PR TECHNIQUE: PRODUCT RECALLS - Addressing returns to vendor

The modern information age has put added pressure on PR teams to

act quickly over product recalls. But, as John Frank discovers, it's not

the recall itself that damages reputation - it's how you handle it.



Never underestimate the ability of college kids to cause a crisis. Bill

Crane, SVP with GCI Group in Atlanta, remembers the March day two years

ago when client Kidde Safety underwent just such a situation.



Apparently, some Canadian college students were testing fire-safety

equipment, and discovered that a Kidde carbon monoxide detector using a

new type of sensor didn't work properly. They contacted the US Consumer

Product Safety Commission (CPSC), which contacted Kidde.



The company discovered that emissions from ink used in its packaging

were rendering the new sensor useless. That meant the North

Carolina-based company needed to launch a massive recall of one million

detectors it had sold with the new sensor. Crane's firm was contacted to

provide recall PR counsel.



GCI quickly implemented a plan that included:

- Announcing the recall on national morning TV shows.

- Distributing releases about the recall on wire services.

- Making a VNR with Kidde's CEO discussing the recall.

- Pulling unsold product from store shelves.

- Putting up a website where consumers could type in a model number to

see if they had one of the defective products, and then be sent

packaging to return the products to Kidde.

- Distributing posters that announced the recall to retailers, and

established a return program at no cost to retailers.



While Kidde lost sales during the period because it had no product on

store shelves; in the long term, it didn't lose market share due to the

recall, Crane says. That demonstrates how, when executed properly,

recall PR can help maintain customer loyalty and brand reputation.



However, companies must act quickly when they know a product has a

problem, and they must communicate quickly and effectively to all

audiences - regulators, employees, consumers, retailers, and others.



"I don't think a recall in and of itself damages reputation," says

Careen Winters, an SVP with The MWW Group. "It's how it's handled that

affects reputation."



Twenty-five years ago, when he was working on recalls at Ford, companies

had more time to collect data before deciding on a recall, says Dennis

Gioia, a professor of organizational behavior at Penn State's Smeal

College of Business. The evolving media landscape has changed that, he

says. Reports on defective products quickly circulate in today's 24-hour

information environment. Moreover, companies - as well as consumer

groups and regulators - have more tools to find patterns of problems

more quickly than they once did, he adds.



The CPSC is involved in roughly 300 recalls a year. (The CPSC offers a

host of information on recall PR, including a handbook, sample press

releases, and suggestions for putting together VNRs.) Other federal

agencies, such as the Food & Drug Administration, and the National

Highway Traffic Safety Administration, are also in the recall business,

usually negotiating with companies for voluntary recalls. Occasionally,

they go to court to mandate recalls of problem products.



With so much attention, companies need to be proactive when it comes to

recalls. "If you are seen as proactive, Americans are a forgiving lot,"

Gioia says.



The first step in recall PR is to quickly gather the facts to determine

if a recall is necessary. Customer safety should be the measurement,

says Peter Morrissey, now head of Morrissey & Company, and also a member

of the PR team that worked on the famous Tylenol recall by

Johnson & Johnson in the early '80s.



"You're really trying to preserve trust," by being honest with consumers

that your company has a problem, Morrissey says. Johnson & Johnson had a

company credo that put customer safety first, and prompted the recall

without a federal agency urging it.



"It takes a responsible corporation to do the right thing," says Len

Biegel, a principal in the Washington, DC office of Weber Shandwick

Worldwide, who was involved in the Tylenol recall.



Once a company is set to start a recall, it needs to get the facts to

its employees, because they'll be on the front lines dealing with

consumers and the media.



That's what RF Binder did this summer for client Christmas Tree

Shops.



The retailer discovered that the liquid in 28,000 Galileo thermometers

it was selling could be toxic, even though the packaging said it was

not.



The RFB team held meetings with all the chain's store managers and

customer care representatives, explaining the problem and the recall

plans.



"The most important step for the retailer is internal," says Nancy Moss,

senior managing director with RFB. Uninformed employees can disseminate

bad information that hurts a company's reputation. "So much damage is

done by employees with bad information and good intentions," adds MWW's

Winters.



The RFB team also coordinated recall plans with the CPSC, sent releases

to key media, prepared instore posters, put information on the web, and

set up a toll-free number for customers.



Once a recall is underway, it's also important to respond quickly to

charges or accusations from consumers, interest groups, or others.

"Listen to the activists," advises Biegel. "Are there crazies out there?

Certainly, but you don't turn your back on them."



It's also important for a company to have a single voice - usually the

CEO - stressing points that consumers can relate to.



Using statistics to downplay the danger of a recall - saying, for

example, that a product presents only a one-in-a-million chance of

killing someone - simply unnerves consumers rather than reassures them,

Biegel says.



One of the major mistakes Firestone made in its tire debacle was first

announcing a phased recall for warm-weather states. While Firestone

contended the greatest danger from the tires was in high temperatures,

that did little to reassure consumers in cold-weather states, who also

quickly clamored for replacement tires.



As a recall progresses, keep track of consumer opinion, advises

Biegel.



Johnson & Johnson did that nightly, he claims, and the reputation of the

brand remains solid today.



TECHNIQUE TIPS

1. Do gather facts quickly, and disseminate what you know openly and

honestly

2. Do inform employees about recall details; they're your first line of

contact with customers

3. Do be proactive, and put customer safety first

1. Don't use meaningless statistics to downplay the seriousness of a

recall

2. Don't deny responsibility. A retailer that blames a manufacturer for

a product recall risks alienating consumers

3 Don't take so long to start a recall that others capture the press'

attention with tales of product woes before you do.



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