By Isaac Bonnell
No business ever wants to go through a product recall. They process can be long, expensive and will almost certainly be on the evening news.
But that doesn’t mean a recall will sink the company. In fact, it could be a positive experience for the business in the long run — if handled correctly, said Ryan Pemeberton, an account executive with the marketing firm Baron & Company.
“It’s an opportunity to build trust with current and potential customers,” Pemberton said. “People want to know what happened and how you’re taking care of it.”
The first thing to remember is that speed counts when it comes to communication. Updating the company Web site as soon as possible with recall information will help ensure that customers hear the news from you first, rather than from Twitter or someone’s blog, Pemberton said.
“We always advise clients to be the first to tell their story,” he said. “You have to make significant efforts if you want this to resolve quickly.”
And in the age of digital information, nothing on the Internet goes away. Those blog posts could pop up in a Google search years later — even more reason to make sure that your message is out there, Pemberton said.
Certainly, the scope of a recall and the type of product involved will determine how the public responds. For example, the public may not react much to a recall of several hundred light fixtures. But a nationwide recall of potentially tainted peanuts like what happened earlier this year is another matter.
“That was the biggest recall I’d ever seen and I’ve been here 14 years,” said Michael Elkins, grocery department manager for the Community Food Co-op.
Though the Co-op didn’t make any of the recalled peanut products, it sold those products and had to deal with the aftermath. Peanut sales were down for several weeks, but sales have come back, Elkins said.
“People get over it,” he said. “It varies on what the item is. With milk, people still want to buy milk so they’ll start purchasing it again because it’s a necessity. With peanut butter, though, it’s not really a necessity.”
A huge part of successfully handling a recall is the public perception. Mainly, customers want to know that your company is addressing the situation, Pemberton said.
“There are two courts you need to worry about: there’s the court of law and the court of public perception,” Pemberton said. “If it’s your fault, admit it’s your fault. A lot of times, people are worried more about the legal ramifications. Just because you win in the court of law doesn’t mean you will win in the court of public perception.”
Pemberton points to the 1982 recall of Tylenol as an example. That year, seven people died after taking pills laced with poison. This prompted the company to issue a nationwide recall of an estimated 31 million bottles.
Tylenol’s market share dropped dramatically after the incident, but rebounded within a year due to the company’s quick reaction and new tamper-resistent bottles.
Though that incident happened more than 25 years ago, the lessons learned are still relevant today, Pemberton said.
“We can learn from history so that it doesn’t have to be a trial by fire,” he said.