Tag Archives: reputation

Crisis Management, Reputation Case Study, , , , , , , , , ,

Not so long ago, Volkswagen claimed the top auto industry spot in Fortune’s annual World’s Most Admired Companies list.  The Economist highlighted the Germany automaker’s global ascent in an article titled “VW Conquers the World.”

Now a scandal has put Volkswagen’s reputation in freefall. It comes at a time when Germany is in the world’s eye – leading the EU toward resolution of many issues, most notably the migrant crisis. VW is Germany’s largest employer and as iconic as Starbucks or Ford is in the United States. As far as scandals go, this is a massive one. It has damaged the opinion that many of us have had that the brand means something special—an opinion that extends back to the Beetle.

General Motors covered up faulty ignition switches for years — and they resulted in several deaths as well as 30 million recalls. But GM is back and selling lots of cars. Can Volkswagon recover?

We spend a lot of time observing best and worst practices in reputation rebuilding at companies large and small. Here are our top tips for VW’s beleaguered leadership.

  • Follow Mary Barra’s lead. As CEO of General Motors, she has performed crisis management almost flawlessly. All CEOs can learn from her use of social media to communicate with consumers.
  • Take a page from Toyota. We’ve written extensively about why and how the top car company has adeptly rebounded from multiple crises.
  • Check out these apology playbooks from AOL, GM & Sony.

It’s worth taking a look at the tremendous shifts in reputation VW has experienced over the course of its 75-year history.

An Unlikely Origin

VW began as a state-supported operation in Nazi Germany. While Hitler heralded the Beetle as an affordable “people’s car” (in German, volkswagen), VW’s early years did not live up to that reputation. “Only 630 Beetles were made there during World War II—and distributed to the privileged,” according to Der Spiegel.

A Reputation Reborn

Demand for Beetles during the occupation kept VW alive following World War II, but there was little international interest. After looking at the company as a possible acquisition, the CEO of Ford, for instance, famously concluded that VW wasn’t “worth a damn.” But over the coming years Beetle’s popularity made it a symbol of West Germany’s “economic miracle,” and VW’s success was “one of postwar Europe’s most glittering economic achievements,” according to a Time magazine article from 1963. By that year it was the world’s third largest automaker, and less than a decade later the Beetle’s total production count eclipsed Henry Ford’s Model-T.

Transformation: from “Hitler’s car” to “Beetlemania”

Upon its initial introduction in the United States, VW’s reputation couldn’t escape the Nazi association. “I even tried calling the VW the ‘Victory Wagon’ to take the curse off it, but the press referred to it only as ‘Hitler’s car,’” said Dutch car dealer Ben Pon, who shipped the first Beetles stateside in the late 1940s. Soon, though, New York agency Doyle Dane Bernbach wiped away that stigma with a string of unforgettable advertising campaigns, including “Think Small,” Advertising Age’s top campaign of the century. By emphasizing VW’s impact on an owner’s reputation and image instead of the traditional touting of features, these campaigns were an innovative and influential development in the history of advertising.

Post-Beetle: less risk, but no more mania

When Beetlemania subsided, the void left by such a defining model threatened to undo VW’s reputational gains. Not wanting to repeat the same mistake, the company unveiled a more diverse series of models, including the Passat, Golf and Polo. VW acquired Audi in 1964, and those new models integrated the technology and luxury Audi was known for. They prevented VW’s image from flat-lining but ushered in an extended period of mixed results. Things began to look brighter by the turn of the new millennium, as Audi’s jump to the luxury class occupied by BMW and Mercedes-Benz gave VW’s reputation a boost in the same direction.

Poised for a boom

Reputation has played a major factor in VW’s more recent global endeavors. In many countries “it has been around long enough to be seen as a domestic firm, so protectionists usually leave it alone,” according to The Economist. Its longstanding reputation in China helped distinguish it from pack in the world’s largest auto market. “VW bet on China nearly 30 years ago,” The Economist noted. “A glut of cheap cars is hurting prices in China but VW’s premium models are doing well.”

Rebuilding its image will be crucial for VW’s future success. Only a few years ago, its crowdsourced “People’s Car Project” engaged China’s drivers, attracting 119,000 ideas and 33 million hits. Incorporating that kind of virtual strategy in the climb to regain its reputation might help VW recover…if it can.

 
 
Online reputation management, , , , , , , , , , , ,

Now that NBC has fired Donald Trump, do you find the 2016 presidential campaign more divisive than usual? It is. A few campaigns ago, two American political reporters coined a term for the new Internet-fueled political culture: The Freak Show. It explains much about what we’ve seen already.

“The Way to Win,” by Mark Halperin and John F. Harris, was published by Random House in 2006. It identifies the strategies and traits that create winners (and losers) in modern presidential campaigns. The book’s main focus is how the Bushes and Clintons held the White House for nearly a generation. “The Freak Show” is a major theme in the book. It refers to politics in the Internet age, including the rise of ideological extremism, personal attacks and smear campaigns. When they become mainstream news headlines after first surfacing online, they can derail candidates.

These excerpts from The Way to Win explain why The Freak Show now plays a major role in determining who wins Presidential elections:

The Freak Show is about the fundamental changes in media and politics that have converged to tear down old restraints in campaigns and public debates.

The Freak Show…elevates the personal and the negative over an impartial appraisal of an allegation’s relevance in determining a person’s qualifications for the office. The Freak Show’s incentives favor attack over restraint and sensation over substance. The pervasiveness of these incentives is something that a president or serious presidential candidate faces every single day.

In the past, Old Media tended to sift and suppress the angriest and most sensational elements of politics… In the current generation…the extreme and eccentric voices who have always populated the margins of politics now reside, with money and fame as rewards, at the center.

The political opposition and the media (both Old and New) are filled with men and women who prosper by doing damage to personal reputations. No candidate can be considered serious without an understanding of Freak Show incentives and a strategy for dealing with them.

According to Halperin and Harris, Freak Show politics present a huge threat to any politician hoping to keep control of the narrative of his – or her – life story.  When you lose that, they say, you lose the election. As longtime political insiders, they should know. Mark Halperin is the managing editor of Bloomberg Politics. John F. Harris, the editor in chief of Politico, wrote the best-selling biography of Bill Clinton, The Survivor.

 
 
Online reputation management, , , , , , ,

Business News Daily has published an in-depth guide to choosing a reputation management service.

Three important takeaways:

Whether you’re a business or an individual, it’s important to understand how reputation management services can help you, and to make sure you know what ORM companies can and can’t do and what makes a service trustworthy and effective.

While the majority of ORM providers offer the same basic services, every company is different. It’s important that you choose the best one for you and your business. And handling a reputation management issue quickly and tactfully may be more important than you realize.

Reputation management campaigns often use questionable black hat practices, but they fall into an ethical gray area and can ultimately do more harm to your brand than good. Make sure that the ORM service you choose avoids these tactics and is clear about what it can and cannot do for you.

Shannon Wilkinson, Reputation Communications’ founder and CEO, is a featured expert. Her advice:

“If you are a recent college graduate, you will be best served by a company experienced in removing inappropriate or outdated photographs and information on social media platforms,” Wilkinson said. “Doctors, dentists and attorneys, as well as storefront businesses like restaurants, find online reviews to be their biggest challenge. They might obtain best results using a review management firm.”

And “if you are a high-profile industry leader, VIP or have a rising presence in business, you face different issues and will want a firm that specializes in that sector,” Wilkinson added.

 
 
Crisis Management, , , , ,

The BBC documentary Reinventing the Royals was finally broadcast last night, after an earlier air date was cancelled. The controversy surrounding the documentary is not surprising, considering some of the unpleasant public relations approaches it describes. But that is one side of the PR industry that is deeply entrenched. The consultant described as Prince Charles’ consigliere is far from the first to use such tactics.

 
 
Crisis Management, , , , ,
Crisis management

The iconic American news host, Brian Williams, has been under intense scrutiny in recent weeks. We have followed the conversations online and off.  The late David Carr’s New York Times article on February 8, 2015 resonated with us the most.

In Brian Williams, Retreading Memories from a Perch Too Public, Carr provided a thoughtful point of view about what news hosts face in today’s competitive market.

We want our anchors to be everywhere, to be impossibly famous, globe-trotting, hilarious, down-to-earth, and above all, trustworthy. It’s a job description that no one can match.”

Additional viewpoints from crisis and reputation experts – including our own CEO — are featured in this week’s “Crisis of the Week” column, at The Wall Street Journal. 

 
 
Crisis Management, , , , ,

The Korean Air “nut crisis”—which we have written about here and for the Wall Street Journal’s “Crisis of the Week” column—continues to develop, and escalate.

Cho Hyun-ah, the daughter of the airline’s chairman and herself a former executive, has been charged with violating aviation security law and hindering a government investigation. She faces up to 15 years in prison. This follows her much-publicized arrest last week.

Several other employees of Korean Air and public officials also face prosecution.

This rapidly expanding crisis began on December 5, when Ms. Cho humiliated crew members and forced a plane to return to its gate. Public reaction was immediate and heated. The company attempted to respond, but failed to enact measures that matched the severity of public sentiment. As with all executive missteps that escalate into crises, this illustrates the importance of crisis planning. Have a response plan ready. Don’t get caught playing catch-up with incremental measures. Respond early, and conclusively.

 
 
Google, , , , , , , , ,

Links to five New York Times articles have been removed from some search results on European versions of its search engine to comply with Europe’s “right to be forgotten.” The Times reports that Google recently informed them of the action. This excerpt provides an example of what is being removed:

One Times article that is being shielded from certain searches in Europe is a report from 2002 about a decision by a United States court to close three websites that the federal government accused of selling an estimated $1 million worth of unusable Web addresses. The complaint named three British companies, TLD Network, Quantum Management and TBS Industries, as well as two men who it said controlled the companies: Thomas Goolnik and Edward Harris Goolnik of London.

Links to such articles continue to be available in the U.S.  The full article can be read here.

 
 
Online reputation management, , , , , ,
Reputation Communications

The explosive growth of the Internet has dramatically changed the demands of reputation management. The manipulation of search engine results—what used to be considered the central activity of ORM firms—has lost its utility as search engine algorithms have grown more sophisticated.

The National Cybersecurity Institute Journal has published my new paper addressing this topic. “The New Demands of Online Reputation Management” provides an overview of the leading online reputational threats faced by companies in the United States, as well as an explanation how such events unfold, the motivations behind them, and how they can be protected against and resolved.