Crisis Management in Digital Marketing | Industry Insights | All MKC Content | ANA

Crisis Management in Digital Marketing


Trust is the cornerstone of any successful business-customer relationship, especially for small businesses. This trust, painstakingly built over time, can be fragile and vulnerable to various crises that might strike unexpectedly. Whether it's a social media mishap, a product recall, or a data breach, such events can swiftly erode the hard-earned confidence customers place in a brand. Today, information spreads more rapidly than before, which can amplify the crisis, making effective crisis management an essential skill for any business.

While crises are to be avoided, businesses experiencing a crisis can manage it in a way that maintains and even strengthens customer trust. This is particularly crucial for small businesses, where a strong customer relationship is a significant competitive advantage.

But how can small businesses navigate these turbulent waters and come out stronger? What lessons can they learn from larger businesses that have faced and overcome similar challenges?

Below are real examples of trust loss from well-known businesses along with valuable lessons that small businesses can apply. It's important to explore strategies for mitigating trust loss, manage crises, and find ways to repair and reinforce trust with customers through thoughtful, strategic digital marketing.

How Crises Impacts Trust

It only takes a scroll through Instagram reels or Facebook to know that in our connected world, word spreads fast. A negative review, a customer complaint, or a news story about a business mishap can quickly gain traction on social media, blogs, and news sites. This rapid dissemination can turn a minor issue into a significant crisis, magnifying its impact on customer trust.

Real-Life Examples of Crises Affecting Trust

PR Disasters. A poorly worded tweet, an insensitive ad campaign, or a controversial statement by a company representative (past or present) can lead to a PR disaster. Such incidents can paint a business negatively, leading to a loss of trust among existing and potential customers.

In 2017, Dove faced backlash for a social media advertisement that many perceived as racially insensitive. The ad intended to show the effects of Dove's body lotion on each woman, but instead showed a black woman "turning into" a white woman after using Dove body lotion. Despite Dove's history of celebrated inclusive advertising, this misstep caused significant public outrage, leading to a swift apology and ad removal.

As with many social media crises, the problem came from a lack of listening, understanding their target audience, and understanding how outside factors can influence public perception.

Product or Service Failures. Issues like product recalls, service outages, or quality concerns directly impact customer experience and can erode trust. Customers expect reliability, and a failure in this area can be particularly damaging. This couldn't be truer for small businesses that have to work extra hard to gain trust in the first place.

Now, this one is memorable! Samsung's 2016 recall of the Galaxy Note 7 is a classic example of a product recall crisis. The smartphones were found to have a defect that caused them to overheat and, in some cases, catch fire! Samsung initially replaced the phones but eventually had to recall the entire line, costing the company billions, and damaging its reputation for quality and safety.

Data Breaches and Privacy Concerns. With increasing concerns about data privacy, a breach or mishandling of customer data can lead to a significant trust deficit. Such incidents have legal ramifications and damage the perception of a brand's integrity and reliability.

The following example shows just how long-term the consequences of a crisis can be. In 2017, Equifax, one of the largest credit bureaus in the U.S., suffered a massive data breach that exposed the personal information of about 147 million consumers. This breach led to a loss of consumer trust and resulted in numerous lawsuits and a significant drop in stock price. While Samsung's recall is memorable due to its shock factor, Equifax has continued to be remembered for this data breach.

Negative Reviews and Customer Feedback. In the age of online reviews and social proof, negative customer feedback can have a substantial impact. A series of bad reviews or publicized customer service failures can quickly alter public perception.

In January 2021, Robinhood, a popular stock trading app, faced immense backlash when it restricted trading on GameStop (GME) and several other stocks. This decision came during significant volatility, driven by retail investors from the Reddit community r/WallStreetBets. Many users saw Robinhood's move as siding with Wall Street elites against the average investor, contradicting its mission to "democratize finance for all."

The backlash was swift and severe, with users flooding the app with negative reviews on the Google Play and Apple App stores and some even calling for regulatory action. Robinhood's reputation among its user base suffered considerably, impacting its trust and credibility.

The consequences of a crisis can extend far beyond the immediate aftermath. Losing trust can lead to decreased customer loyalty, reduced sales, and a tarnished brand image. For small businesses, which often rely heavily on their reputation and customer relationships, the stakes are even higher. The loss of trust can be a significant setback, potentially jeopardizing the future of the business.

Strategies for Mitigating Trust Loss

The way a business responds to a crisis can make a significant difference in mitigating trust loss. Let's examine some key strategies and see how they were applied effectively or where there were missed opportunities in our examples above.

Immediate Response 
Quickly acknowledging the issue and taking responsibility is crucial. In the case of Dove's "Real Beauty" campaign, the company promptly apologized, acknowledging the ad's insensitivity. This swift response was critical to beginning the process of trust repair.

Small Business Takeaway: Time is of the essence. Small businesses should quickly acknowledge a crisis and communicate with their customers, even if it's just to say they're aware of the issue and are working on it. This promptness can prevent the escalation of negative sentiment.

Consistent and Honest Communication
Regular updates and transparency are vital in maintaining customer trust during a crisis. Samsung's handling of the Galaxy Note 7 recall initially lacked clear communication, leading to confusion and frustration among consumers. However, they eventually rectified this with more consistent and transparent updates.

Small Business Takeaway: Maintain open lines of communication throughout the crisis. Even if there's no new information, regular updates can reassure customers that you are actively managing the situation. Honesty is key; avoid making promises you can't keep or withholding critical information.

Customer Engagement and Feedback
Actively engaging with customers and encouraging feedback can help rebuild trust. After the GameStop trading controversy, Robinhood could have engaged more effectively with its user base to understand and address their concerns. Their initial lack of engagement led to increased negative sentiment.

Small Business Takeaway: Use social media, email, and other channels to engage directly with your customers. Encourage feedback and take it seriously. This engagement shows that you value your customers and are committed to resolving their concerns.

Transparency and Accountability
Being open about the steps taken to rectify the issue is essential. Equifax faced severe criticism for its delayed response and perceived lack of transparency during the 2017 data breach. A more transparent approach might have helped maintain some level of trust with their customers.

Small Business Takeaway: Be clear about what went wrong and what steps you're taking to fix it. Owning up to mistakes and outlining your action plan can rebuild trust. Small businesses often benefit from a more personal approach, which can foster a stronger connection with their customer base.

Learning and Improving
Demonstrating that lessons have been learned and improvements are being made is crucial in regaining trust. Post-crisis, Samsung conducted an extensive investigation into the Note 7's battery issues and implemented a new 8-Point Battery Safety Check for future products. This demonstrated their commitment to improvement and safety. Likewise, Equifax underwent a total restructuring of its C-Suite, costing the company nearly $3 billion. They improved systems monitoring and communication between the security team and the C-suite and worked to change the corporate culture to emphasize cybersecurity.

Small Business Takeaway: Show your customers what you're learning from the crisis. Implement changes based on the incident and communicate these improvements. Customers appreciate businesses that evolve and improve from their experiences.

Leveraging Support Networks
Utilizing support networks, including industry partners and crisis management experts, can aid in effectively navigating a crisis. Dove, part of Unilever, likely leveraged its extensive network for crisis management support following the backlash from its ad campaign.

Small Business Takeaway: Don't be afraid to seek help. This could be from a professional crisis management consultant, a mentor, or a local business network. Small businesses might not have extensive resources like Dove but can tap into networks for support and advice.

Repairing Trust Through Marketing

After a crisis, rebuilding trust is paramount, and marketing plays a crucial role. Here are key marketing strategies that can help small businesses repair trust:

Rebranding Efforts
Rebranding can signal a fresh start or a significant change in direction, especially after a crisis affecting your brand's image. This might mean updating the logo, revising the brand message, or even changing the product lineup for small businesses. It shows the public that you're committed to change and improvement. Cost-effective rebranding strategies, like social media campaigns or a revamped website, can be impactful without requiring a large budget.

Be careful with this one; be thoughtful about the rebrand, and only do it if your brand image is significantly tarnished. Pay attention to the wants and needs of your target audience. Their reaction to your crisis can give you lots of insight into the direction of the rebrand.

Content Marketing
Content marketing allows you to control the narrative. You can rebuild trust by creating content that addresses the crisis and shares what you've learned and what you are doing about it. It's an opportunity to be transparent and show your commitment to your values. You can use blogs, videos, and social media posts to tell your story authentically. Providing added value through educational content can also help re-establish your brand as a trustworthy authority.

Community and Social Responsibility
Engaging in community and social responsibility initiatives can help repair your image and rebuild trust. It demonstrates that your business is about more than just profit; it's also about making a positive impact. Small businesses can engage in local community events or partner with local charities. These efforts often resonate more with customers and can rebuild trust at a community level.

Leveraging Customer Testimonials and Case Studies
Positive reviews and testimonials from satisfied customers can be powerful in restoring trust. They provide social proof that your business can still deliver quality products or services. Encourage your loyal customers to share their positive experiences and feature these testimonials prominently on your website and social media channels. You should be doing this already as part of your marketing strategy!

Consistent and Transparent Communication
Communicating transparently post-crisis shows you are committed to maintaining an open dialogue with your customers. It helps rebuild trust and demonstrates that you value customer feedback and are responsive to their needs. Continue to share regular updates about your steps to prevent future crises and improvements in your products or services through email newsletters, blog posts, and social media updates.

Turn Your Crisis into an Opportunity

Navigating a crisis and rebuilding trust are critical challenges for any business, especially in the digital age. Remember, a crisis can be an opportunity to demonstrate your resilience, commitment to improvement, and dedication to your customers. With the right approach, you can regain lost trust and emerge stronger and more connected to your customer base.

Colleen McCarthy Flenz is the creative director at Pro Impressions Marketing. Her primary role is to direct the creative aspects of the business, helping dentists gain more new patients through marketing. Colleen is the author of the two email newsletters, New in Dental Marketing and #StaySocial, and has published articles with PIM, UpCity, and the ANA.

The views and opinions expressed in Industry Insights are solely those of the contributor and do not necessarily reflect the official position of the ANA or imply endorsement from the ANA.