer buy United flights.

 

According to the survey, United Airlines had not fully redeemed its reputation because their PR response rate was slow and the company’s apology was considered insincere by consumers.

 

Pepsi, on the other hand, executed an immediate PR strategy in response to the negative reaction consumers had to their commercial featuring American fashion model and ‘Keeping Up with the Kardashians’ television personality Kendall Jenner. Pepsi quickly removed the advertisement, apologized right away, and owned responsibility for the marketing mistake. As a result, consumers’ willingness to buy Pepsi products only dropped from 56% to 55%, and the 1% loss was fully redeemed 7 months later.

 

Because Uber is a young company limited to specific locations, they have not yet built a broad consumer base. When the company is featured negatively in the press on multiple occasions, Uber can’t always rely on its consumer following to support its brand during a crisis.

 

Immediately after witnessing Uber in the news for various allegations of fraud and sexual assault, consumer willingness to purchase rides with Uber dropped from 60% to 47%.

 

Seven months later, 50% of consumers now say they are willing to ride with Uber having “moved on” from the negative news stories. 36% of consumers, however, say they are still unwilling to invest in Uber because they’ve never used Uber before and the negative press dissuades them from changing their purchasing behaviour in way that would support the brand. To have consumers trust your brand is a vital element of business success. Make sure your company maintains this trust by having your PR team ready and available in the event of a PR crisis.

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