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PR Nightmares: What You Can Learn From the Biggest Business Blunders

Julie Thompson
Julie Thompson
business.com Contributing Writer
Updated Sep 20, 2022

One company's mistake is another's lesson. Learn from these public relations nightmares to keep your business's reputation unscathed.

The purpose of public relations is to use strategic communication to influence the public’s view of a person or business. As a business owner, for instance, you can employ PR tactics to strengthen your company’s reputation and encourage consumers to view your products favorably.

Even with the best intentions, however, some PR efforts go awry. While we don’t find joy in others’ misfortunes, we can glean a lot from the PR nightmares some notable companies have found themselves in.

Below are a few examples of major PR blunders and the lessons business owners can learn from them. These situations may have started innocently but turned into public relations nightmares. Take notes to avoid the same fate!

Never blame your customers.

Lululemon Athletica, an activewear company, had an embarrassing problem in 2013 with its new yoga pants: They were too sheer to wear in public. Rather than admitting to quality-control inefficiencies, the brand’s founder blamed the fabric’s translucence on overweight women rubbing their thighs together because the pants were too tight.

What can we learn from this? No matter where fault lies, blaming your customers is always a losing strategy. A sure way to squander money is to insult consumers’ intelligence, taste or, in this case, figures. Customers want a product improvement, not a defensive accusation. If your product falls short, own up to it and make it better.

FYIFYI: The quality of your product matters for more than just PR reasons. There is a direct correlation between product quality and return on investment.

Question the ‘facts.’

In 2001, tobacco titan Philip Morris Co. funded a study that claimed the benefits of smoking outweigh associated costs such as healthcare, lost working days, and cigarette-induced fires. To make matters worse, the company touted the “indirect positive effects” of early deaths – like savings on healthcare and pensions – and alleged that one foreign government in its study had a net gain of $146 million thanks to the tobacco industry. It’s no surprise the report received a massive backlash from the public, prompting the company’s senior vice president to publicly apologize for its “totally inappropriate … terrible mistake.”

What can we learn from this? Always check the facts and analyze a self-funded study from every possible angle. Try to poke holes in your own conclusions. In this case, the costs of smoking are complex and ambiguous – not to mention how distasteful it is to discuss the economic benefits of death with the general public. Even if something’s true, it may not reflect well on your company to celebrate it. [Related article: Lessons in Corporate Ethics From the GM Recall]

Don’t hide during a crisis.

2013 wasn’t the best year for cruise line Carnival, with multiple power losses and plummeting share prices. After one power outage (which understandably resulted in many unhappy vacationers), the company’s CEO was MIA when customers needed him most. Instead, a lower-level executive had to take charge of public communication during the crisis.

What can we learn from this? When an issue arises for your business, always do the talking yourself. If you don’t, you’ll communicate cowardice. The company’s most senior executives – which often include the owner in the case of small and midsize businesses – should be visible and communicative with the affected customers and the public in good times and bad. Consumers want to see issues are being taken seriously by the highest levels of the company.

TipTip: Repairing your company’s reputation is critical after a crisis. Consider these highly rated reputation management services to help with the task.

Be careful how you treat your employees.

You’d think that with a name like Better.com, this online mortgage company would’ve taken the high road when handling a massive employee layoff. But instead, its CEO decided to impersonally fire 900 employees via group Zoom call in 2021. He not only made these workers feel like nothing but a number, but even accused them of stealing from the company by only working a couple of hours a day. As the story went viral, the company’s toxic culture was exposed, and Better’s vice president of communications, head of public relations, and head of marketing promptly resigned, along with other vice presidents and board members.

Incredibly, the company made things even worse in 2022 when another group of employees learned they were laid off from the severance checks that appeared in their payroll accounts. As it turned out, the payments were mistakenly rolled out early, before the staffers could be formally notified of their termination. Social media again lit up with discussions of the company’s cruelty toward its employees.

What can we learn from this? Consumers are watching. Employers can no longer get away with promising nonexistent benefits and verbally abusing their workforce. By supporting your employees’ mental health and financial well-being, you can improve your employee retention and foster a positive company culture that makes customers proud to do business with you. A business owner should want to go viral on social media for treating their team well – not the opposite.

Did you know?Did you know? Keeping your employees happy is one of the best investments you can make for your business. It’s also a good idea to calculate your employee turnover rate so you can spot any problems with retention.

Use clickbait wisely.

The Burger King Foundation grabbed attention in 2021 with a full-page ad in The New York Times publicizing its H.E.R. (Helping Equalize Restaurants) scholarship program, which gives female employees the chance to receive a culinary education grant. The ad declared, “Women belong in the kitchen,” but quickly offered context to educate readers about the lack of women in chef and head chef positions.

But on Twitter, Burger King fired off a tweet that only read, without that crucial context, “Women belong in the kitchen.” The kicker? The seemingly sexist post, bad enough on its own, was published on International Women’s Day. Unsurprisingly, the tweet was met with an outcry, prompting the company to clarify that the post was about its H.E.R. initiative. But because its initial apology was posted as a reply to the original tweet instead of as a new message, it was relatively hidden.

What can we learn from this? A full-scale marketing campaign that includes both social media and print advertising is a smart strategy. However, if you don’t approach each type of media as its own mini-campaign and adjust the language accordingly, an ad could read the way you intended in one medium but come off as tone-deaf in another. Print ads can be supported with substantial text and multiple images; trying to be clever with one-line clickbait on social media can quickly take your company’s reputation in the wrong direction.

Bottom LineBottom Line: A social media marketing campaign can go wrong if you don’t take into account the platform you’re using and how snippets of information play differently in brief posts versus detailed ads.

Don’t ignore grammar.

Steve Jobs was a genius. But even geniuses can stumble a time or two. When making a speech in 2008, Jobs introduced the new iPod as “the funnest iPod yet.” While technically a real word, “funnest” generally isn’t considered the correct term to use. People on the internet collectively howled with laughter and criticized Jobs’ linguistic mistake to the point where the public was more obsessed with his slip-up than with his fun new product.

What can we learn from this? When you’re speaking or writing on behalf of your company, make sure you abide by language rules and conventions. It’s not an unforgivable sin to fumble your word choice, but persnickety consumers might overlook a new product to focus on your blatant grammatical error.

Apologize for employee misconduct.

In 2009, Domino’s employees recorded themselves spitting on pizzas and putting cheese up their noses. When the footage went viral, the company’s president immediately fired the employees and apologized in a YouTube video for their unacceptable behavior. He also thanked the online community for notifying Domino’s of the stunt and rolled out new hiring and sanitizing practices to reassure the public of the company’s commitment to hygienic safety. [Related article: Why Every Brand Should Have a YouTube Channel]

What can we learn from this? In this case, we applaud Domino’s for its actions. The company took horrible publicity and turned the situation around with a solid PR response. If your employees deface the name and dignity of your business, fire them and let the public know what actions you’ve taken. Reassure your customers that their safety, sanity and needs come first in your book.

Ashtyn Douglas contributed to the writing and reporting in this article.

Image Credit: NanoStockk / Getty Images
Julie Thompson
Julie Thompson
business.com Contributing Writer
Julie Thompson is a professional content writer who has worked with a diverse group of professional clients, including online agencies, tech startups and global entrepreneurs. Julie has also written articles covering current business trends, compliance, and finance.