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What should Starbucks do? Here’s what crisis experts are saying

by | Apr 19, 2018 | Public Relations

Java giant Starbucks has its work cut out for in its handling of a racial-profiling crisis that keeps getting worse, according to several PR and marketing communications pros—and the brand needs to act quickly to get control of a wildly spiraling situation.

This brand crisis is much more enveloping than previous kerfuffles the company has been embroiled in, like the holiday cups controversy or marriage equality stance it took—both of which ultimately helped the brand build a stronger identity and reputation.

No, there are no counterpoint sides to be taken in this instance. Now, a Starbucks store in L.A. has been swept into the story after new video emerged showing an employee there refusing to let an African-American man use the restroom—and the longer the story stays in the headlines, and the more it is allowed to unravel, the worse the ultimate damage is likely to be, according to comments gathered in recent news coverage.

What can Starbucks do to shift the momentum and get more control of the story?

“This is a very difficult situation for Starbucks. The company really has to move quickly to try to get ahead of it,” said Tim Calkins, clinical professor of marketing at Northwestern University, reports an NBC article by Martha C. White. “We live in such a highly charged time that incidents like this can really spark a much bigger controversy and can quickly become a major problem for a brand. The real issue for Starbucks is that this leads to a broader criticism of the company.”

The ensuing damage will definitely take a toll on any goodwill Starbucks has managed to collect in the handling of other incidents. “The more your brand is trying to connect emotionally to people, the more hurt people feel when these kinds of things happen,” said Jacinta Gauda, head of New York strategic communications firm Gauda Group, according to a Chicago Tribune article. “They are breaking a promise. That’s what makes it hurt deeper.”

CEO Kevin Johnson has made some of the right moves—but more will be needed

Some communicators acknowledge that CEO Kevin Johnson is in a no-win situation right now, and credit him with some good decisions so far. “That’s really important [Johnson] didn’t let someone else take responsibility,” Richard Levick, chairman and CEO of LEVICK Strategic Communications, told NBC, referring to the CEO’s smart move of not pointing a finger directly at the store manager who called the police. “One of the ways to deflate a budding crisis is to apologize, say I’m sorry and mean it, and take responsibility, and Johnson has done that.”

“I’m actually surprised [Johnson] is handling it the way a CEO should be handling it. He went in head first and he took the blame for it,” said M.J. McCallum, vice president and creative director of Muse Communications, in the Tribune report. “I definitely applaud that. Most people won’t jump on the bomb. Starbucks has a great reputation.”

Johnson’s apologetic tone has been a smart one, and hasn’t gone unnoticed, but this situation will require much more crisis strategy “At this point, I think they’ve responded very well, but I think also they probably will now need to do more,” said Andrew Ward, associate professor of management at Lehigh University, in the NBC report.

“They stand for a better culture. They have stores in inner cities,” McCallum added. “I think he realizes what this one incident can do for his brand.”

The important thing for Starbucks right now is to clearly show it has learned a valuable lesson

“I think Starbucks is sincerely sorry, but it should also take concrete steps and lead the way to turn this into a teachable moment,” said Marcia Horowitz, managing director at strategic communications and reputation management firm Rubenstein, in the NBC report. “It is a wake-up call.”

“Starbucks understands how dangerous this situation is and how important it is for the company to respond to it,” Calkin added. “The optics of this are very bad for everybody involved.”

It’s also key for the brand to admit that this behavior may be engrained in its culture. “I would suspect that this particular issue is something that has occurred before,” Gauda added. “The company is in crisis mode now, but they should not look at this as an isolated issue.”

The brand’s announcement that it would be closing all of its U.S. stores for companywide racial bias education on May 29 is an admirable step toward demonstrating an understanding of that. What other moves will Starbucks make? Only time will tell.

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Richard Carufel
Richard Carufel is editor of Bulldog Reporter and the Daily ’Dog, one of the web’s leading sources of PR and marketing communications news and opinions. He has been reporting on the PR and communications industry for over 12 years, and has interviewed hundreds of journalists and PR industry leaders. Reach him at richardc@bulldogreporter.com; @BulldogReporter

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