Mobile web turns a crisis into a disaster

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The worst-case scenario for brands is now total destruction, so integrity in business and advertising is more essential than ever.

What’s the worst thing that can happen? So goes the line to entice awkward teenagers to try the unknown taste of soft drink Dr Pepper. But perhaps this slogan should be applied more widely by all brands and media owners, following the fall-out from the collapse of the News of the World.

A month ago, News Corp was on track to buy the remaining shares in BSkyB. Within a week, the deal was off, leading figures in the company (though none going by the name of Murdoch) had resigned on both sides of the Atlantic, key figures had been arrested and Britain’s biggest selling paper had closed. It’s extraordinary and sobering that a newspaper publishing continuously since 1843, with 3 million readers, could close within seven days.

So, what are the lessons for all of us?

It seems to me that now is the time to understand risk better. Put another way, it’s critical to assess your critical risk. If a 168-year-old brand can go down in a week, it’s safe to assume any business can fall as quickly if the issue is big enough.

This alone is very new thinking. The classic corporate crises of the past involving Johnson & Johnson with its Tylenol-branded painkiller, Procter & Gamble with its Rely tampon and Unilever with Persil Power washing powder could be contained in the years before social media. All three of these giants remain among the world’s leading consumer goods companies, despite (perhaps even because of) managing their way successfully through some classic disaster scenarios. It doesn’t get much worse than planning for death through product sabotage (Tylenol), death through unanticipated product side-effects (toxic shock syndrome in the case of Rely) or catastrophic product failure your washing powder rots clothes (Persil Power).

It’s a moot point whether the textbook responses of all three companies in previous generations would have been sufficient to save the brand in the fast-moving world of social media, where every consumer is a publisher, but it’s wise to assume that no business is now too big to fail if the crisis is serious enough.

So, what is serious enough? The evidence of the last couple of years suggests companies should check and re-check for two things: product failure and financial wrongdoing.

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It might be BP in the Gulf of Mexico or Nestlé baby milk in China, but somewhere right now a major brand is about to face a core product failure

First, product failure the real world is an accident waiting to happen. It might be BP in the Gulf of Mexico or Nestlé baby milk in China, but somewhere right now a major brand is about to face a core product failure. It could be sabotage, terrorism, criminality, incompetence or sheer bad luck, but it’s worth doing the groundwork now to understand your own vulnerabilities. Which brands are most exposed? Which products put your company more at risk?

The News of the World debacle also teaches us that holding companies with different names from the toxic brand (like News International’s relationship to its flagship paper) are offered no protection by being held at arm’s length. If reputation management is the new brand management (and it is), start with an honest understanding of your own risks.

Second, financial wrongdoing is an employee-made disaster waiting to happen. You might not be the next Barings, Enron or Lehman Brothers, but someone, somewhere soon will have to manage a financial scandal. It’s not as though the media and marketing sector is without form in this area. Think of Interpublic Group hitting the headlines in the early years of the 21st century for returning hundreds of millions of dollars to clients to ensure it conformed with Sarbanes-Oxley (the US Act passed to tidy up accounting practices as a reaction to major corporate and accounting scandals). Think of the SMS voting scandals at ITV. Think of the Office of Fair Trading probes into retailer competition and supplier relationships.

Thank goodness, of course, your brand or agency or customer or media buyer is squeaky clean. Now there’s even a new anti-bribery law to tighten up business practices even further. It might just be worth making sure your own brand spending, agency deal, media planning and agency remuneration are all in order.

Finally, if product failure and financial wrongdoing are two key risks to guard against, it’s also worth making sure that all your ad messages are legal, decent, honest and truthful. Now is not the time to dupe the consumer, when trust in advertising is at all-time low levels. Just ask the Advertising Association.

Perhaps we should all start by making sure we are not over-claiming, over-promoting, over-selling or airbrushing our way to short-term competitive advantage. Unlike product failure or financial wrongdoing, this is entirely within every brand manager and account director’s control. It shouldn’t need the phone hacking scandal in newspapers or even the threat of heavy handed regulation from MPs to remind us that the integrity of advertising underpins everyone’s business brand owner, media business and ad agency alike.

Put another way, we should uphold the best possible advertising standards relentlessly. Why? To use another advertising slogan, because we’re worth it.

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