Under the Influence

Marketing In A Crisis

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Get this episode from  Under the Influence: Marketing in a Crisis (Season 1, Episode 10) - EP - CBC Radio

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Costa-Concordia-Accident.jpgSource: Google Images

A crisis can bring out the best - and worst - in a person, a country, or an organization. 

When companies are hit with a crisis, it can be a defining moment. And their ability to weather the storm can dictate, to a large degree, what their future holds. 

In the world of marketing, it's an all-hands-on-deck situation. Because communication is one of the most important keys to handling a disaster. And how you market in a crisis reveals everything about a company. 

On Tuesday, December 6th, a jet scheduled to fly from Los Angeles to New York was delayed at its gate. The doors were closed, the seatbelt sign was on, and the passengers were asked to turn off their cell phones. 

And all but one passenger complied. 

He was playing a game called "Words With Friends" on his cell phone, and when the stewardess asked him to please turn it off, he refused and used offensive language. Then, he undid his seatbelt, stormed into the washroom with his phone, and slammed the door so loud, it alarmed the pilots. 

That was when actor Alec Baldwin was finally removed from the plane. 

Source: YouTube

Instead of being contrite, Baldwin took to the airwaves and made a surprise appearance on Saturday Night Live's Weekend Update. He appeared dressed as an American Airlines pilot: 

It was an open mocking of American Airlines and FAA regulations, and Baldwin scoffed at the fact that his tirade had delayed the plane. 

But his handling of the incident had a curious effect: It swung popular sentiment around in his favour. Baldwin was off the hook. Minor PR disaster averted. 

But when most big companies go into damage control, they don't have the luxury of laughing it off on Saturday Night Live. 

Take the recent Carnival Cruise disaster. 

Here's the Carnival Cruise Lines onboard safety video you would have seen if you were a passenger: 

Source: YouTube

On Friday, January 13, a Carnival Cruise ship hit a reef and partially sank off the coast of Tuscany, Italy. Some 4,200 people were aboard, and 17 lost their lives (at the time of writing, now possibly 30+). For Carnival, it was a crisis of epic proportions. 

A crisis like this, in marketing terms, requires several things to happen immediately. 

First, the company and its PR firm has to implement its crisis strategy right away. Assuming, of course, they have one. If they do, it usually means gathering all the available information, assessing the situation, and drafting initial communication for the press. 

Next, a company has to display visible leadership. One of the first things on the crisis checklist is to suspend all advertising. But in the case of Carnival, reports stated that the company didn't pull its advertising until one week after the event. 

Another vitally important factor is that the company can't just be working its heart out to deal with a catastrophe, but it has to be seen working its heart out. 

In a crisis, communication is everything. 

In the days following the disaster, it also became clear that Carnival had no plan for dealing with social media. 

Its main Facebook page continued to offer the usual updates on trips and deals. CEO Arison, an avid Tweeter, went virtually silent. Six full days after the accident, a post appeared on the Carnival Facebook page saying that out of respect, they were going to, quote: "Take a bit of a break from posting on our social channels." 

But after virtually no online activity for nearly a week, people started to post negative comments on ship safety, and shock over Carnival's 30% discount offer to the Costa passengers. 

Advertising Age magazine framed the problem perfectly: In times of crisis, it's easy to suspend all advertising, but you can't suspend social media. Online never shuts down, and the public traffic only grew more intense and more negative. 

But a crisis is a maelstrom. And managing it perfectly in the whipsaw of a disaster is almost impossible. 

In the world of business, the gold standard when it comes to handling a crisis... is the Tylenol tampering case of 1982. 

Before the crisis hit, Tylenol was the most successful over-the-counter product in the United States. It had over one hundred million users, and a 37% market share. 

Then, disaster hit. 

Source: YouTube

Soon a total of seven people in the Chicago area would suffer the same fate. 

Johnson & Johnson's CEO, James Burke, reacted immediately by forming a seven-person strategy team. The first thing the team did was alert consumers, via the media, to not consume any type of Tylenol product. 

Then they halted all Tylenol advertising, and stopped all production of Tylenol products. A 1-800 number was established to answer any questions the public had and created a toll-free line for news organizations to receive updates. CEO Burke gave non-stop national press conferences and updates. 

Most importantly, Johnson & Johnson withdrew all Tylenol products from shelves in the Chicago and surrounding area. When two more tampered products were discovered, they recalled over 31 million bottles nation-wide at a cost of over $100 million dollars. 

Soon it was discovered that several bottles had been laced with cyanide, and put on the shelves by a person, or persons, unknown. Johnson & Johnson had clearly been the victim of a malicious crime. 

Within 5 months, Tylenol became the first product to use a new tamper-resistant, triple-seal safety packaging. 

The way Johnson & Johnson handled the crisis was revealing of the company's integrity - which included giving the grieving families counseling and financial compensation, even though the company was not at fault. 

Regardless of the fact Tylenol was absolved of any guilt, a sizable percentage of public still had their faith in Tylenol rocked. So Johnson & Johnson began the long road back to regaining that trust through marketing. So they issued coupons, reduced the price by 25% and sent 2,500 representatives out to reassure the medical community. 

When that was achieved, they created advertising declaring that, even post-crisis, hospitals still chose Tylenol over all other painkillers: 

Source: YouTube

Within 6 months, it had regained 70% of its lost market share.

In 2001, the city of New York was dealing with one of the biggest crises of them all after the attacks of 9/11. 

Here's a compilation of the very first news reports of the World Trade Centre attacks: 

Source: YouTube

It was a perfect example of having an emergency plan in place that couldn't begin to deal with the enormity of the crisis. 

But Mayor Rudolph Giuliani did the best he could. 

One month after the attacks, instead of pulling all advertising, he placed a call to ad agency BBDO to order a campaign. He believed it was critically important to tell the world New York City was still open for business. 

Within 48 hours, BBDO had created storyboards for ads built around a dual theme: That everyone has a New York Dream, and realizing it is the miracle of New York 

Nine commercials were shot in record time using quintessential NY celebrities. 

Source: CulturePub

Even before the commercials hit the air, they got international press attention. The uniqueness of the campaign, and the fact it was produced so quickly in a time of crisis, made it into a news event. 

And marketing began to do its small part in not only buoying the spirit of New Yorkers, but telling the world that New York was open for business. 

Marketing in a crisis can be a watershed moment for most companies. 

The quality of its leadership is exposed, its responsiveness is graded, its empathy and concern for its customers is revealed, and the ultimate test of what lengths it is willing to go to resolve the crisis - regardless of the costs - can be measured for all to see. 

It's interesting to note that Tylenol had no crisis plan in place in 1982. Cyanide product poisoning was almost unthinkable 30 years ago, but Tylenol managed to work its way through the tragedy. They introduced tamper-proof seals, and wrote the book on crisis management. 

Tylenol also had the advantage of dealing with the crisis before the advent of social media and a 24-hour news cycle, unlike Carnival Cruise Lines. How history deals with that company, time will tell. 

New York City showed the world its spirit was indomitable. 

And Alec Baldwin is still a busy actor. 

Someone once said, "Never waste a crisis." It's a lesson that should be taken to heart. 

Because inside every crisis is an opportunity to make the world a better place... 

...when you're under the influence.


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