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By Maggie Z. Mathews
Look at how two different firms and their products were affected by health scares affecting the image and sales of their products. In one case customers were scared away, and frightened of a product. In another case customers and potential customers came to be reassured by the image of a company, and its concern for their health and safety. That product became the standard of pain and headache relief.
Contrast two examples. Perrier water used to be the standard of luxury water products. Perrier was the market leader of imported water products, for thirst, into the United States. It commanded a premium lead in the marketplace especially in luxury beverage establishments such as lounges and bars. It was commonplace and indeed a status symbol, that for the same price as an alcoholic beverage, to order a Perrier with a Twist. Profit margins were exceptional both for Perrier and the retail and restaurant trade.
Along came a twist of fate and marketing. Benzene, a known carcinogen in rats, was found in bottle Perrier water. The company first stated one story that the incident was isolated and of no concern. It was an isolated incident based on one employee cleaning a piece of bottling equipment with that very benzene that was the cause the company reported , Be reassured Perrier .. Blah, blah of no concern. Be reassured that Perrier water does not contain Benzene and is safe Yet when this same substance Benzene was found in additional lots of Perrier water in widely varying geographic areas the company changed its story to another fish story so to speak. As time progressed the company revamped the story even further to state that actually Benzene was added to Perrier water in the Carbon Dioxide used to make Perrier water fizz. This Benzene was naturally removed in the manufacturing process and was of little concern. By doing so the company admitted that their hallmark fame of Naturally bottled water was untrue and adulterated and diminished their very basis of their marketing strategy and established market and market base. If you think about it in the year of 2007 how may times have you have frequently heard the word Perrier?
Contrast this approach of company management at dealing with a crisis in the field with the sterling example of Tylenol capsules being sabotaged and laced with deadly cyanide in the fall of 1982. This was an actual case of murderous prankertism by unknown parties. The company dealt with the issue immediately and on the spot.
Johnson and Johnson accepted responsibility immediately. First the company alerted customers and used the mass media to alert the world so to speak. 31 million bottles of the Tylenol product were recalled at a cost to the firm of 100 million dollars in 1982 dollars.
Further the firm went on to tell customers and the world that it would immediately cease production of Tylenol until it could provide tamper resistant caplets. An investigation was launched to find and prosecute the culprits so that first of all they would be removed from circulation and secondly both to reassure the public as well as convince any copycat agents that this was a very serious matter, not a prank and any further attempts would result in harsh punishments. Indeed copycats may well be blamed for previous death with dire consequences for them. Further Johnson and Johnson at great potential cost also offered to exchange the millions and millions of bottles of Tylenol capsules that had been sold for the new product Tylenol caplets.
Contrast the two different approaches of a company management reacting to a crisis.
Perrier has ceased to be a product on the American retail and beverage scene in any manner of consequence. The pain reliever product Tylenol has become a market leader of great scope. Indeed in a field where generic copy products of acetaminophen (the chemical ingredient of the brand name product Tylenol) abound Tylenol command s the greatest market share. By responding in a most responsible manner to a most serious market threat the firm Johnson and Johnson has prospered beyond belief and has earned the trust and great loyalty of its customers. The management of Johnson and Johnson is to be greatly commended as an example of mature leadership and example to the business and marketing communities.
About the Author: Maggie Z. Mathews
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