A badly handled business crisis makes a company more profitable

Bookmark and Share
My Sister Paid Progressive Insurance to Defend Her Killer In Court. Did you hear about this story earlier this year? (Matt Fisher Tumblr) Bottom line it turned into a social media bun fight made even worse by the auto response script used on Progressive Insurance's Twitter feed!

The really interesting thing for me - aside from "Big brands: When talking on Twitter about how you handled a customer's tragic accident, the phrase "contractual obligations" is unlikely to play well!"

But the real mind blower of this instance is: Did Progressive's "crisis" harm its business?

We don't need to wonder, because the company's financial performance from this period can be found in Progressive's recent SEC filings. The event occurred in the middle of the company's last quarter, which ended 30th September. That quarter was the most profitable the company has had in over a year.

Progressive's revenue was up 5.7% from the previous quarter and up 14% from the same quarter in 2011. The results were far better than expected.

A business based crisis played out on social media is not necessarily a bad thing - their reputation although dented has not hurt their bottom-line.