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Johnson & Johnson Crisis Communication Presentation
- 1. Managing the TalcumPowder Accusations Julian Gross and Katherine Knight Corporate Communications - Dr. Shelva Clemons Final Communications Plan May 9, 2016
- 2. Putting the needs andwell-being of the people we serve FIRST Johnson & Johnson credo
- 3. Background • World’s mostcomprehensive and broadly based manufacturer of health care products • Operates in 3 segments: medical devices, pharmaceuticals, and consumer products • Operates over 265 companies in 60 countries and carries 100 brands • “Guided by its credo” • CSR is at the heart of the company for its commitment and responsibility to the people • October 2011, Forbes named J&J the “top brand” in the U.S. • However, the company has had a series of missteps with recalls and lawsuits all questioning the reputation of the brand
- 4. The Problem • J&Jis under heavy scrutiny for its sale of talcum powder and its connection to ovarian cancer • Forced to pay of $72M and $55M from two lawsuits this year • Facing 1,200 more from women with ovarian cancer J&J spokeswoman, Carol Goodwich: “The verdict contradicted 30 years of research supporting the safety of cosmetic talc. The company intends to appeal and will keep defending its products’ safety.”
- 5. The Problem… Newsy: Feb.24, 2016
- 6. The Product Baby Powder •Johnson’s baby powder was first developed in 1893 • As of 2015, nearly 19% of American households use Johnson’s baby powder and 6.73% use Shower to Shower • Contains talc to help absorb moisture and reduce friction TALC • Mineral that contains asbestos in its natural form • FDA does not allow talc-based products to contain asbestos • All talc used by J&J is asbestos free through their own testing and FDA testing
- 7. Competitive Analysis Most significant competitionin new drug research Main Competitors: Unilever, Kimberly-Clark, Proctor & Gamble, Eli Lilly, Colgate- Pamolive, Pfizer Organic competitors: Honest Company, Burt’s Bees, Crabtree & Evelyn
- 8. Situation Analysis POTENTIAL ISSUES: • NegativeMedia Coverage • Brand and reputation damage • Breach of Trust OPPORTUNITIES: • Show understanding of customers’ concerns • Reiterate safety benefits of products • Expand into new developments • Rebuild brand image
- 9. Goal: To maintainand regain customer trust that has been lost due to recent accusations and pending lawsuits Objectives: ● Increase transparency through interviews and media stories ● Realign J&J with its original credo of being responsible to the customer
- 10. Target Audiences Who dowe need to address? Mothers Mothers with children in diapers that might use baby powder Women Ages 25 - 44 Investors Women ages 25 - 44 that use baby powder for hygienic purposes Johnson & Johnson investors worrying about falling stock prices Intervening Public: The Media The media to reach the target audiences
- 11. Communications Strategies andTactics • Social Media • Traditional Media • Leadership Messaging • Internal Communications • Investor Relations • CSR Opportunities
- 12.
- 13. Social Media • Engagewith all concerned customers on social media • Promote positive content showing J&J is taking the steps to ensure the safety of its customers • Use all of J&J’s outlets to push content and cross share content from third party sources • Use paid ads to target segmented audiences
- 14. Traditional Media Be transparentwith the media • Host press conferences, town halls, and speak directly from C-level officials Partner with trusted media outlets • Participate in live interview with medical officials • Invite media and bloggers to a call when there is a new development or product roll out • Offer exclusive interviews to trusted media
- 15. Leadership Messaging • Onevoice, one message • Position the CEO to talk transparently about company operations • Media train all CEO/C-level officials • Partner with scientists and researchers
- 16. Internal Communications Regularly communicatewith employees • Weekly memos to employees • Video communication from CEO • No communicating with the media or on social media without approval • Develop crisis handbook detailing rules and roles
- 17. Investor Relations Be transparentand positive with investors • Highlight future growth opportunities • Show how company will rebound • Highlight positive opportunities over negative attention • Send special newsletter following big verdicts or significant drop in stock prices
- 18. CSR Opportunities Partner withkey women’s and children’s cancer-fighting organizations • Sponsor Susan G. Komen 3-Day and Relay for Life • Turn lights teal in September to honor ovarian cancer awareness months • Make cancer research donations with the sales of certain products
- 19. Timing & Budget TIMING: •Quick Response & Executive Action • One succinct message • Immediate response following a verdict • Continue measurement and tactics for the year following BUDGET: • Cost effective on all fronts • Largest expenditures on sponsorships • Varies depending on verdict
- 20.
- 21. SWOT Analysis Strengths ● Well-knowntrusted family brand ● Highest amount of pediatric pharmaceutical sales ● Highly effective response for previous crises, such as the Tylenol recall ● Responsive social media ● Consistent stock prices ● Variety of income sources and brand diversity Weaknesses ● Little transparency from CEO regarding recent lawsuits or company matters ● Wide variety of products each with their own issues that also require attention ● Claims of company knowing about the harmful effects of its product and not being transparent about warnings or implementing health safety label ● Self-regulated company that performs its own scientific studies; may not be up to FDA standards Opportunities ● Better inform customers of scientific facts behind talc ● Rebuild trust among parents and women for safety of J&J products ● Build positive media coverage ● Partner with cancer research organizations to raise awareness and inform consumers Threats ● Recent lawsuits with unpredictable outcomes ● Potentially more lawsuits depending on the outcome ● Falling stock prices ● Lack of complete scientific evidence behind products containing talc ● Negative media coverage surrounding product and J&J brand ● SEO shows negative search results
- 22. Sources 24/7 Wall Street.“The 10 Worst Companies Burned by the Media.” The Atlantic. June 14, 2011. http://www.theatlantic.com/business/archive/2011/06/the-10-companies-burned-worst-by-bad-press/240448/#slide9 Adobe Social. May 4, 2016. http://www.adobe.com/solutions/social-marketing/social-listening.html American Cancer Society. “Talcum Powder and Cancer.” November 17, 2014. Accessed April 22, 2016. http://www.cancer.org/cancer/cancercauses/othercarcinogens/athome/talcum-powder-and-cancer Benson, Mike. “Johnson & Johnson: A Leading Pharmaceuticals Company.” Market Realist. March 11, 2015. http://marketrealist.com/2015/03/johnson-johnson-leading-pharmaceuticals-company/ Berfield, Susan, Jef Feeley, and Margaret Fisk. “More than 1,000 women accuse Johnson & Johnson of covering up the risks of baby powder.” Bloomberg Businessweek. Issue 4470. Pg 54-59. April 4, 2016. Bonetto, Lauren. “Marketing to Moms.” Mintel. September 2014. http://academic.mintel.com.proxy.library.georgetown.edu/display/679772/ Crow, David and Lindsay Whipp. “J&J to relaunch baby brand as millennials go organic.” Financial Times. April 19, 2016. http://www.ft.com/intl/cms/s/0/035c1068-0630-11e6-96e5-f85cb08b0730.html#axzz47iRUAzSc Dye, Jessica. “Johnson & Johnson ordered to pay $55 mln in talc-powder trial.” Reuters. May 3, 2016. http://www.reuters.com/article/us- johnson-johnson-talc-verdict-idUSKCN0XT20L Gilbert, Marissa. “Feminine Hygiene and Sanitary Protection Products.” Mintel. March 2016. Accessed May 1, 2016. http://academic.mintel.com.proxy.library.georgetown.edu/display/747679/?highlight
- 23. Hopping, Richard. “Johnson’slawsuit challenges perceptions of trust.” Mintel. http://academic.mintel.com.proxy.library.georgetown.edu/display/767756/?highlight March 31, 2016. Accessed April 10, 2016. Investor Relations. “2014 Investor Fact Sheet.” Johnson & Johnson. 2014. http://files.shareholder.com/downloads/JNJ/1997120036x0x856393/1267DC95-99FA-47D8-81AA- A0A855C129E8/JNJ_2014_Investor_Fact_Sheet_v5.pdf Johnson & Johnson. “Our Company.” Accessed April 2, 2016. http://www.jnj.com/about-jnj Margaret. “The Birth of Our Baby Products.” Johnson & Johnson’s Kilmer House. April 30, 2007. http://www.kilmerhouse.com/2007/04/the-birth-of-our-baby-products/ Money Morning Research Team. “Johnson and Johnson Stock Price Update Today.” Money Morning. April 29, 2016. http://moneymorning.com/market-news/johnson- johnson-stock-update-april-30-2016/ Munro, Dan. “New Study Ranks Johnson & Johnson #1 in Pharma for Social Media Engagement.” Forbes. January 21, 2014. http://www.forbes.com/sites/danmunro/2014/01/21/new-study-ranks-johnson-johnson-1-in-pharma-for-social-media-engagement/#fa23c571dc18 Nanninga, Margie. “Soap, Bath, and Shower Products.” Mintel. February 2016. http://academic.mintel.com.proxy.library.georgetown.edu/display/747662/ Neff, Jack. “Johnson’s Baby Turns to Social Media Transparency to Woo Millennial Moms.” Ad Age. July 30, 2014. http://adage.com/article/cmo-strategy/j-j-social-media- transparency-woo-milliennials/294376/ “OTC Pediatrics: Key Players What You Need to Know.” Mintel. February 2016. Accessed April 10,2016. http://academic.mintel.com.proxy.library.georgetown.edu/display/763157/#atom1 Rooney, Jennifer. “Brand Power to the People.” Forbes. October 5, 2011. http://www.forbes.com/sites/jenniferrooney/2011/10/05/brand-power-to-the-people-jj-takes-lead-in-forbes-ranking/#49353ca15aed Statista. “U.S. households: Which brands of body and baby powder do you use most often?” March 11, 2015. http://www.statista.com/statistics/275421/us-households-brands- of-body-and-baby-powder-used/
Editor's Notes
- #6 http://www.latimes.com/business/hiltzik/la-fi-hiltzik-talc-cancer-johnson-20160506-snap-story.html The Ovarian Cancer National Alliance doesn't list talc at all as a risk factor. Among the main causes of the disease, the organization says, are heredity--mutations in breast cancer gene 1 (BRCA1) or breast cancer gene 2 (BRCA2) are "responsible for about 10 to 15 percent of all ovarian cancers"; obesity; and age -- rates are highest in women aged 55-64. Reproductive history is another factor, with rates elevated among women who have not given birth or taken oral contraceptives. The American Cancer Society does list talc among these risk factors, but only gingerly, stating that "some studies suggest a very slight increase in risk of ovarian cancer in women who used talc on the genital area" and suggesting that the blame may rest with contamination of talcum powder with asbestos, which is no longer the case. So the link between talcum powder use and ovarian cancer hasn't been proved, but hasn't been conclusively debunked, either. That places it right in the danger zone of product liability litigation, especially when scientists on either side of the debate affiliate themselves with lawyers on either side.
- #13 http://www.mintel.com/blog/personal-care-market-news/personal-care-product-safety-trends Removed dangerous ingredients from products and launched this video to regain trust 54% of parents take ingredients into consideration when purchasing a product. This campaign was inspired by the story of Sadako Sasaki. A young japanese girl who developed leukemia from the hiroshima bomb aftermath. In chemo she would make cranes, it was believed that when 1,000 cranes are created a wish/promise is granted. Johnson & Johnson brought its team and their families together to write messages of things they plan to do going forward and assemble them into cranes.