The Speed of Crisis in the Digital Age

Editor's note: The following opinion article is the first in a three-part series by guest columnist Richard S. Levick, the president and CEO of Levick Strategic Communications, the world's largest crisis communications firm. Levick is the co-author of 'Stop the Presses: The Crisis & Litigation PR Desk Reference' and writes for bulletproofblog.com. Click here to read Part 2 and here to read Part 3. He welcomes your comments here.

On the morning of Monday, Sept. 8, 2008, executives at United Airlines, a unit of UAL ( UAUA), began their week like any other. Two years had passed since they successfully brought one of America's most storied airlines back from bankruptcy. More than 3,200 flights to 200 global destinations were scheduled for the day, and United's 55,000 employees were on the job. As the opening bell sounded on Wall Street, shares of UAL were trading at a steady $12 per share.

Within hours, however, the company's entire future was at risk. UAL shares plummeted so fast that authorities suspended trading in them as investigators tried to understand what was happening to this purported "safe bet." By day's end, Corporate America would learn a valuable lesson about how the online revolution can dramatically affect any brand, product, or company in only a matter of minutes.

Earlier that morning, a Chicago Tribune report detailing United's 2002 bankruptcy filing was accidentally reposted to the Florida Sun Sentinel's Web site with no indication that the story originally ran six years earlier. Within minutes, a Web searcher for Income Securities Advisors Inc. (ISA) in Miami Lakes, Fla. performed a routine Google search for the terms "bankruptcy" and "2008." When the ISA team came across the report on the Sun Sentinel's Web site, it appeared to be Web exclusive on breaking financial news that had yet to reach the wires.

At 10:43 a.m., ISA posted a summary of the "story" to the Bloomberg blog, which often distributes news from third-party providers. Five minutes later, UAL's share price dropped by more than half, eventually collapsing to less than $3 a share before authorities were forced to freeze trading at 11:07 a.m. United corrected the mistaken report at 12:30 p.m., but by then the damage was done.

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A painful chapter in the company's past had been resurrected with startling clarity. Even after United set the record straight, lingering concerns over the company's future caused the stock to close down more than 10% for the week.

Thanks to a single blog post, published by an anonymous blogger, one of the world's premier airlines was caught flat-footed in the media environment in which stockholders and analysts now live. In United's case, the blogger had no malicious intent, but recent history provides graphic examples of companies being hijacked by online miscreants seeking to do harm.

One example occurred just last month, when video appeared on YouTube showing two Domino's Pizza ( DPZ) employees defiling food that was about to be served to customers. The event mortally imperilled Domino's corporate brand as millions of potential customers watched the disgusting video. But Domino's own response -- the company eschewed online engagement and waited 24 hours to see how traditional media would react -- only added to the damage.

A decade ago, companies had a full day to assemble their crisis teams, develop their crisis messages and decide upon the best vehicles for disseminating those messages. Yet in the first 24 hours after the now infamous Domino's viral video appeared, more than 750,000 people (or more than half the daily readership of The New York Times) had already viewed it and hundreds of blog posts were commenting upon it. The damage was done well before the traditional media were on story. A week after the video's YouTube debut, Domino's stock had plunged 10%.

Domino's didn't realize that it had already fallen behind at the first sign of crisis. The company -- which handled the ensuing aspects of the crisis in textbook fashion -- misplayed the first 24 hours, but that's the entire point. In today's digital media-driven news environment, the first 24 hours of a crisis are often the only 24 hours a company has to effectively protect its brand credibility and trust.

The United and Domino's case studies -- along with many others in recent years -- reveal how many companies that have demonstrated a mastery of marketing their brands online still struggle to use those same online approaches in a crisis. There are immediate threats to corporate reputation lurking in the social media space. It is therefore incumbent on companies to mitigate such threats and "bulletproof" their brands before they become the subject of critical online conversations.

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