Crisis management: learning from the best and the not-so-best

In today’s digital-first business landscape, crises can strike unexpectedly, and a company's response can significantly influence its brand reputation. How a business reacts to a crisis not only affects its immediate image but can also impact long-term customer loyalty and financial success.

Indian brands have encountered various challenges, from political controversies to product safety concerns, providing valuable lessons in crisis management. Some have successfully navigated these storms, while others have found it difficult to bounce back. Here’s a look at the most effective and ineffective responses, offering important insights for businesses.

The best: Zomato’s swift response to a language controversy

What happened? In 2021, Zomato faced backlash when a customer in Tamil Nadu claimed that a customer service representative refused to communicate in Tamil, insisting instead on Hindi. This sparked a social media uproar, with accusations of Hindi imposition flooding Twitter.

How Zomato handled it? Zomato acted quickly. Within hours, they issued a public apology and emphasised their respect for all languages. CEO Deepinder Goyal personally engaged on Twitter, assuring users that Zomato would enhance its regional language support. This was more than just an apology—they took tangible steps, expanding language options and showing that they were attentive to their customers' needs.

Key takeaway: Timeliness is crucial. By responding swiftly, Zomato managed to steer the narrative before it escalated. Leadership's involvement and concrete actions, such as increasing language support, demonstrated to customers that Zomato valued and respected them.

The not-so-best (could have been better): Uber’s #DeleteUber Movement

What happened? In 2017, Uber found itself in a public relations crisis when it continued to operate during a taxi strike at JFK airport, which was protesting President Trump’s immigration ban. This choice sparked a significant backlash on social media, with the hashtag #DeleteUber gaining traction as users accused the company of taking advantage of the political turmoil for profit.

How Uber handled it? Uber’s response was inadequate and came too late. It took several days for them to release a statement, and by then, the damage was already significant. Travis Kalanick, who was the CEO at the time, eventually stepped down from Trump’s advisory council, but the company’s slow reaction and lack of empathy only intensified the backlash.

Key takeaway: Timing and sensitivity are crucial. Uber’s slow response allowed the movement to grow, and their failure to recognise the political context alienated many of their customers. Crises, particularly those tied to political or social issues, require a prompt and considerate response.

Learning from the best and worst

Speed is critical and important (but don't be mindless): Speed is critical in managing a crisis. Zomato’s quick response helped contain the issue, while Uber’s delayed action allowed the situation to escalate.

Acknowledge and own up: Honesty is the key. Zomato immediately addressed the issue and apologised, while Uber’s slow response and lack of empathy only worsened public trust.

Involve leadership: The leadership matters. Zomato’s CEO Deepinder Goyal’s direct involvement reassured customers, whereas Travis Kalanick’s late engagement did little to repair Uber’s image.

Provide solutions: Customers want action, not just apologies. Zomato’s commitment to enhancing language support showed they were serious about improving. Uber’s response, however, lacked follow-through and failed to address the core concerns.

Be transparent: Clear communication is essential. Zomato’s transparency kept customers informed, while Uber’s poor communication left customers in the dark, damaging trust further.

Conclusion: Be ready for the unexpected. Crisis management involves being prepared and responding effectively when challenges arise. Brands like Zomato, Paytm, and Amul have shown that acting swiftly, being transparent, and providing real solutions can transform crises into opportunities for building customer trust. Conversely, brands like Jet Airways and Maggi highlight the expensive repercussions of poor crisis management. For companies today, the lesson is clear: plan ahead, communicate effectively, and act quickly to emerge stronger from any crisis.

(Our guest author, Premkumar Iyer is the Chief Operating Officer at HAWK, a GOZOOP Group company, where he leads innovative strategies in customer service and online reputation management. With over a decade of experience in the digital space, he has held various leadership positions, driving operational excellence and enhancing customer engagement.)