Crisis communication case study: Toyota

Toyota has long enjoyed a stellar reputation of reliability, quality and value. Until recently, its brand had only been strengthened by the dilapidation of the U.S. car industry, and Interbrand ranked it eighth on the list of the world’s strongest brands of 2009.

Indeed, when I was having the inevitable conversation with my father about which car I should test drive at the tender age of sixteen, I still remember him telling me that Toyota made the most dependable vehicles.

How things have changed. Over 19 fatalities have been attributed to problems with Toyota vehicle acceleration mechanisms, including a tragic crash involving an off-duty California police officer and his family in late August 2009. Apparently reports of unreliable acceleration have been around for several years, however the story has only recently become very public. The officer had been driving a loaned Lexus while his wife’s model was being repaired, and reported to emergency authorities that the car was automatically accelerating out of control. Speeding at 120 mph, he and his family were killed in the horrifying accident. In a press release of September 14, 2009 Toyota expressed its sympathies to those involved and explained that it appear a floor mat had been incorrectly installed, causing the accelerator to become jammed.

The company’s worst nightmare has continued to intensify since then. A voluntary recall was announced November 2, 2009 for owners of certain Toyota and Lexus models, with floor mats still suspected as the cause for alarm. Come January 21, 2010 Toyota stated it would recall 2.3 million cars to correct sticking accelerator pedals on certain Toyota models; this process was explicitly made separate to the risk of “pedal entrapment by incorrect or out of place accessory floor mats.” (link) Several days later, it decided to suspend sales of eight models.

The influential Consumer Reports has removed its recommendation of the eight models suspended. Toyota stock has dropped significantly. Car owners are understandably concerned.

So has Toyota handled this crisis well? Has it adhered to the fundamental principles of crisis management theory?

In some ways, it has. Toyota has made good use of social media avenues to engage customers using a frank, reassuring voice. Jim Lentz, president of U.S. sales, answered questions directly through Twitter. (“We believe if we do this right, customers will come back,” he Twittered.)

A massive campaign is in full effect, utilizing full page ads in newspapers, a dedicated web site, television ads and executive interviews have been consistent in messaging and tone. These tools have been well used to promote the company’s actions to address the problem. The company’s U.S. blog, Our Point of View, offers a first-person discussion of the issues at hand. It also publishes questions from the press along with Toyota’s responses.

But while Toyota has been swift to move on this particular series of incidents, perhaps it would have already passed through this storm if it had paid greater attention to the complaints made prior to 2009. Always assume the worst. With the unbelievable number of social media arenas used by consumers these days, there’s no excuse for brands not to have their fingers on the pulse of consumer sentiment.