Crowdfunding is a popular way for startups to raise money to launch their businesses. But the real challenge begins after a successful fundraising round. Funded startups often hit a bump in the road which delays progress and delivery of goods. When it happens, disgruntled customers take to the web and complain, tweeting about their disappointment or posting angry comments on the company Facebook page. What can you do to mitigate damage when you miss a deadline? Here’s how to weather the storm when you have to break bad news to your supporters.
- Minimize concerns/complaints: Minimizing a concern trivializes someone’s experience. Instead, validate their feelings and then begin the process of reconciliation. How can you move past this negative experience and regain trust? Honestly, this may not be possible in every scenario, but there must be an effort on the part of the company to recognize the damage that was done and make an effort to compensate for damages.
- Understate the problem: Own up to the full scope of the crisis. There has already been a breach of trust, and any negligence in reporting the full extent of the problem will simply erode the trust even further.
- Attempt to improvise your crisis plan: A crisis plan is like an insurance policy – you should always have one while hoping that you’ll never have to use it. If you don’t have a ready plan, now is the time to assemble your team and create one. A monitoring system should be in place today to track online conversations about your company. This is crucial, as it allows you to identify a crisis when it happens online in real time.
- Debate with supporters/customers in a public forum: Online comment threads tend to get heated quickly and take on a life of their own. Do not attempt to shut down the conversation or delete negative comments. Instead, try to move the conversation to a more private forum such as phone, email or social media direct messages. A business can feel anonymous, but once an angry customer can speak with an individual, the brand is humanized and the chance of coming to a resolution increases.
- Disclose news in a timely way: Having another source scoop you will make it appear as if you were hoping the story would not come to light. By breaking your own story, you are able to craft the language that will be used and quoted by other news sources.
- Take responsibility: As you publicize your news, be sure to accept responsibility for the problem. Do not attempt to lay blame elsewhere. Apologize sincerely and be as clear as possible about the course of events that led to the crisis. As you detail the problems, address how they will be remedied in the future, or at least make clear that all efforts are being made to identify and remedy the underlying problems.
- Offer creative compensation: When damages are done, either tangible or intangible, restitution must be made. This compensation can be financial in the form of discounts, vouchers or free products. In other circumstances, restitution may be the ability to cancel a membership or order without any financial consequences.
- Monitor online for feedback/discussion: As mentioned above, brand monitoring should be a routine task, but during a crisis monitoring can’t be “set it and forget it”; it must be handled by an experienced team on a 24/7 basis. It is key that your crisis plan address who will be responsible for the monitoring and who will be responsible for deciding when and how to respond.
In a best-case scenario, the 24-hour news cycle will limit the time your crisis has the public’s attention. Hope for the best, but plan for the worst. If you don’t have a crisis plan yet, now is the time to draw it up. Beyond updating it on a regular basis, we hope you will never have to think about it.