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Jul 26, 2004
How To

How to Safeguard Your Brand Reputation: Examples from Tommy Hilfiger, GE, Coca-Cola, Dupont

SUMMARY: As a Senior Writer for the Wall Street Journal, Ron Alsop has seen a lot of companies bungling during PR crises. We asked him what six steps you can take today to make sure your brand is safeguarded from the slings and arrows of misfortune. This article includes quick, real-life examples from GE, Tommy Hilfiger, Dupont, and others.
Tainted by scandals in the last few years, the public view of corporate America has hit an all-time low, yet very few companies work to proactively manage their reputations.

"The biggest mistake companies make in terms of their reputations is they just worry about troubles and crises, and don't have a full-time watchdog," says Ron Alsop, Senior Writer at The Wall Street Journal and author of 'The 18 Immutable Laws of Corporate Reputation'.

We caught up with Alsop at the ADTECH show in Chicago this month, and asked him for concrete examples of how companies can safeguard their reputations before crises occur. He had six suggestions:

-> Step #1. Measure your reputation consistently

Decide who your most important stakeholders are -- investors, customers, employees, government regulators, the media, etc. -- and ask questions designed to look at key aspects of your company's reputation. These might include:
--quality of services
--financial performance
--vision and leadership of company's executives
--workplace environment
--social responsibility
--ethics

"The benefit of doing it on a consistent basis is that you can see warning signs of a decline," Alsop says. Then you can work to enhance your reputation before it has reached a crisis level.

-> Step #2. How Coca-Cola & Tommy Hilfiger Use Their Web Sites to Dispel Ugly Rumors

When rumors hit, some companies find it best to meet them head-on.

The Coca-Cola Company has a section on its site called Myths & Rumors. "Here are some rumors you may have seen or heard -- and the facts," the page says, and is followed by a list of the rumors (i.e.: The acidity of cola drinks is strong enough to dissolve teeth and bones).

Each rumor is clickable, and brings users to "our response."

Tommy Hilfiger has done the same for a single rumor about supposed racial comments he made on the Oprah Winfrey Show "that has troubled them for about a decade," Alsop says.

The page, led by the heading "Tommy Rumor," includes a quote from Tommy himself telling users that the rumor is "completely erroneous." The page also includes links to newspaper stories that have refuted the rumor and a statement by Oprah Winfrey saying the event "just never happened."

-> Step #3. Citizen's Financial Group's Internal Campaign

"Employees are the most important reputation champions, and a lot of companies don't do a good enough job of communicating to them how important reputation is," Alsop says.

For example, he says, Citizen's Financial Group has created an incredible sense of commitment of employees to the company and the company's customers. How?

"A lot of it starts with the CEO. Every morning when he comes in to work, he sends congratulations or thank-you notes, handwritten, to bank employees," Alsop explains. "He spends more than half his time trying to connect to his employees emotionally."

-> Step #4. Microsoft & Social Responsibility

"People more than ever expect companies to give back," says Alsop. "Companies that do good deeds will survive a reputation crisis much better."

Companies that benefit the most from social responsibility are those that "own" a cause, "like Avon and breast cancer, or IBM and education," he says.

This can be tricky, though: How do you communicate your philanthropy without seeming self-serving?

Let the beneficiary of your philanthropy be the center of the press release, Alsop suggests. "You'll still get a mention for the company but nothing too blatant, because people are incredibly cynical right now; they see it as an attempt to deflect negative publicity."

This happened with Microsoft, when the establishment of a foundation coincided with the antitrust action, Alsop says. "People viewed it as an attempt to look like good guys."

Again, by focusing on a single issue, a company will get a lot more positive attention. Plus, it's easier for employees to understand a single initiative and help spread the word. "Avon sales reps talk about the breast cancer activities when they sell door to door."

Some companies don't publicize their good works, "but that's risky, too, because employees and others want to know about your good deeds," says Alsop.

After September 11, companies such as Honda and Johnson & Johnson donated to rescue efforts, but didn't publicize their activities. "They started getting emails from investors, customers, and especially employees saying, why aren't you helping out?"

-> Step #5. GE's Ethics Program

"Ethics codes are seen as window dressing," says Alsop. "Even Enron had a 50+ page ethics code. It needs to be part of the corporate culture, not just a document employees see once a year."

For example: General Electric has an integrity program called The Spirit and the Letter. One initiative of the program involved making a video of Anne Curry from NBC News reporting on some past ethics violations, "sort of like what you'd see on Dateline NBC." GE gave the video to employees.

Raytheon created a video with Roger Ebert and the company's ethics chief. The video showed the two of them sitting in a balcony critiquing workplace dramas and how employees reacted to ethical dilemmas.

-> Step #6. Dupont's Crisis Control Fire Drill

Companies that handle crises best have strong crisis contingency plans and carry out practice drills, Alsop says. "It's a big effort for sure, but many companies do it."

For example, Dupont practices major drills in which they simulate a crisis. In one such drill, they staged a mock kidnapping of a top executive by activists opposed to biotechnology. "They hire actors to help create scenarios, and the employees see videotapes of activities" to help them understand how to deal with the reality of such a crisis.

The Altria Group staged a similar scenario in which a Kraft Foods co-CEO went missing in Mexico. Employees saw tapes of a "news announcer" talking about the crisis, and learned how they might respond in the event of an actual crisis.

When the well-being of your customers is at risk, make sure you reassure the public that you've taken every step to eliminate the danger and that you deal fairly with anyone who has been harmed.

Deal with a crisis quickly, be forthright about the problem, and you may emerge from it with a stronger reputation than you had before.

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