Crisis Management

Any company is susceptible

Researchers and practitioners have variously defined the meaning of crisis.  But perhaps one of the most comprehensive definitions is “a major, unpredictable event has potentially negative results. The event and its aftermath may significantly damage an organization and its employees, products, services, financial condition and reputation” (Zaremba, 2010). However, in order to prevent extremely negative consequences of a crisis, companies should be prepared or in other words, they should have crisis management plans, which is a reference tool that presents a list of main contact information, reminders of what normally must be done in any crisis and forms in order to be used to document the crisis response (Institute of PR, 2007). One of the multinational companies that faced rare and interesting crises is Red bull, when they had to pay 13 million dollars because their drink does not really give wings.

It did not give me wings!!

Red bull has been facing several crises for a long time. However, the most questioned one was when they were ordered to pay 13 million dollars to its customers, because their slogan did not give them wings as their campaign have always promised (Brant, 2014). The case started in 2013 when Benjamin Careathers, a regular American user of Red Bull products, claimed that it is untruthful to use the slogan “Red Bull gives you wings” In addition, he said that for nearly a decade he consumed Red Bull and accused the business of being misleading in its claims of giving people wings (Brant, 2014).

This type of this crisis is considered as crisis of deception as it involves fake promises and false commitments to the consumers, and this was proved by the lawsuit.

Red Bull responded to this crisis and denied any wrongdoing. According to Rothman (2014), the company issued a statement to “Bevnet”, a magazine that specialized in beverages industry: “”Red Bull settled the lawsuit to avoid the cost and distraction of litigation. However, Red Bull maintains that its marketing and labelling have always been truthful and accurate and denies any and all wrongdoing or liability. “The company also faced crisis here in Egypt, when they had to cancel their event “Red Bull Car Park Drift” one hour before it starts. The Red Bull Car Park Drift is a car drifting competition event held once a year which started back in 2008 in Lebanon. It kept spreading so quickly with 19 qualifiers in 11 different countries and a huge increase of their fans. Two years ago, there was a huge storm an hour before the event starts which unfortunately was not mentioned on the forecast which caused one of the huge screen billboards to fall and break on one of the cars. There were also a lot of equipment that got destroyed in the venue.

This type of crisis goes under a natural crisis due to the fact that it all started with bad weather that humans cannot control. It could have been avoided if the forecast news were accurate, but unfortunately it was not mentioned in the news that there was going to be a storm that hard.

The company took an immediate smart response towards such a setback, to please both the audience and staff. Due to the fact that the storm was an hour before the event, the crisis management team had to postpone the whole event to avoid any risk on the participants, audience and staff. They even returned the audience’s money back and announced that they will not have to pay for the rescheduled event.

Red Bull dealt with several crises both globally and locally, it either denies any wrongdoing or it uses the rebuild strategy to absorb the aggression of their customers and to try to satisfy them. These strategies that the company follows when solving crises are actually smart because even after all of these crises happened, the company are growing and expanding more and more every day.

Crisis management needs a strong structure to get it solved. Pinnacle’s marketing team has set of Crisis Management Programs, by developing researchers, solutions, and strategies to be followed that will gently get you out of the problem and monitor your experience afterwards.

Conclusion...

Red Bull dealt with several crises both globally and locally, it either denies any wrongdoing or it uses the rebuild strategy to absorb the aggression of their customers and to try to satisfy them. These strategies that the company follows when solving crises are actually smart because even after all of these crises happened, the company are growing and expanding more and more every day.

Crisis management needs a strong structure to get it solved. Pinnacle’s marketing team has set of Crisis Management Programs, by developing researchers, solutions, and strategies to be followed that will gently get you out of the problem and monitor your experience afterwards.

Pinnacle® is a multi-country consultancy firm. Our consultants are spread around the world; with 70% of our consultants are women. We have built our organization on modern business model with agility, diversity, and resilience to the business dynamics. We have chosen our technology platform to support our modern mindset thus we work from anywhere …. As work is not a place anymore. We implement Lean Six Sigma in everything we do whether internally or externally at our client sites. 

This article is written by:
Mahitab Ahmed​
Mahitab Ahmed
Pinnacle, Business Analyst
Pinnacle Ltd.

Pinnacle Ltd. is a multi-countries modern consultancy firm, with offices around 13 countries in 4 continents, and 34 consultants working remotely and virtually managed.

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