Teresa Horscroft's blog

Can Toyota rebuild its reputation after the recent crisis?

2010-03-25T18:26:00.001Z

Some media students from Alton College interviewed me last week about how Toyota’s faulty accelerator pedal crisis may have damaged the company's reputation. While it is evident that the car manufacturer made some basic crisis communications errors, it will be interesting to see whether Toyota can rebuild its reputation as one of the world’s most trusted car brands.

The mistakes made by this fast growth car company will no doubt ensure that it is referred to in business and communications management text books for years to come.
The first mistake Toyota made was not to respond quickly enough. It was too slow to: acknowledge the problem; decide how to deal with the problem; and communicate remedial actions. In a crisis speed is critical. In recent years we’ve gone from having a few hours or even days to just a few seconds before news about a crisis is spread widely via online blogs, social media sites and news pages. It’s more important than ever that, as part of crisis preparedness , companies have planned for a multitude of possible events. The planning should include among other things agreement on how to respond, who will respond and even a draft of the planned response. I am sure there are a number of scenarios that could be covered by a single statement for a company in this sector, where product recalls are not uncommon. Doing the legwork in advance really does gain valuable time.

The second, but my no means final, error Toyota made was to try to downplay the problem. It will always be wrong to trivialise a problem where people have or could die. And honesty is crucial.

Further, by adopting a decentralised approach to disseminating information, customers received mixed messages about the nature of the problem, adding fuel to the already flaming fire of consumer anxiety.

In a crisis, you need to quell rumours and confusion by ensuring that communication comes from the top of the organisation. Since the internet is global and bad news travels quickly online, it should also be consistent across the globe (with local detail if necessary). And if you’re communicating on webcasts or TV, don’t forget the importance of body language. It’s not enough to say you’re sorry, you have truly be sorry in order to look sorry too. I watched one TV interview where the spokesperson appeared defensive and even slightly annoyed at the questions he was being asked. This is not a good attitude to take. People have died. Show some respect and remorse.
Despite these blunders, it is still possible to survive a crisis when a company, like Toyota, has already built a huge amount of customer trust. It’s no easy ride to recovery however. Toyota still needs to get the business response and the way it communicates that right from now on. It was slow to engage with and leverage the support of dealers, suppliers and partners in the early stages of the crisis, but that doesn’t mean it’s too late to start. It’s also not to late to work with other key influencers , such as Top Gear presenters Jeremy Clarkson, James May and Richard Hammond or independent car safety experts. Invite these trusted experts to test cars. Get them into the manufacturing plant to review first-hand the quality and testing processes and let them lift the hood on what happens under Toyota’s bonnet. Film it, document it and use it to highlight how seriously safety and quality are taken at Toyota. But don’t use it as an excuse for what happened. Acknowledge the issues and show how they are being tackled. Being open and transparent will show that Toyota has nothing to hide. This will help to rebuild trust and perhaps even gain some new followers in the process.

Toyota still has a chance to rebuild its reputation as long as it continues to deliver on its promises. People will forgive a mistake when it’s dealt with openly and honestly. Anything else plants seeds of doubt that can damage trust and brand loyalty.

How your office environment and staff behaviour impacts your corporate identity

2010-03-21T19:02:00.002Z

My preparation for a video interview this week included more than researching Toyota’s battered reputation. I spent just as much thinking about visual impact. This included tidying away desk clutter, displaying recent copies of marketing and PR trade magazines as well as the daily papers and filling the flower vase. It reminded me that a company’s image is not only communicated by its collateral, press coverage, website and product packaging. Corporate identity is presented in every single interaction a company has with its suppliers, partners and customers. The way the receptionist answers the phone or greets visitors; whether the office is tidy or messy, modern or old-fashioned, small or large; how welcoming the reception area is; and how staff dress and behave, will all communicate something about your company.

Ask yourself what your own office and staff says about your company and is it consistent with how you describe the company and your core values.

As an example, think about how you might feel if you saw a Waitrose van driver throwing rubbish out of the window while driving along. Probably not the behaviour you’d expect from the nation’s favourite ‘green’ retailer. I’m sure I’m not the only person who has been unimpressed by a sullen or rude receptionist. How do you feel when you walk into a shop and hear sales staff gossiping about the person they just served in front of you? This happened to a colleague recently who subsequently decided to boycott that shop in future.

When we work so hard to gain customers, losing them as a direct result of staff behaviour should not be tolerated. But it really is equally important to consider the entire journey that a potential or existing customer takes with your company. If you don’t already undertake regular and comprehensive corporate identity audit then there’s no better time to start than right now.

Is it acceptable to have a blog ghostwritten?

2010-02-11T08:41:00.003Z

A recent blog by Vikki Chowney at Reputation Online tackled the issue of whether ghost-writing a blog is an acceptable practice. She identified two main opposing schools of thought on the issue. First are the digital natives who believe ghost-blogging to be an unacceptable practice and argue that the whole idea of a blog is that it captures the first-hand views and opinions of the author. Some of these people even deem ghost-blogging to be illegal. They suggest that CEOs and other ‘bloggers’ have no idea what they are putting their name to.

Secondly there are the agencies that don’t see ghost-blogging as any different from ghost-writing by-lined articles. Essentially this is where I stand. In both cases the content of the article is discussed (or at least should be) with the author to ensure that their opinions and expertise are accurately represented. Once written the author reviews and then agrees to the article or blog copy before it is submitted and published. Even though blogging needs to have a quicker turnaround and the tone of the piece is entirely different from a by-lined article,the procedure is really no different. If the idea or beliefs expressed in the blog were firstly asserted and secondly agreed by the ‘author’ then there should be no case, legal or otherwise, to discredit the blogger as bogus. One commentator on Vikki’s blog, Alex Blythe, makes an important point. He says authors trust ghost-writers to present their opinions in a clear and engaging way. Of course they do! Just because someone can’t write or doesn’t have the time to, they can still have their views published with the help of a ghost-writer or ghost-blogger.

On other hand if the author really has not authorised the text and someone is blogging his own opinions under the banner of the CEO then I am inclined to agree with the digital natives on this one: that the by-line should be attributed to the real author (the actual writer). The same applies to anything else that is essentially written as a by-line rather than the company line.

To summarise, yes, ghost blogging should be acceptable with a few fundamental rules. We should be encouraging companies to communicate in a more open and transparent way with all of their audiences. Blogging is one of the ways they can do this. It gives a company a real face and invites customers and other influencers to interact, which could be invaluable in building brand loyalty as well as influencing corporate strategy and sales.

Stand and Deliver: is your brand delivering on its promise?

2009-09-24T10:39:00.002+01:00

A recent unsatisfactory experience with Tefal’s customer service department reminded me that no matter how much money companies spend on building great products, establishing the brand and communicating the brand’s strength’s again and again, it takes just one bad customer experience to break that hard-earned customer loyalty.

Yes I was disappointed that my ‘lifetime guarantee’ product was faulty, though rather relieved that the rivet on the pan handle hadn’t blown up in my face. But had Tefal apologised and offered to replace the faulty product then I may have forgotten about the experience. I might have even felt more confident in the Tefal brand for honouring its lifetime guarantee. Instead I was rather rudely accused of misusing the pan! Is there a special way to boil water apart from make sure that water is present? When I finally convinced them to listen to sense, they permitted me send the saucepan back, at my cost I may add, so that they could judge the reason of its demise.

When I did receive a replacement for the faulty product, there was no communication at all from Tefal - no 'we're sorry’ letter; no compliments slip; no reassurance that my other saucepans wouldn’t blow up while being used; and no refund for the cost I had incurred in sending the heavy package away.

The whole experience has not only cheapened my opinion of the Tefal brand, but I no longer trust it. Would I have felt the same if Tefal hadn’t promised me that their products were of such high quality that they would last a lifetime? Would an apology and some reassurance have helped? Yes and yes. People tend not to remember the problem as much as how it is dealt with.

In the end, when a brand fails to deliver on its promise it’s in more trouble than a brand that just doesn’t deliver (years of research by Millward Brown backs this up). Communications professionals would do well to step outside of the comms department for a few hours and make sure their brands stand up to the scrutiny of the promise.

Public Relations does not equal Print Relations

2009-06-09T16:12:00.001+01:00

In her Media Week column recently, Tess Alps, chief executive of Thinkbox, commented that “you can’t do PR without print titles”. I disagree. PR is and has always been about more than just print press relations. Print is just one flavour in a pick n mix bag of media that has continued to expand over the years. Press relations has expanded in last 20 years from TV, radio and print to include web sites, and social media (blogs and microblogs and other online communities of interest). And while it’s true that picking up a magazine and reading press coverage or listening to a client being interviewed on the radio still excites me, there are other PR activities outside of press relations - analysts, investors, industry organisations and other opinion formers for example - that have always been important to target in order to reach and influence stakeholders. So even though I believe that for some time at least people will continue to value picking up a magazine or newspaper, I can still imagine a PR campaign without print.

Where news breaks

2009-03-08T18:52:00.002Z

I first read the news that a Turkish airplane had crashed into Amsterdam’s Schiphol airport on BBC NEWs Online. But this online news site was not where the story first broke. Neither was it a rival online news site, television, radio or a daily paper. Citizens not journalists broke the story first on microblogging social website twitter (www.twitter.com in case you haven’t already tweeted). It’s not the first time major news has first been aired by tweeters either – Twitter was also where news of the plane crash on the Hudson and the terrorist attacks in Mumbai first became widely circulated before it was picked up by the media. It got me thinking about whether this was a new media phenomenon or simply an online replication of a process that’s always happened in the real world. Certainly journalists have been listening to consumer conversations for years. In the last few years this may have involved tracking discussions in an online discussion forum or social networking site like twitter, but before the Super Information Highway (what we used to call the Internet way back) it was during a conversation with friends in the pub or at a Rugby game or from snatched conversations on the train. People have long been the real source of a lot of breaking news.

It’s easy to get carried away with the latest in online media. We need to remember that as much as the Internet - and the wikis, microblogs, blogs, web sites and social networking sites that populate it – should be a key element of any communications strategy, life isn’t all online. At least not yet. People still do read the newspaper, talk to friends and look up from their blackberries or computer screens (from time to time anyway)!

The Wheels of Change – Are you monitoring the consumer generated temperature?

2009-03-08T17:49:00.002Z

I have just returned from a 30 mile cycle ride during which I experienced five, yes five, changes of weather. It started out as a beautiful sunny Spring day. By mile five it was blowing a gale. Rain, hail and snow followed me on my journey through the spectacular Hampshire countryside. As I took off my sunglasses and put on my waterproof, I congratulated myself on being prepared for the change of weather. And while I did not expect it to rain, hail and snow all in one day, it was a reminder that it’s always a good idea to be prepared for the unexpected. This is as true for cycling as it is in business in fact. I imagine I’m not the only person that is always (well nearly always) prepared for the unpredictable British weather or a puncture. But how many businesses are really prepared for potential crises?

We know that companies need to listen to their customers, but how many really do all of the time? With thousands of consumer-generated media - discussion groups on facebook or other community sites, blogs, microblogs (or tweets) to name just a few –news travels exceedingly quickly. This is particularly true of negative news. Companies can no longer wait for the consumer feedback forms to be analysed. They need to be listening all of the time. It can be difficult to monitor the thousands and millions of blogs, let alone social networking discussions. Certainly traditional monitoring systems such as press clippings services are no longer adequate. New services are required. Millward Brown Precis pioneered the development some years ago of a service that monitors millions of online discussion forums in real-time. Rather than capture and send individual blogs as ‘clips’ that PR departments or busy executives never have time to read, its Precis:cubed product scans online consumer discussions and clusters selected topics together so that businesses can take a ‘big picture’ view of what online discussion ‘themes’ relate to their product, company or sector. The single-screen graphical view is a useful real-time thermometer for consumer opinion and an early warning system for potential problems or trends.

But is listening enough? No it isn’t. A crisis plan as well as an issues management plan should be in place – after all if issues are managed effectively then a crisis can be averted – to respond to any issues that are unearthed by such monitoring. Setting up a reputation management group is a good first step. This group would be responsible for monitoring external issues and trends and then making recommendations on changes to strategy, business plans and processes accordingly. They would develop and communicate the organisation’s position on and response to appropriate issues, both internally and externally.

In addition to the crisis or reputation management plan, discussion trends and issues should also be fed back into the business to improve existing programmes or products. The communications team for example could develop a response or campaign around consumers’ concerns before they gain momentum and become a crisis. But it doesn’t need to stop here. For example, the product development team for example, may make changes to the next version of the fridge once they discover that customers are frustrated by the five hole egg container (because every time they buy six eggs there is always one that doesn’t fit into the container). The call centre may also find it useful to know as early as possible that the latest software release is causing problems and prepare their staff with an appropriate response for any inbound calls related to this issue.

You may be prepared for the weather with an umbrella in your bag and perhaps now a pair of snow boots in the back of the car, but is your business prepared to deal with issues and potential crises?

Surplus to short term profits but what is the long term impact of redundancies

2009-02-02T19:32:00.005Z

Microsoft joined a distrurblingly long list of companies to make people redundant last week. 5000 people will be served notice in the next 18 months. The news surprised me. Not because of the fact that yet another company is faced with falling revenues, but because this global megacompany has more than $21 billion in the bank, cash. Wow. Could 5000 people really be surplus to profits? As an owner of a small business, I understand the need to make cut-backs in tough economic times. Yet I am troubled that such a global powerbrand is making redundancies to add more silver to its coffers. I have always considered redundancy to be one of the final solutions to a company’s woes. News of redundancy spreads anxiety and panic through an organisation at an alarming rate. And anxious, stressed or unhappy staff can impact productivity as well as customer service. What do customers themselves think about the news? Does it make them feel less loyal to the Microsoft brand I wonder? Shareholders, often the target of such business decisions, may well feel assured by such money saving news, but did Microsoft forget about the opinions of its customers and employees, often forgotten as a company's most valuable assets?

I wonder whether the money saved is really worth the risk to employee loyalty to customer experience and to the long-term future of the company. Those companies that continue to value their customers and staff while focusing on improving processes to make operational efficiencies are more likely to be laying the foundations to future market dominance. Short term profits do not always pave the way for long-term gains.