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Response to Tylenol Tampering Crisis Shows the Value of Brand Reputation

Johnson & Johnson’s swift response to the 1982 tampering crisis
illustrates the value of a brand’s reputation.

The Tylenol tampering crisis happened 30 years ago this weekend.

The proactive way Johnson & Johnson reacted — quickly pulling its product off the shelf — is regarded as a model for companies responding to a public relations crisis.

Johnson & Johnson recalled $100M worth of product. A financial disaster, to be sure, but the company correctly concluded the damage would have been a lot worse if the public could not trust the purity of its product.

An NPR story I heard yesterday emphasized this point. It quotes a marketing ethics professor as saying: “If you’re a really good company like [Johnson & Johnson was] in making this recall, you’ve got to say, if we don’t protect the brand name and our integrity of our reputation, then nothing will matter in the long run.”

Well said. It’s a reminder all brand owners should take to heart.

The reputation a trademark represents means everything. As Johnson & Johnson can attest, it’s not something a brand owner can completely control. But the reputation connected with a trademark is something an owner certainly can influence, and should jealously guard. It doesn’t matter if you’re a multinational like Johnson & Johnson, or you own the neighborhood hair salon. The brand owner’s honesty, the value it provides, the way it treats customers, the quality of its goods and services — these are the things that matter.

A company’s reputation is so tied to its trademark that if its reputation is ever tarnished beyond repair, the only rational response is to start over with a clean slate and invest in a new brand. That’s what Phillip Morris (now Altria) did. But it is so much better to do what Johnson & Johnson did instead: avoid catastrophic brand harm by doing whatever it takes to protect one’s good name.

Unless paired with a company’s good reputation, a trademark is no asset at all.

Posted on September 30, 2012 by Registered CommenterMichael Atkins in | CommentsPost a Comment

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