Two Corporate Crises

Maybe it's because even conservative media seems to be on permanent spring break, but one observation I simply haven't seen is that both the Bud Light-Dylan Mulvaney fiasco and Tucker Carlson's firing from Fox are textbook corporate crises. I sometimes worked in corporate contingency planning when I worked, so I have some familiarity with the field.

Of the two, Anheuser-Busch seems to be the company that belatedly recognized it was facing a textbook crisis, but its response was, and continues to be, nevertheless textbook wrong. Over the weekend, this news came out:

Anheuser-Busch executives have promised beer distributors that going forward marketing will be heavily screened following Bud Light's Dylan Mulvaney backlash.

Bosses held a closed-door meeting with distributors in Washington, DC, this week where they laid out future plans - and promised to 'spend heavily' on Bud Light to salvage its public image, according to reports.

Accounts differ on exactly how far Bud Light sales have plummeted, but clearly reports of the "closed-door meeting" suggest distributors are nervous. Other reports suggest Bud Light has hired Republican lobbyists to repair its image in Congress. But the Dylan Mulvaney episode began April 1, when they posted a selfie of them holding a Bud Light can with their face on it -- here we are a month later, and all we've really heard has been leaves of absence, cloaed-door meetings, and lobbyists, while Miller Lite and Coors Lite both saw their sales jump more than 17% in the same period.

Poking around the web, I discovered there was actually a similar crisis for Pepsi in 2017, when it released an ad featuring Kendall Jenner:

The world was treated to Jenner leaving a modeling gig to “join the conversation” which she and her fellow marchers seem to “win” after she hands a police officer a Pepsi. The backlash was immediate and fierce, but in Pepsi’s defense, so was their corporate crisis management.

The brand did initially release a statement defending their campaign by saying, “This is a global ad that reflects people from different walks of life coming together in a spirit of harmony, and we think that’s an important message to convey.”

However, less than 24 hours later the soda company had pulled the ad and paused the campaign entirely. A second statement followed: “Pepsi was trying to project a global message of unity, peace, and understanding. Clearly, we missed the mark, and we apologize.”

This is the one strategy that Bud Light hasn't followed -- unlike Pepsi, they didn't pull the endorsement, and they still haven't apologized. Instead, a couple of lower-level executives are just "on leave", and the company is quietly telling distributors they'll spend more on advertising down the road. The site at the link says,

The response from Pepsi was immediate and effective. Like many successful crisis communication examples, the brand showed empathy and promised action. This was the first and most important step in their crisis management process and it paid off. Quick yet effective responses help minimize the risk of long-term effects from negative reactions and prevent them from permanently damaging a brand’s reputation.

But in comparison to Bud Light, Fox's strategy in firing Tucker Carlson is even worse. All we really know is that Tucker is off the air, in circumstances that are unclear, for a reason that nobody can fathom. Sean Hannity, who might have been a public face for the network during the crisis, could say only

My phone has been blowing up all day. The hard part for me is I don’t have a clue. . . I have no idea. Was it Tucker’s decision? Was it Fox’s? Was it a mutual agreement that they had? I don’t know.

Even Carlson himself has little to say:

[N]ow Carlson himself has said that it didn’t actually happen at all. In a text message to the news analysis site 19FortyFive, Carlson said flatly: “I’m still employed by Fox.”

The crisis management site I linked above gives an example of a successful corporate strategy over a firing that involved silence:

In February 2017, Bradley Reid posted on Cracker Barrel’s corporate website asking why his wife Nanette had been fired from the retail-manager job she’d held in an Indiana Cracker Barrel for 11 years.

It wasn’t long before the hashtag #JusticeforBradsWife began trending. Someone even started a Change.org petition for answers that garnered over 17,000 signatures. People began adjusting Yelp and Google pages for the brand to feature photos of Brad’s wife. And other fast food chains began capitalizing on Cracker Barrel’s bad press, including a Chick-fil-A sign emblazoned with “Now Hiring Brad’s Wife!”

. . . The restaurant’s crisis management was, apparently, not to treat this like a crisis. They kept quiet on the issue, never publicly addressing the movement or Brad’s wife. While you’ll still find a few #NotMyCountryStore hashtags littering Cracker Barrel’s social media channels, the firestorm has mostly passed. And the crisis didn’t appear to have any negative effects on the brand’s financial performance.

Cracker Barrel shows us an example of how silence can sometimes be the best form of crisis communication. In fact, while some critics say silence was the worst response, the general consensus is that it wasn’t the disaster everyone thought it would be at the time. While staying silent may be a risk, it can really pay off. The majority of their consumers today are either unaware of the issue, have already forgotten about it, or know what happened but still enjoy eating and shopping there.

I think the key takeaway is that Cracker Barrel is unique; it appeals to a heartland market -- there are 60 Cracker Barrels in Florida, but only 9 in either California or New York. Its customers trust the brand and enjoy eating and shopping there. The individual personnel problem didn't damage customer trust in the brand.

The problem for both Bud Light and Fox is that a pro-trans endorsement and firing Carlson (or whatever that was) damaged trust in a brand in markets that aren't all that different from Cracker Barrel. So far, it appears that Fox isn't even acknowledging it has a problem:

Viewership for the 8 p.m. hour of Fox News, a prime-time television spot occupied by Tucker Carlson for years, has plummeted by half in the days since the anchor was suddenly fired Monday.

. . . The viewers appear to be opting for other conservative networks, as Darcy reported that Newsmax's 8 p.m. hour totaled 510,000 viewers, tripling the audience they drew at the same time last Wednesday. The right-wing alternative to Fox has also been using its airtime to accuse Fox and the Murdoch family of caving to "the left" by firing Carlson, according to the New York Times.

Fox has not publicly confirmed a reason for why Carlson was dismissed from the network, and theories have abounded with possible explanations for his departure.

My surmise here is that Tucker's firing was a fit of pique by Rupert Murdoch himself, and nobody but nobody is in a position to try to manage that particular crisis. The usual crisis management prescriptions -- assuming the crisis must be addressed at all -- involve transparency, communication, acknowledging errors where appropriate, and designating a credible public face for the corporate response. Bud Light has been fumbling with halfway measures, allowing both Dylan Mulvaney himself and the farcical Alissa Heinerscheid to remain the public faces of their strategy.

But so far, Fox's strategy appears to have been infinitely worse. Both crises involve major misunderstandings of their market -- or possibly in Murdoch's case, simply ignoring his market in a fit of jealousy at Carlson's success -- that I think reveal bigger issues underlying the current state of the country. Both brands look like they'll have permanent damage from these misunderstandings.