When a scandal causes a crisis….

In 2008, China was over-shadowed by the scandal of dairy products(Timeline of the 2008 Chinese milk scandal). Since the notorious issue of the Sanlu Group’s tainted milk powder was revealed in February, which was proven to be responsible for killing at least six infants and sickening nearly 300,000 others, the Chinese government began to put more emphasis on food security supervision. Just several months later, a scandal about another well-estimated dairy producer, China Mengniu Dairy Limited Company broke out, for its usage of OMP (Osteoblast Milk Protein, which was named by the company) in their popular product Milk Deluxe, a food additive since 2005.(A pack of Mengniu Milk Deluxe contains OMP, sold for about twice the price of standard milk.)

The scandal brought an unprecedented crisis to Mengniu’s good reputation, because OMP, the element which was supposed to help the absorption of calcium and promote bone growth in the osteoblasts and prevent osteoporosis, was rumored as a cancer causer. When it emerged in the center of a scandal, it was time for Mengniu to pick up the weapon of “Public Relations” to fight for its fame. But unfortunately, it failed in the war of changing public opinion. There are three major faults that caused its failure:

The first fault was that the organization was too late to reply its public. Actually, similar scandals had emerged at the end of 2008, but Mengniu ignored the power of these scandals until they became worse after nearly three months. With the “aid” of internet and other media, these three months gave the publics enough time to turn their suspicion into anger. Mengniu should have realized that, although the Sanlu Group had been bankrupted for its crime and its former chairwoman was sentenced to life in prison, the public still kept their eyes on dairy products in China. It is crucial to respond to the public in time, especially when the public is still suffering from the discreditable dairy industry as a whole.

Secondly, Mengniu were inconsistent in what they said. keep the words in consistency. It is recorded that the organization first stated the major active ingredient in OMP is an Insulin-like growth factor 1 (IGF-1), but later denied adding IGF-1 and said that OMP is the same as Milk Basic Protein (MBP). IGF-1 could possibly cause cancer in extreme doses. The company claimed that the additive is widely used in Europe, the United States and Japan, and had been certified by the New Zealand Food Safety Authority and the U.S. Food and Drug Administration (FDA). However it turned out that the FDA letter referred to a perhaps different additive used by the Japanese Snow Brand Milk Products Company. Although it got a so-called official document later to prove the safety of OMP, they were weak on the legitimacy to the public, because of the conflicts in the company’s previous remarks.

Lastly, Mengniu’s reaction to the scandal was improper. Actually, Mengniu had suffered from another scandal for its milk powder which tested positive for melamine. The action it took was to apologize to the public first and recall tainted milk powders from market. The proper strategy made its image challenged but not beyond repair. However, regarding its liquid milk scandal, Mengniu changed its “traditional” strategy. It stopped adding OMP to its milk on February 2nd after a government order, but did not recall products on the market. The action caused misunderstanding between the company and its public, people thought the organization didn’t deal with the issue seriously. So more negative media and consumers’ suspicions followed; the situation became worse.

Although later, the Ministry of Health of China stated that OMP is "not harmful to human health" on February 13, Mengniu could not save its un-harmful Milk Deluxe from acrisis. Mengniu lost its prided brand as a result of poor public communication.

On the other hand, a case of how Colgate took advantage of public relations to handle the scandal in China can be regarded as a successful one. In 2005, when confronting the scandal of using Chloroform (which is regarded as a cancer causer by EPA: United States Environmental Protection Agency) in toothpaste products, Colgate arranged a series of campaigns to deal with its relationship with the public. For example, a public relations group was set, a timely news express was arranged, support from the related authorities was gained and other effective tactics were used. In summary, a right public relations strategy made Colgate succeed in the war of regaining the trust of the consumers in its Chinese market.

According Dennis L.Wilcon & Glen T. Cameron( 2007, Public Relations: Strategies and Tactics, pp263), an effective crisis communication meets the following elements: 1) Put the public first 2) Take responsibility 3) Be honest 4) Never say “No comment” 5) Designate a single spokesperson 6) Set up a central information center 7) Provide a constant flow of information. 8) Be familiar with media needs and deadlines 9) Be accessible 10) Monitor news coverage and telephone inquiries 11) Communicate with key publics.

It is undoubted that any kind of scandal can bring negative influences to the relationship between an organization and its public. The public relations department, as the organization’s reputation defender, has a responsibility to deal with all the “bad news”, and has a crucial role to reduce the risk of scandal to the minimum extent.