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Copy of Crisis Case Study: Pepsi Syringe Case of 1993

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Ger Peerboom

on 25 September 2013

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Transcript of Copy of Crisis Case Study: Pepsi Syringe Case of 1993

Crisis Case Study:
Pepsi Syringe Case of 1993
June 9, 1993

First complaint, hypodermic needle found.
June 11, 1993 Washington area
Second complaint, SECOND hypodermic needle found.

Sent investigator from Alpac Corp. (regional bottler)
“FDA announced that the syringes
were not contaminated and issued a statement that consumers in the
Pacific Northwest, Alaska and Hawaii
should pour canned drinks into a glass
prior to drinking, just to be safe.”
June 13th, 1993,
New Orleans, Louisianna
Third complaint

PepsiCo was officially convinced, it was a hoax.
We've gone National
Madison Hanna
Nicole Abreu
Monica Prado
Following week…...

More than 50 reports of Diet Pepsi tampering had been reported across 23 states.

PepsiCo would not give in, NO RECALL. Instead, they set out to prove to their constituencies that these allegations were false.

“Fight the media crisis with media”
PepsiCo took the widespread media coverage as an advantage. They fought media with media in the form of VNRs, interviews, complete transparency.
Craig Weatherup, Pepsi-Cola North America President and CEO, became their spokesman because of his familiarity with the bottling system.

One day after Weatherup’s first television appearances, crisis team members noticed that news reports were beginning to use words such as “copycat” and “hoax.”

(cc) image by rocketboom on Flickr
The media was causing more panic then the syringes.
Big Time Newspapers such as the Seattle Times, New York Times, and Chicago Tribune caused stirs across the nation.
News Stations were sensationalizing the picture of Diet Pepsi with a syringe next to it.

Media Panic Among Consumers
June 15, 1993
News Stations Voice Doubts
PepsiCo's Media Retaliation

1st step
June 15, 1993
(cc) image by nuonsolarteam on Flickr
First VNR Created
and Distributed
(Canning process)
403 TV Stations
Media begins
questioning legitimacy of
crisis immediately
One VNR in particular won over most of the American public.

The VNR that proved the syringe hoax using surveillance footage from a convenience store, turned PepsiCo into the victim.

The VNR That Turned the Tide
Spokesperson, Weatherup, explains the canning process and how tamper proof it is

Pysically shows the canning process within a Pepsi Plant

FDA arrest of a man for falsifying claims and syringe locations vs. production plants as unrelated

Surveillance camera footage of a woman inserting a syringe into a can of diet pepsi while the clerk looked away.

The VNR Offensive
FDA also reminded individuals that making false complaints carried a “maximum penalty of a $250,000 fine and five years in prison.”
Within 11 days, the Diet Pepsi crisis was over. The FDA had made several arrests for filing false tampering reports and there had been no substantiated cases of contaminated soft drinks

June 19 to June 21, PepsiCo ran ads in national newspapers declaring “Pepsi is pleased to announce nothing.”
On the weekend of the Fourth of July, PepsiCo printed coupons in newspaper ads that said, “Thanks America.”

In all, sales of Pepsi and Diet Pepsi were reported to have dropped about 2% during the crisis but rebounded after the Fourth of July.
Standing Ovation
Internal: PepsiCo sent faxes to all of its regional bottlers twice daily to keep them apprised of any developments, and PepsiCo employees continued to respond to calls made to the company’s toll-free line from consumers, bottlers, and distributors.

Mr. Weatherup was joined on Nightline by FDA Commissioner David Kessler, presenting a powerful message to consumers as both men assured the public that the tampering reports were unsubstantiated and that PepsiCo’s products were safe.
How would the presence of social media have affected this crisis?

Do you think Pepsi should have recalled their products?
Was PepsiCo correct in their treatment of the first two syringe reports as a regional issue? Should they have mobilized their crisis team at that point instead of waiting for the tampering claims to spread?

Discussion Questions
"Snopes.com: Needle in Pepsi." Snopes.com: Urban Legends Reference Pages. Web. 31 Jan. 2012. <http://www.snopes.com/horrors/food/syringe.asp>.
Works Cited
Monday, 9:30 Am. "Pepsi Panic of 1993. Roadside America." Roadside America - Guide to Uniquely Odd Tourist Attractions. Web. 28 Jan. 2012. <http://www.roadsideamerica.com/rant/pepsipanic.html>.

Crisis Public Relations. Web. 29 Jan. 2012. <http://crisispublicrelations.blogspot.com/2006/03/history-lesson-part-ii-diet-pepsi-in.html>.

13, June. "The Diet-Pepsi Crisis | Newsflavor." Newsflavor | News In Any Flavor: Daily News, Latest News, Local News, Breaking News, US News, World News. Web. 01 Feb. 2012. <http://newsflavor.com/alternative/the-diet-pepsi-crisis/>.
Gave public instructions
Acted immediately
Cooperated with Federal Authorities(Food and Drug Administration)
Kept employees informed
Two-way symmetrical program

The VNR’s showing people tampered with the cans were an effective tool in helping maintain the public's confidence in the stringent safety measures taken to produce Pepsi products
Their reputation may have come into question when the story first hit but because Pepsi’s honesty and cooperation with the public helped lessen the potential harm to their organization

Today, PepsiCo is a $29 billion company
150,000 employees around the globe
Consistently recognized for its corporate citizenship, philanthropic efforts and diversity programs It is the
World’s fourth-largest food and beverage company
Full transcript