Stephanie Lowder’s Tylenol Case Study evaluates one of the most infamous cases of product tampering in United States history, and provides an assessment of the public relations response by Johnson & Johnson, the manufacturer of Tylenol.
The case involves a 1982 crisis where seven people throughout Chicago’s West Side neighborhoods were killed after ingesting cyanide-laced Tylenol capsules. These had been tampered with, and it was quickly discovered by the authorities that this was the connective cause of death. There was an immediate public reaction, both locally in Chicago, but also throughout the nation. In Chicago, police cars would drive through neighborhoods and give warnings to the residents through loudspeakers, and there was national media attention and reports on all of the major networks. The Food and Drug Administration issued a warning to the public that Tylenol should be avoided until an investigation could be completed.
The immediate reaction by Johnson & Johnson was to issue a public statement guaranteeing that the public tampering did not occur at a Johnson & Johnson plant, due to strict controls that were already in place. This implied that the tampering occurred at a local level, limited to the Chicago area. Chicago was currently in a state of panic, with hospitals being overwhelmed with telephone calls, and numerous residents voluntarily admitting themselves into area hospitals if they suspected any ill effects after taking Tylenol. Nationwide, however, because of the publicity given the incident, and the severity of the case, there was still a panic over whether Tylenol capsules had been poisoned. In addition, there were almost 270 copycat incidences that furthered fears across the country.
Lowder then describes how Johnson & Johnson engaged in a public relations campaign to help minimize the detrimental impacts of this crisis. The term crisis is defined as a major and unpredictable event with potentially serious negative implications for both the organization and shareholders invested within the organization. This particular crisis is identified as being an intentional act to disrupt Johnson & Johnson. The crisis life cycle is a three staged-process, beginning with pre-crisis, crisis, and then post-crisis. Pre-crisis is the totality of conditions that exist prior to the incident, and in this case would include the amount of Tylenol that was being manufactured and sold, safety measures that were put in place, and general attitudes toward both the Tylenol product and the manufacturer, Johnson & Johnson. Crisis refers to the specific instigating act, which involved the poisoning of Tylenol capsules; and post-crisis refers to the response effort by Johnson & Johnson. At the time, this sort of crisis was unprecedented; therefore, Johnson & Johnson did not have a set crisis management response plan in place to deal with this particular occurrence. The threat of product tampering was not considered a risk before this time, perhaps because the nature of the crime was so unprecedented. However, Johnson & Johnson was able to navigate the crisis so that it did not cause irreparable harm to the long-term reputation of the Tylenol brand or Johnson & Johnson company.
Lowder’s article then highlights the step Johnson & Johnson took while navigating this plan. At the time, the crisis looked dire for the company; one advertising agent mentioned within the article describes how he thought the Tylenol brand was forever ruined and would be unable to be sold in the future. This sentiment was not agreed with by Johnson & Johnson executives, who decided to implement a two-phase public relations campaign designed to reiterate the safety and quality of their products, which in turn would mitigate the amount of potential financial damage caused by this crisis. The first part of the two-phase plan was to ensure that all protocols were handled effectively while the investigation was underway, while the second plan was dedicated toward renewing customer trust.
The handling of this plan was based on concepts of resiliency, which is an ability to adapt to changing circumstances. Johnson & Johnson similarly handled this incident in accordance with core organizational values, which often determine how an organization will respond in times of crisis. This was evidenced in the immediate reaction of Johnson & Johnson promising an investigation and also taking responsibility for these poisonings, despite the company being clearly victimized by a hostile, external agent. Along with a clear demonstration of company values, the culture throughout Johnson & Johnson’s leadership to respond with urgency also helped mitigate the initial damage done to the company’s reputation in the immediate aftermath of these highly public incidents. Rather than to attempt to reassure customers that Tylenol was still safe to use without knowing this to be actually true or not, a spokesperson for Johnson & Johnson took the opposite approach and warned customers to specifically not take any Tylenol product until the investigation was completed. Johnson & Johnson was able to deliver this message by relying on the key public of the media, which disseminated this message to the general public. This step highlights how Johnson & Johnson took the ethical, rather than self-serving, approach: the company most likely lost millions in sales due to their own warning, and they took the precaution of a nationwide warning despite these poisonings only occurring in the Chicago are.
The specific strategy in the Johnson & Johnson response was using the public information model. This model involves disseminating information to consumers, but not necessarily relying on receiving feedback. Instead, the main goal in the immediate aftermath of the crisis was to simply inform customers that they should not use any Extra-Strength Tylenol. This was motivated by a general concern with public health and safety, and there was no attempt by the company at this time to try and convince customers to continue buying their products.
The first phase also made use of social exchange theory, which evaluates both the long-term costs and benefits of any recommended action. This theory presumes that costs should be kept low, and rewards should remain high. In this specific instance, the reward was regaining consumer trust and preserving the company reputation; therefore, advocating that customers did not continue to use their products until the investigation was completed was a way to pursue the greater reward of consumer confidence, although this included a short-term loss of not selling any products over the duration of the crisis. The ethics on display in this response can be seen in how the company did not attempt to find ways to encourage customers to continue using their products.
The decision to remove advertising and recalling products that came from the same shipments as the poisoned capsules was made immediately, but there was a concern over whether a nationwide recall should be implemented. After decision making involving team play and intercultural communications, Johnson & Johnson leadership finally decided that a nationwide recall was the appropriate measure. Although this created significant financial implications for the company, the move was well-received, and motivated on theories that preserving the reputation of the company would produce more long-term benefits than trying to downplay the threat.
Following the recall, Johnson & John son moved toward the second, post-crisis phase. This involved offering a reward for finding the killer, and working with the media in an honest and open manner. This strategy involved agenda setting theory, which works to shape popular opinions by framing the public conversation rather than prescriptively telling consumers what to think. In this instance, Johnson & Johnson’s recall and offering of a reward gained media sympathy, which helped shape consumer sympathy.
Five months after the poisonings, Tylenol unveiled a five-point plan that would seek to fully regain public trust and reestablish the brand as the market leader. First, Tylenol pioneered the FDA’s implementation of tamper resistant packaging requirements; second, coupons were made widely available for customer use, which was their key public; assurances were given that intentional disruptions would not occur in the future, with the emphasis on intentional disruption to mitigate perceptions that Tylenol was at fault; a public toll-free hotline was created; and twenty-five percent discounts were provided for Tylenol products. Johnson & Johnson also created an advertising strategy based on the elaborated likelihood model, which was implemented to convince consumers to resume using Tylenol, and they worked with medical and health care professionals to continue prescribing the product after it was deemed safe to do so. All of these efforts received positive media attention, which helped restore the Tylenol brand in the public eye.
These crisis management efforts were not the result of an established contingency plan, but rather as a reflection of key organizational values, which identified the company had social obligations beyond maximizing sales. Following these values gave company executives a rationale for ordering the recall, which in turn generated public sympathy, rather than condemnation. These values were established by the dominant coalition of leadership that existed within the company.
The Tylenol crisis was a massive public relations event, as there was widespread public interest and scrutiny. The short term losses were presumed to be around $100 million in lost sales, but the long term image of the company was eventually restored. This is due to Johnson & Johnson’s decision to employ an open system of communication, which involved being proactive and honest about the crisis, rather than attempting to shield it from public view, or minimize the potential threat of poisoned capsules. This incident is therefore regarded as one of the most successful crisis response efforts of any major corporation.
Despite widespread public views that Johnson & Johnson handled the crisis effectively, there are still some lingering criticisms; for instance, there was an eight day period after the crisis emerged before the recall, which some argue was not quick enough. Others placed blame on Tylenol, rather than agreeing with the media that Johnson & Johnson was essentially a victim. However, by most accounts, this is an effective case of crisis management.
Lowder concludes with a more recent recall involving Tylenol that does not appear to have been handled as efficiently; despite the previous measures taken, a 2009 contamination of Tylenol products with a non-fatal, but still unpleasant chemical, did not yield the same real efforts. However, Tylenol overall appears to have saved its reputation from the 1982 disaster, and today, still remains associated as a trusted, family-oriented organization that has become a household name. The main emphasis of Johnson & Johnson’s approach to the 1982 crisis highlights how all actions taken were based on integrity, and despite not having a clear crisis plan in place, the company was able to act upon central organizational values to inform the proper plan that was eventually implemented. This generated media support, rather than condemnation, which filtered into the public. By addressing all points of the crisis, and instigating a concerted effort to regain the public trust following the incident, Johnson & Johnson was able to survive this particular crisis.
