In today’s episode, co-host Shaheen Samavati chats with Leigh Dow, CEO of strategic marketing agency 48 West, about the recent Silicon Valley Bank (SVB) collapse and how a social media-focused crisis communication strategy might have helped prevent such an adverse outcome for the company.

Leigh has extensive experience with strategic PR and marketing, having started her career in government communications and then rose the ranks in marcom roles at fortune 100 companies, including Intel and Honeywell.

During their conversation, Shaheen and Leigh talk about what went wrong with SVB’s social media crisis communication, how they could have reacted and ways that brands can be better prepared for dealing with a crisis on social media—including three lessons we can learn from SVB.

You can watch the full conversation in the video above or on YouTube, listen to the podcast on Apple or Spotify, and read a recap of the conversation below!

What happened to Silicon Valley Bank?

Silicon Valley Bank failed spectacularly in March 2023 in what might have been the first-ever social media-fueled bank run. The initial panic started with a newsletter called The Diff by Byrne Hobart, which crunched some numbers on SVB’s financial situation. This led to rumors swirling on Twitter and a run on the bank in a matter of hours—with investors and depositors attempting to pull out a staggering $42 billion in a single day. 

How did SVB’s reaction add fuel to the frenzy?

“SVB were slow to react on social media, but they also didn’t make it easy to understand what was happening through their other communications channels.” – Leigh Dow

SVB released a press release, but it failed to mention why they were doing what they were doing. Investors then had to look through their investor presentation for answers, which is a densely packed report that you really have to dig through to find the why.

Their communication was also highly targeted at investors using heavy investor lingo—not considering other stakeholders, like depositors, who needed to be communicated with.

“In a crisis, you need to speak very clearly to your target audience in ways that they can not only consume but really understand what’s going on to give them peace of mind.” – Leigh Dow

What would have been the right way for SVB to communicate?

The first thing Leigh says should always be included in a crisis communication plan is a solid set of FAQs. You should have FAQs for internal use that can be used to anticipate questions that leaders are likely to get and FAQs for your audience that address their concerns.

In SVB’s case, their CEO did a Zoom call with investors, but it didn’t go so well. There was no question and answer period, nor were any FAQs published afterwards. Unfortunately, the talking points on the call weren’t as clear as they should have been, and the CEO didn’t leave a sense that they had a command of the situation.

“When you have someone communicating about your brand—whether on a conference call or in an interview—you really want them to impart to the audience that they have a command of the situation.” – Leigh Down

They were also very quiet on social media. With Twitter especially prone to rumors, SVB could have reached out to the platform for support in curbing rumors by requesting they put a notification on posts to encourage fact checking.

What is good social media practice for financial institutions in a crisis? 

It’s common practice for companies with such a high fiduciary responsibility to keep their social media feeds promotional—speaking more to the consumer of bank products as opposed to the inner workings and operations of the financial institution. 

However, in a crisis, as Leigh says, “Social media can be your best friend and worst enemy.”

It’s an easy and fast way to get facts out the door, but it’s also a place where people can distort information.

“One of the reasons why institutions like this don’t spend a lot of time and effort on social media or choose to stay very quiet is because they know that things can be twisted and distorted—even when they make their best effort to get the right facts out the door.” – Leigh Dow

However, if you already have vetted assets—in SVB’s case, the press release, public presentation and Zoom call—why not share those across social media as well? Perhaps just change the language a bit to make it more understandable.

It’s important to use social media as a way to answer questions and give people the information that they need.

“A great way to use social media is to guide people through what’s going on. Be responsible to your consumer.” – Leigh Dow

How can brands be ready to respond to a crisis?

You absolutely have to have a social media crisis communications plan before anything happens.

Most companies spend a lot of time on disaster and recovery plans and maybe not as much on a crisis communications plan. But at the speed of social media, that’s a very risky move.” – Leigh Dow

Leigh suggests having a trusted counsel with a seat at the table from a communications standpoint. Someone who isn’t afraid to ask tough questions, play devil’s advocate and really debate through all possible scenarios. That person should also be able to translate everything into very plain language as well as have a clear understanding of your audience.

It’s important to have a communications team that can monitor social media. They need to be critical thinkers and understand the good and bad directions a social media post can go in. To stay ahead of any potential crisis, you need to have a pulse of what’s going on in the world and a plan to quickly respond when needed.

“FAQs and talking points are a really important part of your crisis communications plan. As well as making sure that your social media team, marketing team, executives, and anybody who communicates externally understands those FAQs and the talking points.” – Leigh Dow

Who in your team should be handling social media crisis communication?

According to Leigh, your social media team shouldn’t be responsible for crisis communication:

“I think that investor relations and crisis communications are their own professions and disciplines where execution is mission critical.”

However, social media managers understand your social audience best and should always be consulted in crisis communications. They’ll clearly understand how things can be twisted on social media and how to avoid any adverse reactions.

They’re also your first line of defense when your brand starts trending on social media—be it good or bad.

“Social media managers also have a role in terms of monitoring your brand and trends on social media.” – Shaheen

What are the biggest lessons marketers and communication leaders can learn from the SVB situation?

Leigh shared three key learnings:

  1. Know who is talking about your brand and when it starts trending.
  2. Be very clear, concise and easy to understand when communicating in a crisis. It’s important to show that you have command of the situation.
  3. Be human and provide information that answers your customer’s concerns—like an FAQ list.

Have a strong spokesperson who helps calm the situation by explaining it in a rational and easy-to-understand way. You don’t only need to have the right information written down, but also presented in the right way.”

You can check out Shaheen’s speaker profile if you’d like to have her speak at your next event or be a guest on your podcast.

Check out more posts on social media communication:

To read the full transcript, click on page number 2 below.