Mother Energy Drink (Coca-Cola)

The first example relates to Mother Energy Drinks, which was launched into the Australian market in
2006 by the Coca-Cola Company.
Coca-Cola used a heavy launch program to generate trials of the product. In particular, they had a
series of TV commercials that have a look and feel similar to the Madagascar movie that was
popular at the time. They leveraged their extensive distribution channels and were able to get the
product in many retailers, with prominent point-of-sale displays. The can’s packaging had a tattoo
look about it, again tapping into the popular culture of the time.

While the launch campaign was professionally and effectively executed, the taste of the product was
not great and repeat purchases were quite low as a consequence.

Obviously, Coca-Cola is a major firm in beverage, so a poorly performing product is simply not
suitable for them. Therefore, they had to decide whether to improve and reposition the product or to
withdraw it and replace it with a new brand and product. The firm decided to reposition the product.
This is because they had done such a good job with the launch, that the brand awareness (a key
part of brand equity) was very high in the marketplace.
With the relaunch and repositioning project, their biggest challenge was to convince consumers to
re-trial the product. As a result, they changed the packaging, increased the size of the can and, of
course, improved the product’s taste.

However, they approached the problem of the product’s perceived poor taste head-on. For instance,
on the can’s packaging, in quite prominent letters, they had “New Mother, tastes nothing like the old
one”. Their TV commercials for the relaunch (see below), which used a humor appeal, showed
commandos breaking into the lab to get the scientists that invented the original formula.

As a consequence, they are able to reposition the product as having a great taste and many
consumers were willing to re- trial the product and today the product enjoys a good share of the
Australian market and is performing to the firm’s expectations.

Napisan
Napisan is a laundry detergent product that was designed to wash baby diapers (called nappies in
Australia, hence the name of the product). Napisan was a very popular product up until around the
1980s when there was a significant change in consumer lifestyles.  As consumers became more
time poor, as a consequence of both parents working, there was a big shift from using washable
cloth diapers to using disposable ones.
Therefore, sales of the NapiSan product fell in line with the decrease in consumer demand. This is a
good example of repositioning being required due to the change in the macro environment.

The firm had a good quality product, so they had to decide whether to reposition the product or to
bring out the same product under a new brand name. They decided to reposition it because it had
good brand equity (high awareness and it was trusted by consumers).

Over recent years the NapiSan product has been successfully repositioned for a new use; being the
ideal laundry detergent for tough stains.

 
Repositioning a Credit Union
The final example demonstrates how a credit union was repositioned because it did not have a clear
positioning space. As shown in the perceptual map (below), the credit union was competing in a
local market with a local bank which was substantially bigger than itself. Both were best perceived as
local and conservative, but the much larger financial institution was generating more market share.
As you can see, there was a clear market gap in the bottom right-hand quadrant and the credit union
decided to reposition itself into that space. This move allowed them to keep the positioning aspect of
being local, but required them to modify their positioning from being conservative to being more
innovative.

As part of this repositioning process, the credit union introduced a range of new products, set up a
customer relationship management (CRM) program, modified their sales and customer service
staffing structure, and changed their tagline to “leading the way”.

These marketing mix changes were able to clearly communicate their new positioning and the credit
union grew by 60% over the next three years.

BANGALORE:  Over the years we have witnessed a lot of controversies related to famous
brands. From packaged foods to restaurants most of the brands have gone under the
scanner for various reasons, the most recent one being Nestle’s Maggi. But some of the
brands fought their way to the top and came up with flying colors and re positioned their
products to the market. Let us take a look at some of such brands and their products as
compiled by live mint.

 Pepsi

The soft drink makers had to go through a rough patch during the early 2000s due to the
high level of pesticides in the product. Not only Pepsi but also all the other soft drinks sell in
the country had to face the music. 

After several months of ban India's health ministry has also dismissed the allegations, both
questioning the accuracy of the data compiled by the CSE, as it was tested by its own
internal laboratories without being verified by outside peer review.

Cadbury India Ltd

Cadbury India Ltd now named, Mondelez India Foods Pvt. Ltd) is the largest chocolate
brand in the country. They began its operations in 1948 and have pioneered cocoa
cultivation in India. Currently the brand operates in five categories such as Chocolate
confectionery, Beverages, Biscuits, Gum and Candy.

But earlier in 2006 the company had to fight a lawsuit since its chocolate products were
found plagued with worms. But they came back strongly with an advertisement casting ‘Big
B’, which explained the functioning of their factories and the new packaging also
contributed in repositioning their brand.

Flipkart

The e-commerce giants Flipkart had its big day on October 6th 2014, through ‘Big Billion
day’. The sale was introduced as a promotional strategy, even though Flipkart achieved the
target this led to public outcry and widespread criticism among consumers, competitors and
partners, heavily damaging its reputation.

Most of the products were sold for less than cost price, and Flipkart was accused of killing
competition. The promoters Sachin Bansal and Binny Bansal had to address the mass and
apologies for the inconvenience caused. But over coming all the turmoil, Flipkart still
manages to be on the top of their business. 

Gap

Gap is one among America’s favorite apparel retailers. The brand competes with
multinational retailers like Zara and Forever21. The company had decided to give a fresh
look by repositioning its products with a new logo in 2010. But unfortunately, the idea
backfired for them. They had to face criticism all over the social media. Later they came up
with an apology and decided to replace the new logo with the old one.

Yum!

American fast food Company, Yum is a Fortune 500 corporation, it operates the licensed
brands Taco Bell, KFC, Pizza Hut, and Wing Street worldwide. But the multinational
company had to face a tough time in the Chinese market from 2014.
The KFC’s under the brand was found selling expired products which resulted in their
overall reputation. Even though they have put the blame on the supplier, Shanghai Husi and
cut them off from the business the sales are still in a slow process of recovery.

 Tesco, Asda and Aldi

The horse meat in the packaged food products clamming to be beef was another food related
controversy which caused chaos in UK in 2013. The controversy involved retailers such as
Tesco, Asda and Aldi. This controversy questioned the safety and quality assurance within
the food supply chain. National wide protest against the large scale meat exporters led to
arrests and the retailers started finding alternative resources for their packaged meat by
leaving behind the suspected vendors.

 7-Up.The famous positioning of 7-UP as the "Uncola" perfectly positioned

that product for those who did not want to consume cola drinks. For those who
do (a confirmed Coca-Cola fanatic), the positioning of 7-UP had no appeal.
But that's fine, since I am not their prospective customer anyway (even though
THEY might consider me a prospect).
- Courtesy of Steven "sbhoward" Howard
 Starbucks. I've been critical of Howard Schultz the turnaround CEO,
but Howard Schultz the entrepreneur franchised "premium coffee," forever
upgraded the "coffee shop" experience, and created one of the world's most
powerful brands in the process.
 Swatch. The most famous example I can think of is Swatch. Created as a
defense against low priced Japanese quartz watches that swamped the market,
instead of competing on price, [parent company] SMH positioned the product
as the famous "fashion watch," thereby creating a whole new market, much
larger in size than the original watch market.
- Courtesy of Ricky " rdewerk" de Werk
 Hyundai. Another fantastic example is Hyundai, a company that
understands how to consistently move upstream through intelligent product
positioning. Hyundai is increasingly creating havoc in the market for their
competitors and finding ways to innovate, and develop value propositions that
resonate with their customers and prospects.
- Courtesy of Mikah "MikahDC" Sellers
Your brand is your business. In addition to executing against your long-term brand strategy, you
need to understand how today’s market impacts your brand and impacts your competitors, and most
important, you need to understand what your consumers are thinking. No sector stands still; there
are changes every single day. A new product launch, a new campaign; whatever it is, you don’t want
to be caught unaware.

People in general, without possibly knowing it, tend to be occupied with how
they are perceived as human beings by others. Identity is a big thing to many
and for the most part, people will strive to be as individual as possible.
Despite that need for individuality, you can to a degree still categorise people
and put labels on them; mod, rocker, punk, city boy, country boy, sports
enthusiasts...the list goes on and you can subcategorise them even further.
Things such as social status, financial status, sexual preference, hobbies and
interests can all be seen as reflective of one's identity or how someone from
the outside might perceive them. But what makes people come to develop
these perceptions of someone and how are these identities shaped? Is it in
something in our DNA that makes us like this? Could be if we were to get
scientific and look closer at the nature of genetics. However, we are all born
as blank canvases so to speak and it is our own actions and decisions that lead
us to fashioning these self-identities. It's true to suggest that we can identify
and perceive people by their make-up; the coffee they drink, the clothes they
wear, the food they eat, the car they drive and the music they listen to.
Therefore we can see brands as pieces of the large puzzle that can be called
identity – the identity of people that is. People make the brands and brands
make the people. Internet retail psychologist Graham Jones gives weight to
the argument that brand images are seen as reflective of the people who
consume them and are linked to people's perception of themselves and their
self-identity; “Brand owners like to think that their brand image is all about
them and their products and services. However, consistent psychological
research shows this is false. Brands are much more about the people who use
them, than the brands themselves. That's because people use brands to
confirm their self-identity. One of the on-going issues people have is
establishing the answer to "who am I?" We are constantly seeking ways of
measuring ourselves and confirming that we are who we think we are. Our
self-identity gets re-affirmed every day in many ways. One way in which
people confirm their identity is to link themselves to a brand which they
believe has the same characteristics as themselves. As a result, when people
opt for a particular brand they are not saying they like the brand; rather they
are saying they like themselves.” It is then up to brands to find out; who are
the people who make their brand?

For marketers, finding out more about brand perception is an in-depth task

which requires them to go to the heart and very soul of consumers. They need
to find out what people are saying about them as a brand and who are their
customers? The findings may be a number of things; insightful, encouraging,
or incredibly devastating in that general brand perception couldn't be further
from what marketers had envisaged or wanted it to be. Brands will forever be
associated with people and from that, perceptions perhaps even stereotypes
will be formed.
 Brands can be
changed drastically for the good and there are numerous examples of how
marketers turned the fortunes around for a certain brand and gave them a
fresh new identity. The key lessons to think about when re-branding are to
listen and adapt. Listen to what your customer is saying about your brand or
better yet, what is it your customer really wants from this brand? Now take
that knowledge and adapt accordingly. Taking a look at some great examples
of fantastic re-brands, we can see that through careful and detailed research,
they found out what people were saying about their brand and how it was
perceived, and by adapting to new customer needs, changed for the
better. Burberry for years now has been a prime example of complete brand
transformation and with it, previous brand perceptions have completely
gone. Despite its 150 year history, at the turn of the 21st century, the brand
was becoming more and more disassociated from the premium image it had
upheld. Rumours of some public places banning the wearing of Burberry due
to its perceived gang-wear tag, made it an unfashionable brand to wear thanks
to its perceived association with hooliganism. New creative director
Christopher Bailey aimed to turn this around and align it again with the
luxurious shopper and fashionista it had attracted. The recruitment of Kate
Moss and Emma Watson, two British female icons whose identity screamed
sophistication and culture, was a major point in moving forward for the
brand.  Bailey got inside the head of his consumers (or in this case, the old
consumers they wanted to win back) and discovered what they wanted from
the brand and how they related to it. Burberry's association with esteemed
figures like Moss and Watson made Burberry lovers proud to wear the
famous check pattern again and felt it came closer to the identity they were
yearning for when wearing the product. Also, making new styles for Burberry
far more modern yet still holding on to those traditional values it held, made
the brand appear more adaptable to the changing trends of fashion.

Wal-Mart, now one of America's biggest chain of stores, initially suffered

from poor brand perception. But with this some close research, clever
thinking and adapting accordingly, soon turned things around and have never
looked back. Like any shopper, Wal-Mart's shoppers enjoy value for their
money and want it to go a long way. There is of course nothing wrong this,
after all don't we all want that? The slogan that communicated this message
across however, for some reason didn't get people enthused about the brand.
“Always Low Prices” had with it somewhat of a negative connotation.
Perhaps the mention of “Always” and “Low” didn't evoke a sense of
experience, fulfilment or benefit for customers. To some it might have been
viewed as the sole and go to place for cheaper products. Cheaper for instance
suggests a lack of quality. The company soon changed their logo to “Save
Money. Live Better.” Strong words which would make customers feel their
lives have improved and for the better. Through customer research, Wal-Mart
found that customers want to better their lifestyles and would therefore stick
with a brand who can help them achieve that.

Going back to brand

identification and perception with consumers, it is something that very much
still exists. However, with brands having to get to know their customers and
how they identify with brands, this is becoming more difficult. With more
and more new ways of self-expression and the customer continually evolving,
the customer research journey must become far more intense. As Graham
Jones explains; “Brands also face a growing issue. There are now more and
more ways of affirming our identity, such as daily feedback on social
networks. This means that people need to attach themselves to a brand less
than before. Several studies are showing that brands are becoming less
important to consumers. Partly this can be explained by the greater
availability of methods of affirming self-identity. For brands this ultimately
means they need to get to know their customers in greater depth to find out
those self-identity gaps which the brand can fill. The change in perception a
brand might want is down to understanding the psychology of its target
customers in much more detail than ever before.” So whether it be logos,
associations, slogans or image; marketers need to keep on the pulse of what
their consumer is after and what they aspire to in an effort to keep brand
perceptions positive and reflective of the customer.

If you are presented with flashcards of product logos, how many will you be able to identify?

When presented with a logo or a brand name, what immediately comes to your mind? What
feelings does the name invoke? How do you respond to it? Now try thinking back to the first
time you encountered that brand. What did you think of it back then? What do you think of it
now? Has it changed? If so, what changed?

This means that your brand perception has undergone a shift.

© Shutterstock.com | Stuart Miles

In this article, we 1) understand the basic concept of branding, 2) how to develop a

brand strategy, 3) a quick overview on brand perception, 4) actionable strategies for
changing brand perception for your company.

THE CONCEPT OF
BRANDING
 Before we go any further on the topic of brand perception, let us first take a look of what
branding is.

A “brand” is a name, term, design, or any other feature that distinguishes a product from
one specific seller or manufacturer from that of another. “Branding”, on the other hand, is
more than the process of choosing a unique name or image for a product. It actually
involves embedding that unique name and image in the minds of the customers through
various strategies and techniques, such as advertising campaigns and other marketing
programs. Its goal is to make the brand gain a solid foothold in the market and carve a
market comprised of loyal customers.

A business cannot handle its marketing aspect without touching on branding. In fact,
branding is considered to be one of the most important aspects of a business since it is one
of the major tools or strategies that will give the business a competitive edge.

With their brands businesses give a promise – a representation of what they offer to their
customers. It is also a tool that can be used to differentiate their products or services from
that of their competitors. The brand is the thing that customers will first see, and we all know
what they say about first impressions: they stick, and they last. Therefore, it is important to
make sure you have a brand that fully represents the promise of what and who your
business is, and make your customers stick with you.

Let us take a look at why branding is important for all businesses.

 All businesses have a message to convey to customers, whether this is having the
best product or wanting the customers to buy their product instead of others. Branding is
their tool in order to deliver this message clearly and effectively to its target market.

 Branding adds credibility to a business. Customers will take a business more

seriously if they have a brand to associate it with.

 Branding mainly targets the emotions of the customers, so if you want to connect
with your customers on an emotional level, the best way to do that is to have excellent
branding strategies in place.

 Branding is also a good way to motivate your customers into buying your products or
service. Turn them into buyers and start earning that profit!

 Companies would like to have a customer base, develop loyal customers that will
keep coming back to (and buying) the business.

DEVELOPING A
BRAND STRATEGY
Branding does not end with coming up with a good name, an even better logo, and slapping
both on flyers, brochures and advertisements that you release to your target market. Your
business’ brand strategy is not something that you should take lightly, if you want your
brand to have meaning for your customers.

Brand strategy involves the what, where, when, how, and to whom you will be
conveying your brand messages. What message will you communicate? What channels
will you utilize to convey the message? Who will you target, and who will you use to get the
message across? What timing will you follow in the delivery of the message?

The aim of having a brand strategy is to increase the equity of the brand. Brand equity is
seen as that value-adding element that will set your product apart from identical or similar
products or services in the market. The stronger the brand equity, the higher will be the
value of your product or service. That gives businesses a license of sorts to increase its
premium or its price.

Take Coca-Cola, for example. The market is now saturated with different brands of soda.
However, Coca-Cola products are more expensive, and that is mainly down to the fact that
it has already built a very strong brand equity. The same is true for Facebook. Other similar
social network platforms have sprung in recent years, but Facebook remains to be the most
popular and still widely used platform because it already has a solid brand equity besides its
network effects.

Much of the reason why some brands carry more weight or have more brand equity is
because the companies or businesses behind these brands were able to find ways so that
the market will have more emotional or personal attachment to them. Coca Cola’s
advertising campaigns over the years involved utilizing the concepts of family, togetherness,
and having that sense of belonging, all while sharing a drink of Coca-Cola.

Any company can come up with a unique brand name, design an eye-catching logo, and
come up with a genius tagline. However, all that will be for nothing if the business is unable
to create meaning or perception in the minds of the customers.
 QUICK OVERVIEW
ON BRAND
PERCEPTION
Here is a dose of reality: management may think that their product is the best in the market.
The public, however, may think differently. This is because they are from different ends of
the spectrum. Now it is up to them to make sure that their assurance about their product will
align with the public’s perception of their product, and of their brand, as a whole. The
business can argue all it wants about how the public is wrong, but in business, public
perception is a reality. Unless the business is able to change the negative perception of the
public of their brand, it will not be able to improve how the brand is seen or perceived, and
the business will not be able to move forward.

Brand perception does not develop overnight. It is a result of various experiences, such as:

 Advertising or marketing

 Previous experience of the customer with the brand

 Interactions with the sales force, customer service and support, and other employees
of the company that owns the brand

 Reviews from trusted sources

 Word of mouth or recommendation by personal acquaintances

Three Layers of Brand Perception

Derrick Daye, the author, and a senior brand strategist at the consultancy firm The Blake
Project, said that brand perception or meaning has three main layers.

 Cultural meaning: This is the first layer that consumers see and respond to
whenever they see a brand. It is that aspect that is easily influenced by popular or local
culture. Thus, it is not rare to see brands make use of celebrities to leverage popular
culture, or specific representations to leverage local culture. Examples would be the Molson
beer in Canada and Subway in the United States.

 Community meaning: In this context, “community” refers to any group of associated

people, or people that share something in common. It could be a hobby, an interest, or a
 common cause. Harley Davidson, Apple, and Patagonia have been cited as brands that
have the ability to attract entire communities.

 Individual meaning: This looks into the person himself. Does the brand make
enough of a difference to convince a user to spend money on it? In the end, this is what
marketers aspire for, so they must first pierce through the first two layers – influence the
cultural and community meanings – in order to be able to eventually influence the personal
or individual meaning. From there, marketers may also be able to change how an individual
perceives a brand.

STRATEGIES FOR
CHANGING BRAND
PERCEPTION
When a company notices that their brand is no longer making as much money as before,
they normally become resistant towards making some changes. But when they do, the first
thing they look into is the possibility of changing the advertising agency they used to work
with, or giving their logo a facelift. Or they could throw more money on a new advertising
campaign that, sadly, may or may not work.

There are many strategies that can be employed in order to change brand perception.
Before you can change anything, however, you must first gain a clear picture on the
perception of your brand.

 How does the public perceive your brand? (ACTUAL)

 How do you want the public to perceive your brand? (IDEAL)

Once these two questions are answered and you see significant differences, it’s time to take
action and come up with ways in order to make them correlate.

Perform an internal check

This entails looking within the organization. Is there something you can change that will
enable the business to deliver the promise of their brand to their customers? Is the
customer service and support no longer performing well? Did the management suddenly
change objectives and it is no longer aligned with that of the brand?

There have been times in the past when brand suffered due to poor management, and
the restructuring or change of leadership in the companies have proven to be enough of a
 nudge to make the public or the customers change their attitude towards the company and
the brand.

Make your brand social

TV and print advertising are still reliable tools, but they are no longer only – or the best –
options available. These days, all businesses are now cognizant of the power of social
media and the wonders that social forms of brand publicity can do for them. Advertising or
establishing online presence in social sites is definitely highly recommended, even to
startups. Users of these sites are seven times more likely to spend or purchase a product or
service if they see the brand on these social sites.

Studies show that social media is responsible for the largest shift in brand perception. Take
advantage of this trend and make sure your brand is visible in social media sites, such
as Facebook, Twitter, Pinterest, and Instagram, to name a few.

Pay attention to your product or service experience

Businesses pour so much of their resources towards their marketing campaigns and
strategies, but they fail to improve their products or services. This is one thing that is often
overlooked even by the most seasoned marketers. It is often said that marketing strategies
can make or break brand perception. That is true, yes, but that is not all there is to it. They
often forget that the product or the service experience itself can also create or destroy brand
perception.

What does this mean? A business may have the best marketers in town, and they have
excellent marketing strategies in place. In fact, their marketing communication is
impeccable, and can easily reach and influence the customers. However, if the product is of
poor quality, or the service was delivered in a less-than-satisfactory manner, the customers
are still going to have their perceptions undergo a shift or change.

Therefore, never lose sight of your product or service development. Continue to look for
ways to improve your offering. When we say “product or service experience”, we are not
only referring to the quality of the product or service, but also the various aspects that make
up the whole experience. You also have to rethink and reconsider the following:

 Product features. These include the specifications, functions, styling, and even
the packaging of the product. Find ways to improve them.

 Pricing. Monitor your pricing. Do your customers still find your pricing competitive?
Reasonable?

 Distribution strategy. Think of ways to improve the delivery of your products and
services to your customers.

 Customization. Will you be able to customize your products or services for your
customers? Consider bundling or unbundling of products and services.
 Customer service and support. How well does your company handle complaintsand
other customer concerns?

Focus on key players

Brand perception is influenced by word of mouth, recommendations, and reviews. You can
start by focusing on key players, or the individuals and entities that have enough power to
change the public opinion.

For example, a brand of athletic shoes has been getting flak for being associated with illegal
labor practices, resulting to negative brand perception. The company addressed this by
signing up a world-famous athlete, who also happens to be considered from a minority
group, to endorse the brand.

Here are other examples: restaurants enlist the help of food bloggers and food critiques to
improve their image. A food manufacturer forms a partnership with a health guru to
incorporate their products in his diet or food plan.

Be flexible and always stay on your toes

Always keep in mind that branding is a continuous, ongoing, process, and brand
perceptions can evolve over time. Just because you were able to create an excellent brand
perception among your customers does not mean you should be complacent. Continuous
monitoring is still required so you will remain in touch with your customers and how they
perceive your brand.

 Conduct regular or periodic surveys to existing customers regarding their current

brand perceptions. Use questionnaires and/or feedback forms.

 Keeping in touch with customers through social media channels.

 Research what new customers need or are looking for.

Anticipate the shifts or changes by analyzing their behaviors. This will make you more
prepared to deal with the effects of these changes in brand perceptions. Also, be quick on
your feet. As soon as negative perceptions arise, act on them. Letting them slide, hoping
that they will soon pass anyway, may be counter-productive.

These strategies apply when the company decides to continue investing on the existing
brand. There is one other option, which is considered as the last resort when studies by the
business reveal that the market segment being tapped into by the brand no longer has a
future.

This option entails inventing a new brand altogether. Sure, it means you would have to go
back to square one and start from scratch. But many businesses may deem it easier to
create a new brand than to attempt to change existing perceptions. This can be seen as a
fresh start for the company.
Changing brand perception is not an easy process. It is not cheap, either. The company has
to have more than enough dedication, determination and commitment to make it happen,
not to mention a lot of other resources like time and money. However, the rewards are
always worthwhile once the company is able to push through.

BP
Oil giant BP had spent years trying to establish itself as an environmentally responsible
brand. In 2000, the company launched its $200m global PR and advertising campaign,
Beyond Petroleum, to improve its brand image, which resulted in the creation of today’s
green and yellow, nature-inspired logo. It worked: brand awareness leapt from just four
percent in 2000 to 67 percent in 2007, according to a survey conducted by BP at the time.
Furthermore, CoreBrand found BP’s brand power increased to an all-time high score of 50
by 2008.

But all that work was undone in one fell swoop when, in 2010, the Deepwater Horizon rig in
the Gulf of Mexico exploded, killing 11 workers, causing untold damage to surrounding
wildlife, and destroying fishing and tourism businesses en masse. The eruption, which
continued for 87 days and saw more than three million barrels of crude oil released into the
ocean, according to a US federal judge, has since become infamous as one of the biggest
environmental disasters in American history.

BP reported a $5bn loss in 2011, marking the first time it had been in the red
in nearly 20 years
Unsurprisingly, BP’s reputation took a battering. The impact on business was immediately
felt, with BP gas stations in the US witnessing a drop in sales and share prices tumbling 55
percent that year – from $59.48 to $27 per share. The company reported a $5bn loss in 2011,
marking the first time it had been in the red in nearly 20 years, and by 2015 it had spent
$28bn on cleaning up, settling claims and responding. The oil giant became the butt of
criticism from far and wide; Greenpeace UK even launched a logo contest “to depict the real
image of the oil company”.

BP responded with a multimillion-dollar ad campaign stating “we’re sorry”, reiterating that

no oil had been spilt since the repair and promising to fund $500m in scientific research.
Owning up to the disaster went some way towards easing the pain, with BP witnessing a
significant improvement in its reputation between 2011 and 2013, according to Harris
Interactive.

But some believe it wasn’t enough, and controversial comments from the company’s CEO,
Tony Hayward, underplaying the spill didn’t help matters. “The company was slow to
communicate in the immediate aftermath of the disaster and tried to pass the blame on to
third parties”, said Sellito. “Its CEO came across as arrogant and aloof in broadcast
interviews, and BP showed little empathy to the accident victims.”

And indeed, the impact on consumer perception was still evident several years on: a
HuffPost/YouGov poll in 2013 found that 43 percent of Americans had an unfavourable
view of BP, and 59 percent hadn’t changed their opinion since seeing the adverts.

That fact hasn’t necessarily been felt on the bottom line – the company, of course, remains
one of the biggest players in the market, perhaps in part because consumers are unlikely to
outright reject an essential like petrol on moral grounds. However, share prices have failed to
reach the highs seen before the spill, averaging $44 between August 2010 and August 2014 –
down 27 percent from the peak – reflecting a continued lack of investor confidence.

Communication and a commitment to sustainability have played their part in reputation

recovery, but in a case like this they can only go so far. According to Sellito: “For those with
longer memories, the green and yellow sunburst of the BP logo will always be tainted
by Deepwater.”
Volkswagen factory in Wolfsburg, Germany. The company’s sales tumbled as a result of 2015’s
emissions scandal

Volkswagen
In September 2015, the US Environment Protection Agency claimed Volkswagen,
responsible for 70 percent of the US diesel car market, had been cheating on emissions tests
by installing ‘defeat devices’ on its vehicles. These devices, which switched cars to a
separate, higher-emission mode when they weren’t being tested, meant that on-the-road
nitrogen oxide emissions were being released at up to 40 times higher than the federal limit.

Public perception of the brand was dealt an immediate blow. According to YouGov
BrandIndex UK, the company’s ‘buzz’ score fell from between 10 and 11 to -2 shortly after
the news broke, while perception of its overall health plunged.
And time didn’t heal things: a survey by Autolist in February 2016 found public willingness
to buy a Volkswagen had fallen by 28 percent, while perception of the brand’s environmental
consciousness had tumbled almost 50 percent. A quarter of those surveyed considered the
scandal as bad as – or even worse than – the BP Deepwater Horizoncatastrophe.

Public willingness to buy a Volkswagen had fallen by 28 percent, while

perception of the brand’s environmental consciousness had tumbled almost
50 percent
Social media seemed to perpetuate the damage; Amobee Brand Intelligence reported that
over 16,000 negative tweets had been posted in the four days following the accusations,
while on Facebook the company found itself targeted with a flurry of negative comments.
One user wrote: “As someone who has owned, driven and loved Volkswagens for more than
40 years, because of your criminal actions, I will probably never buy another.”

That loss of trust led the company’s sales to tumble, especially in the US, where they were
down by a sixth in July 2015. Volkswagen’s market cap plummeted, falling by more than a
quarter between September 2015 and June 2016, and the company subsequently revised its
plan to become the world’s biggest automaker by 2018. It is also now paying the highest
company fee in history for breaches under the Clean Air Act ($14.7bn), setting aside $10bn
to buy back or repair the 11 million vehicles affected in the US alone.

In response, the company appointed former Porsche Chief Mathias Müller as CEO, who has
already set about creating a new corporate strategy – one that includes putting all the brands
under a profitability review and potentially halting the production of certain models.

Only time will tell what impact Müller’s actions will have, but many believe Volkswagen’s
tarnished reputation will take a long time to repair. “These customers feel cheated”, wrote
Steve Morris, Founder and President of brand strategy agency the Mth Degree. “Audi and
VW owners who have been directly affected by this scandal are dismayed… How VW and
Audi made drivers feel will have repercussions for years to come.”

For a company once known for its promotion of ‘clean diesel’, public perception in this case
could have a very real impact on the business’s bottom line – and not just in the short term.
PETA campaigners protest against SeaWorld in Long Beach, California

SeaWorld
In 2013, the documentary Blackfish sparked a global backlash against SeaWorld – one which
was to have an unprecedented impact on the theme park operator’s reputation. The film
revealed the violent behaviour of orca whales held in captivity at the park, focusing on the
death of trainer Dawn Brancheau, and was broadcast to a CNN audience of 20 million
people.

SeaWorld responded with a statement that objected to the central premise of the
documentary, concluding the words used “reveal Blackfish not as an objective documentary,
but as propaganda”. It stated: “To make these ultimately false and misleading points, the film
conveys falsehoods, manipulates viewers emotionally and relies on questionable filmmaking
techniques to create ‘facts’ that support its point of view.”
By January 2015, SeaWorld shares had fallen 33 percent, profits had dropped
28 percent and CEO Jim Atchison had stepped down from the helm
But whichever side was speaking truthfully, it appeared to be too late to change public
perception. In 2014, a poll by Consumerist named SeaWorld one of America’s worst
companies, and what followed was a dramatic and painful crash: STA Travel and Southwest
Airlines stopped working with the theme park (the latter the result of mutual agreement,
according to SeaWorld) and by January 2015 shares had fallen 33 percent, profits had
dropped 28 percent and CEO Jim Atchison had stepped down from the helm. By May 2015,
the company had already been sued four times, and by August that year profits had plunged
84 percent.

The theme park spent $10m on marketing, with a cross-media campaign that focused on the
23,000 creatures SeaWorld had rescued, launching a website dedicated to showing how it
looked after its animals. While that may have gone some way in improving the brand’s
image, SeaWorld continues to feel the effects of the controversy today: the company cut its
full-year profit forecasts at the end of 2015, from $370m to $360m, in part due to “continued
SeaWorld brand challenges”, according to current CEO Joel Manby.

Prospects are looking rosier than before, however: in March this year, SeaWorld announced
the end of its orca breeding programme and orca shows, in a move that was celebrated by
animal rights activists across the world. Share prices soared to over $20 following the news.

Although it’s still suffering lower visitor numbers than pre-Blackfish, Dennis Speigel,
President of International Theme Park Services, believes the brand is slowly on the way to
recovery. “The perception of SeaWorld among the public hasn’t gone away, but it’s not at
the [poor] level it was 18 months ago”, he told the New York Post in August. “The imagery
issues have not had enough time to go away. This is a 10-year turnaround.”
Point of sale machines at discount retailer Target were hacked in 2013, exposing the details of 150,000
customers

Target
In 2013, discount retailer Target became – somewhat aptly – the target of one of the biggest
data breaches in US history, when 110 million credit and debit card numbers and other
pieces of personal data were accessed over the Black Friday weekend. The news sent
customers running and earnings tumbling, and the retailer predicted the breach would cost it
at least $148m. Share prices fell eight percent in the second half of the year, profits dropped
by 46 percent in the final quarter, and CEO Gregg Steinhafel was ousted.

Target hack
110m
Pieces of personal data accessed

150,000
Customers exposed

$148m
Predicted minimum cost to Target
According to some, Target’s mistake lay in not communicating the problem quickly enough
– the disaster was only revealed several days after it had been discovered, with news site
Krebs on Security reporting a week earlier that it believed the retailer was investigating a
problem. “The company moved quite slowly on this breach”, wrote TechCrunch
Reporter John Biggs after Target’s official announcement.

When it did own up, customer service was reportedly poor, packing a further punch to
Target’s brand image. The retailer then admitted to “limited incidents” of fake
communications to customers, damaging its reputation further. Where Target did go right
was in its eventual transparency: Steinhafel apologised, giving customers discounts across
the store and providing a year of free credit monitoring.

It is this upfront communication that is at the forefront of reputation recovery, at least

according to James Brooke, Managing Director of Rooster PR. In the case of the recent hack
of UK telecoms company TalkTalk, which saw the personal records of over 150,000
customers exposed, instant and open communication limited reputational damage, with fewer
customers than expected ending their subscriptions. According to Brooke: “The CEO was
very front foot in front of the cameras, reassuring and educating customers while informing
customers that they needed to change their passwords.”

Had Target taken a similar approach right from the start, the profit losses might have at least
been curbed, and the brand image salvaged from a shadow which, some would argue,
continues to hover over the retailer today.
Former CEO Michael O’Leary’s confrontational style ultimately put passengers off Ryanair

Ryanair
Low-cost airline Ryanair made stirring up a storm its go-to marketing strategy under CEO
Michael O’Leary, whose controversial and often insulting words generated free column
inches for the carrier. Comments such as, “If drink sales are falling off, we get the pilots to
engineer a bit of turbulence. That usually spikes sales”, and “We don’t want to hear your sob
stories. What part of ‘no refund’ don’t you understand?” became the norm for O’Leary.
Standing seats and charging customers for using the toilets were just a couple of his
suggestions, while in 2006 candidates for the position of Ryanair pilot were reportedly
charged £50 for an interview.

But despite the old adage, there is such a thing as bad publicity, and Ryanair bore its brunt.
In 2014, it was named the second-worst brand in the world by Which? users, and a study by
the Daily Mail found 38 percent of consumers would rather pay more to have a simpler
experience.

Ryanair reported a £28.7m ($37.5m) loss in the three months to December,

signifying its worst end-of-year performance in five years
In 2013, the airline started to feel the effects of that public perception. It reported slowed
growth and, for the first time in a decade, revised its profit forecasts twice in the space of two
months. The company then reported a £28.7m ($37.5m) loss in the three months to
December, signifying its worst end-of-year performance in five years.

O’Leary finally recognised it was time to change tactics: “I’m learning over the last year or
two that a lot of what [founder Tony Ryan] was saying was actually right – we should have
been nicer to customers earlier than we have been. As I said myself, if I had known being
nicer to our customers was going to work so well, I would have done it years ago.”

In response, Ryanair implemented its three-year Always Getting Better programme in 2014,
as a means of improving the customer experience and enhancing its brand image. The airline
tripled its marketing spend to €35m ($39.6m), cut fees, focused on its digital offering and
introduced perks such as a second carry-on item and its Business Plus scheme.

It didn’t take long for the impact of the improved brand image to be felt. Passenger numbers
hit a record 10.4 million in August 2015 and grew 18 percent in FY2016, marking the
highest rate of growth since 2009. This year, underlying net profit rose by an impressive 43
percent, the company’s biggest margin in over a decade and giving it the highest operating
margin in Europe. For Ryanair, treating customers well has paid off – quite literally.
Demonstrators protest Abercrombie & Fitch’s decision to open a new store in Savile Row, London

Abercrombie & Fitch

If there’s one brand that knows how to incite the wrath of consumers, it’s Abercrombie &
Fitch. In February, the controversial retailer won the title of ‘Most Hated Brand in America’
in the American Customer Satisfaction Index, scoring lower than any other retailer that has
ever appeared on the list.

And it’s little surprise: under former CEO Mike Jeffries, Abercrombie became known for its
exclusive and outright discriminatory policies, sparking boycotts, protests and million-dollar
lawsuits on a regular basis while shooting itself in the foot with an image that quickly
became outdated. From releasing racist T-shirts and discriminating against non-white job
candidates, to forcing employees to do press ups and barring certain workers from customer-
facing roles, the list of accusations against the retailer was extensive.
Abercrombie & Fitch sales growth
8.48%
2013

-8.73%
2014

-9.06%
2015

-6.02%
2016
SOURCE: MarketWatch

But it was in 2013 that it all came to a head, when a 2006 interview with Jeffries resurfaced.
He said: “We hire good-looking people in our stores. Because good-looking people attract
other good-looking people. A lot of people don’t belong and they can’t belong. Are we
exclusionary? Absolutely.” The comments sparked widespread anger and a 68,000-strong
petition followed, further tainting a reputation already in question among an increasingly
socially conscious market.

Exactly what impact these slip-ups had on the company’s finances is difficult to say, but
Retail Analyst Dwight Hill believes the comments had a direct effect. “One factor [for the
decline in sales] has to be the negative press [the company] received from the comments
Jeffries made”, he said. The company’s results would certainly suggest some truth in that:
profits plunged 77 percent that fiscal year, and some store sales fell for 11 consecutive
quarters to December 2014, tumbling 15 percent in Europe alone in the third quarter.

Since Jeffries was ousted in December 2014, Abercrombie’s fortunes have improved: it
posted its first quarter of comparable sales growth in three years at the end of 2016, but it is
arguably too early for the company to pop the champagne just yet. In the second quarter of
this year, comparable sales dropped by eight percent, and the American Customer
Satisfaction Index suggests the company still has a way to go before it can repair the damage
that years of controversy and exclusivity appear to have done to its reputation.