Effective Communication Case Study

Effective Communication Strategy

PepsiCo Corporation took an instant offensive stance to the claims in an effort to combat the negative repercussions from the syringe accusations. Timing was critical during this crisis; the public’s perception of the safety of the PepsiCo. product Diet Pepsi and PepsiCo’s overall stance on the safety of consumers was on the line. “The plant was opened to the media and the plant owner, manager, and quality assurance manager were made available to the press”(Center & Jackson, 2003). PepsiCo’s communication strategy was to only communicate on the facts and the evidence and maintain open lines of communication with its publics.

PepsiCo Co.’s direct approach and open lines of communication with consumers, media, and FDA helped to provide an open book image of the company. The company was convinced this was not an assembly line issue within the business and was willing to answer to their publics. A critical piece of the company’s effective communication plan was the ability to provide fact-based answers to questions. Damage control began through these response teams who were able to provide information to the publics. These teams were also able to poll the public image of PepsiCo in an effort to provide an assessment of the risk.

PepsiCo’s Publics

The public relations campaign focused on both external and internal publics. The external publics consisted of customers of the alleged tampering, third party investigating agencies, the media, and consumers. The internal publics consisted of all levels of PepsiCo employees. In an effort to reassure the public of safety of the products PepsiCo provided a detailed explanation of their internal processes in an effort to debunk the illogical bizarre accusations. The company worked with the FDA to perform an internal investigation and educate both internal and external publics.

Communications ImpactThe strategy of the communication was to reassure the public that PepsiCo maintained safe bottling plants, while maintaining responsibility for consumer safety. PepsiCo successfully accomplished this effort through the same media outlet that brought the crisis to light. Television was used to bring the crisis to 100 million American homes and would now provide PepsiCo the outlet to expose the recklessness of the reports. PepsiCo public affairs team had conducted nearly 2,000 interviews within one week”(Center & Jackson, 2003).

Hindsight

Could the message have been communicated more effectively? After any crisis evaluation provides value and potential ideas for improvement for future situations. Considering the crisis and the information provided to PepsiCo at the time, the company did well. PepsiCo. “the ensuing activities of the Pepsi response team, and the U.S. Food and Drug Administration, calmed the crisis and won for the company the coveted “Best of Silver Anvils” in the 1994 Public Relations Society of America competition”(Center & Jackson, 2003, 325).

While PepsiCo’s strategy won them an award some critics believed PepsiCo’s offensive stance could have been interpreted as a lack of concern or responsibility for consumer safety. In 1982 Tylenol established precedence for safety by recalling their products when tampering accusations were made. However, the facts presented in the Tylenol incident had supporting evidence in which consumer’s health had been directly affected. PepsiCo had no such evidence. PepsiCo showed strength and accountability by keeping the facts straight and working with the public to determine the actual details behind the incidents.

Public Relations Communication Tools and Techniques

PepsiCo took advantage of the tools that were used to against the company. They implemented a video showing the streamlined, safe can filing process was produced and released to the media. They empowered a response team that was available around the clock to address the massive number of questions and complaints. It was important to address the negative press through a variety of media in order to combat the negative imagery that bombarded the press. “Video news releases, audiotapes, press releases, charts, and diagrams of the production process and photos for external and internal distribution” Center & Jackson, 2003, 328). The technique was to have a swift, fact-based response. The company also took the claims seriously, owned up to the responsibility of the crisis and engaged a unified tactical response.

Benefits and Risks

Perception is truth in the eyes of the public. PepsiCo had no choice but to take a risky stance of leaving their product on the market while they disproved a ludicrous charge against it. Recent legitimate claims of product tampering from other large corporations fueled the negative perception against PepsiCo. Television and media helped spread this perception as well as the truth after the accusations had been investigated. One may consider the statement the truth will set you free, PepsiCo consistently brought the truth to light. It may have cost them millions of dollars in sales during the syringe scare but they had no choice but to stand by their company. PepsiCo had the truth behind them, they had the facts of their safety processes on their assembly line as well as the investigation of the FDA; a trusted third party.

Today’s Affect with Technology and GlobalizationDuring the crisis PepsiCo initially assumed that the affect of the claim would remain local. Due to the impact of television broadcasts the issue became national within a short amount of time. Today taking into consideration, Internet with blogging, webcasts, standard media outlets, and globalization of markets; if a similar incident happened today it could cause a world-wide media epidemic for a large corporation.

Consider that PepsiCo sells their products all over the world. “By the end of 1994, Pepsi Max was sold in approximately twenty countries”(wikepedia.com, 2007). If there were a problem or a perceived problem today with a PepsiCo product it could span at least 22 countries. Any company that is in a global market should establish crisis plans for all markets, local, and global.

In summary, the PepsiCo Corporation effectively established a strategic crisis management campaign. They faced tampering accusations with facts and accountability. They strategically and effectively communicated with their publics and did not allow the accusations any more merit than they required. The PepsiCo Corporation was able to re-establish face with consumers and was presented an award for their excellence in crisis management.

References

Center, A., & Jackson, P. (2003). Crisis management. In (Ed.), Public Relations practices: Managerial Case Studies and Problems (6th ed., pp. 325-330). Upper Saddle River, NJ : Prentice Hall.

roadsideamerica.com (1996). The Pepsi Product Tampering Scandal of 1993. Retrieved August 3, 2007, from http://www.roadsideamerica.com/rant/pepsipanic.htmlwikepedia.com (2007). Pepsi Max. Retrieved August 3, 2007, from http://en.wikipedia.org/wiki/Pepsi_Max