BE PREPARED WITH A BRAND CRISIS PLAN

In 2000, Snow Brand, Japan's premier dairy foods company, had 45% of the market. Then 15,000 people in western Japan, including children, became ill after consuming the company's products.

The company first tried to downplay the incident, expressing greater concern for its brand than for the victims. Then it hesitated to recall tainted products, even after an order from the Osaka public health centre. Finally, it tried to cover up the primary cause for the sickening. Within days, its market share had fallen to single digits, and eight factories closed. Eventually, the once proud brand had to submit to a takeover bid from Nestle.

Snow Brand, accounting giant Arthur Andersen, airline AirTran and many other companies have learned how quickly a poorly handled crises can damage a brand. Like Snow Brand, companies who do not have a crisis plan in place are especially vulnerable.

Every company interested in the sustainability of their brands must have a crisis plan. A crisis is any legal dispute, theft, accident, fire or other disaster that threatens the integrity or reputation of your brand, usually accompanied by negative media attention. In India, for example, both Coca Cola and Pepsi had to defend their brands against allegations that their drinks contained toxins.

Crisis handling, like any potential high-risk situation, requires planning and preparation to minimize negative impact. A crisis plan is guided by three principles. The first is a premium on honesty and accuracy, reinforced by the need to tell all you know when you know it. Lawyers often advise ducking for cover, but this is absolutely the wrong strategy. The next is speed. Without responsiveness to the demand for immediate answers, rumours and half-truths will inevitably fill any information void. Finally, lines of authority and responsibility must be clear. Who will be in charge of fact gathering, and who will be responsible for informing employees and other constituencies, or lining up alternative suppliers?

Based on these principles, key elements of a brand crisis plan include:

• Lists of emergency contacts: These not only include police and other emergency services but also the names, numbers and emails of top executives and PR personnel. Supplemental lists must contain the names of media, security and government personnel as well as employees. Others that must be contacted during a crisis can include customers, suppliers, civic organizations and channel partners. Copies of these lists must be accessible inside and outside of corporate offices.
  
  
• Website, press release and other templates: Intensity and pandemonium rule during a crisis, punctuated by stakeholder demands for immediate information. When a crisis hits, you want to spend time protecting the brand, not figuring out where to start. Have an emergency website prepared that can be hosted immediately, along with a backup server. Make sure the host can handle the inevitable spikes in demand. Consider using blogs for more immediate updates. Fill-in-the-blank press releases can help get critical information out faster.
  
  
• An appointed spokesperson: Only one person should talk to the media. Comfortable in front of a TV camera and with reporters, this person should be knowledgeable about the organization and the crisis at hand. Before talking to reporters, this person must anticipate and rehearse responding to tough questions. Never talk off the record, and never let more than one person speak for the company.

A brand is built on a fragile foundation of trust. As Snow Brand and others have found out to their dismay, responding too slowly to a crisis, failing to accept responsibility or communicating poorly with the public can destroy such trust. As the tsunami tragedy taught us, disaster can strike at any time from unexpected sources. Be prepared with a crisis brand plan.