Advice for brands: Tread carefully in Brazil amid political, economic woes

Marketers will want to assure their brands celebrate the Olympic spirit yet are attuned to public sentiment.

On Monday, newly installed speaker of Brazil’s Chamber of Deputies Waldir Maranhão shocked the country by saying he was annulling that legislative body’s vote to forward impeachment terms to the Brazilian Senate.

The announcement unleashed joy and anger, and precipitated at least two motions to the Supreme Court. Tiririca, a professional comedian who is also a member of the Chamber, and looks somewhat like Marahão, shaved his mustache in public to avoid being confused with the now very unpopular Speaker. Just 12 hours later, Maranhão reversed his decision, allowing the Senate’s vote to move forward. And that was just one day.

The last few months in Brazil have provided enough material to fill the next 10 seasons of House of Cards. Political parties and their supporters have maneuvered in Congress, the courts, and streets as the country convulsed towards Thursday morning’s historic vote to remove wildly unpopular President Dilma Rousseff for at least 180 days and begin a formal impeachment trial. 

Despite this important milestone, the situation in Brazil is extremely fluid, presenting near- and long-term challenges for the country. Companies and brands also face a difficult environment, one communicators and marketers must handle carefully.

To start with, there are the Summer Olympics set to begin August 5 in Rio de Janeiro. Olympic and athlete sponsors will have to strike the right tone in their communications locally given the country’s severe economic challenges and public’s sour mood. Add to that the challenge posed by the Zika virus outbreak that could affect athletes, organizers, and spectators. Oddly enough, researchers suspect Zika was brought to Brazil from spectators attending another global sporting event, the 2013 Confederations Cup soccer tournament. They now fear Zika’s spread could be intensified globally due to the Olympics.

Marketers will want to make sure their brands celebrate the Olympic spirit yet are attuned to public sentiment, engage in a manner that is aligned with the national mood, and avoid tone-deaf promotion. The challenge will be all the greater given that the contexts for audiences inside and outside of Brazil will be significantly different. Sponsors and federations will also need to protect athletes and prepare for crises should any get ill. 

On the corporate reputation side, the impact of the current crisis will extend well beyond the Olympics. Major companies featured on "most admired" magazine covers just a few years ago have seen their executives jailed for corruption and turning state’s evidence. The culture of impunity that isolated Brazil’s public and private elites from accountability is crumbling. 

As a result, corporate communicators are working in a new context, one that requires companies to establish and implement clear compliance protocols and demonstrate integrity, not just communicate it. Emboldened prosecutors and a skeptical public have significantly raised the costs – real and reputational – of corporate misbehavior. 

Successful corporations will need to build or recalibrate their cultures and communications to face increased scrutiny. They will also want to research regularly to understand where they and their industry stand in the public mind. This is especially true in the area of public affairs and government relations where the ability to engage on policy issues will be directly affected by a company’s stature and reputation. 

Finally, there is beleaguered Brand Brazil, which suffered a spectacular fall from an economic bubble of grace in the past three years. There are few countries as endowed with natural resources and human capital, a huge domestic market, and economic potential. Yet studies find Brand Brazil is strong on fun and culture but weak on citizenship, corruption, and poverty. The current crisis will work to reinforce negativity due to the latter attributes.  

As the new and successive governments work toward implementing structural reforms that will make the country truly competitive, communication must emphasize progress on traditionally weak attributes so that a more balanced, sustainable, and successful Brand Brazil emerges. 

Brazil’s crisis has been riveting, but especially painful for those who love Brazil. (Full disclosure: I lived in the country for eight years and have a Brazilian-American wife and children). The hope is that a stronger, healthier Brazil will emerge from the mess. As the country evolves, communicators will have a unique view into changing public attitudes and a unique responsibility to assure their organizations navigate the challenging currents successfully.

Ramiro Prudencio is president and CEO of Burson-Marsteller Latin America.

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