The Tylenol Crisis

I ended my last post with the cliche, "honesty is always the best policy."  This colloquialism has some merit in public relations, however.  In my last post I gave an instance of unethical behavior creating problems.  To reinforce the idea of ethical action rewarding a company, I would like to explain how ethical action in a crisis situation has helped a company.  This is also a very interesting story that occurred in the midst of a crisis.

In 1982 several people died in the Chicago area after consuming Tylenol capsules.  The problem was not that the product was tainted by the manufacturer, but that the Tylenol bottles had been tampered with.  Cyanide was place in Tylenol bottles.  Obviously, something had to be done.  Johnson and Johnson couldn't very well sell a product that could kill you.  The market share of Tylenol plummeted from the top spot during this time.  Johnson and Johnson could have left Tylenol on the shelves and quickly phased out the capsules, however, the corporation went above and beyond to ensure the wellbeing of its public.

Every bottle of Tylenol was recalled (an estimated loss of $100 million).  Tylenol bottles were then equipped with tamper evident covers.  Finally Tylenol reintroduced the product at a reduced price.  Sales quickly rebounded and Tylenol was on top again.  However, their ethical actions put them ahead of the game.  Tylenol's voluntary recall was inevitable, but so was the voluntary recall of every pain medication.  This allowed Tylenol to reintroduce its product first.  Secondly, Tylenol led the way in terms of safety innovation.  Many other companies soon followed, but Tylenol was at the forefront of product improvement.

This story is proof that acting in the best interests of your publics can work out for you.  Tylenol faced a catastrophe but ended up on top because of the way the company responded during a crisis.

The Tylenol story can be read here:
http://iml.jou.ufl.edu/projects/fall02/susi/tylenol.htm