Brands behaving badly

Brands behaving badly
May 5, 2017 hello@thesumof.com.au
Brands behaving badly

Brands behaving badly
United Airlines, Uber and Kit & Ace are a few of the high profile brands we’ve seen recently take a beating in the international press for behaviour that can only be described as reprehensible. But it has also given us a window into some of their business strategies and how they deal with such significant PR fallout, which has generally been abysmal.

In the United Airlines case, dragging a customer off a plane, and—as an LA Times article outlines in another incident—threatening a First Class passenger with handcuffs because he wouldn’t give up his seat for a more ‘high priority’ customer, are just a few of the stories that have emerged about the airline. This is not only savagely bad PR, this culture and behaviour has had a significant impact on the business. According to The Telegraph: “Shares in United Airlines’ parent company suffered a bumpy ride on Tuesday as the worldwide backlash over its forcible removal of a passenger continued. United Continental closed down 1.1pc at $70.71 (£56.61), after falling as much as 4.4pc earlier. The company shed as much as $1bn in market value before ending the day with a loss of about $250m. More than 16 million United shares changed hands, the most for any session in a year. The stock is down about 3pc for the year.”

The initial response from Oscar Munoz, United Airlines CEO, didn’t help, either. In a memo to staff he described the passenger who was forcibly removed as being “disruptive and belligerent” and praised staff for following “established procedures”. However, as The Guardian reports, this was almost immediately retracted after the international backlash exploded and the devastating effect on the share price became evident. As a result, Munoz sought to offer a complete backflip on earlier comments and issued an apology to all involved. Unsurprisingly, this was clearly perceived as disingenuous and shallow.

In Uber’s case, secretly installing a fingerprint in iPhones, which remained even when the phones had been wiped, shows a complete lack of respect for people and the law. Only after a personal dressing down from Tim Cook (Apple, CEO)—and a threat to remove Uber from the App Store—did Travis Kalanick appear to have a sense of the magnitude of his blatantly poor decision making. This is in addition to Uber’s underhanded and secret software named “Hell”, which was allegedly used to keep tabs on customers of its main rival Lyft and which has resulted in further customer backlash and legal cases, adding to Uber’s many other woes.

And according to a Broadsheet article, Canadian fashion label Kit & Ace decided to abruptly shut all stores overnight across Australia, the United States and the United Kingdom without any advance notice and terminating staff immediately, informing them through Facebook and Instagram.

This all points to a common theme, which brands and businesses seem to be continuously overlooking: Branding is how you behave, it’s about the value you provide and how you deliver on your promises. This influences how you are perceived in the world.

If your actions and behaviour are contrary to your promises to customers and their expectations, then (crisis management) PR won’t save you. People are at the heart of your brand, whether they are staff or customers—and whether you like it or not.

The significance and importance of this relationship often gets lost in jargon and clinical labels like ‘consumers’, ‘customers’, ‘end-users’, ‘demographics’, ‘audiences’, ‘stakeholders’, ‘shareholders’, ‘KPI’s’, ‘executives’ and ‘brands’. Even though we regularly hold individual CEOs to account, and this has been the case with United Airlines and Uber in particular, it shows how the behaviour of leadership (i.e: individuals) and the culture they promote influences the policies which staff then enact. This translates to the experience we have with organisations and creates the perceptions we generate about them, which in turn defines a company’s brand. Basic decency suggests people should generally respect one another. But this sentiment seems to change when those people believe they can hide behind the facade of a ‘brand’.

These latest missteps are a clear reminder that brands and business are about the relationships between people—how we treat others—and businesses will be justifiably held to account on various levels if they choose to forget that simple truth.

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