As the Masters Tournament came to a close in Augusta, Tiger Woods became a case in point of someone who in six months has gone from universally admired golf icon, to being flogged by the media, to being characterized as a flawed human being who is still admired for being a superb golfer. For those who focus on the iconic nature of his stardom and brand, he may still be scorned; for those who focus more on his performance as a golfer, he is making progress toward renewed admiration (albeit different from before). In the spirit of our two-part post on customer adoration of brands, he has gone from a brand worthy of a Lovemark, back to a high performing brand. Where he goes from here is anyone's guess.

Toyota is in a different kettle of fish, as they should be when errors cause injury and worse. It is not just the errors that are challenging their reputation; it's the ambiguity of how they have responded, the growing sense that some within Toyota sought to delay and even bury the issues. Those perceptions, along with the errors, create a trust nightmare for the business. "Would you buy a Toyota, given what you have read and heard?" "Not right now", seems to be the common response.

And yet the research on service recovery tells us to act, to act quickly with a bias toward the values you live by, and to act transparently.

J&J's response to the Tylenol crisis years back remains the gold standard for crisis response and recovery. It's been widely written about as a model of leadership in a crisis, of brand and reputation management, and of being socially responsible as a firm.

Here is the other data that from research on consumers' intention to repurchase after they had service difficulties. Not surprising, those who had no service difficulties had a higher intent on average to repurchase than those who had difficulties of some type and no recovery satisfaction (71% vs. 41% intent to repurchase). Those who had service difficulties that were dealt with in a satisfactory way had a higher intent to repurchase than those who did not have a satisfactory repair experience (67% vs. 41%). That makes sense, too.

This is the really interesting bit: those who had a severe problem (as opposed to just a mild problem) and a satisfactory recovery experience had an even higher intent to repurchase than those who had no problems at all (75% vs. 71%). This research advances what is known as the service recovery paradox and was presented by Anna Chandonnet and colleagues at the annual conference of the Society for Industrial and Organizational Psychology.

Seeing how a company and its employees make the extra effort to ensure problems are dealt with creates an opportunity for customers to really experience the brand in action. And that promotes loyalty.

Yes, you may think to yourself, that this is all just common sense. But as Management Professor David Bowen reminds us, "Commonsense isn't always common practice."

Toyota, there is still time to turn this around, but that time is now. You need to:
1. Make your plan to address the safety issues fully transparent.
2. Make the process for customer access to your efforts equally transparent.
3. Assume everyone who might purchase a car from you someday, not just current customers, are the people you want to appreciate your commitment to service recovery.
4. Keep communicating, even when you think you have done enough, and after the media moves onto some other attention-getting story.
5. Engage employees in an ongoing dialogue about how they are discussing these issues with friends, family, customers, and strangers. Give them the opportunity to learn with and from each other. They will become your agents of reputation recovery.
6. Track and disclose everything. This includes impact on sales, perceived reputation, intent to purchase other brands, and employee attitudes, and maintain this tracking. When the disappointing numbers begin to recover (and they will), others will see for themselves the trends and your willingness to address the issues over time.

Here's what I want to know....

How has your company rebuilt customer loyalty in response to an error?

How does your company create a climate for learning from mistakes?