Johnson & Johnson Tylenol crisis
Prior to the emergency, Tylenol was the best over-the-counter item in the United States with more than one hundred million clients. Tylenol accounted for 13% of Johnson & Johnson’s year-to-year sales growth and 33% of the company’s year-to-year profit growth. Tylenol was the supreme pioneer in the painkiller field representing a 37% piece of the pie, surpassing the following four driving painkillers consolidated, including Anacin, Bayer, Bufferin, and Excedrin. During the end of 1982, some malicious person or persons presumably unknown, replaced Tylenol Extra-Strength capsules with cyanide-laced capsules and these capsules were deposited on the shelves of at least a half-dozen or so pharmacies, and food stores in the Chicago area. Due to consumption of these poison capsules, seven unsuspecting people died a horrible death.
Johnson & Johnson got to know about this by the media. The company was faced with the dilemma of saving the product without destroying the reputation of the company.
Johnson & Johnson chairman, James Burke, reacted to the negative media coverage by forming a seven-member strategy team. The company’s first actions were to immediately alerted consumers across the nation, via the media, not to consume any type of Tylenol product. Johnson & Johnson, along with stopping the production and advertising of Tylenol, withdraw all Tylenol capsules from the store shelves in Chicago and the surrounding area. By withdrawing all Tylenol, Johnson & Johnson showed the public that the public safety is more important to the company even it costs more.
In the first week of the crisis, Johnson & Johnson established toll-free lines for customers to respond to inquiries concerning Tylenol safety and for the news organizations to receive updates about the crisis. Though they were not responsible for the product tampering, Johnson & Johnson provided the victim’s families counseling and financial assistance.
Marketers predicted that the Tylenol brand would never recover from the crisis but only 2 months later, Tylenol products were re-introduced containing a triple-seal tamper-resistant packaging and Johnson & Johnson became the first company to use this new tamper-resistant packaging. To motivate the people to buy their product, they offered a $2.50 off coupon on the purchase of their product. They also used an extensive media campaign for its promotion.
Sympathy strategy was the big part of Johnson & Johnson’s crisis communication strategy through which they portrayed the organization as the unfair victim of an external malicious entity. By 2001, 45% sales came for prescription drugs, up from just 18% in 1980. Johnson & Johnson re-established the Tylenol brand name by the effective crisis management strategy. The Tylenol crisis is the best example to follow by the companies which are at the threat of losing everything.
By:
Chetna Kandpal
