Let’s all lay out the red carpet for the PR crisis stroll of the decade-Toyota. That’s right! America’s top automobile brand is playing the blame game and, it’s got them in big trouble. Well, crisis management trouble. Only now, recalls and apologies just aren’t pawns worth playing.
In case you’ve been living under a rock, let me summarize Toyota’s communication flops over the last six months. First, came the shifting floor-mats, then the busted accelerators, and now, failing throttle systems.
After a slew of ignored customer complaints and lawsuits regarding acceleration problems, Toyota somehow also managed to forget PR’s cardinal rule: telling the truth.
Instead came lies and blame, and with those: production halts, an extremely tarnished reputation and sizeable profit losses. So the questions are: who should the public blame? What should Toyota do next? Can they really recover?
Yes, with time and a lengthy image-repair plan.
One of the cardinal rules in crisis preparation is paying attention to warning signs which have potential to become crises. Corporations should handle any emerging issues in timely, thorough manners to avoid full-blown major fall-outs. Prompt investigations and responses are essential components in crisis prevention.
Consider Toyota’s first recall example: 3.8 million vehicles back to dealers for floor-mat exchanges. Well that’s great, but to start: Toyota never initially apologized to their customers for the recall inconvenience, and then, the company denied any internal vehicle flaws.
So, right from the beginning, Toyota dropped the image ball. After all, 3.8 million customers had to inconvenience themselves for Toyota’s mistake. A proper CEO apology and a more focused plan of corrective action to resolve the floor-mat “issue” may have helped Toyota’s historically balanced reputation.
As time went on, Toyota then announced another recall claiming accelerator pedals may stick regardless of the floor mat design. This one was even worse. It forced a complete shutdown of production while Toyota execs scrambled to figure out what to do next.
PR experts know the first rule in crisis communication is to assume the worst in every situation. You must be paranoid in your thinking, and have a plan of action for every crisis your team can dream up.
So, not only did the second recall induce massive panic amongst the organization’s stakeholders and customers, the public seemingly watched Toyota’s reputation silently slip away. However, in February, U.S. Toyota President Jim Lentz finally made a public appearance on The Today Show, where he offered an apology and expressed sincere regret to Toyota’s customers.
Unfortunately, recalls and profit losses are not Toyota’s only problem. Toyota also appears to have a major issue with honesty. According to Edolphus Towns, Chairman of the House and Oversight Government Reform Committee, Toyota deliberately withheld critical information regarding vehicle design flaws and testing evidence following crashes.
Naturally, this has lead to extreme customer distrust and a massive public relations plan to re-energize the Toyota brand. And that’s going to cost them way more than recalls and dealer fixes ever did.
How about a history lesson? The Exxon Valdez oil spill crisis was instrumental in demonstrating to businesses and corporations how important it is for the CEO to be seen addressing a major crisis. Someone dropped that ball, too.
Toyota’s CEO Akio Toyoda came under intense scrutiny from the U.S. Congress and asked “forgiveness for any accident Toyota drivers have experienced.” How thoughtful. Better late than never I guess, but Mr. Toyoda, perhaps you waited too many months before showing sorrow to the largest car market in America.
Still, from this previous customer’s perspective, Toyota is on the path to recovery–thanks to a cleverly executed image repair plan.
Following the initial crisis, (and it’s certainly still an ongoing one) Toyota took full-page ad space–no cheap fix, by the way–in major newspapers explaining the recalls, and highlighting their long-standing reputation for reliability and commitment to the U.S. markets.
Toyota is also running lengthy, apologetic television and radio ads emphasizing employee dedication to repairing vehicles, restoring customer trust and with that, Toyota’s reputation.
So “Moving forward”, keep your eyes on the reputation (not the money!) prize.