You would have thought that after the public relations disasters that companies like KFC have had that most companies would have a reputation management plan in place, ready to get implemented at the first hint of negative news coverage. Well a new study by BtoB and Eric Mower and Associates shows that that is not quite the case. Fully 57% of companies surveyed said that they do not have any type of plan in place.
Of the 43% of companies that do have a crisis plan in place, over 10% worry about their ability to implement it, and only half have trained spokespersons.
“If companies choose not to be prepared for a crisis, they and shareholders will pay the price, because crises have a way of twisting and turning till they do serious bottom-line damage,” said Peter Kapcio, director of reputation management services at Eric Mower and Associates and head of that agency’s crisis communications practice. “In most cases, it’s not the initial trigger of the crisis that causes the damage; it’s what follows a botched response.”
Kapcio added “It’s downright professionally irresponsible when b-to-b marcomm people allow their companies to operate unprepared. What if your brand new corporate headquarters building burned down, and it was discovered later that your facilities manager had `neglected’ to buy fire insurance? It’s the same thing when b-to-b companies invest millions in building their brand or company reputation, and then do nothing while it’s all at risk from the next potential crisis.”
So what is the risk to not having a reputation management plan in place ready to go? When asked how long it takes a brand to recover its reputation after negative publicity:
- 23% of respondents said it took three months to a year for their brand to fully recover from a crisis
- 13.3% said it took more than two years to recover
- 17.7% said they have yet to recover after two years.
Even those who have taken the time to put together a reputation management plan, are not fully confident that their plan does enough. According to the survey, among those companies that did have a crisis plan in place, 29.3% said it protects the brand sufficiently, 26.3% said it protects the brand somewhat and 20.2% said protection cannot be anticipated.
My question is, if you have a plan in place that does not protect your brand, then what kind of plan is it? That is like saying that you have a plan to protect you if you get sick but the protection cannot be guaranteed if you do actually get sick.
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Great Post David –
Just out of curiousity, why do you think companies choose to forego reputation management plans? Is it because they are underestimating the impact that the web can wreak on a blog, or are we overestimating it?
Strikes me that there are still a lot of marketing execs out there who look at the web as little more than white noise and spam
Jason I think you hit it on the head that a lot of marketing execs still don’t get the net, and we forget that the Internet is still basically only 10 years old.
My feeling is that reputation management plans are something that happen at the corporate or board level and most people at that age and level are not big computer users.
Yes that is a big generalization, and varies from industry to industry, but once you move out of technology, I think it is a lot truer that most people admit.
I’ve had to write a lot of reputation management proposals recently, they are a lot more successful when the company has a lot of bad things about them online, especially if they are ranking well.
Every company should have one, but at the end of the day internet marketing companies still need to make money, and they need the funds for the extra services.
Couldn’t agree more. I can’t tell you how many companies simply wait until it is too late to determine how they will respond to crisis communication via social media.
The spread of social media and its inclusion into the major engines makes it a serious reputation management issue. Many corporations greatly underestimate the speed that user generated content is indexed by the major search engines.
The other problem is the fragmentation of corporate marketing efforts by various agencies. Their Web, PR, Search, Print, TV and Radio efforts are run by separate agencies or departments. Getting all these groups together to develop a cohesive, multi-channel reputation management strategy could be quite a feat.