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A Cautionary PR Tale February 8, 2010

Posted by Lynn Christiansen Esquer in Marketing and PR.
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Toyota, the world’s largest automaker, took decades to build its platinum reputation. It took just two weeks to topple it, in what will go down in the history books as one of the biggest corporate PR debacles ever.

Clearly, Toyota’s handling and response to its sudden-acceleration and breaking-system woes should be a cautionary tale to crisis communicators everywhere.

The slow and inexorable drip, drip, drip of news, recalls and possible solutions has dried up business at Toyota car dealerships, created shortages for rental car agencies, worried and inconvenienced its customers and made the company the global butt of jokes even as its market value has severely plummeted. You know things have gone very wrong for Toyota when suddenly Detroit automakers are looking really good to consumers.

Companies need to realize that crisis is nearly inevitable and be prepared. Design fails, recalls happen, bad press will follow. But Toyota took the Tiger Woods route: Initially ignoring the growing scandal, avoiding public statements as the crisis grew, finally admitting parts of the problem but only after others had made their damning accusations, then — eventually — putting a recall and repair plan into place, albeit with mixed messages and too many unanswered questions.

Toyota is now throwing itself on its sword in mea culpa ads, and company executives are offering themselves up as whipping boys on national TV news magazines. But had the company addressed the problem head-on weeks ago, it would not have needed to atone so spectacularly.

A solid crisis communications plan, carried out competently and courageously — and most of all, immediately — could have saved Toyota. Think Tylenol or David Letterman. In the Google/Twitter/Facebook era of today, crisis execution is measured in hours, if not minutes. That it took weeks for Toyota to formulate a plan speaks to its internal problems and lack of accountability. Its deplorable response will almost certainly translate into heightened paranoia about its end product by consumers.

Toyota finally seems to be finding its course and communicating with the public, although the recalls continue. The question now becomes whether the company will be able to repair its tattered reputation enough to find its way back near the top of the heap; and if so, how long it will take.

All for the lack of a crisis communications plan.

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