The crisis: Two Cadbury chocolate bars were found infested with worms in Mumbai, India. The Maharashtra FDA quickly seized the chocolate stock at Cadbury's closest manufacturing plant in Pune.
How Cadbury responded: The company was slow out of the gates. It released a statement claiming that the infestation was not possible at the manufacturing stage, while the FDA disagreed, prompting a tussle between the two. The media jumped on Cadbury, and the brand was under widespread assault.
Cadbury took its advertising off the air and launched an educational PR project that targeted retailers. It kept the media updated through press releases on the specific measures it was taking to correct its manufacturing and storage processes. The company also imported new machinery and changed the packaging of its Dairy Milk bars.
Four months later, Cadbury began advertising more aggressively. By then, the company's relationship with the media had improved greatly.
The result: Cadbury's sales in India plunged 30% in the wake of all the negative media coverage, and this was during a season when its sales usually increase by 15%. But over time, Cadbury began to recover.
Within eight weeks of the introduction of its new packaging and advertising campaign, sales had almost reached pre-crisis levels. The company announced eight months after the incident that its consumer confidence was back to to normal. Cadbury has maintained its position at the top of the Indian chocolate industry ever since.
But Cadbury suffered three years later when a salmonella outbreak wasn't handled nearly as well.
Sources: Rediff, Public Relations Consultants Association of India
In a digitally connected world where hearsay can easily obfuscate pertinent information about your company, one random event might suddenly send your business into a tailspin. M2.0 Communications provides in-depth, real-time assistance for businesses experiencing an unexpected crisis.
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