Nike%Incorporated% Crisis%Management%Plan% PartI%€¦ · ! 2! Introduction%!...

Nike Incorporated

Crisis Management Plan

Part I

Christian Baker Phil Faso

Nicole McKenna Greg Nordstrom

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Introduction Nike has emerged as the world’s leading innovator in athletic footwear, apparel, equipment, and accessories. Nike is continuously looking for new ways to engage and communicate directly with our consumers. The Nike Crisis Communication Plan is a detailed guide to managing and addressing possible emergencies or crises that may occur. The plan outlines the procedures and steps that must be taken in order to minimize the negative effects on the brand.

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Table of Contents

Introduction ....................................................................................................... 2

Crisis Team Mission and Purpose ........................................................................ 4

List of Potential Crises ........................................................................................ 5

The Nike Management Team .............................................................................. 6

Key Publics and Stakeholders ............................................................................. 7

Plan for Crisis Preparation and Prevention .......................................................... 8

Media Audit ....................................................................................................... 9

Social Media Strategy ....................................................................................... 10

Potential Third-‐Party Experts and Support ........................................................ 11

Immediate Response Checklist ......................................................................... 12

Communication Channels Worksheet ............................................................... 13

Key Messages Worksheet ................................................................................. 14

Press Release Template .................................................................................... 15

Nike Company Information ............................................................................... 16

Media Log Sheet ............................................................................................... 17

Contact Information ......................................................................................... 18

Procedure for testing the Crisis Management Plan ........................................... 19

Part II Crisis Response ....................................................................................... 20

Internal Response ............................................................................................. 21

Initial Press Release .......................................................................................... 22

Key Messages and Talking Points ...................................................................... 23

Social Media Strategy ....................................................................................... 24

References ....................................................................................................... 25

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Crisis Team Mission and Purpose The mission of Nike’s Public Relations branch is to have an appropriate response to any expected crisis that Nike Incorporated may face. Our top priority is uphold the brand’s integrity The purpose of the plan is not only to ensure the company of its positive image, but to repair the company of any damage that may have occurred as fast and efficient as possible. It is our job to come up with a plan of action and decide whom the spokesperson should be. The benefit to developing this plan is a decreased chance of violation of the expectations of stakeholders. Our organization needs this because things will always go wrong within an organization, but if we have the proper plan in place we will be able to successfully diminish the crisis before it becomes public and damaging to our organization’s reputation. Being prepared will keep us in the forefront of the situation, and potentially lessen the criticisms that we may receive from our stakeholders. We pledge to be honest, accurate and transparent, while being cooperative with all of our stakeholders during times of crisis to maintain/regain our image as a trustworthy, and creditable organization. Our goal is to be the first responders to our own news by actively communicating with our publics during times of a crisis by: 1.)Providing accurate and honest information. 2.)Promptly responding to the questions/concerns of our stakeholders. 3.)Being transparent no matter what the situation is.

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Possible Crises (Likely and Unlikely)

Likely Crises and Their Potential Scenarios

• Labor Issues o Poor Working Conditions

§ Strikes § Protests

• Sponsored Athletes o Athletes come under controversy

§ Remember: • Each case is different • We have made a commitment to these athletes • They have also made a commitment to Nike and our ethics.

• Product Recalls o Pull the product and refund customers

• Natural Disasters o Store or plant is damaged or destroyed due to flood, fire, tornado, etc.

• Store or Workplace accidents o Employee or customer gets injured in a Nike store or plant

• Shipping Errors o Customer or retailer does not receive product originally ordered.

• Social Media o Unhappy customers gain attention on social media

• Rival Companies o A rival company starts an ad campaign damaging Nike

• Rumor o Fictional rumor is started that damages Nike’s reputation

Unlikely but High Impact Crises

• Workplace Violence o Employee or Customer related shooting at a Nike store or plant o Physical altercation at a Nike store or plant

• Boycott o Large-‐scale boycott or banning of Nike products

• Store Issues o Poorly conditions inside a Nike store o Hiring of employees with severe criminal records

• Black Market o Nike products are sold illegally on the black market

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The Nike Crisis Management Team Nicole McKenna: Nicole will act as the Crisis Management Team Leader. She will be in charge of supervising the entire crisis team, attend all media events related to the crisis, one of several spokespeople, key decision maker, and lastly, in charge of developing a social media strategy. Phil Faso: Phil is the Public Relations Expert. He will act as the writer, in charge of creating press releases, oversees and manages social media posts and account, and media facilitator. Greg Nordstrom: Greg will be the chief legal advisor, he will be in charge of giving counsel, checking all posts and press releases for faulty statements that may cause lawsuits, aid in crafting public statements, and risk management. Christian Baker: Christian will be the Human Resources Manager. He will be in charge of appoint the Crisis Management Team, conducting the crisis response training, handles employee issues, and aids in internal communication.

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Nike Key Publics and Stakeholders

• Board of Directors • Shareholders • Employees • Customers • Designers • Manufacturers • Distributors/Suppliers • Competitors: Adidas, Under Armour, Reebok, Puma, New Balance • Hurley, Converse, Cole Haan, Air Jordan • Stores affiliated with Nike • Media • Nike sponsored athletes

Based on the immediacy and content of the crisis, key publics and stakeholders will be notified in a respectful order. Meaning, the most affected will be notified first

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Plan for Crisis Preparation and Prevention

Preparation-‐ When a crisis strikes Nike will immediately identify it’s vulnerabilities. For Nike in specific we must be sure to assign agents to our athletes that will inform them of ways that will benefit our companies image. Athletes and employees will make mistakes, but if there is a substantial amount of good history with an organization, stakeholders will be more forgiving. Athletes and employees will be required to do community service events with three different organizations of their choosing. Nike will also sponsor short biographies of good things done by their athletes yearly. These short biographies will air on ESPN and Disney. Nike must also be familiar with possible crises and formulate a crisis prevention team that is obligated by contract to follow this crisis management plan. Be sure that this team is fully aware of their role in the prevention and response of a crisis. Be sure that the crisis prevention team is aware of the location of the crisis. The last step of preparing for a crisis is to create a crisis management plan that is specific to Nike. Prevention-‐ In terms of a crisis, employees must also be prepared to do a detailed job of environmental scanning. The team will must be sure to be aware of all news channels and websites reporting on the crisis. We must know what information is being quoted that may not be true, but may be damaging to the company. The crisis prevention team must also be aware of what’s being said on social media websites. Nike must be its number one spokesperson. We must be aware of all the popular complaints of our consumers/stakeholders. We must also offer opportunities for stakeholders to tell us how we are doing. We must give promotional opportunities for people who complete surveys so we can always be aware of the state of our publics. If we are good we can continue to move in that direction, if not we must find out what specifically needs to be changed. Focus groups will be important in regards to new releases, this can prevent defect items from going out on the market. There will also be a threat assessment given comparing the likelihood and impact particular issues and crisis’ will have on Nike. We also must consider what the impact our stakeholders have on our organization.

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Media Audit

Due to Nike’s broad market, media from around the country would cover a potential crisis. This chart below lists the major media outlets in the United States. News Outlet Email Phone Twitter Type of Outlet

ABC News [email protected] 233-‐566-‐8000 @ABC Television

CBS News [email protected] 202-‐578-‐8909 @CBSNews Television

CNN [email protected] 202-‐567-‐4000 @CNN Television

FOX News [email protected] 212-‐301-‐3000 @FoxNews Television

MSNBC [email protected] 201-‐583-‐5000 @msnbc Television

NBC News [email protected] 212-‐664-‐4444 @NBCNews Television

Los Angeles Times

[email protected] 201-‐567-‐0001 @latimes Newspaper

New York Times

[email protected] 212-‐556-‐1234 @nytimes Newspaper

Tribune [email protected] 312-‐677-‐8909 @chicagotribune Newspaper

USA Today [email protected] 800-‐872-‐0001 @USATODAY Newspaper

The Wall Street Journal

[email protected] 212-‐455-‐6800 @WSJ Newspaper

News Week [email protected] 212-‐301-‐3010 @Newsweek Magazine

Time [email protected] 312-‐566-‐9000 @TIME Magazine

NPR [email protected] 301-‐677-‐9000 @NPR Radio

Forbes [email protected] 212-‐566-‐8750 @Forbes Web

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Social Media Strategy

• Utilize all modern social media • Respond to questions in a timely manner • Be honest and transparent • Apologize sincerely for crises that are the fault of Nike Incorporated • Align content with goals and values of Nike Incorporated • Manage access to social media accounts carefully • Use President and CEO of Nike Incorporated (currently Mark Parker) as primary

spokesperson • Make sure messages remain consistent across all channels • Consider the time posts are being made and their visibility

Questions that may be asked by the media:

• How did this crisis happen? • Full description of crisis • Will there be legal action? • Will any jobs be terminated? • How did this happen?

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Third Party-‐Supporters and Potential Supporters

If a crisis were to occur, there are many different third parties who remain credible and loyal to the Nike brand. If the press ask for references, the names on the following list should be given. Michael Jordan: former NBA athlete and longtime supporter of Nike Drew Brees: NFL athlete and longtime supporter of Nike LeBron James: NBA athlete and longtime supporter of Nike Cristiano Ronaldo: European soccer athlete and longtime supporter of Nike Tracy Carbasho: author of Corporations That Changed The World: Nike

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Immediate Response Checklist 1. What is the crisis?

• What happened? • Where did it happen? • When did it happen? • Who is involved? • Why did it happen? • How did it happen?

2. What is being done?

• Has the Crisis Management Team been contacted? • Have the appropriate stakeholders been notified?

3. Evaluate Crisis

• Do you have all of the facts? • Are your sources credible? • Is the media already aware?

4. Begin Crisis Response

• Contact and gather the Crisis Management Team • Follow the guidelines stated in Crisis Communication Plan • Begin to assess media coverage to find out what publics are saying

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Communication Channels Worksheet Nike will inform the following stakeholders through each respective channel in case of a crisis

below: (In order of occurrence)

• Board of Directors o Personal E-‐mail, Call, Sit-‐down board meeting

• Shareholders o Mass E-‐mail, Call, Press conference (shareholders and employees only)

• Employees o Mass E-‐mail, Meetings at stores/plants, Press conference (shareholders and

employees only) • Plant Management

o Mass E-‐mail, Skype meetings • Customers

o Social Media, Mass E-‐mails, Press conference (media only), Television, Newspapers, Magazines, Informed from Authorized Retailers

• Retailers o Mass E-‐mails, Press conference (shareholders and employees only)

• Materials Distributors o Call, Mass E-‐mail

• Competitors (Adidas, Under Armour, Reebok, Puma, New Balance) o Mass E-‐mail, Social Media, Press conference (media only), Television,

Newspapers, Magazines • Media

o Email, Call, Press conference (media only)

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Message Map Worksheet Scenario: New product is defective Stakeholder: Customers, employees, stockholders Concern: Restore faith in Nike products and rebuild company reputation

KEY MESSAGE 1

KEY MESSAGE 2 KEY MESSAGE 3

We would like to formally apologize to all those affected by the defective product.

Nike is dedicated to the highest quality. Products that do not live up to our high standards are not acceptable.

Our customers’ satisfaction is of the highest importance to us.

Support Point 1.1 Support Point 2.1 Support Point 3.1

The product in question does not live up to Nike’s high standards.

The defective product is going to be recalled.

We will continue to create new innovative products.

Support Point 1.2 Support Point 2.2 Support Point 3.2 Nike customers expect the very best. We want to make sure that is always what they get.

Those who bought the inferior product will have their money refunded.

We will continue to keep lines of communication open so that customers can inform us of future problems.


We are in the process of investigating what went wrong during the development of this product..

We will do everything in our power to stop something like this from happening again in the future.

Our track record shows that throughout our history, we have done whatever it takes to satisfy our customers.

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[Date] Contact: Nicole McKenna FOR IMMEDIATE RELEASE Title: Crisis Management Leader Email: [email protected] Phone: 773-‐706-‐4993 Email: [email protected]

Crisis Response Press Release Template DATELINE—Summary lead that addresses issue at hand and provides enough information for stakeholders who may not be aware of the crisis yet. Expression of empathy or concern as needed. Reassure stakeholders of Nike’s continued care and investment. If necessary, the expression of concern or empathy may come before the summary lead (depending on the nature of the crisis). Main Paragraphs: Who is affected: __________________________________________________________ What is going on: _________________________________________________________ Where is this taking place: __________________________________________________ When did this occur: ______________________________________________________ How did this occur: ________________________________________________________ Why is this so important: ___________________________________________________ Quote from spokesperson, this can tie into the key messages and support. Name of Spokesperson: Title: Quote: Reiterate key messages and points of support. The key messages should include a description of how Nike is addressing and resolving the situation. Include two to three key messages with support for each.

• Key Message #1 and supporting points • Key Message #2 and supporting points • Key Message #3 and supporting points

For more information, contact: Nicole McKenna Crisis Management Leader Phone: 773-‐706-‐4993 Email: [email protected] Website: Nikeinc.com

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Nike Company Profile “Just Do It.”

Nike Inc. who has been the worldwide leader on sport market since 1990, just before its main competitor Adidas. The company was founded in 1972 and headquarter is close Beaverton in Oregon. The chairman is Philip H. Knight and the chief executive officer is Mark Parker. Nike’s turnover was 25.3 billion in 2013. It’s famous logo was ordered in 1971 by Phil Knight, it is called “Swoosh” and it was created by a design student. To develop its brand image, Nike has multiplied sponsoring with sportsman, for example in tennis with Rafael Nadal or Roger Federrer. Nike has now taken over all football apparel by making their jerseys and apparel. Superstars such as LeBron James, Kevin Durant, and Kobe Bryant have become the face of the organization after the fall of Federrer and Tiger Woods. Since, its crisis with labor child, the company tries to improve its brand image to stay the leader on its market. Nike also owns different brands, which are its subsidiaries. Its portfolio is composed of: Cole Haan, which designs and distributes clothing, footwear, and accessories for men and women. Converse Inc. also distributes clothing and footwear. Hurley International LLC specializes in surfing, skateboarding and snowboarding equipment. NIKE Golf designs all equipment for golf. These companies are definitely essential in the success that Nike has recently seen. In the 1950s, Nike got its start with two revolutionary men Bill Bowerman and Phil Knight who wanted to revolutionize the athletic sport. In the 1960’s they sold the first Tiger shoes. In the 1970s they created their first product brochures as an advertisement marketing tools. The name that was then ‘Blue Ribbon Sport’ was then changed to ‘NIKE’ for logo and design purposes. These two men began to sell their own products and sponsored athlete Prefontaine, who was the beginning of their success. In the 1980s Nike launched its famous and brand new technological shoes called “Nike Air” and became a publicly traded company. They then signed their most recognizable athlete Michael Jordan who increased sales. Shortly after this Nike invested in the slogan “Just Do It.” In the 1990s they created their first retail store “Niketown” in Oregon which later branched out worldwide In the 2000s Nike found a new partnership in the Olympic games and tournaments. And recently they have partnered with the NFL and multiple NCAA athletic programs.

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Media Log Sheet

Crisis Situation _________________________________________________________________ Date ________________ Message for ___________________________________________________________________ Date/time of call ________________________________________________________________ Caller _________________________________________________________________________ Phone number(s) _______________________________________________________________ Media outlet/Name _____________________________________________________________ Return call by/Deadline _________________________________________________________

Summary of inquiry _____________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________

Who responded to the inquiry? ____________________________________________________

Date/Time _____________________________________________________________________

Summary of response ____________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________

Further action needed? ______________________________________________________________________________

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Contact Information

Name Phone Number Email Position

Nicole McKenna (773)706-‐4993 [email protected] Crisis Team Leader

Phil Faso (309)345-‐6034 [email protected] Public Relations Expert

Greg Nordstrom (847)239-‐0548 [email protected] Legal Advisor

Christian Baker (312)687-‐3601 [email protected] Human Relations Manager

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Procedure for Testing Crisis Management Plan Every quarter, we will stage crisis drills to evaluate our crisis plan and make sure our team members are prepared. We will use a different type of crisis each time, and the team will run through our crisis management plan. We will evaluate the team and also ask them to evaluate themselves during and after the drills to see if they perform up to our standards. The team will be asked to present to management all communication they would make to the public and within the organization. They need to take all possible stakeholders into account. The main goals will be to limit the amount of financial damage and damage to reputation the corporation would experience if this crisis were to really happen. Once the crisis has been managed, we will evaluate how well the crisis was managed and how it could have been managed more effectively. We will also ask our team members what improvements they think could be made to the crisis management plan. Once the drills are complete, we will make any necessary changes to the crisis plan. It is important to update the plan often to make sure all contact information and procedures are up-‐to-‐date. We will then make a presentation to the team to tell them what they did well and what they did poorly as well as to inform them of any changes we made to the crisis plan.

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Nike Incorporated

Crisis Management Plan

Part II—In Response to: CEO Mark Parker’s Insensitive Comments

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Internal Response When dealing with a crisis one must have a crisis strategy ready to respond accordingly. The first statement when dealing with a crisis response is typically delivered through the mass media (Coombs 139.) So the media will be the first place we would target. Our crisis deals with people who will be at an emotionally charged state due to the comments made by our CEO Mark Parker. Despite the fact that his comments are very hurtful I we know that we can lift NIKE back on our feet through quick, consistent and open communication. Crisis response content is divided into three categories instructing information, adjusting information and reputation management (Coombs 144.) We believe our situation falls under the category of reputation management. We do not want our stakeholders believing that we discriminate against overweight people. Although most of our customers do not fall under the category of “fat,” we must learn from the mistakes of Abercrombie and Fitch and manage our current reputation. Our response will be quick so after two hours of deliberation the crisis management team holds a press conference that we will pay ESPN, ABC and any cable channels that has ties to ESPN and Disney. We will utilize as many media outlets as possible. At this press conference we will allow Mark Parker to be the spokesperson even though he is the cause of the problem, the reason for this being the fact that he made the mistake, so he needs to correct it by apologizing to all of our stakeholders. The majority of the speech will be written by our crisis management team, while the apology end of it will come from him so it can come from the heart and be more genuine. Taking this approach we will be able to avoid the Paula Dean disaster, by being open to our publics. Our speech will begin with a statement of Mark Parker’s wrong doing, then an apology that leads in to compensation, so our company is taking the rebuilding posture (Coombs 155.) Once the press conference is over we will begin our #NikeForAll campaign which will show the world that NIKE’s views are not ones that were expressed by Mark Parker in his Forbes article statement. We will have a twitter blast from NIKE and all of our sponsored athletes. We will be all over social media websites rebuilding our reputation. This is a crisis that has to be taken seriously, because it could easily become a situation that would lose us money in the long run and ruin our reputation.

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Initial Press Release

May 1, 2014 Contact: Nicole McKenna FOR IMMEDIATE RELEASE Crisis Management Leader Email: [email protected] Phone: (773)706-‐4993 Email: [email protected]

Nike’s Response to CEO Mark Parker’s Insensitive Comments BEAVERTON, Ore. – We have recently been informed of the insensitive comments made by

CEO Mark Parker in the recent issue of Forbes Magazine. On behalf of Nike we would like to

apologize to our consumers and all others offended by his comments.

At a press conference on Wednesday, Parker made an official apology regarding the

insensitive comment.

“I take full responsibility for the comments I made. It was not my intention to offend our

customers or anyone for that matter. Nike values all of our consumers regardless of weight,”

said Parker.

While Nike believes everyone should be happy with the body they have, we commend

those trying to get in shape. Nike is currently in the process of extending our plus size clothing

line.

As a worldwide brand, Nike continues to look for new ways to engage and communicate

with their consumers in every one of the 160 countries that Nike operates in.

Nike will continue dedicating themselves to inspiring positive attitudes and keeping the

lines of communication open with our stakeholders so their opinions are heard.

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Key Messages and Talking Points

Scenario: President making insensitive comments Stakeholder: Employees, stockholders, customers Concern: Limit damage to reputation

KEY MESSAGE 1

KEY MESSAGE 2 KEY MESSAGE 3

Nike would like to offer a sincere apology to anyone offended.

The comments made by our president do not reflect the values of Nike Incorporated.

We commend people of all sizes that want to exercise and improve themselves.


We acknowledge that Mr. Parker’s comments were inappropriate.

Nike values all of its customers regardless of weight or gender.

We just created expanded sizes in golf and tennis gear.


We are taking steps to assure something like this does not happen again.

We believe that everyone should be proud of the body they have.

People who are trying to improve themselves should not be insulted.


We are dedicated to keeping open lines of communication so that our stakeholders can make their opinions heard.

Nike wants to inspire positive attitudes, not negative feelings.

We are proud of the fact that people of all shapes and sizes buy our products.

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Social Media Strategy Following Mr. Parker’s comments, Nike will release a social media campaign that will apologize for his actions. There will be a press conference immediately with a direct apology from Mr. Parker. On Twitter and Facebook, Nike’s official pages will release an apology and give a disclaimer that Mr. Parker’s comments do not reflect how Nike feels about its customers. Also, Nike will monitor social media web sites but will not reply directly to individual comments and replies. We want to stop bad publicity (hashtags) before they become too big to stop. We will not require our sponsor athletes to make statements on their social media pages, but we will welcome any support for Nike. We obviously do not want athletes participating in any attacks against Nike on social media and will take any such tweets/posts as attacks against Nike. Lastly, Nike will start releasing previews of the newly designed plus size clothing showcasing our approval of different sizes and shapes.

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References

Coombs, T. Ongoing crisis communication: Planning, managing, and responding. Thousand Oaks, CA: Sage Publications. History and heritage. (2014). Retrieved from http://nikeinc.com/pages/history-‐heritage

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