Does Your Reputation Need Rehab? Even if your product and company are solid, if the consumer's perception of you is negative or damaged, sales of your product and company can suffer.
Opinions expressed by Entrepreneur contributors are their own.
Mention the name "Bill Cosby" and half the room will fondly remember the entertaining Dr. Huxtable on "The Cosby Show," or even those tasty Jell-O Pudding Pops commercials. The other half will condemn Cosby as an accused rapist. Which is the real Bill Cosby? We may never know. What matters is the perception others have of him, based on what they have heard, read, seen or personally experienced.
Reputation is formed in the minds of the people we influence; they form judgments and perceptions of us based on their own understanding of who we are, what we've done, or what we stand for. Is this right? That's debatable. But reputation is real in the minds of the people who perceive it. For instance, if I perceive you to be arrogant, out-of-touch with your customers and elusive, I may not want to buy your products, endorse your company brand or recommend your company to my friends. Even if your product and company are solid, if the consumer's perception of you is negative or damaged, sales of your product and company can suffer.
Related: 6 Tools for Monitoring Your Online Reputation
Remember when United Airlines CEO Oscar Munoz faced social media backlash for his perceived callous and insensitive response to a passenger forcibly removed from a flight because of overbooking? The act itself was damaging, but it was the CEO's behavior that is said to have fueled the deluge of anger, helping United's stock drop $1.4 billion. "It didn't help that apologies from United and its CEO Oscar Munoz were deemed tone deaf and insensitive by many on social media," Fortune reported.
In 2007, when it was revealed that Whole Foods CEO John Mackey used a pseudonym to contribute more than 1,100 entries on Yahoo Finance's bulletin board campaigning for his company's stock and occasionally blasting a rival, fans of the Whole Foods brand began questioning the company's value if the CEO modeled such disingenuous behavior.
What happens when reputation is damaged?
When Uber CEO Travis Kalanick's argument with an Uber driver over fare prices was filmed and shared across the web, Kalanick felt the wrath of reputation damage: His online popularity and customers' endorsement of his product (Uber) suffered from his negative behavior. The hashtag #boycottuber started spreading across social media channels. Consumers equated his negative and hurtful behavior with his company and protested.
When trust is fractured, followers will often distance themselves as quickly as advertisers dropped Bill O'Reilly on Fox. They want to move away from the brand and negative reputation so they are not associated with the individual or company and what has happened that they perceive to be hurtful.
Social media and social networking seem to fuel this distancing behavior. When our friends, colleagues, clients and influencers perceive a brand to be damaged or toxic, we rally behind the people we believe we can trust, and therefore will also want to distance ourselves from what they tell us is bad.
Related: This Company Accidentally Deleted Its Clients' Data. Here's How It Won Them Back.
Can you rehab your image after a scandal?
There are daily examples (e.g. Billy Bush, Tiger Woods, Kathy Griffin) in Hollywood and the business community where individuals make careless or thoughtless mistakes and find themselves with a damaged reputation. There are also examples of individuals who have successfully repaired and rehabilitated their brands.
Remember Martha Stewart? Stewart served five months in prison, five months under house arrest and two years of probation following a conviction for insider trading, only to emerge to reclaim her publishing and product empire. She maintained her innocence and never apologized for doing wrong. Why, then, did her audience not fully abandon her? In my opinion, Stewart had built a relatable brand that had enough positive context to override negative behavior. Consumers felt they knew her; she shared insights to help make them better wives, mothers and hostesses. In a sense, her audiences valued her recipes and decorating tips more than they cared how she operated her business. Her home decorating and cooking show suffered in ratings, and her name was downplayed somewhat on magazine covers, but her appeal and credibility helped her entice a $353-million sale of her company in 2015. Audiences -- primarily women -- wanted to see her prevail.
Related: Why Your Startup Needs to Protect Its Online Reputation From Day One
How and when should you respond?
To make the offense go away quickly, many people react by:
- Issuing an insincere or "forced" apology
- Overcompensating in either a negative or positive way
- Donating money to an organization thta has a stellar reputation (assuming this will cleanse their own brand)
- Creating a diversion
- Hiding from view (hoping it all passes over)
In fact, there is no one-size-fits-all response to a reputation crisis. Reputation management professionals will counsel clients to consider the impact of the offense, timing of the response, goals/needs of the target audience, personal values and other external factors. Hopefully, they will also discuss whether the offense indicates a larger issue or condition that requires attention (e.g. rehab or counseling) as well.
Related: 3 Ways to Turn a Startup's Bad Professional Review Around
When addressing a reputation crisis, responding quickly is not always the ideal response. In the case of Kalanick, he quickly tried to explain the situation, issued a blog expressing his regret over the incident and committed to improving his skills as a leader. Soon, he began showing a more contrite and relatable version of himself, appealing to followers who would understand that "everyone makes mistakes," including him. Online audiences were skeptical, since his apology still appeared to be crafted and insincere. Over time, audiences will decide which is the true Kalanick -- the one who yelled at an Uber driver, or the human being who made a mistake.
In Munoz's case, his quick response seemed to negatively reinforce his position that the incident was the passenger's fault, and his condoning of the policy that permitted overbooking landed him in front of Congress to explain. In his case, responding quickly, the way he did, proved detrimental.
In some situations, I'll advise my clients to adopt a wait-and-see approach. For instance, if they are being criticized in the media for taking a stance on a personal issue they feel passionate about, I might advise they wait to see if their online tribes and followers rally to their defense. Having others vouch for your integrity, instead of reacting to defend your own name, can rehabilitate a damaged brand more effectively. Similarly, it might help to see if the swell of passion around what you said or did is, in fact, fleeting. By responding in a bold and public way, you might incite a negative story when the issue was dying down.
Related: How to Create a Polished CEO Presence Worthy of Mark Zuckerberg Without Hiring a Staff
Make your apology count.
The way you address or confront the incident matters a great deal. Issuing a sterile and formal apology through a "family spokesperson" or "representative" is not nearly as effective as when the offending individual looks his or her audience in the eyes and genuinely owns responsibility for what happened.
When Kathy Griffin addressed the outrage over the photograph of her holding a replica of a decapitated Donald Trump head, she did so in what appeared to be a rehearsed and scripted apology video. While her goal likely was to show authentic and relatable regret and apology (she didn't wear makeup in the apology video), her body language and choice of words made the message appear insincere, fueling further outrage.
An apology needs to be specific, sincere and repeated to make an impact. In business, legal limitations can make this challenging: boards of directors and other stakeholders have input into how we quickly and publicly accountability and apologies for mistakes or wrongdoings can be issued. This can slow down the reputation rehab process significantly.
When faced with a reputation crisis where they need to accept responsibility, I advise clients to apologize for their behavior and demonstrate confidence in their ability to make things right and overcome the negative impact of the challenge. It is important to avoid projecting arrogance at all costs. Instead, communicate a strong desire to regain trust and a willingness to do better in the future. Mistakes happen. While we can't change the past, we can promise to get help if we need it (e.g. rehab, counseling, advice), we can work to make things right and avoid repeating the offending behavior. Only when the last part is completed over time will trust be rebuilt. If your audiences see that you are getting help, are making amends, showing contrition (if warranted) and surrounding yourself with safeguards to avoid repeating the behavior, they will entertain believing in you again. The proof is in the actions.