WMPRSA March Program Recap: Toyota in Crisis (3/17/11) How communications helped an automaker transition from recalls to recovery
In early 2010, Curt McAllister, Midwest public relations manager for Toyota Motor Sales, U.S.A., Inc., found himself in the midst of one of the largest automobile recall crises in history. With over 8 million vehicles recalled globally, the Toyota brand began to dissolve as its reputation was slandered across media outlets worldwide.
The crisis was kick-started in the fall of 2009 when a family died in a Toyota rental car in California. The accident was caused by a thick floor mat, which was wedged underneath the gas pedal. The company recalled the floor mats, thinking they had solved the initial problem. But the floor mats were only the beginning. On January 21, 2010, nearly 2.3 million vehicles were recalled for “sticky pedals” – an issue that had yet to be resolved by Toyota. Five days later Toyota stopped production and, on Jan. 29, announced that they had found a solution. This was eight days filled with negative media coverage for the brand, plummeting Toyota’s reputation as an industry leader in merely days.
These eight days were followed by nearly 12 months of vehicle recalls, government fines and negative media attention nationwide. Toyota became a popular target for parody advertisements, cartoons and late night television, many using the recently coined term “runaway Toyota.” Social media played a large role in the spread of negative views of the brand with nearly 72,000 tweets and 3 million YouTube videos posted. Despite the fact that the company was continuing to unveil new models, the focus remained on the recalls and the brands falling reputation.
Toyota turned back to the basics and used communications to help them transition into recovery. Throughout the crisis, the company remained honest and transparent while always taking responsibility without blaming others or pointing fingers. They wanted the world to rediscover the Toyota way and began to rebuild the brand one customer at a time.
Again, it was social media that played a large role in this recovery. The website www.toyotanewsroom.com was launched, allowing visitors to view all releases, photos and video submitted by the company. Toyota also distributed an e-newsletter titled Fast Facts and held webinars designed to keep media and consumers up to date on the company. Toyota remained proactive in promoting their key messages and also began to call out questionable communicators and defending themselves by debunking outrageous public claims.
Toyota took their message on the road through a 21 city tour in the U.S. and another media tour at their plants in Japan. Regular media updates helped to control news coverage and discussions with local dealers helped to sway any further issues that had surfaced. McAllister provided Midwest support in what he described as a “barnstorming tour.” The public relations manager spent nine weeks travelling across the Midwest speaking to dealers, buyers and media at eight different auto shows.
The Toyota recall crisis is now considered to be history, allowing the brand to focus on its product. But it seems that product was never an issue for the company. Although sales were flat, Toyota remained the number 1 retail brand in the U.S. in 2010. In February 2011, a 10 month study deemed Toyota’s electronics to be flawless and sparked a 42 percent increase in sales.
- Honesty and transparency are paramount for all companies, particularly those engaged in a crisis.
- Aspire to communicate to all internal and external audiences in a similarly timely fashion. Nothing is more aggravating to an employee/associate than learning about all company developments via media reports.
- Incorporate Social Media communications into overall mass media strategies and tactics. Start seeing SM-minded individuals as “citizen journalists,” – absorbers and disseminators of information.
- Don’t neglect your responsibility as a communicator to correct erroneous media reports and misinformed journalists. It’s OK to tell a reporter he or she is wrong if you have solid information and a non-threatening demeanor.
- If you agree to a television or live radio interview, remember that everything is fair game. The interview isn’t over till the camera crew rounds the corner and/or the phone call ends with the radio station.
- When a member of the media contacts you to comment on the handling of a crisis, ask yourself this simple question: Am I doing this interview for me (increase my/company’s brand standing) or to convey a fair assessment of the situation? If you see this as a greater opportunity for YOU than the PR profession, at large, you should probably decline the opportunity.