Feature
The Gist
- Customer impact. The CrowdStrike outage caused significant disruption and financial losses for its clients.
- Communication failure. Lack of timely and transparent communication exacerbated the negative impact of the outage.
- Crisis response. Effective crisis management requires substantial, empathetic engagement and robust strategies.
The recent CrowdStrike outage is a stark reminder of the potential pitfalls in managing customer experience during a crisis. When the global IT security firm experienced a significant meltdown, its response raised more questions than it answered.
In an attempt to make amends, CrowdStrike's offer of $10 Uber Eats gift cards to “contractors who helped to manage the recovery efforts” has been widely criticized, highlighting the importance of incident response, transparency, meaningful customer engagement and effective communication. This incident also underscores the critical need for companies to have robust crisis management strategies that go beyond superficial gestures, ensuring customer trust and satisfaction are maintained despite significant disruptions.
The CrowdStrike Outage
On July 19, 2024, CrowdStrike, a prominent cybersecurity firm, faced an unexpected and severe outage that left many of its customers scrambling for solutions. The disruption, which lasted for several hours, impacted the company’s ability to provide critical security services, leaving numerous businesses vulnerable during the downtime. As CrowdStrike’s systems went offline, customers experienced disruptions in their security monitoring and incident response capabilities, raising significant concerns about the reliability of the service.
The fallout from the outage was immediate and widespread. Businesses that rely on CrowdStrike for their cybersecurity needs found themselves without crucial defenses, prompting a flurry of emergency measures to protect their data and networks. The incident drew swift reactions from customers and industry observers alike, who questioned how a leading security provider could suffer such a substantial failure. The lack of timely communication from CrowdStrike after its initial response only compounded the frustration, as clients were left in the dark about the extent of the issue and the expected resolution time. One insurer estimated that Fortune 500 companies lost a collective $5.4 billion due to the disruption, underscoring the severe financial repercussions.
Mary Beth West, APR, FPRCA, PR advisor and crisis communication expert, told CMSWire that as with any crisis with the level of impact of the CrowdStrike outage, there always can be criticism and lessons learned — particularly as follow-on consequences of a crisis unfold in later weeks or months. West said that, in spite of the public backlash, CrowdStrike was actually very responsive when the initial event occurred.
"When the CrowdStrike story first broke with news of canceled flights and grounded airlines — among many other impacts across industries — CrowdStrike CEO George Kurtz immediately appeared for televised interviews that morning," said West. "With noted humility, he explained the company’s position on what was occurring, taking immediate questions from the media.” West reiterated that the top executive's fast responsiveness to news media was a good thing, in that it demonstrated a high leadership-accountability factor, which simply doesn’t happen in most high-profile crises these days.
The backlash, however, highlighted a significant misstep in CrowdStrike’s crisis management approach, underscoring the importance of substantial and empathetic customer engagement during emergencies. Adding to their woes, Delta Air Lines hired prominent attorney David Boies to seek damages from CrowdStrike and Microsoft following the outage, which led to millions of computers crashing and thousands of flight cancellations. When asked in an interview on CNBC about how much compensation CrowdStrike and Microsoft have offered the company after the CrowdStrike outage cost the airline $500 million, Delta Air Lines CEO Ed Bastian said "They haven’t offered us anything. Free consulting advice to help us."
CrowdStrike said Delta did not accept its offer of onsite help during the carrier’s meltdown that led to thousands of flight cancellations and delays, and a lawyer representing the cybersecurity firm said Delta’s threat of litigation has “contributed to a misleading narrative that CrowdStrike is responsible for Delta’s IT decisions and response to the outage.” This seemingly regular routine of shifting the blame continues to damage CrowdStrike’s reputation.
Sujay Saha, president at Cortico-X, a boutique, experience-led strategy and transformation firm, told CMSWire that compassion and a collective responsibility message, rather than shifting blame, would resonate better with customers and the industry.
"In today’s interconnected world, collaborative efforts and a customer-first approach are crucial for maintaining brand integrity and trust during unexpected disruptions," said Saha, who added that Delta could have minimized the damage its own brand sustained by itself being transparent and forthcoming when the crisis occurred. "Delta’s experience highlights the need for immediacy and transparency. A timely acknowledgment and setting clear expectations could have mitigated frustration. Empowering staff with clear communication protocols and innovative tools like pre-approval for reimbursable expenses can enhance customer experience during crises."
In the days following the outage, CrowdStrike attempted to regain customer trust by issuing statements and providing more detailed explanations of the causes and measures taken to prevent future occurrences. Despite these efforts, the incident left a lasting impression on many, serving as a cautionary tale about the critical importance of reliable service delivery and effective communication in maintaining customer relationships.
Related Article: Customer Trust: The Backbone of Digital Age
The CrowdStrike Response to Customers
When CrowdStrike initially offered the $10 Uber Eats gift cards, many were left believing that the company had made the offer to anyone who was affected by the outage, an act that would have seemingly trivialized the vast amount of damage that the outage caused. CrowdStrike was quick to reply to the gift card fiasco, stating that they did not offer gift cards to those impacted by the outage, but rather offered the gift cards to contractors who helped to manage the recovery efforts of the disastrous software update that took down thousands of websites.
TechCrunch reported that some of those affected received an email offering the gift cards, which stated that CrowdStrike recognized "the additional work that the July 19 incident has caused. And for that, we send our heartfelt thanks and apologies for the inconvenience,” as shown in a screenshot of the email that was shared by TechCrunch’s source. Kevin Benacci, a spokesperson from CrowdStrike, told TechCrunch that the company did send the gift cards, which ironically were flagged as fraud by Uber due to high usage rates.
“It’s notable that CrowdStrike attempted later to demonstrate its apologies with the very modest Uber Eats gift card offer to stakeholders,” said West. “The merits can be debated of even issuing such a modest gift card to certain stakeholders in the wake of such a massive technology disruption, which in no way served to counterbalance the headaches inflicted.”
There are two morals to the story, added West. “If you’re going to issue a gift or a credit or any form of ‘make good’ effort for impacted customers or workforce in the wake of a catastrophic performance failure on the company’s part, make sure that:
- The ‘make good’ is perceptually commensurate to the suffering endured from the company’s earlier mistake — or else, it appears that the company has woefully under-quantified the negative impact its failure inflicted, which only will serve to make stakeholders more angry and insulted.
- That the ‘make good’ delivery is seamless, user-friendly and glitch-free. This latter point generally requires a high level of coordination between the offending company and any third-party vendors or partners — in this case, Uber Eats.”
West emphasized that it's always unfortunate when a company seeks to reconcile its problems in good faith but inadvertently stokes more crises for itself, which certainly occurred with the Uber Eats cards.
Communication and Transparency Are Vital During a Crisis
Effective communication and transparency are paramount during a crisis, especially in the tech industry, where disruptions can have far-reaching implications. The CrowdStrike outage is a prime example of how the absence of clear and timely communication can exacerbate the negative impact of an already challenging situation. When businesses face unexpected incidents, their stakeholders — clients, partners and investors — rely heavily on accurate and prompt information to assess the situation and plan their responses accordingly.
Transparency builds trust, especially in adverse circumstances. When CrowdStrike experienced its outage, many customers were left in the dark, unsure of the extent of the problem or the timeline for its resolution. This lack of information can lead to frustration, panic and a loss of confidence in the service provider. On the other hand, companies that communicate transparently about the nature of the issue, steps being taken to address it and expected recovery timelines can mitigate some of the negative fallout. Such communication reassures stakeholders that the company is in control and actively working to resolve the problem.
Brenda Christensen, CEO at Stellar Public Relations, told CMSWire that absolute and complete transparency is not only required but so is expediency. "Companies must respond quickly and with clarity. Having a newspaper reporting background like myself prepares you for creating global customer and stakeholder communications that are clear and consistent,” said Christensen. “Or, the next best option is to envision how the news media would cover the event and write the story yourself — then, you can work backward from there to create a press statement that is straightforward, factual and anticipates public and media scrutiny."
In addition, effective crisis communication involves not just disseminating information but also listening to and addressing the concerns of those affected. During the CrowdStrike outage, the perceived decision to send $10 Uber Eats gift cards as an apology was widely criticized because it did not align with the severity of the disruption experienced by customers. A more responsive and empathetic approach, acknowledging the inconvenience and outlining concrete measures to prevent future occurrences, would likely have been better received.
The CrowdStrike outage not only exposed technical vulnerabilities but also highlighted gaps in leadership and crisis management. Effective crisis management starts at the top, with leaders who can steer the business through turbulent times with clear, decisive actions. In crises such as the CrowdStrike outage, the role of leadership is crucial. Leaders must be visible and vocal, providing clear, consistent messages that help manage the expectations and emotions of all stakeholders. This includes using multiple communication channels — such as emails, social media and press releases — to ensure the message reaches a broad audience. By prioritizing transparency and effective communication, companies can maintain their credibility, reduce uncertainty and build a sense of partnership with their clients, even during a crisis.
Christensen emphasized that every corporate communications/PR executive lead needs to have a dotted line to the C-suite. “Those with a business background who understand the complete corporate structure and operations are better positioned to coordinate an effective response,” said Christensen. “It is critical to have empowered and knowledgeable PR executives who can act swiftly and decisively.”
Related Article: Does Your Brand Have a Social Media PR Crisis Response Plan?
Examples of Brands Whose Crisis Handling Showcased CX
Several brands have demonstrated exemplary crisis management, showcasing their commitment to customer experience. One notable example is Tylenol, a brand owned by Johnson & Johnson. In 1982, the company faced a severe crisis when several people died after taking cyanide-laced Tylenol capsules. Johnson & Johnson's response became a textbook example of effective crisis management. The brand immediately issued a nationwide recall of Tylenol products, halting production and advertising to focus solely on consumer safety. They worked closely with the media to keep the public informed and introduced tamper-proof packaging to restore consumer confidence. Johnson & Johnson’s transparent communication and swift action not only mitigated the crisis but also reinforced their reputation for prioritizing customer safety.
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Another example is Toyota’s handling of the 2009-2010 recall crisis. Faced with reports of unintended acceleration in their vehicles, Toyota issued recalls affecting millions of cars worldwide. The company’s response included halting sales of affected models and conducting extensive investigations to identify and fix the problem. Toyota’s executives, including the CEO, publicly apologized and committed to improving safety standards. Despite the significant impact on their sales and reputation, Toyota's transparent communication and proactive measures ultimately helped regain customer trust and reinforced their commitment to safety and quality.
More recently, Starbucks demonstrated effective crisis management during a 2018 incident in Philadelphia, where two African American men were arrested for sitting in a store without making a purchase. The event sparked widespread outrage and accusations of racial profiling. Starbucks responded by closing over 8,000 stores across the United States for a day to conduct racial bias training for its employees. CEO Kevin Johnson personally apologized to the men and met with community leaders to address concerns. Starbucks’ decisive actions and commitment to addressing the issue head-on helped the company navigate the crisis while showcasing its dedication to creating an inclusive and welcoming environment for all customers.
Lessons From CrowdStrike’s Crisis Management
CrowdStrike's response to the outage offers several important lessons for other businesses. First, the need for a well-prepared crisis communication plan that prioritizes transparency and timely information is evident. The lack of immediate and clear communication left customers in the dark, exacerbating the situation.
Christensen said that based on the information we now know, there was a breakdown in authority and chain of command between the C-suite and corpcomm. “All companies should plan and prepare for all scenarios and follow the crisis communication plan step-by-step. In handling potential crises, it's crucial to categorize them according to their possible impact, target audience and associated stakeholders. The key lesson is to construct a dynamic guide with branching tiers, a structure that allows organizations to better manage varied situations and executives who are strong enough to demand that it be executed.”
Secondly, in response to the outage, more significant and contextually appropriate actions were necessary. Rather than distributing gift cards, CrowdStrike should have issued a profound apology and outlined robust measures aimed at preventing such occurrences in the future. Finally, this incident highlights the importance of continuous improvement in customer experience, especially in the cybersecurity sector where trust is paramount.
Aside from the obvious customer experience ramifications of such an outage, it also brings to mind the importance of being prepared for any crisis or contingency so that should a crisis occur, the brand’s PR and communication mechanisms are in place and immediately ready to respond.
“The common golden thread that runs through any crisis communications plan involves details around every single scenario,” said Christensen. “From a customer choking on a mushroom to a private airplane crashing into Santa’s court at a mall. The basic elements are what I call the ‘three P’s’ - Plan, plan and plan.” Christensen explained that this involves meticulous preparation, scenario planning and continuous updating of the crisis response protocols to handle emerging challenges effectively.
Related Article: Trust Doomsday: What to Do in the Year of the Brand Trust Crisis
From Crisis to Opportunity
The CrowdStrike outage and subsequent response serve as a stark reminder of the critical importance of effective crisis management in maintaining customer trust and satisfaction. While the company's initial response and offer of $10 Uber Eats gift cards were widely criticized, this incident highlights the opportunity that crises present for companies to showcase their commitment to customer experience.
Ultimately, how a company responds to a crisis can leave a lasting impression on its customer experience, underscoring the need for robust, empathetic and well-planned crisis management strategies in today's customer-centric environment.
