It's been all over the news: Last week the Lexus GX 460 was given the extremely rare "do not buy" rating by Consumer Reports. On the heels of Toyota's PR disaster surrounding recalls over cases of unintended acceleration, the once-esteemed carmaker has stepped in it again.
Toyota's response was typical: A calculated surprise that betrayed a more general confusion. The initial statement offered to the media read, in part, "Lexus' extensive vehicle testing provides a good indication of how our vehicles perform and we are confident that the GX meets our high safety standards." This textbook case of corporate blah-blah-blah was followed up with a promise to retest all its SUV's and Crossovers, while its PR staff worked overtime giving reporters vague answers to questions about the situation, most of which boiled down to, "We don't know."
Frankly, from someone who watches marketing and PR responses as carefully as I do, this was a bigger train wreck than the problem itself. Toyota did manage an admission by the end of the week and we can consider this a step in the right direction -- at least the company seems to have learned something from the $16.375 million fine levied earlier this month by the NHTSA, punishment for its failure to notify the agency of "sticky pedal" defects. A recall of the GX was then issued on Monday, and regardless of the alacrity displayed by the engineering side of the business, I still think Toyota hasn't mastered the art of professional crisis management as well as it should by now.
I have written a few times in this blog about steps that could be taken by Toyota to mitigate these issues before they spiral out of control. I keep watching to see if its response strategy will improve, yet I'm still waiting. Toyota and Lexus still have the same, lame Facebook pages that boast over 160,000 aggregate fans, but are rarely updated -- a missed opportunity. The Toyota Twitter account has gone from 18,000 followers last month to just over 20,000 as of today, but by comparison Ford has nearly 30,000, and Southwest Airlines blows them out of the sky at 1,000,000. Toyota does have information on the recall on its Web sites and seem to make it easy to contact the company with questions or issues, but this is pretty basic stuff. Where's the real outreach to a public that has grown legitimately skeptical?
If Toyota simply asked for people's thoughts, ideas on how to better engage with them and re-assure them -- even if it decides not to take the advice -- I think the company would be well on their way to shedding some of their cold, closed, uncaring, image. I hope they are at least tracking public reaction via social listening tools, a simple first step towards being proactive.
As part of my current work as a marketing consultant I meet with agencies and vendors that work for Toyota. Just the other day I was with such an agency that serves some of Toyota's markets outside of the U.S. In discussing this issue with them, I kept coming back to, "Why are they not being radically transparent?"
The response from the agency was that the powers that be in Japan do not allow U.S. management to do so. Certainly, I can understand the legal implications of providing too much information. These days it seems like everyone is suing Toyota. But I still believe that the long-term cost of all this ill will is going to be far more expensive than a little more transparency, even if that may result in a few more short-term dollars spent in settlements.
"Radical transparency" means going above and beyond the expected levels of communication and response, in a way that is audacious and shocking in its clarity. For instance, a couple of years ago, Jet Blue found itself in the hot seat for stranding flyers on one of its planes for an obscene amount of time. It responded in a way that was so out of character for corporations that the reconciliation effort spawned huge positive sentiment, overshadowing the initial consumer anger. First Jet Blue published a full-page letter of apology in major newspapers taking complete responsibility without trying to offer excuses. They it committed to drastic improvements and backed it up with something they called the "Jet Blue Customer Bill of Rights." Then it began to publish regular results on its improvements and setbacks. Good or bad, we knew it was trying, knew how and what it was doing to improve, and as customers we felt kept in the loop.
I witnessed this issue first-hand a decade ago. The Ford Explorer tire debacle began while I was at Ford and I watched it unfold. Ford struggled with these same issues of transparency, and that situation wasn't even as cut-and-dry as what Toyota has been dealing with, as Firestone was seen as at least equally culpable. It's no secret that Explorer sales have struggled each year since the crisis.
Today we live in a world where opinions flow instantly and can gain a volume and intensity that's downright dangerous, much more so than Ford experienced in 2000. Social networking platforms like Twitter have forever changed the rules for crisis management. In the situation Toyota -- and now its revered Lexus brand -- faces, where the blame is clear and concern is valid, there's no reason to think things will wind up any differently. I just hope that someone in Japan realizes that protecting its closed-off culture in a world that's embraced open, radical transparency will never inspire or engender trust. But then again, should yet another disaster come their way, perhaps the third time will be the charm.