Reference no: EM132275280
Crisis management communications at the coca cola company:
Background
The Coca-cola company is the largest manufacturer, marketer and distributor of non alcoholic beverages in the world. It is generally considered to be the most recognized global brand among consumers as well. It’s numerous brands names are sold in nearly 200 countries around the world. Cokes corporate headquarters is in Atlanta, Georgia.
The situations
In June 1990 , 120 people in Belgium became ill ie ( vomiting , headaches) after drinking Coca Cola. More than 50% of these people, many of their children needed to be hospitalized. The Belgium health ministry immediately launched an investigation of the incident and demanded that coke remove its mother brand such as nestle and Minute Maid. The government in France , Spain and Netherlands imposed a ban on all products produced by Coca Cola.
Coke managements handling of the crisis
Two days after the first reposts that people were becoming ill from drinking coke emerged , coke withdrew 2.5 millions of Coca Cola ,Coca Cola light , Fanta & sprite . However , Coca Cola still did not provide formal explanation publicly as to why drinking coke had made the individuals sick. It also refused to establish and maintain as open dialogue with the Belgian health minister immediately after the incident. Rather, it elected to launch its own independent internal investigation of the issue.
About a week after the beginning of the crisis, Douglas Ivester , coca colas chairman issued an explanation and an apology. Specifically , he stated “ I want to reassure our consumers , customers and governments in Europe that the coca colas company is taking all necessary steps. The two explanations Coca Cola offered for the crisis were that a small number of bottles from its ant warp plant contained effective carbon dioxide and that some came from its French factory had been contained by a fungicide. Coca Cola indicated that a small number of the contaminated cans might still be on a sale at small, independent retailers in the United Kingdom. The company stated that it had no plans to inform the general public of this issue because it believed that media coverage had already taken care of this.
The aftermath
The management or Coca Cola has received reviews from analysis and consumers in Europe for its handling of the Belgium crisis. Some analysis led that Coca Cola has done irreparable damage to its brand image and has lost the confidence of consumers. The Coca Cola management however believes strongly that the company will rebound in Europe with no long term negative impact on sales and profits resulting from the incident.
Required :
1. Evaluate Coca Cola managements strategies for handling of the crisis in Belgium and other European countries. What did they do well ? Where could they have improved?
2. If you were the CEO of Coca Cola at the time of the crisis , what would you have done to handle the crisis.
3. What are the practical implications of this case for you as a future manager?