Adidas' PR Crisis With Kanye West

Adidas' PR Crisis with Kanye West
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Provide a brief situation analysis of the issue and how it is currently being managed.
Dear CEO, this email is meant to update you on the PR crisis that Adidas is facing regarding Ye, commonly known as Kanye West. Ye was involved in anti-Semitism remarks, and his "White Lives Matter" branded shirt legitimized the white supremacist ideology. With Ye having worked for Adidas since 2013 and been the face of Adidas since his collaboration on the Yeezy sneakers, his negative remarks were associated with the brand. This greatly affected the company by sparking a social media storm with the hashtag #boycottAdidas. The company also faced reputational damage. The Drum website that gauges whether people would be comfortable working for the said brand revealed an extreme decline among 18 to 34-year-olds (Faull, 2022). The executive management of Adidas further worsened the situation by taking too long to respond to the issue. This is because they had the outdated mindset that silence is the best answer in times of crisis, which does not serve consumers today (Mallick, 2022). It took 3 weeks for Adidas to let go of Ye. Following that, the company has been using other methods, such as issuing statements and conducting interviews. The Yeezy stock problem further worsened financial losses.
Describe all stakeholders that this organization/entity would need to communicate with
during this crisis and prioritize them. What would be the best way to reach each?
The stakeholders involved in this situation are discussed below.
* The employees: Adidas employees may feel worried about the company's crisis and the company's reputational damage. The employees must be prioritized and reassured that the company will try its best to regain its consumer base and that such a PR will not happen again. The best way to reach them is through emails and one-on-one meetings.
* Consumers: Adidas should prioritize the consumers and assure them that Ye's moves are against the company policies and culture and that they do not tolerate any form of hate speech. The best way to reach customers includes the use of social media drives and targeted emails
* Investors: This group needs to understand the damage's true extent to the company's financial performance. Adidas can schedule meetings to discuss with this group.
* Media: The media was responsible for spreading Ye's remarks; hence Adidas needed to communicate with them for accurate reporting and to give any reports regarding the company. A media statement will be appropriate for this group (Pugh, 2022).
Offer insight into how you would counsel this entity to manage and respond to the crisis.
Be clear on why these recommendations are good ones.
To respond to the crisis,
* It is essential that Adidas first take full accountability for the crisis and apologize to everyone offended by the comments and the public. This is necessary as it will help create trust between its customers that they are committed to making things right. Additionally, this step shows that Adidas as a company works with integrity and transparency, making the consumers understand and control the narrative.
* Adidas should also cut ties with Ye while also addressing how they will prevent a similar situation from happening in the future. This is a good recommendation as it will ensure that the brand is protected and viewed as a socially responsible company, which by extension, will help retain its client base.
* For the Yeezy stock, Adidas should liquidate its inventory in the US and other parts of the world. This will enable the company to clear out the stock while minimizing the company's financial losses. Destroying the Yeezy sneakers will mean a loss of $526 million, while restructuring the shoes can also be quite costly (Hamilton, 2023). This is why liquidating the inventory is the best option.
Can you provide examples of any other brands that experienced similar crises and how
they handle it effectively or poorly?
Some companies that handled their crisis effectively include Johnson and Johnson in 2010 when they discovered th...