Freudian Slips and War Hype: TOP 5 of the Most High-Profile PR Scandals in Ukrainian Business

Репутація

Reputation is always a long game. A positive perception of a brand or company owner is formed over the years and through deliberate daily steps based on a carefully crafted strategy. And you can get into trouble by making just one mistake.

No business is immune to reputational problems. At the same time, only some manage to restore trust and consumer loyalty by reducing public dissatisfaction. In the digital era, even a minor negative mention of a brand or its owner remains online for a long time.

So why do Ukrainian companies, top managers, and public figures still put their reputations on the line and resort to thoughtless actions and emotional statements, exposing themselves to a barrage of criticism and canceling? Which of them manages to overcome the crisis with dignity, with minimal financial and reputational losses?

1. Tabasco and the language scandal

Social media was stirred up in April of this year by a statement made by Oleksandr Smirnov, co-founder of one of Ukraine’s most significant marketing agencies, TABASCO. Reposting a post by Minister of Education and Science Oksen Lisovyi, he accused him of “harassing Russian speakers” and called the Kyiv-Mohyla Academy “Kyiv-retarded.”

This Freudian slip by the company’s CEO caused anger among opinion leaders in the Ukrainian segment of Facebook, as well as among TABASCO’s clients and well-known entrepreneurs.

Shortly afterward, the post from Smirnov’s page disappeared, and another one appeared, in which the co-founder of the advertising agency promised to collect things “for your historical country” and posted photos of awards from the Armed Forces, the National Police, and the Minister of Defense of Ukraine.

Regarding the official position of TABASCO, on their Facebook page, they seemed to apologize. They expressed dissatisfaction with the unfortunate situation and distanced themselves from Smirnov’s words. However, if we analyze the reactions to the post, the number of shares, the comments below, and the dozens of likes for each of them, this attempt to extinguish the reputational fire only further fuels it.

What about the insight?

Unfortunately, today, almost every day, the media reports on the unfortunate “suicides” of opinion leaders, influencers, and popular brands. In pursuing popularity, trying to stand out from the competition, and winning the audience’s favor, emotions often take precedence over rationality. But in the case of the TABASCO agency, the mistake was not only the CEO’s aggression on topics that hurt Ukrainians but also the inability to admit his mistakes and apologize.

Blaming the “victims” is always a losing strategy. If people are offended, it is not them who are to blame, but the offender. It is one of the golden rules of crisis communications. The agency had to take responsibility, not deny the co-owner’s words, draw conclusions, and apologize. It would have laid the groundwork for further reputation restoration.

2. Sweet YARO and bitter Ukrainophobia

Anti-Ukrainian jokes often cause reputational losses for companies. For example, in October 2021, Yulia Privalova, owner of the YARO brand, became the target of hate speech. On her Instagram, she posted a photo with her husband on the main square of Moscow and responded to a comment under the post where they were called separatists with a joke about two Banderites. Not everyone laughed.

Likely, the situation would not have gained such publicity if activist Serhiy Sternenko had not highlighted it. He published a post on Ms. Pryvalova’s Instagram screen, in which he condemned her Ukrainophobic statements and called on Ukrainian companies to boycott YARO.

The trademark owner found no better solution to save her reputation than to delete the post. However, she published another post in which she apologized and tried to prove her pro-Ukrainian position. However, it was too late: Epicenter, Rozetka, Silpo, Auchan, Glovo, Idealist coffee chain, etc., refused to sell YARO products.

The company issued an official statement a week after the incident with the owner. On their Facebook page, they assured of their love for Ukraine, called the flurry of criticism on social media “viral information attacks,” and apologized. However, something went wrong, as the comments under the post were soon closed. Not everyone believed the apology, as “those who were offended” were once again to blame.

What about the insight?

У коментарях під дописом цікавилися, а чи буде власниці бізнесу не лише емоційно незручно, а ще й матеріально боляче? Риторичне питання. ****

Про фінансові втрати Юлії Привалової, яка два роки тому позувала на центральній площі країни-агресора, можна лише здогадуватися. Звісно, відмова великих маркетплейсів від співпраці з брендом, задекларована спочатку, не могла не похитнути її фінансовий стан. Проте YARO існує й досі і, зважаючи на занадто прямолінійні відповіді Привалової у соцмережах, комунікацію не поліпшив. Можливо, компанія і втратила частку своєї української аудиторії, та впевнена в постійних клієнтах і надбанні нових – на міжнародних ринках.

3. Patriotism or hype at war?

Ukrainian businesses suffered significant losses at the beginning of the full-scale Russian invasion. However, in the summer of 2022, it began to recover, unanimously supporting the Armed Forces and helping IDPs.

Despite calls in professional circles “not to put war on promotions,” many Ukrainian companies took advantage of the wave of patriotic enthusiasm and changed/expanded their product range. FMCG and gastronomy have become prevalent industries for using Ukrainian symbols and military naming.

That’s how they appeared:

  • vodka “Nepoborna”
  • beer “Dzhmil Javelin”;
  • pizza “Bayraktar” and “Chornobaivka”;
  • underwear with national symbols;
  • children’s sports suits with “catchphrases” of public figures;
  • even vegetable seeds “Haimars” and “Azovstal.”

The limited edition line from the Varvar craft brewery, released in February 2023, caused outrage. Their beers “Heroes Don’t Die” and “Heroic Bucha Kombucha” were harshly criticized on social media. The authors withdrew the beers from the sale and apologized, explaining that they had created the series in memory of their colleague who died at war and that all proceeds from the sale were to go to a charity.

The scandalous situation quickly reached its logical conclusion: the brand apologized, admitted guilt, explained the reason for the act, and promised not to do it again, but the unpleasant aftertaste and sense of surrealism remained.

What about the insight?

Ukrainian business certainly had a tough time in 2022. Many companies still exist in uncertainty. However, society should have already formed an ethical and conscious attitude to the war.

Today, communicating on the war theme for brands is like running through a minefield: you may be lucky, but there is also a chance that this will be your last adventure. The idea of the Varvar brewery was noble, but the implementation was too emotional. Ukrainians will see this label as just another manipulation of a very painful topic. They will not understand that it is a tribute to a fallen soldier and a charity fundraiser.

Brands should remember that war is primarily a tragedy and loss. Therefore, before implementing any products or events related to it, it is worth conducting a survey of the target audience and calculating all possible risks.

4. Yakaboo and sexist statements

Ukrainian companies that find themselves at the epicenter of reputational scandals due to the rash words of their top managers do not often resort to extreme measures. That is why the case of Yakaboo’s handling of the crisis in an unpopular way and firing its CEO Ivan Bohdan – is an example of an exception rather than a rule.

So, what was the reason why the co-owner of one of Ukraine’s largest online bookstores found himself out of business? On September 28, 2022, as part of the discussion “Ukrainian Book: After the War, Away from Moscow” on a YouTube channel, Ivan Bohdan suggested that women buy more books with money earned by men. Outrageous comments from readers began to appear during the broadcast. The next day, there were many of them.

Mr. Bohdan posted a message on his Facebook page on the afternoon of September 29, apologizing for his words and summarizing that the company had made a difficult but correct decision. He was stepping down as Yakaboo’s CEO. Soon after, the bookstore also issued an official apology to its audience. Thus, this dismissal was the fastest among the Ukrainian tops and the first after a single sexist statement.

What about the insight?

After Ivan Bohdan’s resignation, some of his critics said it was too much. However, the majority welcomed the news. However, has the dismissal of the company’s CEO become a panacea for the online bookstore from reputational losses? Considering that Yakaboo is the largest book retailer with no alternative and has skillfully overcome multiple crises, doubts about a quick recovery from the sexist scandal disappear.

Perhaps, on the contrary, the “Bohdan precedent” will work for, rather than against, the brand’s reputation: it will contribute to further business development, successful communication, and loyalty of future consumers. In business, there are often cases when recognized mistakes become advantages, an idea for a new product, or an innovative project.

5. Alyona Alyona and drifting in Kyiv

In August 2021, the famous Ukrainian rapper Alyona Alyona got into a scandalous story after participating in a shoot for the energy drink Red Bull. In the video, two sports cars drifted on St. Sophia Square in Kyiv. As it turned out later, the city authorities did not grant any permission to organize and shoot such advertising. A complaint to the police was promptly filed, which resulted in a criminal investigation and even the seizure of the offending cars.

However, despite the considerable hype and flurry of negativity against Red Bull and Alyona Alyona, the story ended almost idyllically. The company issued an official statement in which, taking into account all the critical elements of such information, they admitted their guilt, apologized for their shameful behavior, regretted the mistake, and promised to fix everything. Alyona Alyona, in addition to honest and timely communication with its audience, also joined the cleaning of traces of burnt rubber on the pavement together with utility and cleaning companies. Apologizing, regretting, and fixing it herself is often enough to win back favor.

What about the insight?

What is the moral of the story? A reputational lifeline equals less reputational damage. Red Bull is a famous global company with a good reputation. Ukrainian rap artist Alyona Alyona is an opinion leader with a substantial audience. If they hadn’t had such a positive background formed over years of effective communications, the situation could have ended in total canceling.

Algorithm for brand communication in times of crisis

Therefore, it is essential to communicate with both external and internal audiences:

  • To apologize. Sincerely and without excuses. It is better to address the audience in the first person singular (company/brand name), but if the owner decides to direct the attack on himself, the pronoun “we” will be appropriate.
  • Admit the mistake. First of all, this is about strength, not weakness. It is also about the ability to take personal responsibility and build trusting relationships with colleagues, partners, and clients.
  • Don’t look for the extreme. Shifting the blame to others to flatter your ego and denying vulnerability is the path to a destructive corporate culture and fear of mistakes in general.
  • Offer a solution. From words to actions. By correcting the mistake and compensating for moral or material damage or taking other actual activities, you will restore the trust and loyalty of your audience.

Reputation restoration during a PR scandal is made effective:

1. Quick reaction. As you know, negative news is spread with more zeal. So save time if you have something to say.

2. Knowledge of the audience. It will help you choose the most appropriate rhetoric and style of message. Targeted communication = effective communication.

3. A clear position. The answer should be consistent, understandable, and not contradict personal values and company principles.

4. No offense. Even if you receive a portion of hate from your competitors, don’t throw mud at them in return. What to do? See the Algorithm for brand communication during a crisis above.

5. Honesty. Despite prejudice, it is still valued in society. Explain the truth about why an unpleasant situation has arisen.

6. Confidence. Don’t be afraid to give the impression of a vulnerable brand. Everyone makes mistakes, but only a few admit them because this requires decency and courage.

Do not expect disaster, but be ready for war

To summarize, no brand is immune to reputation problems. Therefore, every company should have a developed crisis strategy or at least a list of must-dos, which, in the event of a stalemate, will help determine the vector of movement, quickly resolve and overcome the consequences of the crisis, or even better, predict and prevent it.

We should also remember that today, in times of war, communication requires even more balance and empathy. Therefore, one of the main rules that will help companies of any size and with any background to prevent reputational problems is “not to press on sore spots” and always communicate honestly with their audience.

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