Elite Education Institute PRS303: Starbucks PR Crisis Management

This report delves into Starbucks' public relations crisis stemming from an incident in Philadelphia, where two black men were asked to leave, leading to widespread social media backlash. The analysis identifies critical errors in Starbucks' crisis management, including a delayed response, failure to control online reputation, and neglecting to listen to public concerns. It argues that Starbucks underestimated the power of social media and the need for immediate, empathetic action. The report concludes that while Starbucks made efforts to mitigate the situation, its response was inadequate, resulting in significant financial losses. Recommendations include proactive social media engagement, immediate and tailored communication, continuous monitoring of social media, and the formation of a crisis management team to address stakeholder concerns effectively, emphasizing the importance of monitoring, planning, and communicating during a crisis.

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Public Relations Crisis Management at Starbuck
Student’s Name
University
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Table of Contents
Introduction.................................................................................................................................................3
Errors made by Starbucks............................................................................................................................3
Conclusion...................................................................................................................................................4
Recommendations.......................................................................................................................................5
References...................................................................................................................................................8

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PUBLIC RELATIONS CRISIS MANAGEMENT AT STARBUCK
Introduction
Public relations is the practice of managing the spread of information between an organization,
stakeholders and customers to protect the image of the business. This means that the organization
develops strategies that address exposure of information to the public to ensure that a wrong
impression is not created that can hurt organization proceeds (Berger & Reber 2006, p. 25). This is
achieved by establishing and maintaining relationships with the target audience of the organization. In
most cases, public relations programs are targeted at a specific audience especially during crisis
situations. In the case of Starbucks, the crisis entailed the situation where the manager called the police
to arrest two black men were asked to leave the police and policemen called to escort them out a
situation which lit up social media where people pointed out how the white people were treated
differently from black people (Kamnetz 2018, pp. 3-6). Such a crisis can hurt the image of the
organization which can trickle down to the sales that the company makes. Therefore, the company
developed a crisis management strategy to ensure that the business was not affected by this crisis.
Errors made by Starbucks
The biggest error that Starbucks did was failing to control its online reputation during the crisis. Social
media is a powerful tool that is being used today for people to share information. This means that
management needed to develop a public relations plan immediately for dealing with the online
challenge that the issue was presenting (Kamnetz 2018, p. 6). Starbucks overlooked the power of social
media and did not analyze how this can affect the business image through social media waves. This is
because, on social media, people cannot be controlled and whatever circulates can hurt a business badly
(Gonzalez-Herrero 2008, p. 149). This means that Starbucks needed to have developed an immediate
hashtag strategy to mitigate social media platforms like Twitter and Facebook regarding the issue.

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However, the manager was more focused on how the sales of the company have been affected the
reason why he was quoted saying that sales have not been affected.
Another error that management made was the longer time taken to gather information and respond to
the issues that the company was facing. In this case, the CEO took three days to gather information
about the incident before responding. When the protestors were calling for action, management did not
respond immediately but rather let the crisis continue. When people were gathered outside the
Philadelphia and the boycott changed to #BoycottStarbucks it required an immediate response to calm
down the situation. The CEO took time to own responsibility for the issue that had happened since the
apology that he made was not accepted at all. This is because the power of listening was ignored. In
crisis management, situations are supposed to be handled immediately so that they do not escalate and
cost the image of the organization (Colley 2009, p. 34). Thus three days were long for the CEO to
respond to the issue that he knew could hurt the image of the company.
Lastly, the CEO failed to listen to what the people who were boycotting and responding on social media
wanted. The power of listening is an important tool in dealing with the issues that revolve around the
image of the organization and their impact. The power of listening allows organizations to analyze the
needs of customers by engaging them to assess the challenges that they face and how the company may
have hurt them in different ways (Samuel 2017, p. 7). They wanted him to be present in person and take
responsibility rather than offer only a Twitter post which did not have any promise that the customers
could rely on. This indicates how lacking the power of listening and early crisis management skills can
hurt the image of the organization.
Conclusion
The role of public relations is to manage the image of the organization by mitigating any crisis that
threatens the success of the organization. This means that the organization has to put strategies in place

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for responding to crisis situations within the business environment. Although Starbucks has been praised
for handling the crisis that it faced recently well, management did not adequately mitigate the situation
since it led to over twenty million loses in sales when handling the issues that revolved around the crisis.
Therefore, public relations need to be prepared for any situation by being open to the crisis thus doing
quick data finding, responding immediately through an apology and then developing a crisis
management plan to restore the image of the organization through monitoring social media and other
communication channels so that the best strategy can be adopted. Therefore, Starbucks tried in
mitigating the situation but management could have done better in managing the crisis.
Recommendations
Gregoire, Salle & Tripp (2015) suggests that social media is a powerful tool that organizations need to
understand that it can propel or hurt the business at any time. This means that Starbucks needed to
have responded immediately by engaging its customers on the issue to mitigate the situation and
maintain its public relations. This entails sharing the concerns with customers and responding to the
issues that they raise even if they do not concern the business (Coombs 2007, p. 19). This cools the heat
especially in the time when racism is seriously being condemned. Since social media platforms like
Facebook are toying with new rating systems that allow people to write reviews about the company or
even recommend a business. It means that this can hurt any business that does not take care of its
online reputation.
Therefore. Starbucks needed to have responded immediately by containing the online environment.
Samuel (2017, pp. 3) suggests that public relations crisis come out of small mistakes that people make
and then they glow into something bigger. This means that the company may be racially biased but the
small mistake that the manager made could cost the image of the organization. Thus Starbucks needed
to have addressed the situation directly and thus in the Twitter apology, negative keywords filters

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relevant to the crisis needed to have been used to allow filtering the words so that people can feel that
management is empathetic. The two asymmetrical model of public relations suggests that feedback can
be used to get into the psychology of the audience by tailoring the message to get an effective reaction
(Kellerman 2006, p. 79). This means that the responses that management made needed to have been
tailored based on the nature of the crisis and should have been keenly crafted to relay the intended
message. This could have reduced the reaction and increased acceptance of the message if management
had considered how the message will be taken by the public and its relation to restoring the
deteriorating image.
According to Mathew (2017), monitoring of social media is an important element of crisis management
since it enables the organization to understand the current situation and any upcoming crisis that could
hit the organization. This is called the power of listening since, during the crisis, people need human
responses and at the same time to hear the corporate voice from the organization itself. This means that
the strategy of listening can be used to understand the issue that needs an urgent response from
management. This means that the CEO needed to have constituted a crisis management team that will
listen to stakeholders across platforms to determine the solutions that can be used to handle the
situation. From the situational theory of publics, people can be identified and classified according to the
challenges that they present to the organization and information seeking behaviour used to develop the
best way for managing the situation (Coombs 2004, p. 470). Thus by understanding how people were
reacting to the crisis situation in social media, then Starbucks could have developed the best strategy
that handles the issues that were happening in social media to reduce harm to the public image. This
means that management needs to monitor every element that can affect the image of the organization
like social media and develop ways of ensuring that they can be adequately controlled to avoid
escalations. Therefore, the best way that Starbucks could have managed this situation is monitor, plan,
and communicate.

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Arpan & Roskos-Ewoldsen (2005, p. 429) suggests that communication experts suggest that the initial
response for any crisis situation in the organization should be made within the first few hours of the
crisis. This means that management needs to acknowledge the crisis that has happened and carry out
fact-finding immediately to gather information on the issue and then offer a quick response to the crisis
as a way of mitigating the extended effects of the crisis. From the contingency theory of
accommodation, management needs to understand that there are different options that can be taken to
address a crisis by weighing the communication options and picking the best option that meets the
needs of the crisis (Shin, Heath & Lee 2011, p. 173). Thus the CEO needed to have responded
immediately after the crisis happened before the rampage on social media. This could have mitigated
the situation because people could be responding to the post made by the company rather than what
had been posted about the crisis situation by other people. The best way to mitigate such situations is to
be the first to offer a statement before the issue reaches to other people. Therefore monitoring social
media and responding to issues in time is the best way for mitigating any crisis issues in the
organization.

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References
Arpan L & Roskos-Ewoldsen D 2005, "Stealing thunder: An analysis of the effects of proactive disclosure
of crisis information", Public Relations Review, 31(3), pp. 425-433.
Berger B & Reber B 2006, Gaining influence in public relations: The role of resistance in practice,
Mahwah, Lawrence Erlbaum Associates.
Colley KCA 2009, "An Overlooked Social Media Tool? Making a Case forWikis", Public Relations
Strategist, 5(3), pp. 34-35.
Coombs WT 2004, "Structuring crisis discourse knowledge: The West Pharmaceutics case", Public
Relations Review, Volume 30, pp. 467-474.
Coombs WT 2007, Ongoing crisis communication: Planning, Managing, and responding, 2nd ed, Los
Angeles, Sage.
Gonzalez-Herrero ASS 2008, "Crisis Communication Management on the Web: How Internet-Based
Technologies are Changing the Way Public Relations Professionals Handle Business Crises", Journal of
Contingencies and Crisis Management, 16(3), pp. 143-152.
Grégoire Y, Salle A & Tripp TM 2015, "Managing social media crises with your customers: The good, the
bad, and the ugly", Business Horizons, 58(2), pp. 173-182.
Kamnetz, T., 2018. What you can learn from how Starbucks handled PR crisis. Fast Casual, July.
Kellerman B 2006, "When should a leader apologize and when not?", Harvard Business Review, 84(4),
pp. 73-81.
MATHEW CM 2017, "Role of social media in crisis communication in the business context: a study with
Indian examples", International Journal of Research in Commerce, IT & Management, 7(6), pp. 50-53.
Samuel K 2017, "A Social Media Crisis Management Plan All Marketers Can Follow", Forbes, 12
September.
Shin JH, Heath RL & Lee J 2011, "Explanation of Public Relations Practitioner Leadership Styles: Situation
and Culture", Journal of Public Relations Research, 23(2), pp. 167-190.