As a parent, a brand professional and a business leader, the Mattel/Wicked crisis is one I look at from a range of perspectives. As a parent I understand the outrage. As a business leader, I know that Mattel’s leadership will be working hard to apologise and put things right, while seeking to understand how their safeguards failed. As a brand manager, I know their team will be focusing on how to prevent anything similar from happening again.
Looking beyond the immediate controversy, what can we say about the relationship between leadership, crisis and brand value?
We have been tracking the world’s 100 most valuable brands for 25 years. The total brand value of the best global brands in our 2024 ranking stood at more than $3.4tn (£2.7tn) – equivalent to the world’s sixth biggest economy. Brands are human creations and therefore subject to the human characteristic of making mistakes. Part of what sets strong brands apart is effective leadership through crises, as well as an ability to learn lessons and build up brand governance to prevent and minimise future crises. Let’s look at some examples.
Learning from brands which grew through crises
Microsoft is a brand shaped, in part, by the crises it has navigated. Just this summer, a massive IT outage resulted in travel chaos around the world. Microsoft’s leadership through the crisis was strong, solving problems for companies affected and collaborating with their partners. As with the 2016 Tay.ai crisis, it’s a testament to Microsoft’s evolution from a ‘know-it-all’ culture to a ‘learn-it-all’ culture.
The story of Microsoft’s phenomenal growth in brand value over the last ten years can be seen against the backdrop of the antitrust crisis which came close to breaking the company apart. CEO Satya Nadella has reoriented Microsoft’s culture around empathy and innovation. In the past they depended on a monopoly to force their products onto users. Now they’re a brand which builds products people want to use. Their antitrust crisis has made them a stronger brand.
And Microsoft is not an isolated case. Starbucks was briefly engulfed in crisis and boycotts in 2018 following the wrongful arrest of two Black men in one of their stores. The brand emerged from this by responding quickly and sincerely. They showed a willingness to take big actions to learn from this, including closing 8,000 stores on a single day for bias training. Starbucks emerged as a brand and culture more committed to diversity and identity, exemplified by initiatives like their #whatsyourname campaign, which celebrated identity and acceptance.
Uber had broken culture and an underperforming brand by the end of the Travis Kalanick era. Under Dara Khosrowshahi, Uber has moved from being a “move fast and break things” culture to a “move fast and do the right thing” culture. The results speak for themselves. Profitability. More valuable offerings. Increasing brand value.
The easy conclusion from these examples might be that “what doesn’t kill you makes you stronger.” Our data suggests it’s not as simple as that. There are brands which go through crises and never truly recover. Facebook continues to be a profitable company but has never recovered as a brand from the range of crises and court cases it’s encountered over the last decade. A more appropriate aphorism for business leaders might be “never waste a brand crisis.”
How not to waste a brand crisis
Get the immediate response right in terms of speed, visibility, sincerity and, most important of all, actions. There’s a lot of great commentary from crisis management experts about the Mattel/Wicked case. One point we’d add is not to neglect the internal audience. Crises are stressful times for all employees, wherever they sit in the company. If employees see executives leading by example in the most challenging circumstances, then the internal brand will emerge stronger.
Manage your next crisis before it happens, not while it’s happening. Brands can avoid crises more often if they truly operate based on their brand purpose and values. Are your brand values words you say or principles you enact? F. Scott Fitzgerald famously defined a first-class mind as one which could keep two potentially contradictory ideas in mind at the same time. Similarly, employees in first-class cultures do not neglect integrity and ethics while growing their brand value – they do the right things and do things right.
Seize the opportunity for change. From our Best Global Brands analysis we know that the brands which keep growing are masters of change. Enduringly valuable brands have enduring principles and assets. But they are also in a constant state of managed evolution. Brands which grow stronger from crisis do so by seeing an impetus to accelerate change.
As they emerge from this crisis, I wish Mattel’s leadership well and look forward to seeing what initiatives they put in place to make their brand stronger.
Gonzalo Brujó is the global CEO at brand consultancy Interbrand
As a parent, a brand professional and a business leader, the Mattel/Wicked crisis is one I look at from a range of perspectives. As a parent I understand the outrage. As a business leader, I know that Mattel’s leadership will be working hard to apologise and put things right, while seeking to understand how their safeguards failed. As a brand manager, I know their team will be focusing on how to prevent anything similar from happening again.
Looking beyond the immediate controversy, what can we say about the relationship between leadership, crisis and brand value?
We have been tracking the world’s 100 most valuable brands for 25 years. The total brand value of the best global brands in our 2024 ranking stood at more than $3.4tn (£2.7tn) – equivalent to the world’s sixth biggest economy. Brands are human creations and therefore subject to the human characteristic of making mistakes. Part of what sets strong brands apart is effective leadership through crises, as well as an ability to learn lessons and build up brand governance to prevent and minimise future crises. Let’s look at some examples.
