Commentary

What you can learn from how Starbucks handled PR crisis

Starbucks made headlines when two African-American men were arrested and removed from a Starbucks location, and the brand is still seeing effects.

July 24, 2018

By Taylor Kamnetz, Content Strategist, ReviewPush

When problems arise, there are various ways to respond and react. Sure, there are best practices in crisis management, and often they are, in fact, the best possible answers and solutions to issues.

Just over two and a half months ago, Starbucks made headlines worldwide for two reasons. One of its stores in Philadelphia, Pennsylvania, (1801 Spruce St.,) made major waves on social media after one Twitter user, Melissa DePino, live-tweeted and filmed two African-American men on April 12 getting handcuffed and escorted out of the major coffee chain. These two men stated they were simply waiting for a friend to arrive and had asked to use the bathroom while waiting, where they were told, "No," and were then asked to leave by the store's manager.

The power of social media is not one to be overlooked or undervalued. Today's consumer culture is one of entitlement and expectation. Consumers expect top-notch service and respect from the jump when engaging in business with any company. The rise in popularity and respect for online reviews also plays into this recent, empowered consumer of 2018.

By tweeting out this video to her 11,800 followers, DePino set the stage for virality; perhaps without even knowing it. On Twitter, anything a user tweets out will be viewable by their followers. If a user has their profile set to public, such as DePino, their tweets can be retweeted, thus increasing that singular tweet's reach with one click.

To date, the video has been retweeted nearly 170,000 times. Although the exact number of people who have interacted with the video is unknown, the effects from its context have impacted Starbucks more than one would expect.

On April 12, the Starbucks on Spruce Street had 0 negative reviews on its Facebook page. However, that would soon change after DePino's video gradually began to pick up momentum and coverage locally and around the expansive world of social media. Sure, there have been numerous questionable interactions and events shared across social media platforms in the past but this; this was different; This was Starbucks. This was shocking.

The following day, its Facebook page received 334 negative reviews, to then hit its peak negativity on April 14, where it received 1,210 negative reviews. Two days: it took two days to rack up 1,210 negative reviews at a location that seems to have a generally quiet Facebook page.

In light of this event, Starbucks was praised for its handling of the matter. Its public relations department was performing at an exceptionally high and noteworthy level. The company's CEO communicated its deep remorse and regret for what had happened and announced it would close all stores for one day of "racial bias training."

Though this training wasn't required for employees, it was quite the band-aid to keep the bad blood from spreading any further. Starbucks wanted to right its wrongs and show customers worldwide it cared and valued each person that walked through their doors, and now have a policy allowing anyone to use its facilities and seating regardless if they're a customer or not.

Now June has come and gone, yet Starbucks is still in the news. Two and a half months later, Starbucks is still dealing with the repercussions of this crisis that began in one store due to one manager's poor decision. Starbucks announced that it will be closing 150 stores this year; three times the amount closed over the last several years.

Starbucks reasoning for closing stores is, and has been, underperformance. How did a worldwide chain such as Starbucks possibly find themselves in a situation where its closing three times the amount of stores it has in the foreseeable past?

Like we said: social media is a powerful thing. When you combine the horsepower of social media with the rise of consumer empowerment and entitlement; you get quite the force to be reckoned with.

See, that newly found consumer empowerment leads to vocality. In terms of Starbucks, the actions that occurred at this one location didn't just strike a nerve in the community, which began protesting this specific location for days and weeks following the incident. As a consumer in 2018, you want to be heard. You want the business that made you feel negatively in any which way to know: 1.) They offended you, 2.) How they offended you, and 3.)Your newly acquired views on their business; likely with choice words.

Just because Starbucks is a large corporation with lawyers, investors and anyone else it may need on-staff to handle crisis' such as the one that occurred in Philadelphia, Pennsylvania, doesn't mean the brand can escape online scrutiny.

Since DePino's video began to pick up traction, people were outraged. Tweeting about their fury or writing a long, unwarranted rant to their friends on Facebook wasn't going to get to the core of the brands problem. However, taking to this branch's Facebook and Yelp pages, and voicing their distaste with exceptional description would likely do the trick.

It also helps that Facebook has recently been toying with a new rating system that not only lets you write a review, you can now ‘recommend' a business. If you don't have the time or patience to scroll through various reviews to get the full scope of what a business is about, Facebook now pulls keywords out and puts them on display, based on how frequently they're seen in the business's reviews. In the case of this Starbucks' location, those keywords ranged from "disgusting" to "racist" and even "unacceptable."

When Starbucks made its initial announcement to close 150 stores this year, it was evident that Starbucks president and CEO Kevin Johnson was trying to save face and beat around the bush — understandably. Yet, as reported by The Observer, Starbucks soon-to-retire CFO Scott Maw admitted that the incident in Philadelphia did have an impact on its overall performance worldwide, though wouldn't call it an excuse for growth stallment.

Starbucks definitely had an advantage in this PR nightmare. The brands worldwide revenue as of 2017 was $22 billion, and currently have over 28,000 locations across the globe. Yet, even with all the tools money can buy to save a company from falling, the ripple effect of such incidents in a highly vocal time of consumerism cannot be contained and they remain unpredictable. Luckily for Starbucks, closing 150 stores doesn't put them out of business.

Unfortunately, there are numerous businesses that can't say the same. There are thousands of local businesses worldwide that would be buried alive should their manager act as this Starbucks' branch manager did. Ensuring your staff is all on the same page is a good place to start, but ensuring you have ears in every conversation relative to your business is even direr. You need to take control of your online reputation before you're in the middle of a crisis.

While the hope is that you never find yourself in a crisis and have hopes that staying positive will keep your employees happy, engaged and unlikely to be the root of any bad press; look at what's happening to Starbucks, a global corporation. When you run your own business, whether it's a cafe or a critically acclaimed five-star restaurant in the heart of the Upper East Side; preparing for the worst while aiming for the best is the only way to go.

People are talking every second of every day about their experiences on social media and online review platforms, and your business is no exception. Rather than waiting for news to hit you in the face out of left field; get engaged with your customers, live where they live online, answer their questions even if it's not about your business, and should their be an issue a customer has drawn public attention to; respond to it publically, and be genuine in your efforts to solve their problems. At the end of the day, the customer is (and always will be) king.

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