Saving a strong brand from toxic damage
It was about 25 years ago that Johnson & Johnson suffered one of the worst nightmares a consumer products company can face. Seven people died from ingesting Extra Strength Tylenol capsules that had been laced with cyanide. It was the first known case of death caused by deliberate product tampering. This incident recently came to mind after a number of people (too young to remember the Tylenol scare) asked me if brands suffer permanent damage when there’s a consumer product quality problem like the recent Mattel situation where it was discovered that many of its popular toy brands were manufactured with toxic components. My answer to their question is “no, not if.” Brands can actually come out stronger if they do two things very well.
The first thing a brand must do to save its good name is to react really, really fast – jump in and quickly address the situation frankly and honestly. Now, reacting really, really fast these days is really, really hard. Given the Internet and its finger-happy bloggers, the whole world knows what’s going on within seconds of its happening. To stay ahead of the busily pointing fingers, brand organizations have to be closely connected to what’s going on in the blogosphere. Good companies have teams in place to monitor and listen to the incessant online chatter about their brands. They have contingency plans in place and people empowered to act promptly and aggressively should the need arise. Seemingly nanoseconds after news of Mattel hit Wi-Fi networks, for example, its CEO issued a statement that the company would immediately recall millions of toys from retailers’ shelves along with put into place significant new manufacturing procedures. While this will cost the brand millions of dollars near term, these instantaneous actions should help mitigate brand fallout in the long term.
The second thing a brand should do in challenging times is to do more than consumers expect it to do. In the case of J&J’s Tylenol, this meant not only an instant recall of the product but the development of new tamper-resistant bottles along with the development of tamper-resistant caplets. While the company’s share price and its share of market took an immediate plunge right after the scare, its more-than-expected actions helped it regain its number one brand position by the end of the year. It remains the top-selling analgesic in the country.
Stuff happens. There are all sorts of potentially damaging situations a consumer product brand can face in its lifetime. Whether it allows itself to be defeated by the situation depends on how quickly the brand reacts and if it does more than people expect it to. While it may be an expensive proposition, saving a strong brand name - whatever the cost - is priceless.
September 11th, 2007 at 7:50 pm
This quick response to crisis brings to mind 1993 when the fast food chain Jack in the Box was found to be responsible for the death of four children having eaten tainted meat.
Following the tragedies Jack in the Box spun it into place several intitiaves for food saftey. Other restaurants follwed and soon Jack in the Box became the industry authority on food quality and cooking regulations. An amazing reovery for a brand that could have folded.
April 19th, 2008 at 6:34 pm
I’ve worked on multiple product recalls, and invariably damage was greatly mitigated when the client had already engaged in a four-part cycle of crisis prevention activities:
vulnerability audit
crisis planning (operational and communications)
training
simulations
I have a lot of information on this topic available at www.bernsteincrisismanagement.com/articles.html, if you’re interested!