Public Relations Tactics

Looking Back: The Best of Silver Anvil recipient from 1997 -- An E.coli outbreak nearly destroys a company; how crisis management helped restore consumer confidence

Publication Date: 6/2007

Source: SO01 Public Relations Tactics
Product Code: 6C-070613
Organization/Author/Firm: Anonymous
Industry: Consumer Products / Food - Beverage
Specialization(s): Crisis Management
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The outlook was good for Odwalla in 1996. The California-based company, founded in 1980, projected sales of $90 million for juice concoctions such as “C Monster,” “Mo’ Beta” and “Femme Vitale.”

That outlook changed, however, on Oct. 30, 1996, when the State of Washington Environmental Health Services made a possible link between several cases of E.coli and Odwalla’s apple juice. The outbreak caused the death of a 16-month-old Colorado girl and sickened more than 60 people in the Western United States and Canada.

Although the link was uncertain, Odwalla CEO Stephen Williamson ordered a recall — $6.5 million in total — of all products containing apple or carrot juice from 4,600 retail outlets in seven states and British Columbia. The link was confirmed on Nov. 5. As Fast Company reported later, by that point, sales had dropped 90 percent; Odwalla’s stock price plummeted 34 percent; customers filed more than 20 personal-injury lawsuits; and a grand-jury investigation threatened to destroy the tight-knit community of 500 Odwalla employees.

Odwalla, though, successfully regained most of its customers through quick handling of the crisis by its PR counsel, Edelman Public Relations Worldwide, whose San Francisco office began working with Odwalla officials on Oct. 31, 1996.