CASE STUDY ON ODEWALLA JUICE COMPANY

CASE STUDY

ON

ODWALLA JUICE COMPANY

FOR THE EVENT



MUMBAI FOOTPRINTS’O9

(SIMC)









INSTITUTE NAME:

CHETANA’S R.K. INSTITUTE OF MANAGEMENT AND RESEARCH

PARTICIPANT’S NAME

KETAKI G. HARDIKAR

DHAVAL M. MISTRY

AJIT A. CHAVAN







BACKGROUND

Odwalla (pronounced "odewalla") is the health-conscious juice company which began a couple of decades ago when Greg Steltenpohl, Gerry Percy and Bonnie Bassett began squeezing fresh oranges on a $200 hand juicer.

ISSUES

On October 30, 1996, everything changed for the Odwalla Company. With the corporate vision in place and many precautionary tactics, Odwalla still could not avoid E. Coli.With a significant effect seen on the consumers FDA found a link between the Odwalla apple juice and the dangerous bacteria.

Sales fell by almost 90%, and the company’s stock price plummeted by 34%. More than 20 personal-injury lawsuits were filed and the future for the company did not look promising.









ACTIONS FORMULATED

As the company had gained a great name in the market and was one of the trusted brands in the market it is sure that the company would be receiving great media attention and would be talk oof the town. On this entire basis we have formulated our strategies.

As Odwalla was a big name in the juice making industry and a contamination case was certainly a major dent in reputation of the company. As a PR consultant certain strategies to be formulated to bring back the company from the losses and lost market name are mentioned below:

1. Print/visual media best suited for the products target audience, should be chosen to convey sincere apology.

2. As the company had gained a great name in the market and was one of the trusted brand in the market it is sure that the company would be receiving great media attention and would be a talk of the town. Hence it is of utmost importance for the company to maintain transparency about their function and also to admit the presence of contamination, as there always exists an element of human error.

3. Recall all the stocks available in the market so that the spread of E.Coli is prevented.

4. Compensation for all those affected by the viral outspread.

5. Clear and correct information to be provided to the media by the spokesperson of the company in order to prevent the spread of rumours.

6. All channels of communication from the consumer to the company should be kept open and tactfully convince the consumer and rebuild the trust.

7. Use the media coverage that company is getting, to communicate the message to consumer and rebuild their trust.

8. Set up hotlines and websites to answer all the queries of the consumer.

9. Continuous plant visits would be organized and that too by the representatives from FDA, and regular publishing of their reports in the news media, so the company will able to redevelop the trust in the market.

10. Company should adopt affordability Strategy

11. From recent experience of other companies restoration of consumer and hence trade confidence is of utmost importance



ECONOMIC BUDGETING AND ITS EFFECTS

As representative of the PR agency the plan devised has to be a one with maximum impact and minimum monetary inputs. Hence the plan chalked out can be economically suitable for Odwalla; the economic budget is as follows:

The company with the gross profit of around $1100Mn certainly has the capacity to bounce back in the market, by maintaining a low budget to overcome their declining market position.

So the plans formulated as a representative as a PR agency is economical as the core area of expenditure are only the:

1. Remuneration given to the families of those affected by contamination.

2. Advertisement cost for Public Apology.

3. Penalties paid to the FDA and other regulatory bodies.

All the other action plans given by us, require minimal expenditure as they are Intra Company resources put to judicial use.