Question

How can companies utilize advertising and social media to recover their "celebrity" status after failures like these? Find an example of a "fall from grace" case study that played out in social media. Analyze what the company did poorly and provide information on how they are (attempting) to recover.

Answer 1

Advertising and social media play a big and crucial role in recovering from a 'fall from grace' situation. One of the biggest examples of the 'Fall from grace' is the Maggi case. Maggi was banned from the sale in India, which brought the company's market share to zero within weeks. The mistakes committed by the company and the methods of recovery are given below.

Explanation:

Social media and advertising to recover 'celebrity' status from failures.

Social media and advertising are one of the most successful communication tools. They help a brand to communicate with their customers and build loyalty. Social media and advertising also help a brand to recover their "celebrity" status after certain failures as:

i. They allow the brand to showcase their side of the stories to their customers. They have a chance to provide explanations for all the allegations being made against them.

ii. They help the brand in launching recovery plans. For instance, Domino's brought 'turn around pizza', when they were accused of using the wrong ingredients.

iii. A brand can know about the customer's opinion using social media and advertising. They allow the brand to better understand the customer's state of mind.

iv. It also allows the brand to accept and apologize for their mistakes. In some situations, when brands are aware of their mistakes, they can use these platforms to apologize and move forward.

Overall, Sending out wrong or inaccurate information can cause more damage than before. Brands shall make sure that the information they are sharing is correct. Brands shall also be aware of the fact that their silence will be considered as an acceptance to mistakes.

'Fall from Grace' case study

FSSAI ( Food Safety and Standards Authority of India) banned one of the most loved snacks, Maggi. Maggi is an instant noodle brand owned by Nestle. The brand generated 30% of total Nestle's revenue. The reason for the ban was that it contained more than the prescribed limit of lead. The effect of the ban was humongous. The company lost all of its sales and had to destroy nearly 30,000 tonnes of the product. However, the brand had a loyal and committed customer base, that was waiting for them to recover.

Mistakes committed by the company

There were certain things that Nestle did, that made the situation worse. Such as:

i. The company ignored the order passed by FSSAI in the first instance. The order to ban the product was completely ignored by the brand for many weeks. It was after three weeks when the order circulated on social media. The company's ignorance to address the issue made the situation uncontrollable.

ii. When the company realized that the order is now open in front of everyone, it still chose to give complex answers with inaccurate explanation. It drafted a technical response, which was not understandable by anyone. It was hard to ascertain whether the company has agreed to the fault or not.

iii. Upon receiving the order, Nestle instead of providing their tests or clarifying the issue, disputed the test by government. The company claimed that the test results being shown to the company are false. As a result of this, the new tests suggested the presence of excessive lead and the company had to pull back its products from the shelves.

iv. Another mistake committed by Nestle was undermining social media. The company was bombarded with social media queries and questions. The company chose to stay silent which destroyed its image in front of many people.

How the company is attempting to recover

The company lost all of its sales within a very short time frame. There are many measures that the company is trying as an attempt to recover from the scenario. These attempts include:

i. Going online - The company used Snap deal as its partner to sell its product online. The collaboration was done to increase the sales of the company.

ii. Providing familiar taste - The company focused on the core element of its product that is the masala mix that comes with the product. Maggi made sure that the customers are offered with the same taste as before. This will enable the brand to retain customer loyalty faster.

iii. Decreasing dependency - Before the ban, the company was dependent on only one product that is masala Maggi. But now the company has launched 6 new flavors of the brand to reduce dependency on a single product.

iv Increasing communication - The company realized that the biggest shortcoming in this scenario was the lack of communication with the customers as well as stakeholders. The company now tries to bring more transparency with its shareholders and has employed more staff to stay connected with the local authorities.

Overall, Nestle committed many mistakes, in the beginning, that might have worsened the situation, but the way it handled the situation is inspirational. The brand can regain its market share at a relatively good rate. It has started to attract its old as well as new customers. Many companies can learn from Nestle's 'fall from grace' situation.