Product Contamination

Product Contamination In October of 1982, seven people in Chicago died after taking Extra-Strength Tylenol (Effective crisis management). The product has been tampered with once it reached the shelves by an unknown suspect who had laced the capsules with lethal doses of Cyanide. Before the incident Tylenol had a thirty-seven percent market share and revenue of approximately $1.2 million. Immediately following the cyanide poisonings, its market share fell to only seven percent and some predicted the product would never recover.

However, Johnson & Johnson initiated a successful public relations campaign that quickly revised the product. Directly after discovering that the deaths in Chicago were caused by the Extra-Strength Tylenol, Johnson & Johnson made a decision to place customer safety ahead of company profits (Kaplan). Instead of trying to cover up the situation, the company immediately alerted consumers across the nation not to consume any type of Tylenol product.

It warned consumers not to resume using the product until the extent of the tampering could be determined, stopped all new production and recalled all existing Tylenol capsules from the market. Not only did Johnson & Johnson react responsibly, it moved quickly. The company came up with a campaign to re-introduce its product and restore confidence back to the consumer within six weeks of the discovery of the product contamination.

Key components of its plan included (Mitchell 1989, cited in Effective crisis management): Tylenol products were re-introduced containing a triple-seal tamper resistant packaging. It became the first company to comply with the Food and Drug Administration mandate of tamper-resistant packaging. In order to motivate consumers to buy the product, they offered a $2.50 off coupon on the purchase of their product. To recover loss stock from the crisis, Johnson & Johnson made a new pricing program that gave consumers up to 25% off the purchase of the product.

Over 2250 sales people made presentations for the medical community to restore confidence on the product. The company's handling of the Tylenol tampering crisis is considered by public relations experts to be one of the best in the history of public relations (Kaplan). Within five months of the crisis, the company had recovered seventy percent of its market share for the drug - and the fact this went on to improve over.