MAR036-6 Brand Communication and Reputation Management Assignment Sample
MAR036-6 Brand Communication and Reputation Management Assignment Sample
Introduction
Monitoring consumer perception of a brand and taking strategic action to improve its image are critical aspects of brand reputation management. Customer communication involves advertising, social media and reviews as part of a brand’s communication strategy (Jun and Park, 2017). This report demonstrates an understanding of marketing communications tools, and reputation management strategies are critically evaluated. The present report outlines perspectives about the Extinction Rebellion Letter sent to all UK advertising agencies, followed by insights about how they approach communications. Then, in order to understand how customer expectations, change during covid-19, two brands are chosen: Tesla and H&M. Finally, practical and measurable guidelines can be derived from the comparison.
Perspective on Extinction Rebellion Letter
The aspect regarding Brand Reputation Management has been considered a systematic procedure of supervising how customers have been perceiving business. It helps to adopt strategic actions in the same business entity, which is quite essential for improving a brand’s image. In recent times, the reputation management approach has empowered successful monitoring and safeguarding of the brand’s reputation across reviews, social media, as well as Google.
Throughout this study, the Extinction Rebellion Letter under the UK advertisement sector, based on two (2) chosen brands, key brand expectations, and shareholder involvements have been explained as well as critically evaluated with viable insights and sound benefits.
The Extinction Rebellion as an activist group had brought London Swathes to a standstill, whereas the whole advertisement sector has induced some viable insights. Through an open letter, this activist group has made advertisers as well as their agencies, which have urged to use the right power of persuasion in terms of handling sudden climate changes in the environment, whereas ecological emergency has also been highly justified (Theguardian.com, 2020). In addition to this, the group has also helped to push the UK government’s failure in terms of acting on the climate as well as ecological emergency into the public eye. Through this active group, a foreign non-violent civil disobedience movement has denoted that life on this planet is in crisis as well as also facing mass extinction (Thedrum.com, 2019). In addition to this, it has also wanted governments to declare climate as well as ecological emergencies as well as by taking immediate and prompt action thereafter after all.
On the other hand, throughout this letter, the condition of anonymity has been justified, whereas it has also been boasted that decades of advertising and promotion have exceeded based on the situation. Additionally, the active group member’s experiences in the advertising sector including senior roles have not also been fobbed off (Westwell and Bunting, 2020). Towards the industry leaders in the UK, this letter has also helped to engage with people involved at the time of working and activities in the whole advertising industry at the same time.
Response from UK ad Agencies and their Clients
UK agencies can use campaigns, advertisements, and blogs to communicate with clients in response to the extinction rebellion. Advertising companies are now being urged to participate in Extinction Rebellion’s campaign. If brands don’t “make this shift,” consumers will require brands to be more honest about climate change and environmental issues, an environmental organization claims in a letter. “When people are concerned about the climate, advertising can influence company policies and consumer behavior, enabling them to make better decisions on what they purchase, use, and do”, according to Gardner et. al. (2022). Compared to 1990, greenhouse gas emissions in the UK are expected to be reduced by half by 2025 and eventually eliminated by 2050. With the help of advertisements like campaigns, blogs, and so on, the UK government has made some big promises to combat climate change. It is hoped that carbon emissions will be cut by 78% by 2035 (Ginanjar and Mubarrok, 2020). The biggest obstacle to achieving this goal would be the lack of low-carbon heating, renewable energy, and electric cars. Several people would have to reduce the amount of meat and dairy they eat to achieve this goal.
As part of its initiative, Ad Net Zero’s Initiative was launched in 2012 to reduce carbon emissions generated by ads, their production, or delivery. AA’s website offers a means for individuals to donate to Ad Net Zero and support their fight against global warming.
As a result of a collaboration between AA and Credos, a UK advertising think tank, 84,000 tonnes of CO2e are released by the UK advertising industry every year. Most of the emissions from business travel come from planes, which account for approximately 58% of all emissions. A total of 1.2 million tons of carbon dioxide (CO2eq) are released each year by the industry, according to Credos (Thomas, 2017).
When businesses are managed (and advised) properly, they can balance purpose and profit, believes Lucy Taylor, Head of marketing and new business at MullenLowe Group UK. A campaign like Extinction Rebellion is right in its intentions: advertising can impact people’s opinions, engage them, and encourage them to change their behavior. The demand for action on climate change is right, and it should be taken now. The power of businesses (their clients) ‘ power to positively impact the world lies in their ability to influence.
Figure 1: Lucy Taylor Ads on Twitter about Extinction Rebellion (Climate Activism)
(Source: Twitter, 2023)
Covid-19 affects the Reputation of Tesla and H&M
Rather than taking brand reputation management as a critical business strategy, it has been perceived as an easy task. The covid-19 pandemic, for example, is a good example of an international natural disaster that could prove this assertion, according to Richardson, (2020). The company is usually forced to deal with competition challenges as a result of these disasters and has a hard time maintaining its brand as a result of uncertain market conditions. Communication is a crucial component of ensuring investors and employees are informed and updated on the current priorities and expected changes. The Coronavirus pandemic has shifted people’s and business priorities, and communication has been vital. A firm must remain informed about its business priorities even during international crises to maintain its reputation.
In times of pandemic, many brands face challenges in communicating with their stakeholders, but Tesla has an exceptional communication strategy. “As part of Tesla’s marketing communication, the company relies largely on social media marketing, word-of-mouth marketing, a direct sales team, stores and galleries, and participation in international auto shows, which are all part of Tesla’s marketing strategy” according to Pathak et. al. (2023). Other automakers struggle during the pandemic, but Tesla’s brand reputation shines. Chinese and other overseas markets nearly made up for the loss of sales in the UK as deliveries at the electric carmaker fell modestly (Xinyi et. al. 2022). Still, the pioneering electric car company seems to be coming into its own. The sales of Coronavirus products are holding up nicely despite the Coronavirus pandemic, with growth in China and other overseas markets more than making up for a slowdown in the UK. During the second quarter of 2020, the company delivered 90,650 cars, a 5 percent reduction over the same period in the previous year. As of the first quarter of 2020, the company had sold 88,496 cars, with most of its operations mostly unaffected.
Figure 2: Tesla Shares are high after a pandemic
(Source: Harrison, 2022)
Several issues faced by global fashion retailers were reported in the media during the COVID-19 pandemic crisis. Communication with stakeholders is one of the challenges. Customers and other stakeholders are not adequately informed about the company’s performance since the management and administrative departments have poor communication skills (Dung, 2020). This indicates a significant gap in product quality. The company’s manufacturing processes have been adversely affected by these gaps, affecting the company’s profit margins around the globe. Businesses worldwide have been adversely affected by the Coronavirus pandemic, which emerged in early 2020. Compared to the previous year, H&M’s sales growth was still -34 percent during weeks 12-22 of 2020. As a result, the demand curve shifted in 2021, resulting in a decrease in brand reputation and a significant demand reduction.
Figure 3: H&M Falling Down during Covid-19
(Source: Statista, 2020)
Tesla Brand Managing to Exceed Customers and Stakeholder’s Expectations
As of 2020, the Coronavirus spread worldwide after the first case was reported in China. There have been millions of deaths worldwide due to the severity of the disease after 2020 or in 2021, according to Scobie et. al. (2021). Because of the increase in deaths, the government and business shut down their activities, and it was suggested that people wear masks whenever they are in public and maintain a one-meter distance from others. Small and medium enterprises were negatively affected by these procedures, resulting in the collapse of most giant businesses. Even though the virus has negatively affected many businesses, some have maintained management operations, particularly during the pandemic. By adopting public relations and strategizing the organization’s planning, these organizations diligently dealt with the international crisis (Al Eid and Arnout, 2020).
The case of Tesla demonstrates how an organization can manage its brand during a virus outbreak and thus exceed customer expectations. Even during the disease outbreak, the company could satisfy its customers. Occasionally, Tesla experienced delays in production and supply chain interruptions due to lockdowns as an American automobile company. The lockdown did not deter Tesla from increasing sales or customer satisfaction compared to its competitors, even after restructuring its strategic planning.
By formulating strong management policies and aligning its operational process with unpredictable crises, Tesla has managed to stay ahead of the competition. However, it has always been a norm for the management to set up plans that would aid the company in coping with worldwide crises, even though Tesla hasn’t yet developed policies and plans to handle these challenges (Shiddiq, 2020). This policy has helped the company offset the nationwide lockdown’s effects on its economy. As Tesla’s crisis management team worked closely with the automotive industry’s suppliers and partners, it assisted the company during the harsh pandemic. During the lockdown and the supply chain disruptions, the company assessed both the positive and negative implications and was prepared to respond to them. Tesla’s management applied a crisis management model (CMM).
Figure 4: Crisis Management Model (CMM)
(Source: Marker, 2020)
An organization’s crisis management model is its conceptual framework for preparing, preventing, adapting, and recovering from potential crises. Using CMM, managers can comprehend the various activities and events in the organization, enabling them to apply effective crisis management strategies (Spector, 2019). “In general, crisis management models suggest that crisis management teams should match their strategized crisis-mediated responses with specific crisis orientation responsibilities to protect reputations from reputational harm.”
As a result of the model, crisis managers are required to identify the crisis’ origin, classify it in its respective category, and examine the relationship between the crisis and the situation previously. As a result of these procedures, managers can accurately estimate the impact the crisis will have on the firm’s reputation and how people will perceive it. In its operational activities, Tesla has applied the CMM model in the following ways; In Tesla’s operational activities, the robust CMM networks have controlled all communications between people and processes. Modeling helped Tesla make crucial decisions and helped Tesla’s managers identify the primary factors that could have affected its participation in crisis management, according to Boiral et. al. (2021). The CMM has helped the company maintain its brand reputation, particularly in the eyes of its investors, who now understand the best methods for responding to crises.
In all of Tesla’s consumer markets, various studies indicate that the company has successfully applied public relations to gain trust in people and processes. Compared to its automotive manufacturing industry rivals, Tesla has a lower budget for all its advertisements. Unlike its competitors, Tesla spent six dollars on an advertisement for one vehicle, while its competitors spent more than six dollars. Moreover, the company has adopted public relations strategy emphasizing information sharing with investors and maintaining continuous relations with them (Bangeja and Agarwal, 2022). Elon Musk’s Twitter account will strengthen Tesla’s relationship with its customers, suppliers, and stakeholders. The company can exchange information through social media if the plan is executed and manage nationwide challenges like lockdowns if it implements the plan.
Furthermore, the management posted updates on its website and Twitter accounts whenever delays were encountered between the production department and the delivery point of the consumer. According to Jun and Park, (2017), Tesla has significantly improved brand perception across social media networks. The company wanted to ensure that all its customers and investors were aware of its activities. As a company, the management adhered to regular and uninterrupted communication during the pandemic, strengthening its PR strategy during the most critical period.
H&M Brand Falling Short of Customer’s and Stakeholder’s Expectations
Despite some companies overcoming the negative effects of covid-19 on their brands, others have lagged and are still grappling with the negative effects of the virus. Several fashion brands suffered reputational damage due to the Coronavirus. The manufacturing processes of these companies were severely challenged. As a result of the outbreak and spread of the disease throughout the world, H&M has fallen short of customer expectations (Kim and Woo, 2021). The best-known service H&M provides to its customers is fashion. Because of the increased customer expectations, the company’s reputation has declined due to the nationwide lockdown, just like other companies in the fashion industry. As a result of the lockdown, the company managers were unaware of the disruption to sales and the market of operation during the first phase of the lockdown. A supply chain policy review could have given them an insight into the differences between the sales volume and revenues before the pandemic, in addition to failing to review the supply chain policy during the pandemic, based on Chowdhury et. al. (2021). A further benefit of the supply policies would be to assist in determining the level of customer expectations after the pandemic has occurred.
The lockdown severely damaged H&M Company in the following ways: the factory shutdowns in the first trimester of the lockdown contributed to the firm’s downfall. The second problem was that qualified employees could not operate the manufacturing or production facilities because the government told them to stay home unless otherwise instructed. Lastly, the lockdown tends to irritate customers, resulting in product and service sales decline. It has been known that H&M has been committed to its services. However, the company’s operational deficits and management oversights have resulted in it not reaching its targets and leaving customers unsatisfied (Brydges et. al. 2021). Several years after the pandemic outbreak, the company formed a recycling program utilizing its manufactured clothes to generate sustainable income. While the company has launched a recycling program, it has been shortlisted as a company underpaying its workers the minimum wages to compensate for losses incurred in Covid-19’s first trimester.
To compensate for the organization’s economic instability, the company fired several workers during the second phase of the pandemic. Having lost jobs, the manager has to shift shares from weaker partners to stronger ones. Regarding communicating with customers and other stakeholders about the company’s performance, the management and administrative departments have a poor communication skill, which indicates a big gap in production quality, according to Quirke, (2017). This has negatively impacted the company’s manufacturing operations, resulting in lower profits across the globe. The firm introduced permanent changes in the manufacturing policies and procedures before the pandemic to gain stability, negatively affecting the brand reputation.
Companies employ three common types of crisis response strategies during a brand crisis to protect their corporate reputation. Situational Crisis Communication Theory (SCCT) outlines what companies do in these situations. Taking the example of India, H&M outlines SCCT as follows:
Deny Response Option – H&M reportedly dismissed numerous workers at its Indian manufacturing plants in June 2021 after canceling production orders suddenly. In response to this report, H&M argued that it was not its company that laid off its workers but their suppliers, and there was a conflict between the supplier and the union (Coombs et. al. 2019). As a result of this response, the retailer also exhibited a Scapegoat strategy by attempting to blame their suppliers for the problem. However, it was ultimately up to H&M to argue that the dismissal was not their fault, even though it occurred in an Indian garment factory.
Diminish Response Option – As far as layoffs and labor issues are concerned, H&M opted to Diminish its response. Several employees at H&M Indian manufacturing factories were dismissed in a CNBC article, and an Independent article reported that several employees at H&M were considering termination. According to H&M, this was an unavoidable result of their financial difficulties and decreased customer demand during the pandemic, which resulted in a diminished response from the media.
Deal Response Option – The three retailers studied here have shown compassion to their affected suppliers because of the employment and labor issues raised during the pandemic. As a result of reports in the press about retailers canceling orders, articles in the BBC News and Independent reported that H&M and Inditex have pledged to cover all costs associated with existing orders. There are several ways to respond to a Deal, and one of the most common is a Compassion strategy. To rebuild an organization’s reputation, a compassion strategy involves giving money, gifts, or showing sympathy to victims, according to Cheng, (2018).
Figure 5: Situational Crisis Communication Theory
(Source: Zhang, 2017)
The H&M’s managers have failed to incorporate PR policies into their management styles as computed from the firm’s net operating cash flow in 2021. Further, the management at H&M has ignored their duties and roles, which has resulted in greater expense accruals. Based on the company’s daily activities, it is evident that it has been directly affected by competitive pressure and cannot impose effective public relations (Luo and Wang, 2020). Outsiders and investors have not been informed of potential and expected changes in the company due to the managers’ failure to update them. Several researchers have found that the company’s warehouse operations have been inconsistent, resulting in excess demand and supply not being met due to a lack of manpower. Despite increasing its social media presence, the company has not gained as many customers as it did during the pandemic because of its incremental increase in social media.
Tesla and H&M: Critical and Comparative Analysis
A Coronavirus might be contributing to changes in brand reputation management for businesses worldwide operating their commercial operations. Therefore, the objective of this section is to critically analyze and compare the two brands to find out if any significant differences existed between the two companies in terms of performance. Tesla has applied strong PR despite the global crisis, compared to H&M, because of the crisis management. Customers and investors have appreciated Tesla’s positive brand reputation and growth in sales volumes, profits and profits. H&M, on the other hand, upgraded its production capacity. Public relations in the consumer market would have helped the company implement these production strategies.
The company’s PR strategy has helped to manage the negative effects of the pandemic by creating strong information for the public and creating a stronger brand image, according to Santoso et. al. (2021). The company has also worked extra hard to inform investors and customers of the current situation concerning its manufacturing processes, risks and potential course of action. The Tesla crisis plan included messages that focused on people and processes integral to maintaining the brand’s reputation.
Due to a lack of understanding and ignorance about the manufacturing processes involved in H&M commercial activities, H&M failed to deal with the crisis management approach. While Tesla had a strong presence on social media, H&M had a limited presence because of its offline sales model. Unlike Tesla, H&M doesn’t care about their customer relationships or even deal with the competitive pressure they’re experiencing from their competitors. As a result of the company’s failure to coordinate with its domestic and international suppliers, its manufacturing warehouses will be able to function when the business normalizes after the pandemic has passed.
Future Guidelines for the said company for managing their Brand Reputation
Figure 6: Brand Reputation Management
(Source: Jain, 2022)
Business and body corporates may experience changes in how they conduct their daily business activities due to Covid-19 and other global issues. Due to these global uncertainties, businesses are forced to change their set strategy and objectives, which leads them to formulate strategies that will counter the worldwide catastrophe. In many organizations, there is a culture of being prepared for the worst crises that could arise in their industry of operation. However, despite being ready to handle global issues, the outbreak of Covid-19 and its negative impacts on business was a crisis most business owners and managers did not anticipate (Donthu and Gustafsson, 2020). It is therefore important for business owners and managers to consider the following critical elements to strategize their business operations’ procedures to prevent the occurrence of such pandemics or other uncertainties and maintain the brand reputation. The following elements are involved;
Response to Brand
To maintain brand morality, brands need to constantly engage with their stakeholders.
Response to Marketing
During a global crisis such as Covid-19, businesses must develop a unique marketing approach that helps keep their brand market and potential clients safe. To generate effective marketing strategies, businesses are advised to employ strong segmentation of their customers.
Response to Communication
The management of the global crisis relies heavily on communication between customers and investors (Aula and Mantere, 2020). It is necessary for body corporate to share their daily updates on the crises through social media platforms. It is imperative that companies engage in social media transactions despite global crises such as Coronavirus despite the presence of steps and strategies.
Response to Climate
In order to deal with unexpected climate changes, company managers must possess practical skills. The skills developed by such managers will assist them in handling unexpected crises in the future.
Response to Reputation Management
As a result of the global economic crisis, the response of businesses, non-government organizations, and government bodies determines how much of their reputation is retained after the crisis is over. As a result, the associations should take care to provide people and stakeholders with support and cooperation.
Conclusion
Analysis of the case study concludes that the condition of anonymity throughout the Extinction Rebellion letter and the same has been justified. However, a massive amount of advertising and promotion has also been boasted based on the situation. Taking part in Extinction Rebellion is an initiative by UK advertising industries. Thereafter, it can be concluded that Tesla and H&M played a significant role in understanding customer expectations during Covid-19. An excellent example of a natural disaster on an international scale is the covid-19 pandemic, and the same has been justified under the report.
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