Interview • 18.07.2019

Crisis management in retail: Making a mountain out of a molehill – what now?

How retailers should prepare for crisis communication

Man in light blue shirt smiles into camera
Alexander De Ruiter, CEO of OBI4wan
Source: OBI4wan

A lengthy order, a faulty delivery, an unsatisfactory customer service - all this is quickly evaluated and spread on the Internet and can have negative consequences for the retailer. 

We talked to Alexander De Ruiter from OBI4wan about the tasks that arise here, why they are more complex in online trading than in other industries and the connection between offline and online.

Mr. De Ruiter, crisis management - what exactly does it mean?

Alexander De Ruiter: Crisis management describes the process and the strategies applied within an organisation to deal with events that might have a negative impact on its reputation. 

What steps does this process consist of?  

First of all, a crisis needs to be detected in an early stage in order to act fast and minimize its impact. There are media monitoring tools like our OBI Brand Monitor that alert organisations instantly when signs of a potential crisis occur. For instance a sudden rise in volume of messages on social media or a change in sentiment of messages can trigger such an alert.

The next step is to collect insights on the who, what, where and when of the crisis. Start by figuring out who the key opinion leaders are and what the sentiment in a discussion is. Moreover, you should look into what drives a discussion and which themes are discussed related to the crisis. As an organisation you are much better able to formulate the right strategy and response when you have a complete picture of what is happening. 

It is also important to keep a close eye on the impact of your response and actions to the crisis. Eventually you want to have insights on the long term effects of the crisis on your reputation and evaluate what measures you can take as an organisation to prevent further damage.

How does crisis management work in online retailing? 

The points mentioned before also apply for online retailers. Though the monitoring that needs to be in place here is likely more extensive if you look at the variety of products and brands sold. Moreover, retailers are often expected to take a stand in a wide range of topics, such as sustainability, animal welfare, diversity etc. In order to take the right strategic decisions it is important to have a clear picture on what your customers are thinking and sharing on (online) media and review platforms about relevant topics.

What do online retailers have to pay particular attention to?

It is important to know your clients, your target group and what topics are important for them at a given time. Sometimes we see these topics shifting, for example from a big interest in sustainability related issues to an interest in discussions around diversity. Also you should always be aware of impactful sources/influencers and viral content to be able to respond quickly.

"It is important that companies have experts in house or get support from external media analysts that constantly monitor what is happening on (social) media regarding their brand, but also regarding important themes and topics within the sector." - Alexander De Ruiter on the correct prevention of a shitstorm
Five people stand in a row and hold smileys in front of their faces....
Customer satisfaction and dissatisfaction play an important role for the retail trade, especially in the digital age.
Source: PantherMedia / Rawpixel

Prevention: Can a crisis be prevented? 

Contemporary crises can probably not be prevented, however it can be mitigated. If organisations not only monitor their own reputation but also closely monitor the sector they operate in they have a much better overall picture of the public opinion regarding selected topics and can identify areas that need special attention so that a potential crises can be averted. 

A look into the future: Where do you see potential: for further development in the field of crisis management?"

Create AI solutions by analysing crisis data from other retailers to determine the ingredients and drivers for a potential crisis. So you know where a potential crisis starts and nip it in the bud before it evolves in a crisis. 

What about crisis management in bricks-and-mortar retail trade and how does it differ from crisis management in online retail?

In today’s world everything is connected - a negative event in a local store can be picked up by (social) media and go viral in the same way as for online retail. So also here, it is important to monitor important media sources. 

Interview: Katja Laska

related articles:

popular articles:

Thumbnail-Photo: DJ, play me a song while I shop!
18.11.2019   #brick and mortar retail #in-store marketing

DJ, play me a song while I shop!

Can music increase sales volume? Retail store music playlists generated in real-time make it possible

How do you select the right music and ad spots for your retail store to play at just the right time? Do you have an employee who visits every store armed with a USB stick and downloads ready-made playlists to the respective equipment?Are there ...

Thumbnail-Photo: British consumer behavior: ethical and Instagrammable...
06.08.2019   #marketing research #customer analysis

British consumer behavior: ethical and Instagrammable

Report tracking spending across major consumer markets

As Brexit rumbles on, British consumers continue to spend on brands and businesses that successfully tap into the Holy Trinity of current consumer behavior: the ‘experience economy’, the booming health and wellness movement, and the ...

Thumbnail-Photo: Over fifty retailers demand chancellor fix business taxation...
20.08.2019   #brick and mortar retail #financial accounting

Over fifty retailers demand chancellor fix business taxation

High Street chains and shops sign a letter over business rates

Over fifty major retailers have come together to demand the Government takes action to fix the broken business rates system. In a letter to the new Chancellor, Sajid Javid, retailers called on the Government to put business rates at heart of the ...

Thumbnail-Photo: BOPIS: state of the retail industry
16.08.2019   #e-commerce #customer satisfaction

BOPIS: state of the retail industry

Customer experience in the “Buy online, pick up in-store” process

“Retailers who are winning in the BOPIS game have a mature inventory management system that clearly indicates what is available for BOPIS, but those who prioritize order fulfillment are building the greatest customer loyalty as their BOPIS ...

Thumbnail-Photo: Vast majority of consumers plan to return holiday gifts...
03.10.2019   #pos marketing #personalization

Vast majority of consumers plan to return holiday gifts

“Retailers need to seize the moment."

During the upcoming holiday season 77 percent of consumers surveyed said they plan to return a portion of their gifts, with nearly 20 percent expecting to return more than half of their presents (sorry grandma!). This is both a blessing and a curse ...

Thumbnail-Photo: A pearl among commodities: encouraging impulse buys...
11.09.2019   #pos marketing #customer analysis

A pearl among commodities: encouraging impulse buys

How to make the most of wait times

It’s wonderful if customers come to retail stores to buy things. It’s fantastic if they buy more than they planned to purchase. This offers many opportunities, especially for brick and mortar retailers as surveys show: customers are more ...

Thumbnail-Photo: 75 % of millennials abandon in-store purchases...
14.11.2019   #customer satisfaction #brick and mortar retail

75 % of millennials abandon in-store purchases

Zebra study: out-of-stocks drive shoppers to online

Zebra Technologies Corporation today revealed the results of its 12th annual Global Shopper Study, the industry’s only market tracker that analyzes the attitudinal behavior of shoppers, retail associates and retail executives and examines the ...

Thumbnail-Photo: Get your business ready for E-commerce!
30.09.2019   #e-commerce #customer satisfaction

Get your business ready for E-commerce!

E-commerce Berlin Expo 2020 starts on the 13th of February 2020

The E-commerce Berlin Expo 2019 gathered more than 55000 visitors, 150 exhibitors and 45+ speakers taking part in the annual fair. The numbers speak for themselves - EBE has become one of the most important e-commerce events in Europe. However, ...

Thumbnail-Photo: POS TUNING supports Grips&Co
26.09.2019   #sales promotion #product presentation

POS TUNING supports "Grips&Co"

POS TUNING is committed to promoting young talent in the retail

Since the magazine "Rundschau für den Lebensmittelhandel" launched the Grips&Co competition, the annual cult event for junior staff, HR specialists and brand industry has been taking place for almost 40 years. Two days of ...

Thumbnail-Photo: “What do you have that nobody else has?”...
16.09.2019   #data management #digital marketing

“What do you have that nobody else has?”

Exhibitor statements from the halls of DMEXCO 2019 on marketing trends and technology

We from iXtenso were visiting DMEXCO 2019 and looked around for the latest opportunities and technologies for marketers. We asked some companies what makes their solution unique – here are some answers. ...

Supplier

Mood Media GmbH
Mood Media GmbH
Wandalenweg 30
20097 Hamburg
loadbee GmbH
loadbee GmbH
Nikolaus-Otto-Straße 13
70771 Leinfelden-Echterdingen
VKF Renzel GmbH
VKF Renzel GmbH
Im Geer 15
46419 Isselburg
APG Cash Drawer
APG Cash Drawer
4 The Drove
BN9 0LA Newhaven
HappyOrNot
HappyOrNot
Innere Kanalstraße 15
50823 Köln
POS TUNING Udo Voßhenrich GmbH & Co KG
POS TUNING Udo Voßhenrich GmbH & Co KG
Am Zubringer 8
32107 Bad Salzuflen