Tylenol Case Study

Tylenol Case Study

In 1982 one of Americas most well known and established corporations suffered a large blow that could have crippled many other organizations financially. The issue involved the Johnson and Johnson Corporation also known as J&J and their Tylenol capsule product; this affected the company, its employees and the public. The J&J Corporation was not remembered for the incident but how the incident was handled and in this case study I will discuss the communication techniques that were used to create the outcome for the J&J Corporation.

The Tragedy

The incident in 1982, which was also, referred as the Tylenol tragedy, involved person or persons that are currently unknown who used the Extra Strength Tylenol capsules as a means to spread havoc in the pharmaceutical industry. The perpetrators laced the Extra Strength Tylenol capsules with Cyanide. Cyanide is a powerful poison that can kill a person quickly; the Cyanide laced capsules were responsible for the deaths of seven persons who had used the Tylenol capsules. The incident was not the fault of the J&J Corporation but since the product maker was J&J the reaction from the public placed the blame on the company.

About the Company

The J&J Corporation was founded in 1886 by Robert Wood Johnson as a medical compound and adhesives manufacturer. The company had grown throughout the years as a medical supply company and in the 1950's the company introduced Tylenol (J&J, 2006).

The Tylenol capsules were very popular over the counter pain relievers; the sales of the capsules were 19% of J&J's profits and the product had over 100 million users in the United States alone. The company had over 37% of the market share in the painkiller industry prior to the tragedy in 1982.

Publics Involved

The incident affected millions of Americans including employees and shareholders of the company as well as other pharmaceutical makers. J&J took a large loss over the incident losing over $100 million dollars in lost revenue due to the product recall. This large loss created many layoffs throughout the industry and a loss in investor confidence. This loss was a nightmare for J&J but it had to be done to earn back the confidence of the employees, shareholders and the most importantly the public (Department of Defense, 2006).

Many of the other pharmaceutical manufacturers of over the counter medications were also affected by this tragedy and also lost revenue but the response to this tragedy is what determined which company would survive this crisis.

The Media and the Communication Strategy

J&J and the media did not have any open relationships established and as soon as the media learned of the Tylenol incidents the word spread nationally and throughout the world. J&J actually learned of the news from the media coverage itself (Department of Defense, 2006).

The media coverage ran daily almost exploiting the deaths of these seven people by covering the deaths and blaming it on Tylenol. The media was an intricate part of the negative communication that went out to the publics and J&J new this so the company used the media to its advantage to spin a positive Pubic relations or P.R campaign over the incident. This was a well thought out strategy on the part of Johnson and Johnson.

The Chairman of Johnson and Johnson, James Burke stepped out and confronted the negative press that J&J was receiving by creating a team of experts to combat the media claims. He developed a strategy to focus on two main points and that was to find out "How to protect the people" and "How to save the product". These two points were critical in the development of a good strategy (Department of Defense, 2006).

Tools and Benefits

First the company with paid advertisement through the radio, television and newspaper networks alerted all Chicago residents and the surrounding communities to stop using the Tylenol products and secondly they alerted all retailers in the Chicago and surrounding areas to take all Tylenol products off the shelf. The company also set up toll free numbers to help answer any consumer questions or concerns about the company's products.

These moves proved to be unselfish on the part of J&J, the move showed the public that J&J was not willing to take risk that could continue to harm the public and in turn were willing to take massive amounts of losses in the process.

The Second Crisis and the Final Outcome

Following the 1982 crisis J&J would emerge as one of the most respected corporation's in America by the use of their strategies to overcome a crisis like the Tylenol scare. The strategy used in 1982 would prove to be vital once again as a second Tylenol scare similar to the first emerged in 1986. This time J&J was more prepared than before as they put in place the strategies used in the first crisis in 1982