The ink is still not yet dry on the potential fall-out of these recalls, but another recall, in quite a different industry, hit the headlines late last week, namely the recall by the FDA (U.S. Food and Drug Administration) of certain Johnson & Johnson products, including children's Tylenol. One account of this recall was published by Barry Silverman under the title "Latest Tylenol Recalls Past Crisis" on the brandchannel.com site here. The recall was occasioned by certain "manufacturing deficiencies" that could result "in potency, purity or quality" problems.
Fast-backward to 1982, and to the granddaddy of all recalls, namely the Tylenol crisis of that year, when the product was found to contain cyanide, due to tampering by third parties, resulting in the death of several people. The response of J&J is considered the textbook example of how to deal with a consumer product recall, including transparency, responsiveness, and a meaningful set of actions, including the widespread recall of the product from the shelves at a cost of $100 million dollars (a lot of money at the time, remembering that this was nearly 30 years ago) and the development of the tamper-proof bottle.
It does not appear that any material harm has occured to consumers of the products subject to the current recall. Still, the current scorecard by the pundits of the J&J response reveals a more mixed assessment than the tragic recall of 1982. Let's consider several observations in this regard as reported in the "brandchannel" article.
1. "This time, it seems, Johnson & Johnson's McNeil Consumer Healthcare unit, which makes children's Tylenol, has been less responsive. 'The recall quickly became a flashpoint for some parents,' reports The New York Times. 'Some people said they felt frustrated in their efforts to obtain more information from the company. Others said they had lost confidence in the products. This is at least the fifth recall for consumers of McNeil products in less than a year because of quality control issues.' "
[How does The New York Times know that J&J has been less responsive this time? Did they have some baseline to evaluate this, or what? Also, how many consumers knew that this is the fifth recall in less than a year? What evidence did they have for this loss of consumer confidence?]
2. "Obviously, when recalls are conducted because of a quality problem on the part of the manufacturer, it can shake consumer confidence. The recent spate of highly publicized Toyota car recalls is proof enough that such actions can do a lot of damage to a brand's image."
[Actually, I heard a Bloomberg podcast late last week that suggests that Toyota vehicle sales have held up quite well recently, despite the recall. If so, how exactly has the damage to Toyota's image manifested itself?]
[This is an interesting point, if true, which certainly distinguishes the J&J situation from that of Toyota. That said, I wonder how much evidence, other than anecdotal evidence, is there to show a migration from a branded product to a generic substitute in such a situation. Is the move brand/product-specific, or can it have a more general effect on consumer preferences for drugstore products?]