Tylenol

The media was not only focused on the deaths but it was also pervasive. Throughout the crisis over 100,000 separate news stories ran in U.S. newspapers, and hundreds of hours of national and local television coverage. A post crisis study by Johnson & Johnson said that over 90 percent of the American population had heard of the Chicago deaths due to cyanide-laced Tylenol within the first week of the crisis. Two news clipping services found over 125,000 news clippings on the Tylenol story. One of the services claimed that this story had been given the widest US news coverage since the assassination of President John F. Kennedy (Kaplin, 1998). 


Directly following the incident, Johnson and Johnson's stock fell seven points, and it dropped from having 35 percent of the nonprescription pain-reliever market to having only eight percent of the market.8 However, these tough times would not last. The company aired commercials within days to regain the public's trust, and a month after the recall, the company embarked on an aggressive campaign to rebuild the Tylenol brand. In November, it promised to have the product back on the shelves in a new triple-tamper-resistant package - the first of its kind - by the end of the year. It offered incentives, such as a free replacement of caplets for the capsules and special coupons, to try to maintain its customer base. The company's attempts were successful, and by the following spring, Johnson and Johnson had regained its previous market share.9 When another poisoning involving a New York woman occurred four years later, Johnson and Johnson once again had to take action. "Because the company had been through it before - the tampering, the tragedy, the scrutiny of news organizations - its executives knew how to handle it." 10 Despite the fact this case was soon identified as an isolated incident, Johnson and Johnson decided to permanently discontinue capsule products - once again demonstrating its commitment to putting safety first.

Before the crisis, Tylenol was the most successful over-the-counter product in the United States with over one hundred million users. Tylenol was responsible for 19 percent of Johnson & Johnson's corporate profits during the first 3 quarters of 1982. Tylenol accounted for 13 percent of Johnson & Johnson's year-to-year sales growth and 33 percent of the company's year-to-year profit growth. Tylenol was the absolute leader in the painkiller field accounting for a 37 percent market share, outselling the next four leading painkillers combined, including Anacin, Bayer, Bufferin, and Excedrin. Had Tylenol been a corporate entity unto itself, profits would have placed it in the top half of the Fortune 500 (Berge, 1998).