Defend Your Brand With These Strategies to Combat Misinformation in Business False or misleading information has the potential to damage reputations, fuel poor business decisions and result in legal consequences, but there are proven ways of protecting yourself.

By Nicholas Leighton

Key Takeaways

  • How misinformation negatively impacts small businesses.
  • How to combat it.

Opinions expressed by Entrepreneur contributors are their own.

Technology has provided endless benefits to businesses across the globe and is vital to their growth. Today, data can be shared at breakneck speeds among companies, their leaders, vendors and customers, but this also allows inaccurate and false information to spread at the same rate, most recently by bots powered by artificial intelligence. It has metastasized in society broadly and the internet specifically — whether in the form of social media feeds/online forums, as well as in news articles and other traditional media. Much of it is intentional, including attempts to mislead consumers and gain a competitive advantage.

While this often affects individuals personally, it can also cause severe damage to enterprises and entrepreneurs who rely upon their reputation and credibility. It's critical, then, for them to understand the risks of misinformation, how to avoid participating in its spread and how to lessen the damage it can cause to a professional and personal brand.

How misinformation negatively impacts small businesses

Whether it comes in the form of rumors, hoaxes, fake news or misleading narratives, misinformation represents a particular danger to small companies: They often lack teams of marketing and public relations professionals to deal with such issues and so are more prone to resulting disruptions, loss of customers, negative press, reduced revenue and legal consequences.

Let's explore a few effects in more detail:

  • Reputation damage: Entrepreneurs depend, of course, upon the honesty and integrity of their brands in the minds of customers, investors and partners. Misinformation can tarnish these assets, eroding the trust that's been so hard to establish. This can be especially difficult for a small business to address since it likely can't distance itself from an owner or other principal, for example, in a way that a large organization might be more capable of.
  • Poor decisions: Falling for false data/narratives regarding market trends or what's happening with competitors could lead an entrepreneur to make a poor staffing, sales or customer service move, with potentially disastrous consequences.
  • Loss of customers: Incorrect/misleading information can drive away existing and potential customers, who, understandably, fear doing business with an enterprise or individual associated with it.
  • Legal ramifications: Deliberately disseminating misinformation about a business or individual can lead to defamation lawsuits, among other dangers.

Related: AI Isn't Evil — But Entrepreneurs Need to Keep Ethics in Mind As They Implement It

How to combat it

As a small business owner, you are likely solely responsible for addressing inaccurate information about your company, customers and suppliers, and having a strategy in place to do so can significantly reduce adverse effects. The correct response will depend on the type and severity of the misinformation being shared — each situation likely requires a customized solution.

Remember, too, that some incidents may be nothing more than misunderstandings. For example, in the Battle of Constantinople in 1453, mysterious lights were seen over the city. Word quickly spread that they were a sign from the heavens that the Ottomans would be defeated in battle. It turns out what was witnessed was nothing more than St. Elmo's Fire, a natural and harmless phenomenon in which ionized plasma looks like a bluish flame.

If the misinformation you are dealing with is analogously harmless, you can address it by simply taking responsibility — issuing an apology or otherwise setting the record straight. Businesses that show accountability will almost always come out on top.

Related: 7 Ways to Promote a Company Culture of Accountability

In other cases, misinformation is intentionally malicious. Another historical example involves Benjamin Franklin, who in 1782 created a fake version of the Boston Independent Chronicle newspaper. Within, a false story claimed that the British had hired Native Americans to terrorize American soldiers and civilians across the frontier. Before long, it had been republished throughout the colonies, sparking increased hostility toward Native Americans.

In severe cases, a business may need to go on the offensive to stay ahead of intentionally malicious storytelling. This might include launching a PR campaign or hiring an attorney.

Of course, the best way to eliminate misinformation is to avoid it altogether. At the very least, you can minimize damage by catching it early. Here are some best practices that entrepreneurs can apply to do so:

  • Fact-checking and other verification: Before sharing information on websites, social media profiles or other media, entrepreneurs should be vigilant to carefully fact-check it, ideally from at least two reputable sources. It's much easier to stop misinformation before it starts than to put the genie back in the bottle.
  • Build a solid reputation: Businesses known for being honest, trustworthy and ethical are less likely to be impacted by misinformation. Half the battle lies in the degree to which people are inclined to believe the negative thing they are presented with. If you run a shady operation, people are more likely to act upon something bad they heard, while those who know you run an upstanding enterprise will be more likely to come to your defense.
  • Monitor your online presence: A good practice for catching misinformation before it spirals out of control is to regularly monitor online mentions related to your business or you as a person. Consider setting up Google Alerts to be notified of such new content.

Related: 7 Tips for Making Quality Business Decisions

Nicholas Leighton

Entrepreneur Leadership Network® Contributor

Best-selling author, speaker & business owner executive coach

Nick Leighton believes that business owners should make more money and have more free time. He does this through his best-selling book "Exactly Where You Want to Be – A Business Owner’s Guide to Passion, Profit and Happiness," speaking and coaching. #ChampagneMoment.

Editor's Pick

Related Topics

Growing a Business

More Than 90% of Startups Don't Make It. This CEO Reveals What It Takes to Not Only Survive — But Thrive.

Learn what it takes to grow a company while also scaling as a leader.


5 Link-Building Tips to Help You Rank on Page 1

Link building is one of the most challenging parts of any SEO strategy. Make it easier with five tried-and-tested strategies for building quality backlinks in 2023.


How to Put the "Fun" Back into Your Business Fundamentals

It's time for business leaders to inject some fun into the fundamentals of a flexible working world.

Starting a Business

How Business Community Is Making CEO Life Less Ghastly

People are starting to notice that if you want to get the best out of entrepreneurs, you have to support them. But how?

Business News

Apple Moves to Sever Ties With Goldman Sachs — Here's What That Means for Apple Card and Savings Holders

The end may be near for one of the most prominent alliances between a technology firm and a banking institution.


5 Scrappy Ways to Create Quick Marketing Wins

Marketers are under pressure to create both short-term and long-term successes. Here's how you can create quick wins easily alongside your bigger strategy.