The Downside of Business Branding

Reports of consumer product defects and recalls are coming in fast and furious these days. The media onslaught appeared to begin with tainted Chinese products and the surrounding political uproar. Big name manufacturers have been outsourcing for decades, so why all the noise now? Much of it has to do with the sea change in editorial departments across the nation. "Help Desks" are popping up everywhere in an attempt to thwart dwindling circulation. Politically-driven blogs have become the rage, and scare tactics at Network TV and Cable news networks are always popular during sweeps weeks.

There is one daily newspaper in my own hometown that reports product recalls almost everyday. It's a great public service, in my opinion. If there is bad beef or chicken at my local grocery, I want to know about it.

But I can't help thinking, how much of the reporting is being blown out of proportion. And how exactly are businesses coping with all the negative publicity?

Too many stick their heads in the sand, hoping the crisis will blow over. The general consensus, according to crisis management sources, including the Institute for Crisis Management is that the best crisis management deals with potential crises swiftly, before revenue streams and stock prices can be impacted.

If word has spread to the media and the general public, a crisis communication plan should be implemented to control corporate disruption and any resulting financial damage. With a simple, effective plan in place, organizations are not only in a better position to minimize damage, they are more often in a better position to handle future crisis situations that could disrupt the business and affect its operating expenses, profits and ongoing operations.

Still, creating a crisis action plan is easier said than done. Fear or flight is a visceral reaction to such situations.

One misconception pointed to by the Institute for Crisis Management is that there is usually no warning before such events occur. The fact is, however that problems more often than not have been simmering for a long time, and management often knows about it before any public dissemination. Natural disasters and employee actions play a minor role compared to management decisions, which are most likely to lead to big, bad business news.

The power of branding is an awesome responsibility--and a powerful tool--when implemented by experienced managers who understand the downside costs that effective brand management brings to the corporate table.

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