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Monday, July 22, 2024

Cashing On a Competitor PR Crisis


This title might seem a little unsettling for you as a human being but when it comes to competition amongst brands, a crisis for one is an opportunity for another. However, before we delve into the tactics of leveraging a competitor’s crisis, let’s understand what a “PR Crisis” actually is. 

A public relations crisis is an event or situation that can damage a company’s reputation and affect its relationships with stakeholders, including customers, employees, shareholders, and the general public. PR crises can arise from a variety of causes, such as product recalls, data breaches, executive scandals, legal issues, or negative media coverage.

Tactful Ways To Capitalize a Competitor’s PR Crisis

To effectively leverage a competitor’s PR crisis, one has to monitor industry news and have a crisis communication plan in place. Highlight your own strengths and unique value proposition to make customers more receptive to your brand. Offer solutions that meet the needs of customers left unmet by your competitor’s crisis, and remain professional in your messaging, avoiding negative tactics that could damage your own reputation.

Brands That Effectively Used Their Competitor’s Crisis To Power 

  • Lyft

When Uber faced challenges regarding its operating license in London, Lyft quietly positioned itself as the top alternative. While the public directed their anger towards both the company and city authorities for the problem, Uber’s senior management experienced high turnover, contributing to a poor employer reputation among drivers and head office staff. Additionally, the allegations of sexual harassment led to the firing of over 20 employees at various levels, including the ousting of former CEO Travis Kalanick. 

Leveraging the Uber crisis, Lyft focused the audience’s attention on their values, particularly by keeping their drivers and staff content. This approach helped Lyft avoid the legal troubles and driver strikes plaguing Uber. Lyft paid drivers more money per hour and offered in-app tipping. Lyft saw a 3% increase in users, as they pledged to donate $1 million to the American Civil Liberties Union over the span of four years, aligning themselves as a socially responsible company with a clear political stance. This approach showed that customers prefer a company that is politically aware and socially responsible.

  • Just Eat

When Deliveroo, a UK-based food delivery company, faced scrutiny due to poor working practices despite its operational strength, Just Eat strategically expanded its services and became a more viable option. Deliveroo’s workers had publicly demanded sick pay and other benefits associated with traditional work, which Deliveroo had not previously provided, putting the company at the center of the “gig economy” debate. Adding to Deliveroo’s reputation issues, CEO William Shu gave himself a 22.5% pay raise. 

This situation created a perfect storm, allowing Just Eat to gain a competitive advantage. Unlike Lyft, Just Eat’s approach was more strategic, as they purchased Hungryhouse, another food delivery company. Just Eat’s acquisition of Hungryhouse enabled the company to incorporate branded restaurant chains, rather than just independent local restaurants, and expand its presence in North America with the acquisition of Canada’s SkipTheDishes, making it a formidable competitor to Deliveroo.

  • easy Jet

When Ryanair canceled over 700,000 bookings, leaving the travel plans of many in jeopardy, easy Jet emerged as the solution to the customer’s woes. The crisis occurred due to the mismanagement of pilots’ holiday leaves. In addition, the CAA (Civil Aviation Authority) accused Ryanair of failing to inform passengers of their rights to be rerouted via other airlines under EU law. This resulted in angry reports of families stranded abroad during holidays, businesspeople missing important meetings, and brides and grooms unable to attend their destination weddings. 

Through a new partnership with Norwegian AirShuttle ASA and WestJet, EasyJet started offering connecting flights via Gatwick to North/South America. Moreover, by keeping a close eye on Ryanair’s progress and obstacles, EasyJet was able to prepare and launch its own offering before Ryanair, who was planning to do the same much earlier.

This was how some brands capitalized on the crises of their competitors. In the business world, it is important for brands to recognize opportunities to make their way to the top. Many more such stories regarding brands and personalities from around the world are waiting to be explored on the World Brand Affairs. Join us to know more!