What Risk Management Lessons Can Be Learned From The Duck Dynasty Mess

There’s a firestorm raging on social media about the A&E Network’s suspension of Phil Robertson, the patriarch of the cable television reality show Duck Dynasty, after he made his thoughts about homosexuality public in a GQ Magazine interview.

To keep this post from being overly polarizing, I won’t comment on the interview or the actual comments in the GQ article, instead, let’s look at the resulting fallout.

After the suspending Phil from the show, other family members who appear on the Duck Dynasty show have indicated that they might not be able to continue with the show, which could lead to a termination of the highly rated program, or at least a temporary suspension.  The Network is taking a trouncing on social media with calls of petitions and boycotts and an overall negative light has been shone on everyone involved.  Now keep in mind that the show is a reality show based upon Phil’s family business – a company that makes duck calls for duck hunting.  The popularity of the show has pushed that business to be a $400 million a year revenue enterprise!  The show is the most popular show on the A&E Cable Network, creating millions of dollars of revenue for the network.  So we have the potential for some very significant financial downside risk here.

Including:

  • Loss of revenue for Duck Commander (the name of the duck call business) should some retailers elect to suspend their line of products, or some customers find Phil’s comments distasteful enough to boycott the product.
  • If the show does terminate due to the family unable to continue its relationship with A&E, that will create a longer term impact as the brand gets stale or irrelevant to the consumer.
  • If the show terminates, A&E will suffer loss of advertising revenue, as Duck Dynasty is A&E one of A&E’s highest grossing shows.

We’re talking about potentially millions and millions of dollars in lost revenue for both parties, all due to some very poorly managed media placement.  So, how do you prevent something like this from occurring and damaging your company’s brand or reputation?

Like all other risks your company faces, reputation and brand assets need to be properly managed for successful outcomes.

First is of course identification and awareness of the risks involved.  Do you know what potential risks your company faces when it comes to damage to your brand or reputation?  In the above case, A&E should have known that the people they were working with could be a little quirky and potentially dangerous when it came to the media.  In fact, it’s probably their unique and quirky characteristics that made their show a hit, but ignoring the potential downside risk was a mistake.

Second, what controls can be put in place to manage reputation and brand risk?  Does your company have a standard operating procedure for clearing all media placements through your legal department, or by your organization’s outside counsel?  Have you thought through potential controls to the risks you identified in step one?

In the case of A&E it would probably be a combination of communications and contracts.  Communications means that the participants of every show must understand and have a solid sense of what is acceptable, and what is not, and what the financial impact for stepping over the line could be.  While the show’s stars are independent and likely far removed from the upper levels of corporate decision making at the Network, a consistent communication strategy about “acceptable standards” is a must.  To put belts and suspenders on that communication is explicit contracts that must be deployed to reinforce corporate standards.  Included within those contracts  would be a mandate that the Network must be involved with any and all media events, including interviews, with the Network maintaining the authority to be present at all media events and having authority to approve or disapprove all media placements.  That is a best case scenario and maybe all of that wasn’t negotiable, but it should be the starting point.

Third, can the risk be transferred or insured?  Reputation and brand insurance coverage does exist, but it doesn’t pay for the downstream resulting costs of the damaged brand.  What it does help pay for are the costs associated with mitigating the event as well as access to a panel of public relations experts, crisis communication experts, and social media campaigns to lessen the impact of the event.

In the case of A&E and Phil Robertson, a more defined and scaled response plan would probably have been more effective than what did transpire; which seemed underwhelming to me.

The fourth step in Risk Management is monitoring.  If you’ve completed step one and identified the reputation risks, and quantified the value of your organization’s brand and reputation’s assets then it’s time to monitor those assets.  Depending on the size of your organization, there are several methods of doing this.  For smaller to medium sized businesses monitoring Google Alerts and various social media platforms can be done relatively easily; for larger firms, this task may be undertaken by full time employees or outsourced to a specialty firm that has the manpower and technology to monitor your name, product, service, reputation and brand all day, every day.

At the end of the day, your company’s brand and reputation may be the keystone of value in your balance sheet.  It requires a well thought out strategy to protect that asset, as well as an action plan should that asset be threatened.  Preparation in advance of a threat is necessary to respond quickly and effectively to extinguish negative outcomes.  Insurance may help fund the costs associated with risk mitigation, as well as provide the immediate resources necessary for a timely response.

For more information on how The Coyle Group can help your company manage risk, please contact us using the contact box found on this page, or call 800-287-4115.

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