Best Buy’s lax response lets PR crisis drag on for months

A tawdry scandal has cost the company its CEO and, ultimately, its founder/chairman. The fallout could have ended in December.


There’s nothing like a slow-moving crisis to inflict long-term harm on a company’s reputation.

During the last five months, retailer Best Buy saw how a lack of a clear response and action took its toll on the company. The trickle of news about an inappropriate relationship between the CEO and an employee went from bad to worse. It took down the chief executive, then found its way into the boardroom; the founder and chairman of the company submitted his resignation this week.

According to reports, the crisis began in December when Best Buy founder Richard Schulze confronted then-CEO Brian Dunn about his relationship with the employee, but Schulze never reported it to the rest of the board.

The news of the romance spiraled from there, with an audit committee investigating the incident. During the next few months, the top two executives for the company lost or left their jobs, and the company, looking to regain its footing among competitors, was dealt a huge blow.

Initial media coverage stated that the CEO’s resignation had to do with poor financial results, but the situation got worse with every revelation.

Clearly, announcing an investigation in December would have helped over the long term by rebuilding Best Buy’s reputation. Since the crisis began, Best Buy’s stock has lost one-third of its value.

Here are some crisis response basics that would have more swiftly resolved the matter:

• Quickly activate response strategies and messaging for internal and external audiences;
• Engage in online and offline stakeholder communication;
• Designate on-the-ground staff to support employee teams locally, regionally, and nationally, if applicable;
• Monitor and respond to traditional media and social media around the clock;
• Develop and implement proactive reputation-management campaigns;
• Review and revise crisis procedures and plans;
• Continue to foster relationships with the media and key influencers and audiences.

Though companies can’t always prevent bad news from happening, they can lessen the damage with a quick, transparent response. In Best Buy’s case, a few weeks’ barrage of terrible news would’ve been preferable to this months-long bloodletting.

Gil Rudawsky is a former reporter and editor. He heads up the crisis communication and issues management practice at GroundFloor Media in Denver. Read his blog or contact him at grudawsky@groundfloormedia.com.

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