In recent months, the terror attacks in Manchester, London, and elsewhere have underscored the increasing risks posed by terrorism. Beyond the horror of terror and loss of life, a new challenge has emerged. Risk has shifted from states to people, but also companies. The challenge of terror is extending to brands.
When singer Ariana Grande’s concert was attacked, her brand was immediately drawn in, as was that of multinational European venue operator SMG, which runs the Manchester Arena where the concert took place. Grande endured immediate Twitter attacks the same night. SMG now faces the challenge of developing new protocols and response measures for more than 230 properties that it manages across the world. Meanwhile, German authorities fully evacuated the Rock am Ring Festival in early June.
Grande immediately took action, responding impressively with a charity concert. But the Rock am Ring festival faced a different set of challenges. Imagine the cost of closing a giant festival, akin to Coachella in the U.S., due to a terror threat. What might be the impact on subsequent festivals and attendance? Also consider the insurance implications in all these situations; almost all policies explicitly omit coverage for terror threats, or charge extremely high premiums for them.
The attacks in London took this brand challenge further. One of the terrorists was wearing an Arsenal soccer jersey. London’s The Sun reported this quickly, even making insinuations against Arsenal in its article. This prompted a strong response from many Arsenal fans who pushed to boycott The Sun. This is the new kind of danger that terrorists pose to brand value. What if a terrorist remotely took command of the steering wheel in a certain brand of car and used it in an attack? This is by no means inconceivable. What if an attacker was wearing your brand’s logo emblazoned on his clothing?
Terror has evolved from random incidents in faraway countries to physical and cyberattacks on people, companies, and critical infrastructure. We have moved from large-scale war to smaller, almost perpetual conflicts. As this layer cake of conflicts has raged, ISIS announced an intent to move into 38 countries and mobilize soft target attacks. Manchester and London targeted Europe, while ISIS-linked Abu Sayyaf conducts attacks in the Philippines and ISIS has attacked Iran’s Parliament and its Ayatollah Khomeini monument.
What can be done?
John Melkon, head of the Center for the Study of Civil-Military Operations at West Point, noted at Techonomy NYC that we are now in a state of low-grade perpetual conflict with non-state actors like ISIS. So brands and companies need to update their existing crisis management and corporate communications plans with 2017 terror protocols.
The first thing to do is review corporate communications and crisis management plans, including social media. Social is where a brand will initially find out about issues and first be affected.
Second, work with a cybersecurity consultant and counterterror strategist to identify likely scenarios that might affect your brand. If you’re a venue—that could be an attack. If you’re a supplier—that could be a hijacking of one of your service vehicles. If you’re a brand—what could be the sales impact of having a terrorist associated with you?
Third, prepare, and educate your key staff. These types of risks have existed since the early 1900s, through the World War II and Vietnam eras. The difference now is that digital and social media give any event real-time impact. That could put brands immediately into the news cycle. But if you take steps to address these risks, they will likely have a less devastating impact. A bad response is typically worse than no response.
Lastly, review your risk and country-risk insurance coverage. It’s a tragedy we have to think this way, but even as many of us work hard to combat terrorism, we have to acknowledge the challenging new world in which we find ourselves.