Managing the Talcum Powder

Accusations

Julian Gross and Katherine Knight

Corporate Communications - Dr. Shelva Clemons

Final Communications Plan

May 9, 2016

Putting the needs

and well-being of

the people we serve

FIRST Johnson & Johnson credo

Background

• World’s most comprehensive and

broadly based manufacturer of

health care products

• Operates in 3 segments: medical

devices, pharmaceuticals, and

consumer products

• Operates over 265 companies in 60

countries and carries 100 brands

• “Guided by its credo”

• CSR is at the heart of the company

for its commitment and responsibility

to the people

• October 2011, Forbes named J&J the

“top brand” in the U.S.

• However, the company has had a

series of missteps with recalls and

lawsuits all questioning the reputation

of the brand

The Problem

• J&J is under heavy scrutiny for

its sale of talcum powder and its

connection to ovarian cancer

• Forced to pay of $72M and

$55M from two lawsuits this year

• Facing 1,200 more from women

with ovarian cancer

J&J spokeswoman, Carol Goodwich:

“The verdict contradicted 30 years of

research supporting the safety of cosmetic

talc. The company intends to appeal and will

keep defending its products’ safety.”

The Problem…

Newsy: Feb. 24, 2016

The Product

Baby Powder

• Johnson’s baby powder was first

developed in 1893

• As of 2015, nearly 19% of American

households use Johnson’s baby powder

and 6.73% use Shower to Shower

• Contains talc to help absorb moisture and

reduce friction

TALC

• Mineral that contains asbestos in its

natural form

• FDA does not allow talc-based products

to contain asbestos

• All talc used by J&J is asbestos free

through their own testing and FDA testing

Competitive

Analysis

Most significant competition in

new drug research

Main Competitors: Unilever,

Kimberly-Clark, Proctor &

Gamble, Eli Lilly, Colgate-

Pamolive, Pfizer

Organic competitors: Honest

Company, Burt’s Bees,

Crabtree & Evelyn

Situation

Analysis

POTENTIAL ISSUES:

• Negative Media Coverage

• Brand and reputation damage

• Breach of Trust

OPPORTUNITIES:

• Show understanding of customers’

concerns

• Reiterate safety benefits of products

• Expand into new developments

• Rebuild brand image

Goal: To maintain and regain customer trust that has been

lost due to recent accusations and pending lawsuits

Objectives:

● Increase transparency through interviews and media

stories

● Realign J&J with its original credo of being responsible

to the customer

Target AudiencesWho do we need to address?

Mothers

Mothers with children in

diapers that might use

baby powder

Women

Ages 25 - 44Investors

Women ages 25 - 44 that

use baby powder for

hygienic purposes

Johnson & Johnson

investors worrying about

falling stock prices

Intervening

Public:

The Media

The media to reach the

target audiences

Communications Strategies and Tactics

• Social Media

• Traditional Media

• Leadership Messaging

• Internal Communications

• Investor Relations

• CSR Opportunities

“Our Safety Promise”

Social Media

• Engage with all concerned customers on social media

• Promote positive content showing J&J is taking the steps to ensure the

safety of its customers

• Use all of J&J’s outlets to push content and cross share content from third

party sources

• Use paid ads to target segmented audiences

Traditional Media

Be transparent with the media

• Host press conferences, town halls, and speak directly from C-level officials

Partner with trusted media outlets

• Participate in live interview with medical officials

• Invite media and bloggers to a call when there is a new development or product roll out

• Offer exclusive interviews to trusted media

Leadership Messaging

• One voice, one message

• Position the CEO to talk transparently about company operations

• Media train all CEO/C-level officials

• Partner with scientists and researchers

Internal Communications

Regularly communicate with employees

• Weekly memos to employees

• Video communication from CEO

• No communicating with the media or on social media without approval

• Develop crisis handbook detailing rules and roles

Investor Relations

Be transparent and positive with investors

• Highlight future growth opportunities

• Show how company will rebound

• Highlight positive opportunities over negative

attention

• Send special newsletter following big verdicts

or significant drop in stock prices

CSR Opportunities

Partner with key women’s and children’s cancer-fighting organizations

• Sponsor Susan G. Komen 3-Day and Relay for Life

• Turn lights teal in September to honor ovarian cancer awareness months

• Make cancer research donations with the sales of certain products

Timing & Budget

TIMING:

• Quick Response & Executive Action

• One succinct message

• Immediate response following a

verdict

• Continue measurement and tactics

for the year following

BUDGET:

• Cost effective on all fronts

• Largest expenditures on

sponsorships

• Varies depending on verdict

MeasurementMedia Analysis

Social Media

Management

SEO

Benchmarking

SWOT AnalysisStrengths

● Well-known trusted family brand

● Highest amount of pediatric pharmaceutical sales

● Highly effective response for previous crises, such as the

Tylenol recall

● Responsive social media

● Consistent stock prices

● Variety of income sources and brand diversity

Weaknesses

● Little transparency from CEO regarding recent lawsuits or

company matters

● Wide variety of products each with their own issues that also

require attention

● Claims of company knowing about the harmful effects of its

product and not being transparent about warnings or

implementing health safety label

● Self-regulated company that performs its own scientific

studies; may not be up to FDA standards

Opportunities

● Better inform customers of scientific facts behind talc

● Rebuild trust among parents and women for safety of J&J

products

● Build positive media coverage

● Partner with cancer research organizations to raise

awareness and inform consumers

Threats

● Recent lawsuits with unpredictable outcomes

● Potentially more lawsuits depending on the outcome

● Falling stock prices

● Lack of complete scientific evidence behind products

containing talc

● Negative media coverage surrounding product and J&J

brand

● SEO shows negative search results

Sources24/7 Wall Street. “The 10 Worst Companies Burned by the Media.” The Atlantic. June 14, 2011.

http://www.theatlantic.com/business/archive/2011/06/the-10-companies-burned-worst-by-bad-press/240448/#slide9

Adobe Social. May 4, 2016. http://www.adobe.com/solutions/social-marketing/social-listening.html

American Cancer Society. “Talcum Powder and Cancer.” November 17, 2014. Accessed April 22, 2016.

http://www.cancer.org/cancer/cancercauses/othercarcinogens/athome/talcum-powder-and-cancer

Benson, Mike. “Johnson & Johnson: A Leading Pharmaceuticals Company.” Market Realist. March 11, 2015.

http://marketrealist.com/2015/03/johnson-johnson-leading-pharmaceuticals-company/

Berfield, Susan, Jef Feeley, and Margaret Fisk. “More than 1,000 women accuse Johnson & Johnson of covering up the risks of baby powder.”

Bloomberg Businessweek. Issue 4470. Pg 54-59. April 4, 2016.

Bonetto, Lauren. “Marketing to Moms.” Mintel. September 2014. http://academic.mintel.com.proxy.library.georgetown.edu/display/679772/

Crow, David and Lindsay Whipp. “J&J to relaunch baby brand as millennials go organic.” Financial Times. April 19, 2016.

http://www.ft.com/intl/cms/s/0/035c1068-0630-11e6-96e5-f85cb08b0730.html#axzz47iRUAzSc

Dye, Jessica. “Johnson & Johnson ordered to pay $55 mln in talc-powder trial.” Reuters. May 3, 2016. http://www.reuters.com/article/us-

johnson-johnson-talc-verdict-idUSKCN0XT20L

Gilbert, Marissa. “Feminine Hygiene and Sanitary Protection Products.” Mintel. March 2016. Accessed May 1, 2016.

http://academic.mintel.com.proxy.library.georgetown.edu/display/747679/?highlight

Hopping, Richard. “Johnson’s lawsuit challenges perceptions of trust.” Mintel. http://academic.mintel.com.proxy.library.georgetown.edu/display/767756/?highlight March 31,

2016. Accessed April 10, 2016.

Investor Relations. “2014 Investor Fact Sheet.” Johnson & Johnson. 2014. http://files.shareholder.com/downloads/JNJ/1997120036x0x856393/1267DC95-99FA-47D8-81AA-

A0A855C129E8/JNJ_2014_Investor_Fact_Sheet_v5.pdf

Johnson & Johnson. “Our Company.” Accessed April 2, 2016. http://www.jnj.com/about-jnj

Margaret. “The Birth of Our Baby Products.” Johnson & Johnson’s Kilmer House. April 30, 2007. http://www.kilmerhouse.com/2007/04/the-birth-of-our-baby-products/

Money Morning Research Team. “Johnson and Johnson Stock Price Update Today.” Money Morning. April 29, 2016. http://moneymorning.com/market-news/johnson-

johnson-stock-update-april-30-2016/

Munro, Dan. “New Study Ranks Johnson & Johnson #1 in Pharma for Social Media Engagement.” Forbes. January 21, 2014.

http://www.forbes.com/sites/danmunro/2014/01/21/new-study-ranks-johnson-johnson-1-in-pharma-for-social-media-engagement/#fa23c571dc18

Nanninga, Margie. “Soap, Bath, and Shower Products.” Mintel. February 2016. http://academic.mintel.com.proxy.library.georgetown.edu/display/747662/

Neff, Jack. “Johnson’s Baby Turns to Social Media Transparency to Woo Millennial Moms.” Ad Age. July 30, 2014. http://adage.com/article/cmo-strategy/j-j-social-media-

transparency-woo-milliennials/294376/

“OTC Pediatrics: Key Players What You Need to Know.” Mintel. February 2016. Accessed April 10,2016.

http://academic.mintel.com.proxy.library.georgetown.edu/display/763157/#atom1

Rooney, Jennifer. “Brand Power to the People.” Forbes. October 5, 2011.

http://www.forbes.com/sites/jenniferrooney/2011/10/05/brand-power-to-the-people-jj-takes-lead-in-forbes-ranking/#49353ca15aed

Statista. “U.S. households: Which brands of body and baby powder do you use most often?” March 11, 2015. http://www.statista.com/statistics/275421/us-households-brands-

of-body-and-baby-powder-used/