Reputation Risk and Brand Demise: Then vs. Now – Tylenol 1982…

Michael D. Moberly, Principal, Founder kpstrat and ‘Business Intangible Asset Blog – A Business Intangible Asset Strategist & Risk Mitigator

Below are constructive perspectives, behaviors, strategies, and actions for readers to consider if-when a business experiences reputation risks which can materialize asymmetrically @ keystroke speed and cascade virally.

Readers are obliged, at the outset, to recognize that business reputation + brand are intangible (not tangible) assets which hold value, competitive advantage, revenue generation capability-capacity, and are ‘mission essential’ to brand – product – service – operating culture sustainability.

This is the second of multiple posts @ Business Intangible Asset Blog explores the multiple tragedies + reputation risks that materialized on September 30, 1982, in Chicago to cause the deaths of 7 citizens and produce unparalleled reputation risks and projections of brand demise to Johnson & Johnson’s Extra-Strength Tylenol capsules were determined to be laced with cyanide.

As with the initial post, I respectfully encourage readers to reflect on how and/or if the presence or absence of either, i.e., current technologies, mediums, and platforms, etc., influenced…

  • how these tragedies – events were addressed + treated by the affected parties (in September – October 1982) compared to present day, assame preceded the Internet, cellphones, and keystroke speed – virality of ‘social media’ communication.

We recognize now, less so at the time (as I recall) that J&J leadership endeavored, throughout this period of ultimate (brand) adversity, to endure the Tylenol brand attacks + the Tylenol murders, with the Tylenol brand to be recoverably intact.

Chicago Tribune reporters Stacy St. Clair and Christy Gutowski recently re-painted this portrait in a fine – well researched piece. We thank them for doing so.

The following represent near-verbatim (quotes) from the St. Clair – Gutowski piece and other relevant sources, which I have taken the liberty of categorizing to reflect my work as a business intangible asset strategist and risk mitigator. Please enjoy.

First Time Magnitudes + Realities…

  • largest mass recall in U.S. history, involving more than 31 million bottles (of Tylenol) and costing the companies (McNeil – J&J) $100 million.
  • marketers – advertisers predicted a rapid demise of Tylenol, e.g., consumers would not see the Tylenol name, in any form, on store shelves within a year.
  • Tylenol’s share of the market dropped from 37% in September 1982 to 7% in the following months.
  • could a bestselling brand be saved if the public thought the Extra Strength Tylenol adulteration (poisoning) had occurred while the capsules were under McNeil and/or J&J control
  • HIPAA was still 14 years away, still able to use contacts to gather information necessary to the investigation

Good decisions made early…

  • recognize that the (Tylenol) crisis could not be managed solely from an east coast corporate boardroom
  • need to be closer to the (crisis) epicenter in Chicago
  • establish a Chicago ‘war room’ for discussing strategies, options, and internal investigations
  • establish lines of communication with key people in Chicago
  • avoid relying on secondhand information – reports
  • trust everyone, but recognize the obligation to still cut the cards, and understand each voice
  • recognize that McNeil – J&J principals held more facts than any other party
  • share results of the (on-going) investigation with law enforcement investigators
  • respectfully convey that other parties may have little – no idea where to look (in this sector) or what questions to ask, so, if you don’t allow us to work with you on this, you will be cutting off your nose to spite your face
  • need to seek help to form connections + relationships + partnerships with-to law enforcement investigators and the (Tylenol) investigation task force
  • voluntarily provide lists of disgruntled current – former employees, and unhappy customers to investigators
  • determine if the Tylenol ‘poisonings’ occurred while the bottles were under McNeil or J&J’s control
  • assure the publics’ trust in over-the-counter pain medications
  • explain to relevant parties that a sudden withdraw of all Tylenol-branded products could present additional health problems for consumers + medical centers

There’s more to this story of course…please consider reading subsequent posts on this and related topics @ Business Intangible Asset Blog…

The ‘Business Intangible Asset Blog’ is experientially researched, written, and produced by Michael D. Moberly, to provide readers (business leaders, management teams, boards, and investors with reliable perspectives and nuanced insights to distinguish, value, and safeguard business things intangible designated as mission essential. 

Readers are-encouraged to review and comment on this, and other posts, @ Business Intangible Asset Blog’.


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