Now that the figurative smoke has cleared from the dozens of literal fires caused by faulty Samsung smartphones, the Korean electronics giant has entered into that most craven of corporate actions: Brand-repair mode.
Its advertising — which went completely dark for much of October — is back to pre-recall levels, a date has been set for the release of a full-scale autopsy on the problem and the company is even exploring splitting into two in response to investor backlash.
The immediate financial damage has been rough: The Galaxy Note 7 recall could cost the company as much as one billion dollars, and all the flux left a big opening for competitors like the iPhone and the newly released Google Pixel to carve into its market.
But such bottom-line ballast could be just the beginning, depending on how Samsung’s image fares among the phone-buying public. Randomly exploding products are the sort of thing that tend to stick in people’s minds (not to mention every flight in the U.S. starting off with a warning not to bring the product on board), and that association could cause lasting damage to Samsung’s reputation.
That potential harm is something Samsung will have to size up and reckon with as it attempts to move on from the scandal.
The public apology playbook
Samsung is at least in good company; the road to redemption for scandal-slogged brands is almost as routine as that of disgraced celebrities.
Whether your “fresh ingredients” happened to get some people sick (Chipotle), your flubbed mileage numbers incensed your customers (Volkswagen) or your longtime spokesperson turned out to be a pedophile (Subway), there is a well-worn playbook with which publicly shamed brands can stage a comeback. Hell, Samsung wasn’t even the first company this year to market a blast-prone gadget.
“We tend to think of brands more and more as people,” says Paul Parkin, a founding partner and executive creative director at branding firm Salt. “And when people go through a scandal or incident, there’s a sort of prescribed behavior: Public apology; atonement; ‘I checked in to rehab.’
“There’s almost a need for people to be seen to have seen the error of their ways.”
But Samsung made some missteps on this path. Whether because of its corporate culture, its general unpreparedness or any number of other reasons, the company at least partially botched its moment to repent.
Whereas many of these comeback efforts feel like well-oiled operations orchestrated by slick crisis communications firms, Samsung spent too much time in denial, then failed to be forthright about what happened or offer an apology that felt like it had much heart. It turned to skeevy-seeming tactics like a mid-debate news dump and let the extent of the bad news play out in a slow trickle that dashed any hopes of getting ahead of the media cycle as well as the pretense of transparency.
“It was like the classic stages of grief: Denial, avoidance, coming to terms,” Parkin said.
Dean Crutchfield, an independent branding consultant, is particularly outspoken in his criticism of the company’s response.
“It was like the antithesis of crisis management 101,” Crutchfield said. “They were slow, they were lackadaisical, they were arrogant; It was basically a piss-poor performance.”
But one aspect that Samsung did handle well, says Parkin, was containing the fallout to its Galaxy Note 7 product line rather than the brand at large, which includes such diverse gadgetry as televisions and washing machines (which had their own problems). Most of the news coverage tended to focus on the device itself, raising more questions about the future of that particular product than the company as a whole.
Unfortunately for Samsung, the product line happens to be its flagship smartphone model and the source of much of the brand’s prestige.
How much does the public actually care?
A brand really only exists in the minds of its customers. The logos, the ads, the flashy designs, they’re really only there to conjure up the collection of emotions, perceptions and impulses that make up the actual brand.
So how much of that mental image is now tainted by the stench of fried batteries?
Opinions seem to differ wildly with respect to the overall conviction and tenacity of your average consumer.
“The public has the memory of a flea,” says independent branding consultant Rob Frankel. “I’m telling you they just don’t remember.”
Not true, says Crutchfield.
“Stocks don’t have a memory recall button, but the public does,” he said. “And it can be a long memory.”
Recent customer polls seem to support the former view — or at least the notion that loyal customers aren’t deterred by any number of combustive electronics.
A survey of 6,000 Americans from Reuters and market research firm Ipsos last week found that some nine in ten Samsung customers would likely buy another smartphone from the company, explosions be damned. Another from the survey platform Qriously showed little difference in brand sentiment between people who’d heard about the recall and those who hadn’t.
That latter study did find, however, that two in five viewed the brand more negatively after hearing about the recall — one in five significantly so — which may speak more to the wording of the questions.
Granted, we’re all too familiar with just how accurate public opinion polls can be, but even Samsung’s stock has proven resilient in the long run despite some major turbulence.
It’s difficult to parse just how much lingering bad feelings will actually weigh on the company, especially in today’s short-fuse media environment.
“There’s a lot more stuff to distract you, and it’s all sensationalized,” Frankel said. “So it takes your mind off of things. The average person can’t keep track of more than seven things at a time.”
But even amongst a changing media landscape, brands truisms still hold water. Public trust takes a long time to earn, but it can disappear in an instant.
“The trust is broken,” says Min Lew, a partner at branding firm Base Design. “It’s very human — this idea of trust — it won’t happen through a quick marketing fix or letters to apology. That’s just a portion of it. It takes time.”