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November 21st, 2008

Getting into Hot Water Once in a While Keeps You Clean

“I believe in getting into hot water; it keeps you clean.”

– G.K. Chesterton

Sometimes it’s good for brands to get into trouble — that is, for customers, and the public generally, to begin to question if a brand is what it says it is. In fact, I would argue that the more sudden and urgent the brand crisis, the better it is for the brand.

Whole Foods Market is a good example of a brand in crisis that has used its troubles as a wake-up call to shore up its reputation. When Whole Foods was forced to recall beef from its shelves in August in an E. coli outbreak, customers suddenly wondered whether its quality standards were really that much higher than other big-box grocers. It hasn’t helped that food prices have been going up across the board and the economy is in a shambles. In many consumers’ minds, Whole Foods had become “Whole Wallet.”

Since the beef crisis, Whole Foods has been working hard to prove that it is different — and not necessarily as expensive as everyone thinks. The retailer has blogged about the crisis, issued comparison shopping challenges, and reinforced its quality claims.

What if there hadn’t been a brand crisis for Whole Foods? What if the retailer had simply continued to charge high prices, had gradually lost its quality distinction in its customers’ minds, and little by little its growth slowed until, over a period of years, it began to lose market share?

Compared to this fate — which has befallen too many brands to count — a crisis that gets a company’s management moving sounds pretty good, doesn’t it?

I’ve managed my share of brand crises over the years, and with few exceptions, they’ve ended up being good for the companies involved.

As the Wall Street Journal’s Jerry Seib opined today in reference to our current economic troubles and the opportunity they present for President-elect Obama:

The thing about a crisis — and crisis doesn’t seem too strong a word for the economic mess right now — is that it creates a sense of urgency. Actions that once appeared optional suddenly seem essential. Moves that might have been made at a leisurely pace are desired instantly.

The same benefit is true for brands — particularly at Fortune 1000 companies, where the bureaucracy levels can rival those of Congress.

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5 Responses to “Getting into Hot Water Once in a While Keeps You Clean”

  1. ErikJ says:

    Well this could be a good branding time for Whole foods they still do have very high quality goods, the only problem they have is that they have way to many employees and unnecessary decorations and security guards and such. That why they have high prices. Have you ever been to one? You will always see 5-10 employees standing around and doing nothing while we are paying for it.

    Erik
    http://www.freefor15.com

  2. eamon says:

    A negative can be turned into a postive for sure, yes. And it helps to be optimistic!

  3. Deb S. says:

    Just wanted to Happy Holidays to you and yours.

  4. Daniel Durazo says:

    Great post. I think Whole Foods’ experience is being felt now by all of the companies and grocers who are recalling their peanut butter products.

    The lesson here is that there’s no question of “if” the crisis will hit, just “when.”

    Best,

    Daniel Durazo
    http://danieldurazo.com

  5. I agree. Adversity indeed makes of breaks. But I think Whole Food is rising above the ashes.

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