Protect Your Business with a Brand Risk Analysis
This year has tested everyone’s survival skills. Many businesses are taking a hard look at their overall risk analysis. As a company, Segpay goes through several different audit functions and explores multiple risk scenarios to investigate what could potentially put our company in harm’s way. We look at things like security risks during our payment card industry compliance audits to make sure our systems are redundant and can’t be penetrated by outside intrusions. It’s vital to make sure all our data is secure. We also review our financial risk through annual accounting audits and our regulatory risk when preparing our annual updates to policies and procedures.
From forest fires to flash floods and the ongoing Coronavirus pandemic, what hasn’t crushed your business has made you stronger. 2020 has tested everyone’s business survival skills and made many take a hard look at their overall risk analysis. Every year at Segpay, we go through different audit functions and explore multiple risk scenarios that would or could potentially put our company in harm’s way. We look at things like security risk during our payment card industry compliance audits to make sure our systems are redundant and can’t be penetrated by outside intrusions. It’s vital to make sure all our data is secure. We review our financial risk during annual accounting audits covering the U.S., UK and Ireland focusing on capital and cash reserves. We also look at regulatory risk when we prepare for annual updates to policies and procedures to verify that we’re meeting all the local and regional requirements for processing.
Many of us do all these risk assessments but leave one important area open- our company’s brand risk. It’s an easy target and one that if you don’t have a detailed protection plan in place, a worst-case scenario could bring your business down. In this month’s column, we collaborated with our risk analysis team to reveal our top ways to conduct your company’s brand risk analysis.
Have Compliant Clients Not Mischievous Merchants
Image is important even with the Card Schemes. It is critical to make sure all clients are compliant so there are no potential brand violations that could hurt your company’s image. We’ve experienced this firsthand after a few clients who were still in full compliance caught the attention of the performer community. Their frustrations boiled over onto Segpay with some feeling, as a payment processor, we were enabling programs they did not agree with. We soon became a target of the community which then asked us for action. No company wants to be an arbitrator in disputes or receive negative publicity that could potentially impact its brand, so it is important to know when to act and, in this case we did. Remember all eyes are on you including your merchant base, consumers, acquiring banks, the card brands and the regulatory bodies that grant you licenses to work in other countries.
Know Big Player’s Big Policies
Card brands have had content policies for years that are aimed at protection of their brands. These come with hefty fines that can be placed on merchants that are out of compliance. For example, a large merchant in our space has been under attack from child advocacy groups and that noise got so loud it caught the attention of newspapers and the card brands. Even though that merchant was most likely compliant, it was the loud outcry of potential wrongdoing that made the payment brands and banks take a deeper look at the merchant. This merchant was still 100% compliant but that constant pressure from child advocacy groups was creating negative news that even more people began to pay attention. I even received a call asking if we were working with this merchant (which we were not) to warn us and make sure we wouldn’t get wrapped into their negative press. To stay out of trouble, leading payment brands say their senior team meets weekly to discuss potential merchants, partners and others who could negatively impact their brand and how they’d best address it. This is a great way to head off potential problems. It’s something we do at Segpay too.
Cope with the Cancel Culture
In today’s “cancel culture” it’s important to ask, “could your brand get caught up in negativity that could take your entire company down?” We’ve seen a lot of this lately. The cancel culture seems to be the way society is trying to drive desired behaviors. In just the last six months we’ve seen lots of examples, here are a few.
- Driven by the social justice movement, Aunt Jemima proactively protected its brand by removing the key art image it had featured for years, saying it was no longer relevant in today’s marketplace.
- Nike embraced Colin Kaepernick as the face of Just Do It shortly after he started kneeling for the National Anthem in protest of social justice. Nike took the backlash from consumers who did not agree with Kaepernick’s actions and began burning their Nike gear. In the long term, Nike’s sales went up.
- U.S Representative Alexandra Ocasio-Cortez, known as AOC, asked for the boycott of Goya Foods since the CEO met with the President and complimented him. This worked in reverse and Goya foods sales went up.
- Fitness company Equinox got hammered after news broke that Stephen Ross, the chairman of its parent company was hosting a fundraiser for President Trump.
- Celebrities are also under fire. Jimmy Fallon and Jimmy Kimmel have both faced backlash for old skits and imagery that was inappropriate by today’s standards.
The best thing you can do to protect your brand in today’s cancel culture is to make sure it doesn’t get caught up in negativity. I wanted to leave you with a few thoughts that could help protect your company. Take time to establish what your brand represents and know how you want others to view it. Try to avoid controversial subjects or choosing sides in white hot political debates. Pay attention to diverse voices inside your company. Develop a senior leadership committee to discuss potential items that could impact the stability of your brand and make action plans to protect it. Lastly, pay attention to social media. Look at who’s talking about you and what their saying. Is it negative or positive and act on it when necessary. Need any help developing a plan to protect your brand? Our team can help. Reach out to us at [email protected].