How firms are winning back customer trust after recalls

Eve Jackson (right) and Sonia Rozza at the launch of Insolia, a global footwear technology in Nairobi on March 10, 2017 . PHOTO | WILLIAM OERI 

By GRACE MUNYI

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Summary

• An example of a company that successfully employed this strategy after a recall, in a bid to restore its customers’ confidence is Johnson and Johnson.
• In 1982, its product Tylenol, a painkiller that was the company’s best-selling drug in the US at the time faced a tremendous crisis when seven people in Chicago were reported dead.
• In the case of Johnson and Johnson it assumed responsibility for the tampering despite it not being its fault, putting public safety first and recalling all of its capsules from the market.

In an effort to restore consumer confidence after its shoe recall two months ago, Bata has launched a new collection called Insolia Heels, employing a strategy of quality correction that evidence shows consumers readily respond to after a crisis.

“We at Bata Shoe Company believe that comfort and fashion should come together. Insolia technology allows women to wear high heels up to three times longer, thanks to the revolutionary weight-distribution system that spreads their weight equally on their feet. You walk straighter with your head held higher,” said Alberto Errico, Bata’s president for Africa in a statement.

The launch comes behind a round of negative publicity that typically accompanies a product recall on quality issues, which can lead to a disruption of the established relationship between brands and consumers, affecting the brand image and its equity. However, by offering consumers products that last three times longer, Bata is seeking to move onwards from its earlier substandard shoes and taking action to prevent a repeat of the same quality issues.

In his book, Strategic Planning for Public Relations, Professor of Public Communication Ronald D Smith notes that such a strategy needs to be embraced by any brand that is in a position to fix the problem, especially if it was in some way unprepared or negligent.

“Corrective action involves taking steps to contain a problem, repair the damage and or prevent its recurrence. This is a strategy that can serve the mutual interests of both the organisation and its public, restoring consumer confidence in a brand.”

An example of a company that successfully employed this strategy after a recall, in a bid to restore its customers’ confidence is Johnson and Johnson.

In 1982, its product Tylenol, a painkiller that was the company’s best-selling drug in the US at the time faced a tremendous crisis when seven people in Chicago were reported dead after taking extra-strength Tylenol capsules. It was reported that the product was tampered with by unknown suspects who removed the drug from the shelves, infected it with deadly amount of cyanide and then returned it to the shelves.

At the time Tylenol controlled 37 per cent of its market with revenues of about $1.2m, contributing a 19 per cent share of Johnson and Johnson’s profits. However, immediately after the cyanide poisoning, its market share plummeted to seven per cent.

The company issued an immediate brand recall and later re-introduced the painkiller with a new container with a triple-seal, which was more resistant to tampering, in a bid to restore consumer confidence.

“Johnson and Johnson combined various public relations response strategies, the company conducted an investigation and expressed compassion. But its strongest efforts were in taking corrective actions by introducing a new triple-seal safety packaging that soon became the industry standard.

They also developed new random inspection procedures before the shipment of Tylenol to retailers,” wrote Ronald Smith in his book.

It was also the first company to comply with the US Food and Drug Administration mandate of tamper-resistant packing. Within a year of this quality correction, Tylenol’s sales rebounded and its market share had gone back up to 30 per cent.

Consumer responses have been found to be even more powerful and positive when an organisation willingly accepts responsibility and fixes a problem with its product that it did not cause.

“Assuming responsibility signals an organisation’s full atonement in the classic sense that it turns away from a former position and becomes an advocate for a new way of doing business,” said Prof Smith.

In the case of Johnson and Johnson it assumed responsibility for the tampering despite it not being its fault, putting public safety first and recalling all of its capsules from the market.

This motivated consumers to buy the product when it was reintroduced into the market and saw the company recover lost stock from the crisis.

-African Laughter