Silvabrand | Tell It Like It Is
Silva Brand

Tell It Like It Is

Apr 07, 2022 | by Team Silva
3 min

A brand’s integrity and reputation are integral to its ability to weather tough times. Customers believe in a brand when it is genuine and open about its values and practices. “Businesses build institutional trust on honesty and consistency through transparent messaging and authentically caring about their customers,” according to Forbes. “Because so many other institutions are falling short in these areas, this is where businesses, whether big or small, can pick up the pieces and fill the trust gap.”

Despite this seemingly clearcut path toward building a rapport with the public, many companies fail to connect with consumers in that fundamental way. Edelman writes that “[w]hile 81 percent of consumers take trust into account when making a purchase decision, only 34 percent trust most of the brands they buy or use.”

Perhaps the most effective way for a company to endear itself to people is by turning crises into opportunities and being truthful when something goes wrong. “People trust companies that are honest about mistakes and transparent in the processes they take to rectify them,” explains AdRoll. And so here are several examples of brands that took bad situations and made them marketable through openness and sincerity.

Mega-retailer Target, for one, experienced a potentially disastrous data breach that it addressed with candor and humility. “Cyberattackers gained access to Target’s computer gateway served through credentials stolen from a third-party vendor in Nov. 2013,” reports USA TODAY. “Using the credentials to exploit weaknesses in Target’s system, the attackers gained access to a customer service database, installed malware on the system and captured full names, phone numbers, email addresses, payment card numbers, credit card verification codes and other sensitive data.” This attack had the potential to irrevocably damage Target’s standing with shoppers. But the company took steps to speak openly about what happened and make amends. After first saying the breach possibly impacted 40 million customers, Target later said the number was closer to 70 million. Strategic Vision PR Group writes that “[i]n December after the first announcement, Target offered 10 percent off all in-store purchases to consumers. Following Friday’s announcement, the retail giant said it [would] try to contact customers it [had] email addresses for to provide tips on how to safeguard against consumer scams.”

And HUFFPOST writes that “[t]he company also announced it would spend $100 million for more advanced registers and other technology to process new, safer cards.” A year after the breach, Target had largely recovered from the mishap. In 2015 HUFFPOST reported that “Target’s share price dipped from $62 before the crisis to $56 one month later. At this writing, Target’s share price is now at around $82. Fourth quarter 2014 comparable sales were up nearly 4 percent.”

Phone giant Samsung is another company that survived branding havoc by taking stock of its mistakes and making a wholehearted attempt to fix them. “In 2016 Samsung faced the PR nightmare of products (Galaxy Note 7 phones) that unexpectedly burst into flames. Airlines started prohibiting the phones onboard, making things worse,” Reputation writes.

Insider explains that the company jumped into action with “a press conference, in which it took full responsibility for the crisis. It was also forthcoming in its admission that while it didn’t know what was causing the battery malfunction, it would not rest until the actual cause was discovered.” Samsung was true to its word. “Ultimately the company recalled over two million phones and halted production of the Galaxy Note 7,” according to Reputation.

These measures paid off. Instinctif Partners writes that a year after the crisis “a ReportLinker survey titled ‘Samsung Galaxy S8: Did Samsung Succeed in Restoring Trust’ showed that 89 percent of existing Samsung consumers would consider buying a Samsung phone again.”

A highly publicized instance of a major brand righting its wrongs is when coffee mega-chain Starbucks acknowledged racial bias in its company culture and worked to end it. In 2018 “two Black men walked into a Starbucks in downtown Philadelphia on Thursday afternoon and sat down,” The New York Times reported. “Officials said they had asked to use the restroom but because they had not bought anything, an employee refused the request. They were eventually asked to leave, and when they declined, an employee called the police.”

Starbucks CEO Kevin Johnson quickly owned up to the troubling nature of this incident. In an interview with The Philadelphia Inquirer, he said, “that should not have happened, it was wrong, and my role and responsibility as CEO is to learn, to understand it and fix it.” The company itself followed suit.

“What happened next was that Starbucks closed down 8,000 stores across the United States for racial bias training,” prezly writes. “It is estimated that Starbucks lost around $12 million in profit during the time the stores were shut down, but taking the hit is an important step towards mending the relationship with the public.”

And the company continued to make progress on the vitally important issues of diversity and racial justice. Two years after the racial bias training took place, Blackenterprise wrote that “the Seattle-based coffee maker is using this anniversary to further advance its civil rights agenda with the activation of ‘Courageous Conversations,’ building upon a series of activities to demonstrate its commitment to “inclusion and equity for all.”

While keeping a lid on things or deny, deny, deny may seem like the best options for a brand in the middle of a maelstrom, Target, Samsung and Starbucks’ examples show that the best path forward involves honesty, accountability and redemption. Upland explains it well when it says, “[S]o have you been honest with your customers, or have you tried to ‘protect’ your brand? The latter option simply creates a scenario where you’ll disappoint them, and if you’ve gone this route, you’re in trouble. Not only have you set yourself up for failure, you’ve undermined any trust you’ve built with your customers and their network.”