Coronavirus will make or break brand reputations: Which will it be for you?by
In times of need, companies can really make a difference - and customers will notice. You can cement a lifelong relationship - but you can also do irreparable damage.
Many brands have spent millions of marketing dollars telling their customers how much they care. How much they care about the environment. How much they care about equality. How much they care about their customers and their lives.
But how many really care?
We as customers certainly want brands to care. Research from InMoment, for instance, suggests that social responsibility is a priority for many consumers when choosing which brands to support, with 42% of those polled reporting that brands’ support of environmental, social or political causes is becoming more or much more important to their purchasing decisions.
Elsewhere, a survey by Censuswide revealed that two-thirds of consumers say that having shared values is crucial to brand loyalty, while 89% would switch to a brand associated with a good cause if the price and quality of products or services were similar on balance.
But with corporate social responsibility (CSR) therefore being so influential in purchasing decisions and customer loyalty, it can be difficult to tell when CSR is an ethical choice and when it is a cynical branding strategy.
Consumers are certainly quick to rail against any perceived attempt at ‘wokewashing’ or ‘greenwashing’ - the backlash at Pepsi’s disastrous Kendall Jenner ad, is one example of a campaign backfiring, along with Gillette’s “Toxic Masculinity” Superbowl slot.
But these cynical efforts also threaten to undermine the work of those companies that are genuinely trying to contribute to a better society. In 2018, Unilever chief executive Pierre Jope lamented that woke washing was at risk of undermining businesses’ ability to make a positive contribution to society. It was, he said, “putting in peril the very thing which offers us the opportunity to help tackle many of the world’s issues.”
A chance to show you care
In coronavirus, the world is currently facing an issue the like of which hasn’t been seen for a generation. And brands are now showing their true colours.
Contrast the actions of the likes of Wetherspoons, Travelodge and Sports Direct with those of Kurt Geiger and Pret a Manger.
Martin Lindstrom, chairman of The Lindstrom Group, has been shocked by the behaviours of some companies that he believes have been behaving “like they never plan to interact with customers again.”
“In times of need, you can really make a difference — and your customers will notice. In difficult times, you can cement a lifelong relationship. Well, guess what folks? That’s now,” he says.
“Right now there are a lot of people in need… Some companies have stepped up to the challenge. Notably, the Australian banks Wespac and NAB are allowing their customers to postpone mortgages and payments on business loans for 3+3 months. LinkedIn is offering free eLearning programs for people stuck at home, and LVMH has converted two of their cosmetics factories into hand-sanitiser plants.
“Sadly, these are the exceptions. Many companies have taken steps to care for their employees, but few have done anything for their customers.”
Indeed, Gartner senior analyst Anjali Lai notes that less than a quarter of online adults trust that companies are currently putting their health and well-being first when making business decisions.
“To the business leaders navigating these decisions, our guidance is clear: treat your employees and customers as your North Star. Show customers how you are genuinely looking out for their well-being — even if that requires re-examining your own habits and tactics of business decision-making.”
Act with courage; lead with empathy
Nonetheless, some brands have had admirable responses. Chattermill’s Joao Alves has listed numerous examples of helpful and innovative initiatives, including Just Eat and Virto, as well as the efforts of Slack founder Stewart Butterfield, who has been very active, tweeting to make sure that people feel safe and equipped to solve problems and bridge the communication gap created by COVID-19.
Alex Edmans, professor of finance at London Business School, notes: "It might seem that it’s supermarkets, food delivery companies, and healthcare firms who can make the biggest difference. But leaders of all businesses should ask themselves “what’s in my hand?”. What resources does their company have that they can use to serve society? 1Rebel gym is offering its space to the UK’s National Health Service to be used for beds or facilities. Chelsea Football Club is allowing health workers to stay at their hotel for free, to avoid long and disrupted commutes due to the reduction in public transport."
But above all, it is a time to demonstrate empathy and compassion. Alex Allwood, principal consultant at All Work Together, believes that businesses are in survival mode, but that in the rush to stay operational many have forgotten the customers and employees they serve, responding to their needs with low concern.
"An example is the email I received from my health insurance company that basically said, without acknowledging the crisis or concern for its impact, ‘your next installment is due on such and such a date….please ensure you have the funds available to pay it," she explains.
“Conversely, there are companies acting with courage and leading with empathy. Putting their employees’ and customers’ wellbeing at the heart of their decisions; making peoples’ lives safe is their new priority. These are future-facing actions that will build long-term, loyal, customer and employee relationships.”
She adds: “In these emotionally-charged times, actions that make a difference in peoples’ lives have never been more critical. Leading with empathy, understanding peoples’ needs and responding with compassion will be remembered warmly and rewarded well after this crisis passes.”
Indeed, when COVID-19 passes, it will be clearer than ever which brands really do care - and which ones never really did.
Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 20 years, including Internet Works, CXO magazine and Business Management. He joined MyCustomer in 2007.
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