The negative impact of a reputational crisis

Nowadays, when a user searches for a product or service, he finds wide competition where there are many companies that offer what he is looking for. In this sense, in such a competitive context, what tends to increasingly determine the decision of the users is the digital reputation of the brand, staying with the one that represents the greatest trust. Therefore, when a reputational crisis occurs, this can end up having a negative impact on a company's growth possibilities. Next, we are going to tell you about the negative impact of a crisis and what you should do about it.


Importance of management in the impact of the crisis

Before moving on to the negative impact of a reputational crisis, it is necessary to clarify that its intensity will depend on the way in which said the situation is managed. In this sense, if the company has an effective crisis plan and takes quick action, it can stop the expansion of the crisis. Causing its final impact to be reduced. In addition, the preventive measures that are taken beforehand will help to recognize reputational risks beforehand.


What is the negative impact of a reputational crisis that a company can suffer?

Despite the variations that may occur in each case, the negative impact of a reputational crisis can be reflected in the following results:


Reduction of employees willing to work with the company

When a reputational crisis occurs that puts the company's image at stake, both the workers that make it up and the suppliers, publicists and influencers, among others, may also begin to distrust the company or feel that it is not convenient for them to continue being linked. this. This can lead many people and partners to decide to walk away so as not to get "stuck" in the situation.


Loss of customers and reduced sales

Customers are often the first to be impacted in the event of a reputational crisis. In a historical moment in which people can choose between a wide variety of brands to obtain certain products and services, a bad reputation or reputational crisis in a company can lead them to immediately move away from it and opt for others when making their purchases.

This, without a doubt, ends up having an impact on a reduction in sales. Said reduction can be more or less pronounced according to the crisis management measures that are taken.


Drop in shares and product value

When a company suffers a reputational crisis, this usually leads to a drop in its shares on the stock market. When that happens, the value of your products or services may be affected downward, causing a further loss in revenue for the company.


What to do in the event of a reputational crisis?

If what you want is to reduce or avoid the negative impact of a reputational crisis, there are certain measures that are important to take once it occurs:

  • Carry out an analysis of the situation, what was the triggering factor of the crisis, and its depth.
  • Assign specific tasks to the different parts of the team, also proceeding to bring peace of mind to everyone within the company to maintain their confidence.
  • Offer specific and public solutions to people who have expressed problems that led to the crisis.
  • Develop clear and transparent communication in the media and platforms, revealing the faces and names responsible for said communications and ensuring that these are coherent and sustained in each message.
  • Measure the impact of the statements being made.
  • Avoid denying the problem or making the user responsible for the criticism, take responsibility for what has happened, and give the reason.


At 202 Digital Reputation we are a specialized agency in the prevention, management, and maintenance of digital reputation. We generate a 360° strategy that addresses the entire digital reputation management from the beginning to the end.

Social commitment