Bad PR Won’t Kill Your Business, But How You React to It Might

Just 16 months ago, Domino’s Pizza was living a corporate nightmare.  A YouTube video showing three of their employees engaging in unsafe and unsanitary food prep had gone viral, and the public was appalled.

Today, Domino’s Pizza is celebrating.  Its second quarter profits were up 55% and the public is embracing their (heavily-promoted) new pizza.

So what happened?

Domino’s didn’t panic.

Yes, the situation looked grim in April of 2009.  But Domino’s calmly realized one key truth about humans:

People Forget.

Elsewhere, BP executives are breathing a sigh of relief.  After their oil spill dominated US headlines for three months, the spill seems to be over, and the news cycle has predictably cycled onward to newer topics.  (This, after BP was simultaneously implicated in helping free the Lockerbie bomber in exchange for oil pipeline rights in Libya.)

And how have these global PR calamities affected BP’s stock price?  We’ll know more in the near future, but judging by the way BP’s first-quarter profits doubled, we doubt any of their year-end bonuses are in peril.

So, if Domino’s couldn’t be toppled by blatant employee malfeasance, and BP couldn’t be dented by massive ecological and political disaster, what kind of negative PR could possibly ruin a company?

What about a bad joke?

I’m Only Laughing Because It Hurts

In 1991, Gerald Ratner told the same joke he’d told dozens of times before.  But this time, the punchline punched back.

This time, the media construed Ratner’s quip about “crap,” which was directed at the low-end merchandise sold by his family business, Ratners Jewellers, to imply that he was laughing at the outrageous prices his customers were willing to pay.  When Ratner tried to clarify and apologize, the media literally handed him enough rope to hang himself (or at least a toy gun and a front page photo), and his career was over.

The lesson?

Bad PR happens to every company.  But how a company reacts to that PR determines whether or not the incident causes a scratch or sinks the ship.

Domino’s apologized and fired the offenders.  BP burnished their image and weathered the storm.  And Ratners fumbled.

So when we see each new story about an unthinkable PR disaster — like Air Canada ruining a dying boy’s charity fundraiser — we should certainly be outraged at the parties who deserve our scorn.

But, as marketers, we should also be aware of a sobering (and sometimes sad) fact:

Eventually, people forget.

(Unless you make it worse.)

But don’t forget about us! We’re also on Twitter and Facebook!

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