For companies in crisis, experts recommend honesty, change

Experts recommend honesty, change for companies in crisis
Updated: Jul. 12, 2018 at 6:21 PM EDT
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LOUISVILLE, KY (WAVE) - A pizza king in Louisville has been dethroned.

Papa John's founder John Schnatter's iconic image is slipping away from ads and social media following his resignation from the company over racist remarks.

Public perception of Schnatter and his company is now shifting.

"I guess it's over for the Papa John's pizza. Ain't nobody going to be eating that for a while. Well, people still going to eat it but not everybody," said Dontae Young, Louisville.

"I'm glad he resigned, I feel like that's the best decision to make. If you're going to make those type of comments in someplace as culturally diverse as Louisville, Kentucky, then you don't belong here," said Christion Baxter, Louisville.

"And he was a good person, he really is. I just wish he could have used his words a lot better," said April Moore, Louisville.

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On Wednesday morning, a Papa John's spokesman shared the following statement with WAVE 3 News:

"Papa John's condemns racism and any insensitive language, no matter the situation or setting. Our company was built on a foundation of mutual respect and acceptance. One of our core company values is People Are Priority Always (P.A.P.A.) and we are committed to maintaining a diverse, equitable and inclusive workplace for all of our corporate and franchise employees. Diversity is an essential ingredient in our pursuit of providing a better product and better service to our customers and to the communities where we operate and live. We take great pride in the diversity of the Papa John's family, though diversity and inclusion is an area where we will continue to strive to do better."

Public relations experts said whether you're a small company or a national one, in a crisis a quick response is needed.

"Show concern for those impacted, they take a look at what happened and how it happened. And then they take measures to make sure it doesn't happen again. But in addition to just doing this stuff, you have to show it, it has to be genuine," Dan Hartlage, Principal at Guthrie Mayes Public Relations, said.

Hartlage, who is unaffiliated with the Papa John's, said this advice is applicable to any company or business going through a crisis or scandal.

Social media and its rapid response and connection to consumers can both help and hurt companies undergoing a crisis, Hartlage said. Often, he said, it's the message you spread to your customers and how authentic it is that determines how the company will be perceived in the future.

After a problem, Hartlage said, consumers will consider what changes were made and how it was handled. If they address the issue - people often forgive. If the company doesn't - consumers may choose different products or services long term.

"You know, they didn't do this, they didn't do that, didn't hear from them until much later, they were slow in reacting. Then, quite often, the organization will find itself in survival mode," Hartlage said.

Investors on Thursday reacted very favorably to Schnatter's resignation. Shares of the stock surging on the NASDAQ to close at more than $53 dollars, that's an 11 percent rebound from Wednesday. Though the stock leveled off, CNBC financial analyst Jim Cramer said many in the industry fear the company's future is shaky.

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