Seven people died in 1982 after taking Tylenol capsules, which had been tampered with and contaminated with cyanide. According to Effective Crisis Management, Tylenol’s market share quickly went from 37 percent to only seven percent.
Johnson & Johnson faced a huge challenge. Not only did the company have to manage the crisis communication of just Tylenol, but also of the entire company’s reputation.
J&J recalled approximately 31 million bottles of Tylenol from across the country and stopped all advertising.
On the first day of the crisis, the Tylenol poisonings were the top story for all three broadcast outlets. By the end of the crisis, there had been more than 100,000 news stories run in newspapers.
According to an analysis on the University of Oklahoma’s Department of Communication Web site, a seven-member team was put together by James Burke, J&J’s chairman. His first focus was to protect the people and his second focus was saving the product. The company also used the media to issue alerts and held several press conferences at the corporate headquarters with a live satellite feed. There also was an 800-number available for consumers.
Some say J&J set a standard for crisis communication when they “assumed responsibility by ensuring public safety first and recalled all of their capsules from the market,” despite the fact that the bottles were tampered with after reaching the shelves.
Tylenol was reintroduced into the market with triple-seal tamper-resistant packaging, offered coupons for the products, created a new discounted pricing program, new advertising campaign and gave more than 2,250 presentations to the medical community.
According to Managing Crises Before They Happen (Mitroff, 2001), J&J actually increased their credibility during the crisis because of the candidness of the executives.
Notre Dame expert Professor Patrick Murphy said J&J set a “gold standard” in regards to business ethics as well because J&J was proactive and transparent.
What I think
Although J&J handled this crisis well, I think it would be a totally different situation if it happened today due to social media and the immediacy of communication.
What I believe was most effective how J&J kept the media informed and was transparent. It also was good to have the strategy team set up, although it would have been better if a team was already planned in case of situations like this.