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Nestlé Maggi hopes to again become the top-selling noodle in India after a long and costly controversy over alleged lead contamination of its popular instant noodles. Indian regulators banned the noodles last June after its tests found excess lead in noodles and only recently reversed the ban.
Maggi noodles remained off the shelves for five months and the brand’s reputation suffered substantial damage while the crisis brewed. The company may not fully recover for years.
The controversy provides several PR crisis management lessons.
Maggi focused on the technical and regulatory aspects of the crisis while neglecting communications and public opinion. In its main defense, it stated that’s its tests of over 3,500 samples showed that lead levels were well below regulatory limits.
“This is a case where you can be so right and yet so wrong,” said Nestlé CEO Paul Bulcke, according to Fortune. “We were right on factual arguments and yet so wrong on arguing. It’s not a matter of being right. It’s a matter of engaging the right way and finding a solution.”
To be fair, the company faced substantial challenges: fearful consumers, an aggressive media, tough regulators, and the difficult business climate of India. However, PR crisis management experts and other commentators cite a number of mistakes that can serve as lessons to other organizations.
Slow response. Indian officials first ordered the product recall on April 30, yet the company did not address the media in Delhi or appoint a lobbying firm to represent it in India until June. Media monitoring measurement could have alerted the company about the fast-growing, troublesome media coverage and helped it respond. “Nestlé was clearly caught with its noodles in a knot,” said B.N. Kumar, executive director of Concept Public Relations and national president of the Public Relations Council of India, in a Knowledge@Wharton article.
An appearance of arrogance. Nestlé argued that its own test results of Maggi noodles were correct, which prompted confrontation with regulators who found different results. Nestlé could have pursued a more engaging, transparent process. Jessie Paul, founder and CEO of Paul Writer, suggested that it ask Maggi India personnel to become involved with testing, obtain third-party witnesses, or split the same samples across multiple labs.
Lack of consumer engagement. The Nestlé team was slow to respond to consumers on social media. Many Indians perceived its silence as admission of guilt. The Nestlé India Twitter handle had one tweet on May 21 on the issue, blogged marketing professional Shelza Khan. The Maggi India Twitter handle engaged only on June 3. Social media monitoring could have provided vital insights into consumer sentiment and identified the emerging PR crisis.
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Lack of foresight. Company officials did not, or could not, think ahead or plan for contingencies. While they communicated with government officials about test results, they did not consider alternative strategies.
Overlooked cultural factors. Maggi did not consider the social and political issues of a PR crisis in India, a country colored by its colonial past and skepticism of foreign corporations.
Media relations inadequacies. The company, which has long favored a reserved media relations approach, lacked media relationships as well as a system to access journalists.
Overly complex answers. Some public communications were too complex when they should have been brief and simple. In particular, a statement on its website stating that its noodles were safe was too difficult to find and not immediately understandable to ordinary consumers.
“In trying to break down the problem to its constituent elements and be very specific, Nestlé has compromised on the main deliverable – a simple, positive, BIG SAFETY message,” said Soumitra Sen of Brick to Click CXO.
Bottom Line: The Nestlé Maggi PR crisis in India demonstrates several crucial public communications lessons. The controversy over allegations of lead levels in noodles proves that communicating the facts well is just as important, if not more important, as the facts themselves. That’s a lesson Nestlé executives in India learned the hard way.
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