business reputation crisis

Business Reputation Crisis

How to Handle Business Reputation Crisis | Examples

If you own a business, you know that how you handle a business reputation crisis can significantly affect your customer base, no matter how loyal it is. In fact, according to a survey, 60% of consumers reported that negative reviews made them not want to use a business. 

If you’re unsure of how to handle such crises, read on to find the steps you need to follow for effective damage control.

Steps to Business Reputation Crisis Management

Following are the steps to take if you ever find yourself amid a business reputation crisis:

Assess The Situation

The first step to managing a business reputation crisis is to perform a thorough investigation into what exactly went wrong. If you don’t know what is damaging your business’ reputation, there’s not much you can do about it. 

Some common company reputation damage examples are:

  • Quality and safety concerns regarding your product
  • Poor customer service
  • Social media blunders
  • Legal disputes
  • Labor exploitation issues, etc

Assemble a Reputation Crisis Management Team

After you’ve identified the root cause of the business reputation crisis, it’s time to assemble a skillful team of employees or hire a crisis management firm whose sole responsibility will be to defuse the crisis. Different individuals on this team will work to devise damage control strategies as well as inform everyone who needs to know.

The primary individuals that need to be informed are your business stakeholders. Make sure they’re all on the same page and that they know you have a solid plan for handling the business reputation crisis. Not only will this strengthen your business relations, but they might have some suggestions to handle the situation.

Develop Your Communication and Damage Control Strategies

Next, develop strategies on how you will clear the air about the crisis among the public. Use social media, press releases, emails to customers, etc., to make sure the public knows that the crisis is not being neglected and their concerns are being taken into account. 

If your business is at fault, have your publicist write an apology so that the public knows you care and aren’t afraid to take accountability. Also, include what steps you plan to take to make up for the situation and prevent any recurrences.

Win back The Trust of Your Customers

Once you’ve effectively handled the business reputation crisis, it’s time to rebuild the trust among your customers. Work on improving your customer service and building a positive image. A great way of doing that is by training your employees on corporate communication.

Release positive content regarding your business, e.g., philanthropic work, positive customer reviews, etc. Design loyalty programs and promotions to further strengthen brand loyalty among your customers.

Reputation Crisis Examples

American Airlines

One of the recent brand reputation crisis examples was when black passengers reported the American Airlines staff of being racist. The crisis wasn’t handled well, resulting in legal actions taken by multiple passengers.


In 2015, Volkswagen was accused of hiding the actual carbon emission value in millions of its vehicles. As a result, they lost a significant number of shareholders even after they apologized. To recover its credibility, the company has now vowed to invest heavily in the development of a hybrid car model.


Due to a severe accident near KFC’s logistics warehouse in 2018, there were many delays in deliveries, risking the satisfaction of customers. KFC handled this PR nightmare by making funny ads about the situation to let customers know they’re working on it. They were actively answering customers’ questions on social media and kept the status of their local branches updated on their web pages.


The more your business grows, the more it’ll be at risk for a business crisis. Since these crises can often be unpredictable, it’s often hard to avoid them. That’s why the best thing you can do is craft an effective and efficient reputation crisis management plan. 

The tips mentioned in this article have been used by many big brands to handle their own reputation crises. So, you can count on them to effectively defuse yours as well.