Volkswagen Beetle

The Volkswagen scandal came out of nowhere and hit like a freight train. A once leading global company is now drowning in scandal; with regulatory bodies, employees and more importantly customers, absolutely furious. In just three weeks, its share price has almost halved, its reputation is in tatters, and analysts are saying that this is only the beginning. I couldn’t agree more.

Branded the worst business crisis in its 78-year history, VW has a long journey ahead to restore trust and confidence. In business, reputation has always mattered, and when you have a good one, you know it. Some say it is a measure of trust or a customer’s willingness to recommend a company… For others, it’s down to the satisfaction levels of employees or financial success. I believe that it is all of these things and more.

A decade ago, an unhappy customer may have told ten people about their negative experience with your brand. Even if each of those ten told another ten, you’d still be looking at hundreds not thousands of people hearing something negative about you. However today, with the help of social media, one unhappy customer can tell thousands of people in an instant about their poor experience with your company, and reputation can be irreparably damaged in a matter of hours, or even minutes.

Many reputation-damaging crises are exacerbated by social media and the VW scandal is no exception. Your company’s reputation is a key asset, and just like any other asset, you must protect it from harm on the one hand and expect it to produce a return on the other. Social media now plays a significant part in how you are perceived – with every action (or non-action) being amplified globally.

Companies can no longer sweep bad news, press or behaviour under the carpet and hope it goes away. Social media gives consumers the opportunity to talk back instantaneously and be vocal about and towards the brands they interact with. It opens the door to genuine, unfiltered feedback from the people that matter the most. There has never been such a useful channel for open dialogue between companies and their customers and this is an exciting opportunity – but only if you’re ready for it.

So how can you harness the power of social media? Although the mediums change and are ever evolving, nothing has changed when it comes to the most important thing – understanding who your audience is and what they want not just from your product, but also from you. From that, you can decipher the best way to package your message and an action plan in case anything goes wrong. Succeeding on social media is actually a lot easier than you may think.

That being said, here are my ABCs of social media - top tips on how to enable a constructive use of social media platforms, keep reputation risk to a minimum and respond to difficult situations.

Be organised

Everyone knows that saying, ‘fail to prepare, prepare to fail’. Countless digital wildfires could have been extinguished quicker if there was already a plan in place to counter a reputational crisis. Who is managing your social media communications? Are they adequately prepared if a crisis begins to unfold? Do you have a team on hand, ready to spring into action? Are they directly linked to anyone else on a crisis team? Have you invested in social media monitoring? Answering these questions is imperative to avoid last minute scrambling and being taken by surprise.

Be quick

Research shows that 72% of people who complain on Twitter expect a response within an hour (Lithium Technologies). Being slow to respond will leave your customers on edge, frustrated and neglected. The failure to respond to the crisis specifically to address UK customers is one example of this. The immediacy of social media means you need to be alert and ready to react to every comment. I’ll never forget what has since been dubbed O2’s ‘Social Media Masterclass’. During a network outage, the company’s new Twitter followers increased from an average of 155 to 13,500 per day with thousands of people angrily tweeting every single day. Undaunted, O2 managed to reply to every tweet in an apologetic and personalised manner, and dramatically turn sentiment around. This brings me onto my last point…

Be human

This is possibly the most important of the three. Making money is of course a main goal for a commercial enterprise, however there are different ways to reach that goal. Consumers expect businesses to have a more human face, while still offering a professional product or service. You need to make sure that the personality you portray on social media is a true reflection of your company culture. Use social media not only as a platform for content distribution, but to have genuine conversations. If something potentially damaging about the business is shared online, it is simply not possible to go into shutdown mode and try to hide the truth. Be honest, be authentic and be real - your customers will appreciate that.

Michael Horn, CEO of Volkswagen US said recently, ‘let's be clear about this, our company was dishonest with government regulators and with all of you. We have totally screwed up […] we have to make things right with everyone. We will do what we have to do and pay what we have to pay.’ His honest admission does not take back what VW has done, but is definitely a step in the right direction in rebuilding trust with stakeholders and customers. Whether the company’s behavior reflects this sentiment remains to be seen.

The power to make or break your company’s reputation lies firmly in the hands of those you interact with. But shaping their perceptions is up to you. A company that is seen to ‘do the right thing’ time and time again will build up enormous goodwill not just among consumers, but also important stakeholders. Make sure you’re positioned correctly for social media to be used as a tool, rather than a threat.

By Jennifer Janson, author of The Reputation Playbook and Managing Director of Six Degrees