Classroom A – Lecture 5 (Crisis Comm)

Samsung’s Bad reputation, Note 7 Crisis

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Back in 2016, Samsung’s very own Flagship phone, the Samsung Galaxy Note 7 had a major issue. The phones had an overheating battery which causes the phone to catch fire. With media around the world covering Note 7’s crisis, people are afraid to use Samsung’s product due to a loss in confidence on Samsung’s Quality Check and the fear of similar problems in other Samsung products.

To make matters worse, Singapore Airlines announced on its social media that it had banned Galaxy Note 7 smartphone from all of their flights. This move was followed by restrictions from other airlines such as Qantas who restricted passengers holding the Note 7 from boarding their flights. Reports have revealed that the Galaxy Note 7 crisis has shaved off $18 billion from its organisation.

Samsung Responds

The company promptly held a press conference and announced the recall of Note 7. Additionally, the option of an exchange for a newer phone model with a different battery or a full refund was made available to its customer. Samsung has acted fast in this situation to avoid any further escalation of the crisis.

Samsung also released an official video to explain to the public about the incident.  On top of that, Samsung has also shared with the public on how they will make delivering a safer and better phone by introducing the “8 point battery safety check” that exceeds the industry standards. Lastly, the video also mentioned that they would learn from this experience.

A year later, Samsung saw a 9% increase in brand valuation despite the crisis, and it’s new Galaxy 8 has been selling well.

It Is Better For Company To Say Nothing Than To Say Something Incomplete

The PR person should only present facts and not make any speculation. Making any unnecessary speculation during a crisis is suicidal. With incomplete information, the people or even the media may make inaccurate inference or prediction based on that speculation,  resulting in a negative impact on the company which cannot be negated even when the truth is revealed at the later point of the crisis.

The worst type of crisis to happen to a company

The worst crisis that can happen to a company is the reoccurrence of the same incident after apologising to the public and assuring them that the same incident will not happen again. This clearly shows that the company did not take the previous crisis seriously. Hence, the public might lose trust in the company, and in the long run, the reputation of the company will be tarnished. Recovering from such a crisis will not be as easy as before.