9 PR Fiascos That Were Handled Brilliantly By Management

They bounced back stronger than ever. Crisis management requires more than an apologetic press release or a CEO's disingenuous appearance on CNN. News goes viral in a flash. Companies must be ready to respond to disasters swiftly and decisively, using all platforms to communicate with the public.

They bounced back stronger than ever.

Crisis management requires more than an apologetic press release or a CEO's disingenuous appearance on CNN.

News goes viral in a flash. Companies must be ready to respond to disasters swiftly and decisively, using all platforms to communicate with the public.

Most importantly, companies that make mistakes must sincerely accept responsibility for their actions -- not distance themselves from them.

There's no cure-all method to remedy company crises, but there are lessons to be learned from past successes. Here are examples of nine companies that saved themselves -- and their precious brands -- in the most dire of situations.

Johnson & Johnson's cyanide-laced Tylenol capsules (1982)

The crisis: Seven people died after taking extra-strength Tylenol capsules that had been laced with potassium cyanide, a deadly poison. The killer was never found.

How J&J responded: The company put customer safety first. It quickly pulled 31 million bottles of Tylenol -- $100 million worth -- off the shelves and stopped all production and advertising of the product. It also got involved with the Chicago Police, FBI, and FDA in the search for the killer, and offered up a $100,000 reward.

Post-crisis, the company reintroduced Tylenol with new tamper-resistant packaging and $2.50-off coupons.

The result: A go-to case study in MBA classes worldwide, Tylenol's response to the tragic 1982 Chicago murders is regarded as one of the most successful sequences of crisis management in history.

The media appreciated the lengths J&J went to and its concern for the public interest, so the company was portrayed generally in a good light, helping the Tylenol brand to recover.

Source: Penn State University

PepsiCo's can tampering rumors (1993)

pepsi brittneyThe crisis: A syringe was allegedly found in a can of Diet Pepsi in Washington state. The following week, more than 50 reports of Diet Pepsi can tampering sprung up across the country. It turned out to be a hoax.

How PepsiCo responded: Both PepsiCo and the FDA were confident that the reports were fabrications, so the company came out hard, defending itself staunchly against the accusations.

But PepsiCo didn't make vague statements telling the public to simply trust it. The company produced four videos throughout the crisis, such as a comprehensive report on its soda canning process. The most compelling was a surveillance tape of a woman in a Colorado store putting a syringe into a can of Diet Pepsi behind the store clerk's back.

PepsiCo North America CEO Craig Weatherup appeared on news stations armed not only with visual evidence of the bogus reports, but with the explicit support of the FDA. He appeared most notably on Nightline with FDA Commissioner David Kessler, and they both assured the public that Diet Pepsi was safe.

The result: The rumors fizzled out within two weeks following multiple arrests by the FDA for filing false reports. Diet Pepsi sales had fallen 2% during the crisis but recovered within a month.

The situation required an aggressive defense because PepsiCo hadn't done anything wrong. If the company remained quiet and complacent the damage could have been far worse.  

Source: CorpCommCollab

Texaco's racial discrimination lawsuit (1994)

By Josh Friedman Luxury Travel on Flickr

The crisis: Six of Texaco's African-American employees sued the company for racial discrimination.  Damning conversations between Texaco executives that were secretly recorded seemed to confirm the issue.

How Texaco responded: CEO Peter Biljur started off with a public apology and admitted embarrassment.  The executives involved were suspended (with pay but without benefits), pending the result of the investigations. 

Texaco execs went on tour, visiting all branches and sites of the company in person to apologize to the employees, and the company hired African-American owned advertising agency Uniworld Group to run an ad campaign to help douse the flames.

The result:  The Reverend Jesse Jackson was the most vocal opponent to the company, calling for a boycott, but softened his view after Biljur's response. This was key to the company's image recovery.

Texaco settled the suit, agreeing to pay $176 million. Additional discrimination checks for executives and managers put in place by Biljur have prevented the problem from sprouting up again.

Source: BrightHub

Odwalla Foods' apple juice E.coli outbreak (1996)

Wikipedia

The crisis: Washington state health officials confirmed a link between a local E.coli outbreak and Odwalla's fresh, unpasteurized apple juice. One child died and more than 60 people became sick, prompting more than 20 lawsuits.

How Odwalla responded: CEO Stephen Williamson immediately recalled all Odwalla products containing apple or carrot juice, which cost the company around $6.5 million. He accepted responsibility when talking to the media and promised to pay all medical costs for those affected by the outbreak.

Daily press briefings by Odwalla were used to update the public, along with full-page newspaper ads and a website explaining the situation.

The result: The company had faced its worst-case scenario: death caused by one of its food products.  Odwalla lost a third of its market value by the time everything subsided, and pled guilty to criminal charges relating to the outbreak, which resulted in a $1.5 million fine from the FDA.

But Odwalla was still standing. It focused on customer relations in the months following, attempting to rebuild trust. Odwalla fixed the contamination issue and improved its quality control and safety system.

Odwalla re-launched its apple juice two months later. In 2001, Coca-Cola bought Odwalla for $186 million. 

Source: mallenbaker.net

Cadbury's worm infested candy bars (2003)

The crisis: Two Cadbury chocolate bars were found infested with worms in Mumbai, India. The Maharashtra FDA quickly seized the chocolate stock at Cadbury's closest manufacturing plant in Pune.

How Cadbury responded: The company was slow out of the gates. It released a statement claiming that the infestation was not possible at the manufacturing stage, while the FDA disagreed, prompting a tussle between the two. The media jumped on Cadbury, and the brand was under widespread assault.

Cadbury took its advertising off the air and launched an educational PR project that targeted retailers. It kept the media updated through press releases on the specific measures it was taking to correct its manufacturing and storage processes. The company also imported new machinery and changed the packaging of its Dairy Milk bars.

Four months later, Cadbury began advertising more aggressively. By then, the company's relationship with the media had improved greatly.

The result: Cadbury's sales in India plunged 30% in the wake of all the negative media coverage, and this was during a season when its sales usually increase by 15%. But over time, Cadbury began to recover.

Within eight weeks of the introduction of its new packaging and advertising campaign, sales had almost reached pre-crisis levels. The company announced eight months after the incident that its consumer confidence was back to to normal. Cadbury has maintained its position at the top of the Indian chocolate industry ever since.

But Cadbury suffered three years later when a salmonella outbreak wasn't handled nearly as well.

Sources: Rediff, Public Relations Consultants Association of India



JetBlue's week-long operational breakdown (2007)

The crisis: JetBlue's operations collapsed after an ice storm hit the East Coast of the U.S., leading to 1,000 cancelled flights in just five days.

How JetBlue responded: CEO David Neeleman never blamed the weather. He wrote a public letter of apology to JetBlue customers, introduced a customer's bill of rights, and presented a detailed list -- which included monetary compensation -- of what the company would do to help all the affected passengers.

The result: JetBlue didn't dodge the backlash completely. Throngs of enraged passengers toiled in airports for nearly a week, and they had reached their boiling point by the time Neeleman spoke up.

But in the weeks that followed, JetBlue managed to quash much of the uproar by being as public and straightforward as possible. Neeleman went on YouTube, the Today Show, Letterman, and Anderson Cooper, not pleading his case, but apologizing for his company's faults. 

Though there was much reputational damage done, JetBlue's comeback allowed it to regain some of its luster. For an airline that differentiates itself so heavily on customer service, it was crucial that they did.

Sources: NYT, TheMarketplaceofLife, Time

Toyota's recall fiasco (2010)

Jalopnik

The crisis: Toyota recalled a total of 8.8 million vehicles for safety defects, including a problem where the car's accelerator would jam, which caused multiple deaths.

How Toyota responded: Toyota initially couldn't figure out the exact problem, but it sent out PR teams to try and stop the media backlash anyway. The upper management was invisible in the early stages of the crisis, skewing public perception further against the company.

Toyota's response was slow, with devastating results. But it served as a wake-up call for the company, which somehow turned it around in the months following the debacle.

The company failed miserably in its initial crisis management, but that's what makes Toyota's case so intriguing. Despite its monumental mistakes early on, Toyota still bounced back. Why?

It didn't take long for the public to remember Toyota's previously stellar reputation.  The company offered extended warranties and pumped up marketing, leveraging its long-term track record and reassuring consumers about safety.

Its ads in the following months were more thoughtful and sincere, showing the company's dedication to fixing the problem. Toyota's executives -- especially in the US -- became more visible, speaking to the media and becoming active in the investigations.

The result: The Toyota brand showcased its resiliency, with its positive reputation built up over decades of good performance. The company leveraged this, focusing its marketing once again on safety and its proven track record. It had to show that this disaster -- including its own horrible mishandling of the situation -- was an aberration.

And it worked, with a little bit a of luck. NASA exonerated Toyota of the blame for most of the accidents in 2011 and the company's brand equity leapt 11% this year, according to WPP.

Sources: BrandZ, The Guardian

The Red Cross' rogue tweet (2011)

Twitter

The crisis: One of the Red Cross' social media employees accidentally sent the tweet -- which was meant for her private account -- and didn't realize it. It stayed up for about an hour before the company's social media director was alerted and took it down.

How the Red Cross responded: Social media director Wendy Harman followed up with a humorous tweet from the official Twitter account and acknowledged the mistake.

It got support from Dogfish Head too, who embraced the hashtag #gettngslizzerd and encouraged its followers to donate to the Red Cross.

The result: The tweet generated a bit of buzz among bloggers and the Twitterverse, but so did the fun response by the company.   

Fortunately for the Red Cross, although the nature of the tweet wasn't professional, it wasn't too controversial. Nobody was outraged, and the Red Cross had to deal with nothing more than a little embarrassment.

Source: Mashable

Taco Bell's "seasoned beef" meat filling lawsuit (2011)

Wikimedia

The crisis: Yum! Brands, Taco Bell's parent company, was sued over the contents of its meat. The lawsuit alleged that the company's "seasoned beef" contained only 35% beef, and that Taco Bell was lying in its advertising.

How Taco Bell responded: Taco Bell explicitly declared the claims false, and shared with the public its percentages (88% beef, 12% secret recipe), along with the ingredients in the secret recipe itself.

The company quickly fired up a multi-platform PR campaign to shoot down the allegations and get the word out about its "not-so-secret" recipe. It included traditional local market newspaper ads, but focused on online marketing with a YouTube channel, Facebook page, and more.

The result: Taco Bell's existing consumer base responded overwhelming well to the campaign. The social media platforms shined, with the vast majority of commenters supporting the company's stance. 

Less than four months later, the lawsuit was dropped, and Taco Bell had completely averted a potential PR disaster.

Source: WaveMetrix

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