Brand Crisis Analysis

Brand Crisis Analysis
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Brand Crisis Analysis
Business organizations presently depend on their public relations vibrancy to prosper. Managers are motivated to ensure that their brands attract the best positioning and image in the industry. That is because people or consumers demand associations with brands whose images are marketable. Brand crises devalue businesses and can be challenging if the organizations do not react strategically and at the right time. Occasionally, brands are indulged in crises that can damage their reputation either temporarily or permanently. The reaction that a brand accords to a crisis matter in its competitive sustainability. Toyota is currently the leading brand in terms of sales in the automotive industry. That happens even after the 2009 floor mat crisis that extensively harmed the organization. In this analysis, emphasis is put on the 2009 Toyota brand crisis, its course, and the reaction that Toyota accorded the crisis to revive its position in the industry. The Toyota case gives an insight into some of the prospects that should be addressed as a brand crisis emerges.
The Crisis
Safety and quality are two characteristics that automotive industry organizations must emphasize if their products are to see any success. No matter the brand or price tag, people want to believe that their car can withstand the test of being driven over long distances without causing any safety concerns. That fundamental principle is what Toyota violated with its sticky floor mat crisis (Rajasekera, 2010). In August of 2009, a dealer's faulty installation of an all-weather floor mat from an SUV into a loaner Lexus sedan caused the vehicle's accelerator to become stuck, resulting in a terrible, fatal accident and initiating Toyota's most difficult crisis. In September of the same year, it would be speculated that the Lexus involved in the first accident was a result of the installation of a wrong floor mat. The company, through the CEO, apologized to the affected family with the hope of settling the issue. However, on October 18, 2009, the Los Angeles Times was the first of several stories of some of the Toyota cars experiencing unintended acceleration (Hemus, 2010). The National Highway and Traffic Safety Administration (NHTSA) would investigate the crisis. NHTSA published their report on October 30, 2009, which indicated that a range of Toyota vehicles had installed floor mats that led to sticking the accelerator. The sticky mats led the affected cars into uncontrollable acceleration.
The onset of the crisis led to a series of reactions from the stakeholders led by NHTSA and Toyota. 5 days after the NHTSA report, Toyota sent letters to owners of the affected cars notifying them of the challenges. NHTSA rebuke Toyota’s efforts 2 days later with the claims that the company was dishonest in the real cause of the problem. On November, 4 2009, following a Toyota press release in which they denied problems with their drive-by-wire electronic throttle, NHTSA declared an investigation on Toyota floor mats of different models from 2007 (Rajasekera, 2010). A series of the LA Times publications indicate that Toyota has ignored the calls to correct their floor mats. O...