In 1982 someone tampered with Tylenol capsules, resealed them after adding cyanide, and put them back on the shelves in pharmacies. The product tampering resulted in the murder of seven people, and many thought that would be the end of Tylenol. What happened instead became a casebook example of how a corporation should react. Although the murders happened in Chicago, Johnson & Johnson reacted quickly to recall the product nationwide and reintroduced Tylenol with tamper-proof packaging. The action cost the company $50 million, but within one year they had recaptured 80% of their pre-scandal market share. Due to recalling the product quickly, and an advertising campaign focused on regaining consumer trust, Tylenol remained one of the best selling pain relievers.
With the recent advent of some of the most severe corporate scandals ever perpetrated, specifically British Petroleum, Goldman Sachs, and Toyota; we are seeing an opposite reaction. All three of these corporations have denied culpability for their wrongdoings in multiple arenas. BP has pointed fingers at Halliburtan and TransOcean for their recent oil rig explosion, (who are pointing fingers back). Goldman Sachs is disavowing to congress their knowledge that housing prices were going to fall when they sold subprime mortgage products, even though they were in fact working at the same time to protect themselves from these very same products. Toyota, still in denial, denied for years that there were automobile acceleration problems.
It is particularly egregious to me that each of these three firms specifically marketed their brands based on trust. BP’s “Beyond Petroleum” green campaign was designed to ensure consumers they were environmentally responsible, consumers pay a higher premium for investing through Goldman Sachs because they believed they were looking out for their interests, and Toyota had a long history of emotionally charged advertising focusing on dependability, safety, and quality.
Whatever has happened to corporate accountability and what effect will this have on consumers trusting a brand in the future? It actually appears that marketing and corporate accountability have come full-circle since the days of the Tylenol recall in 1982. Johnson & Johnson recently recalled 43 different children’s medicines, including Children’s Tylenol, due to product contamination and the FDA has charged that they knew about these issues for over two years and attempted to cover them up.
With the recent advent of some of the most severe corporate scandals ever perpetrated, specifically British Petroleum, Goldman Sachs, and Toyota; we are seeing an opposite reaction. All three of these corporations have denied culpability for their wrongdoings in multiple arenas. BP has pointed fingers at Halliburtan and TransOcean for their recent oil rig explosion, (who are pointing fingers back). Goldman Sachs is disavowing to congress their knowledge that housing prices were going to fall when they sold subprime mortgage products, even though they were in fact working at the same time to protect themselves from these very same products. Toyota, still in denial, denied for years that there were automobile acceleration problems.
It is particularly egregious to me that each of these three firms specifically marketed their brands based on trust. BP’s “Beyond Petroleum” green campaign was designed to ensure consumers they were environmentally responsible, consumers pay a higher premium for investing through Goldman Sachs because they believed they were looking out for their interests, and Toyota had a long history of emotionally charged advertising focusing on dependability, safety, and quality.
Whatever has happened to corporate accountability and what effect will this have on consumers trusting a brand in the future? It actually appears that marketing and corporate accountability have come full-circle since the days of the Tylenol recall in 1982. Johnson & Johnson recently recalled 43 different children’s medicines, including Children’s Tylenol, due to product contamination and the FDA has charged that they knew about these issues for over two years and attempted to cover them up.
