It's All About The Experience

rss

A blog about managing and improving customer experience and improving profits.


How Controversy Can Be Good For Your Brand
How Controversy Can Be Good For Your Brand

Based in Knoxville, Tennessee, I have watched the University of Tennessee Volunteers football team enter the national argument over which teams deserve to be in the National Championship and whose quarterback deserves the Heisman Trophy.  

The controversy spilled over at the Country Music Awards show last week. Volunteers Football Alumnus Paton Manning introduced Rocky Top, the Volunteers fight song, as his favorite country song while sharing the stage with notable Georgia Alumn and country star Blake Shelton.  

On repeat ­čÄž­čöé pic.twitter.com/9F0DDxbcdx

 

 

Controversy, if appropriately handled, increases brand awareness and improves brand equity. As marketing genius PT Barnum once famously said, there is no such thing as bad publicity. Below are six companies embroiled in controversies that they ultimately managed in their favor.  

1. The Pepsi Challenge 

In 1975, Pepsi launched the "Pepsi Challenge." The Pepsi challenge was a marketing campaign that pitted Pepsi head-on against Coca-Cola using a blind taste test. Pepsi used a corn syrup-based sweetener in a slightly sweeter formulation. The taste test results showed many people choosing Pepsi over Coca-Cola. The controversy resulted in a significant sales increase for Pepsi, increased brand awareness, and led Coke to develop its disastrous "New Coke" product.

2. Red Bull 

In 2014, Red Bull became embroiled in a controversy. Reports revealed that the company had been using DEHP, an ingredient in its energy drinks banned by several countries. The ingredient, known as DEHP, is a plasticizer linked to health problems such as cancer. After the story broke, Red Bull announced that it would reformulate its energy drinks to remove DEHP. Red Bull ran ads apologizing. The ads reassured customers that its products are safe. As a result of its handling of the problem, public opinion shifted. Red Bull sales increased by 9% in the following year.

3. Nike 

Media reports in 1991 revealed that some of Nike's Asian factories were using child labor. The reports accused Nike of exploiting workers in developing countries and putting profits ahead of people. The company responded by publicly committing to improving factory working conditions and increasing transparency around its supply chain. As a result of the way Nike handled the situation, Nike's reputation improved. Sales increased by 27% in the following year.

4. Ben & Jerry's 

In 2009, media outlets reported that Ben and Jerry's was sourcing some of its milk from cows fed genetically modified (GM) corn. A consumer group questioned the safety of consuming genetically modified foods. Anti-GM activists called consumers to boycott Ben & Jerry's ice cream products. The company responded by sourcing milk from cows certified to have eaten non-GM corn. Because of how it handled the situation, Ben & Jerry's reputation improved, and its sales increased by 11% in the following year.

5. Starbucks 

Starbucks found itself at the center of a controversy in 2015 when media reporting showed that Starbucks paid less taxes than smaller businesses in its industry. Some consumers accused Starbucks of tax avoidance. There were calls to boycott the company's products. Starbucks responded by voluntarily paying more taxes than legally required and investing in small businesses in disadvantaged communities. Starbucks handled the situation well. Sales increased by 13% in the following year.

6. Volkswagen and Dieselgate 

In 2015, US Federal Regulators caught Volkswagon cheating on emissions tests for its diesel vehicles. The scandal became known as "Dieselgate." The US government levied billions of dollars in fines and settlements on Volkswagen. Notwithstanding all the negative publicity, Volkswagen's sales increased after the scandal.

What lesson can we learn from these examples? Controversy need not be a death sentence for a brand. Controversy can be good for a brand if managed correctly, but only if management handles the situation appropriately. Be careful. It can take vast commitments of corporate resources to weather a storm like the ones identified above. To get through, tread lightly and seek the most ethical path possible. Acknowledge mistakes and move publically to fix them. A brand that did something wrong but moved swiftly to do the right thing can ultimately win consumer support.

 








b i u quote


Save Comment
Showing 0 Comment