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Nongfu Spring Water Scandal

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jinjin xu

on 13 May 2014

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Transcript of Nongfu Spring Water Scandal

What's the result?
Press Conference
Nongfu mineral water's Beijing-based production facilities was closed.
Nongfu incurred losses amounting more than 100 million RMB.
Nongfu pushed out of the Beijing water market which about hundred thousand customers.
Loss company's image.
By Jinjin
Monday, May 12, 2014
Baruch College
How Crisis Made?
Nongfu Spring Water Crisis
Nongfu's "Quality Gate"
Started April 10, 2013, Beijing Times printed 67 pages of report within 27 days about Nongfu Mineral water not meeting the national water quality standards of tap water.
Crisis Onset
My Comments:
March 8, customers complaints to Nongfu about unknown finding of black material in the bottled water.
March 22, more complaints from customers.
Customers' complaint
Nongfu's Response
March 8, Nongfu Claims the unknown materials in the water are mineral substances through Weibo.
March 25, Nongfu claimed that C'esbton is conducting black PR against it.
Mid-crisis Response
April 10, Beijing Times reported Nongfu has allegedly failed to meet quality standard.
April 25, Zhejiang Province Department of Health stated that national water quality standards overtakes provincial water quality standards. But Nongfu's company still using provincial water quality standard.
Beijing Times
Nongfu's Response
April 10, Nongfu still claims that C'estbon is conducting a campaign of black PR.
April 25, Nongfu declined to make any statements.
67 Pages!!!!!!
On May 7, Nongfu affirmed the quality of its mineral water meeting national standards and openly answered question from Beijing Times journalists.
Crisis Recovery
Nongfu Started a series of PR campaigns:

May 28, Nongfu organized a tour of its water production facilities in Hubei Provience with more than 30 journalist.
June 7-9, Nongfu provide free water to high school examination students.
June 14, Nongfu organized a tour of its water production facilities at Thousands Lakes.

End of October, Nongfu released Da milk tea. Nongfu spent many resources marketing this new product.
Nongfu's water safety case analysis
Nongfu should have spoken to the media immediately when the scandal came out.
Attacking competitor is not a rational behavior.
Nongfu should maintain good relationship with news agencies.
Nongfu should spend more resources on the internet communication with customers.
"On April 8, customers complained to Nongfu about unknown finding of black material in the bottled water."

"On March 25, 21 Century Network reported that Nongfu Spring water production plants are surrounded by waste disposal."
Zhong shanshan, the CEO of Nongfu's company and Beijing Times journalist engaged into a fierce debate during the press conference.
Full transcript