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Walmart’s PR Woes: Lessons in Crisis Communications

Shares of Walmart Stores Inc. dropped 5 percent on Monday after The New York Times uncovered a massive, half-decade scandal in an in-depth report alleging key executives at Wal-Mart de Mexico, the corporation’s largest subsidiary, carried out and covered up a nearly incomprehensible bribery scheme.

Retail mammoth Walmart, already up against a sometimes negative perception among “buy-local” activist groups, populists, and other organizations and individuals, is caught up in a PR nightmare, which if not addressed soon, may cause the company to join the likes of BP and Rupert Murdoch as a top PR gaffe of the 21st century.

David Barstow, an investigative reporter with The New York Times, broke the story on Saturday, and although it’s been circulated widely on the Web, Walmart still has the opportunity to mend its broken image before it is too late.

So far, Walmart has released a lengthy statement addressing the allegations immediately following the publication of the article – an appropriate first step. In its statement, Walmart’s communications liaison acknowledges the allegations against the company and outlines the actions it will take to begin to right its wrong. Regardless, Walmart likely has a long road ahead with a lengthy investigation in the pipeline.

In light of these findings, here are 6 of the most critical components, in my opinion, of a solid crisis communications strategy:

1.       Never lie: I don’t believe this needs much of an explanation. Never, under any circumstances, blatantly lie to your constituents. If you lie, you will be exposed eventually and the fall-out will be a much worse blow to your long-term credibility.

2.       Carefully select your crisis communications team and spokespeople: Crises are generally very sensitive situations, and for good reason. A company anticipating or in the fall-out of a public opinion debacle will find comfort in a partner who is well-versed, strategic, and in it for the haul, even in a high-stress environment. If you develop your crisis communications plan in advance, you will have more time to choose a partner deliberately.

3.       Identify key stakeholders and audiences impacted by a negative news story or event: In order to communicate effectively, it is critical to identify the audience and stakeholders affected by the crisis. Dig deeper to find individual pain points, concerns and adverse results. Communicate how and why you understand and will rectify each audience’s situation along with a timeline, if possible.

 4.       Have a crisis plan in-place before any crises happen: A successful crisis communications team will develop a plan ahead of crises and know who will be impacted by a variety of scenarios. 

Carefully executed public relations campaigns, even crisis communications campaigns, will be thoughtful and conscious. This helps companies in crisis mode function more proactively in their approach.

 5.       React immediately and strategically: Companies that fail to address a crisis right away don’t shape public opinion but, rather, let public opinion shape the issue. There is only one constant you can control in a crisis for every company, across industries – your message.

The foundation of any solid crisis communication plan revolves around the message. Have general messaging prepared ahead of disasters for numerous scenarios and leverage them as a base to address stakeholder and consumer concerns, but make sure to pay attention to the crisis on hand instead of spitting out general talking points.

6.       Be flexible and understanding: When a crisis breaks, people get upset, and it’s usually for a legitimate reason. If not, communicate that to your base, addressing the situation and correcting any misinformation.

If complaints are valid, don’t ignore them or try to cast them off as insignificant. Put yourself in the agitated base’s shoes and consciously try to understand their point of view. It will help you relate and communicate your message to a disgruntled public.

Did I miss any? How do you think Walmart should address these allegations?