BulletProofBlog the blog on crisis communications

Each week, Bulletproof Blog features exclusive interviews with thought leaders on issues of critical importance to companies and countries. This week, on the heels of the National Retail Federation' s (NRF) Loss Prevention Conference and EXPO, we interview Ellen Davis, NRF Vice President of Industry Public Relations.

During her tenure at NRF, Ms. Davis has been responsible for evaluating NRF positions on a variety of retail topics including e-commerce, consumer spending, the economy, and loss prevention. A nationally-recognized expert on retail crisis communications, she shared her insights with Bulletproofâ„¢:

What are the most common crises that retailers face? Why is it so vital to the bottom line that they are publically addressed?

Ellen Davis: The only thing common about retail crises is that they' re all unique. At any moment, retailers everywhere could be facing a number of issues in stores around the country: store closings, robberies, injuries, theft, customer service issues, product tampering…The list goes on and on.

Many of those situations are local in nature but the retail industry has seen its share of national crises in the news over the past year as well. At our session at NRF' s Loss Prevention Conference earlier this month, I spoke about several of those major national incidents: a situation at a major retailer on Black Friday, where a worker was trampled by an out-of-control crowd; a tragic active shooter incident where five women were killed; and a situation where a store manager showed incredibly bad judgment, which gave the retailer a huge reputational black eye.

When I think about retail crises, I' m reminded of a quote from Warren Buffett, who said "It takes 20 years to build a reputation and five minutes to ruin it." In actuality, with the prevalence of social media coupled with a 24/7 television news cycle, it can take a lot less than five minutes to ruin a great brand. Retailers and other businesses are great at preparing for the logistical elements of a disaster or crisis - spending hours on meticulous evacuation plans, what-if scenarios, law enforcement partnerships and alliances, and drills. What can easily get lost, though, is the role that communications should play, both before and during a crisis.

I' ve been fortunate during my tenure at NRF to develop a very close working relationship with our loss prevention experts. When a crisis develops in the retail industry, we handle it together. I encourage other groups to do everything possible to get that communication started sooner rather than later so that, in the midst of any crisis, there is already a level of trust established. Then, when something unexpected occurs - and it inevitably will - it will be easier to make decisions, pull the trigger, and protect the brand.

What are the most important audiences for a retailer to reach in order to protect against reputational losses in crisis?

Ellen Davis: In retail, almost everything boils down to how customers perceive a situation. If not handled quickly or correctly, crises in retail stores can result in a permanent shift in consumers' shopping habits - and retailers are nothing without their customers.

One of the most difficult balances in retail, compared with other industries, is that everyone shops, so rumors can spread quickly. For example, when an absolutely inaccurate e-mail was circulating last holiday season about retailers going out of business and no longer accepting gift cards, NRF worked furiously with many companies to quash these rumors. Unfortunately, though, it just took that e-mail, distributed to millions and millions of people to change customers' shopping habits. One consequence was that gift card sales during the holiday season were much lower than anticipated.

Of course, I don' t want to minimize the other important groups that retailers need to consider during a crisis. Depending upon the situation, other audiences, specifically the media, policymakers, manufacturers, employees, and industry analysts, cannot be ignored.

What' s next in retail? Are there issues emerging on the horizon that retailers need to be aware of?

Ellen Davis: Retail' s biggest crisis over the last year has been the economy, and it' s often been difficult to focus on anything else. As the economy bounces back - and it will, though "when" is still anybody' s guess - retailers will start to focus again on both national and global expansion. At this point, though, retailers are very focused on their core business operations, trying to do more with less while still trying to provide customers with a seamless shopping experience. It' s been an incredibly difficult journey for the millions of people who work in retail, but companies that survive this recession will be stronger for it.

From a loss prevention standpoint, retailers will likely continue to battle the growth of organized retail crime and increased active shooter incidents at stores and malls around the country. While retailers continue planning for future company crises, giving communications executives a seat at the table in the planning stages is imperative.

Larry Smith is Senior Vice President of Levick Strategic Communications and a contributing author to Bulletproof Blog.