Winning Back Lost Customers Is a Costly Challenge
Perhaps the most famous case illustrating the enormous cost of winning back lost customers is that of the “Tylenol Murders.” In 1982, seven people in the Chicago area died suddenly after taking Tylenol capsules. An investigation revealed that the capsules had been laced with cyanide, a deadly poison. When the story ran on the nightly news programs, a nationwide panic ensued that caused Tylenol’s sales to plummet overnight. Many business analysts predicted that Tylenol’s manufacturer, Johnson & Johnson, would not survive the tragedy. Johnson & Johnson surprised the analysts by undertaking one of the most successful campaigns in history to win back customers. It worked, but the cost was huge. This case led not just Johnson & Johnson but also all major drug manufacturers to develop the tamper-proof bottle. Having done so, Johnson & Johnson undertook an intensive public relations campaign to win back the trust of its customers.
Questions:
If the Tylenol incident were to happen today and you were a user of Tylenol, would Johnson & Johnson be able to win back your trust?
What would it take for Johnson & Johnson to win back your trust if one of the victims were a friend of yours?