Corporations have a tenuous relationship with consumers, and any hint of scandal or malfeasance can result in a major fail. Companies can make mistakes, just like individuals, but many of these PR disasters are a direct result of egregious and reckless behavior that puts consumers at risk.
These corporate calamities include misguided marketing campaigns that promised more than they could deliver, such as the infamous Pepsi Number Fever debacle; and tone-deaf public responses to company errors, such as United Airlines’ unrepentant initial response when a passenger was jerked out of his seat on an overbooked flight.
Memories can fade and companies have recovered from PR fails, but some of the incidents on this list deserve to remain in the public eye.
Blue Bell ice cream is a favorite among dessert connoisseurs, but in 2015, the CEO was arrested and indicted for trying to hide a listeria outbreak that resulted in the passing of three people.
In 2015, Blue Bell was notified by health officials that two products – one from its flagship factory in Brenham, TX, and one from a plant in Broken Arrow, OK – tested positive for listeria, a bacterium that can cause serious sickness or death. In this case, three Kansas residents perished, and many others were extremely ill.
Instead of being transparent, Blue Bell CEO Paul Kruse tried to hide the outbreak. The creamery did not immediately recall the products or publish a warning. Instead, Kruse instructed employees to quietly remove those products from grocers without providing a reason.
Additionally, Kruse told employees to tell any customers who asked that there was an unspecified issue with a piece of manufacturing equipment. Blue Bell only officially recalled the products when ordered to do so, but by then, 10 listeria cases had been linked to the products, and three people were dead.
Kruse was eventually indicted and charged with six counts of wire fraud and one count of conspiracy to commit wire fraud.
LifeLock CEO Todd Davis was so confident in the efficiency of his identity protection company that he published his real social security number in its advertisements. He gave away his social because he “guaranteed” his service could stop identity theft.
The bold move backfired. Davis’s identity was stolen on 13 separate occasions. His SSN was used in activities varying from obtaining a $500 loan from a check-cashing company to opening an AT&T/Cingular wireless account.
LifeLock’s advertising and guarantees landed the company a $12 million fine from the Federal Trade Commission in 2010.
In 1992, the vacuum company Hoover announced an incredible promotion
Sauntore Thomas visited his local TCF Bank in Livonia, MI, in 2019 to deposit checks totaling $99,000. The bank manager believed the checks were fraudulent, told Thomas they would need to be verified, and instead of calling to validate their authenticity, she alerted the local police. When the four officers arrived, they questioned Thomas; after he called his lawyer to confirm the checks were real, the bank manager still refused to deposit them, believing they were fraudulent.
Thomas, a Black man and US Air Force veteran, had recently sued his former employer for racial discrimination, and the legitimate checks he tried to deposit at TCF were from the settlement. He and his lawyer, fresh from their previous courtroom victory, sued TCF for racial discrimination, claiming that this type of humiliating treatment would not have occurred if Thomas were white.
TCF claimed that his behavior was suspicious, but their treatment of Thomas, reinforced by calling the police on a Black man, disgusted many Americans and revealed how racial profiling can take place anywhere.
in the UK: Any customer who spent more than £100 would receive two free round-trip flights to anywhere in Europe.
The advertising campaign was the brainchild of a struggling travel agency looking to sell cheap flights. It approached the UK Hoover company, which was dealing with disappointing sales figures brought about by the recession and competition from brands like Dyson. The promotion included a number of hurdles and caveats that made it time-consuming, but not impossible, for consumers to obtain the promised flights. Ultimately, the sales revenue exceeded the overall cost of the campaign, which included the tickets, and Hoover was finally making a strong profit.
However, instead of reaping the benefits of this fruitful advertising strategy, Hoover decided to expand the offerings and include flights to any city in the US. The company truly believed that not enough people would take advantage of the campaign to disrupt profits, but the price difference in tickets to Europe versus tickets to the US was exorbitant. Additionally, excited UK customers rushed to purchase Hoover’s cheapest products to get them over the £100 benchmark, and the manufacturer began to run out of products.
More than 300,000 people filled out the required forms to obtain their US flights – far more than Hoover anticipated. Most customers purchased a £119 vacuum cleaner. An expert wrote that Hoover made a profit of £30 per vacuum and that the two free fights were worth at least £600, which meant the company would have to spend approximately £570 per customer to honor the promotion.
Ultimately, Hoover tried to swindle customers out of the agreement, resulting in terrible press, angry consumers, and a court ruling that required the parent company to spend $72 million on flights for 220,000 customers. Hoover UK folded and the flight campaign became a textbook example of what happens to companies that do not honor their word.
This might be the most tasteless advertising campaign imaginable, and it is difficult to believe that anyone working in the store would green-light such a premise. Miracle Mattress in San Antonio attempted to use the collective grief from the September 11 tragedy to sell its wares, creating a 20-second commercial that outraged Texans.
The commercial begins with the store manager asking, “What better way to remember 9/11 than with a twin tower sale?” Two store employees fall down on stacks of twin mattresses, set up side-by-side, knocking them both over while the store manager mock gasps. It ends with her saying, “We will never forget.”
Local outrage was immediate, and sparked national condemnation of the store and its crass advertisement. Employees received death threats and Miracle Mattress ultimately closed its doors, unable to overcome the criticism of attempting to profit from 9/11.
United Flight 3411 was slated to leave Chicago’s O’Hare International Airport for Louisville, KY, on April 9, 2017, when an incident occurred that would forever tarnish the company’s reputation and relationship with passengers. The flight was full, but four United employees needed to be on the plane to work a connecting flight. United followed its usual protocol, first offering vouchers to anyone who would willingly give up their seat.
When no one offered, four passengers were randomly selected, including Dr. David Dao Duy Anh, a physician who refused to leave the flight because he needed to be at the hospital the following day. United employees called airport security, who physically dragged the screaming Dao from his seat, hitting his face on the armrest, which resulted in a broken nose and teeth.
Traumatized passengers filmed the incident, which quickly went viral as people around the world reacted with horror to Dao’s treatment. United’s CEO Oscar Munoz initially blamed Dao for being belligerent and described the practice of “reaccommodating passengers” as normal, but Munoz quickly became more apologetic as public outcry grew.
Munoz eventually testified about the incident before Congress, and United came to a settlement agreement with Dao, but the airline will forever be linked to the horrific video of officers dragging a screaming passenger from his rightful seat.
In 1992, Pepsi launched one of history’s worst marketing campaigns in the Philippines that resulted in a riot and the demise of five people. The Pepsi Number Fever campaign seemed simple enough: Pepsi would print numbers from 1 to 999 under the caps of its products, which could be redeemed for prizes, with a grand prize of 1 million pesos.
The effect of the contest was immediate: sales of Pepsi products in the Philippines exploded and their market share, which had always been dominated by Coca-Cola products, increased. Excitement grew as smaller prizes were distributed, but it was the May 25 announcement that created a tremendous stir when the number 349 was revealed as the grand prize winner.
Pepsi planned to print just two caps with that number and the required security code, but a disastrous printing error labeled 800,000 bottles with 349.
Filipino people with winning caps rushed to the Pepsi bottling factories, only to be turned away. The company realized its terrible mistake and offered a payout of 500 pesos instead. While a large number of people accepted this meager prize, most of the winners were incensed and formed an alliance to protest and fight Pepsi.
Over the next year, the protestors held boycotts of Pepsi products and also held rallies, most of which were peaceful. However, a grenade thrown during one protest killed three Pepsi employees, and in Manila, a mother and child perished when a grenade hit a nearby Pepsi delivery truck.
There were multiple lawsuits and some payouts, but in the end, the winners, along with the rest of the Filipino consumers, were disgusted by Pepsi’s manipulative contest, and it remains one of the biggest disasters in marketing history.
When Red Lobster announced its newest marketing campaign in 2003 for unlimited crab legs, it had no idea the sales ploy would almost bankrupt the company. Red Lobster had long included certain seafood on its “all-you-can-eat” menu, but snow crab legs are not as easy to come by as popcorn shrimp.
Edna Morris, Red Lobster’s CEO in 2003, reasoned that by pricing the snow crab feast at $22.99 rather than the usual $14.99 all-you-can-eat price, it would offset the cost of the promotion. The campaign did not foresee some of the problems that quickly became apparent: First, the high price and relative scarcity of snow crab legs; and second, the ability of Americans to eat enormous (and sometimes egregious) amounts of food when it’s presented as a buffet.
Not only did customers eat a ton of the expensive crustaceans, but they also spent a lot of time doing it, because cracking and eating crab legs can be a tedious endeavor. Turnover was slow, and in just one quarter, Red Lobster posted a $3.3 million dollar loss and its stock plummeted.
Morris was forced to resign, and only parent company Darden’s other restaurant, Olive Garden, kept Red Lobster from going under.
Matthew Shinnick received a check in the mail from a Craigslist buyer who had purchased Shinnick’s two mountain bikes for $2,000. Shinnick went to his local Bank of America in San Francisco and asked the cashier if the check was valid. When she replied in the affirmative, Shinnick cashed it, but within minutes he was in handcuffs and was then jailed for nearly 12 hours.
Shinnick was the victim of a Craigslist scam in which victims receive a bogus check from a legitimate bank account. There was no way for Shinnick to know if it was real or phony, and even after the teller reassured him of the authenticity of the account, he was arrested.
Eventually Shinnick was released and all charges were dropped, but he paid nearly $14,000 in legal fees to clear his record. Unfortunately, due to a 2014 Supreme Court ruling that states any calls made to police about a suspected crime are protected, even if there is no crime, Shinnick had no recourse. Like other victims of check fraud, he had no way to sue for damages.
Volkswagen had long touted the environmental friendliness of its diesel automobiles, which made the revelation that the German automaker had been manipulating emissions testing on its vehicles particularly scandalous.
In September 2015, the US Environmental Protection Agency publicly revealed that Volkswagen was in violation of the Clean Air Act by intentionally designing cars that could falsify emissions tests. The EPA discovered the automaker had intentionally designed its turbocharged direct injection diesel engines to activate emissions controls only during emissions testing. This allowed Volkswagen to claim that its vehicles met the US emissions standards during the test, while actually emitting nearly 40 times more during regular driving.
For more than a year, Volkswagen claimed this data was untrue, but finally it became so glaringly obvious the company was lying that CEO Martin Winterkorn resigned and the company paid billions in criminal fines and reparations.
Abercrombie & Fitch was founded in 1892, originally operating as a sporting goods outfitter; since the late 1990s, it has focused its offerings for teenagers. The company was frequently found controversial in the fashion media because of its sexually risque advertising and an abandoned attempt to market thongs labeled “eye candy” for children. But in 2006, the CEO caused an uproar when he revealed his true beliefs in an interview.
A&F conspicuously limited its sizing for girls, ranging from XXS to L, making it impossible for anyone over a size 10 to shop there. In a rare interview granted to Slate writer Benoit Denizet-Lewis, CEO Mike Jeffries admitted that his company limited its sizing because he only wanted “cool kids” to wear the A&F brand.
He explained himself fully in the interview, stating:
In every school there are the cool and popular kids, and then there are the not-so-cool kids. Candidly, we go after the cool kids. We go after the attractive all-American kid with a great attitude and a lot of friends. A lot of people don’t belong [in our clothes], and they can’t belong. Are we exclusionary? Absolutely.
When Denizet-Lewis’s article hit the website, Jeffries’s admission confirmed what many had long suspected: A&F was not a very nice company. It limped along for the next few years, and in 2013, Jeffries was allowed to step down with dignity, even as the brand’s stakeholders breathed a sigh of relief. The clothier remained popular with some teenagers, even as many people in the media and the body-inclusivity community called on the brand to expand its sizing.
With the departure of Jeffries, the company listened to feedback, reducing its sexualized campaigns, and finally started offering inclusive sizing in 2013. In the long run, Jeffries’s PR disaster resulted in a better outcome for the A&F brand.
On February 11, 2014, the Lanco 7H natural gas well owned by the Chevron Corporation exploded in Pennsylvania’s Greene County, killing one employee and causing a fire that burned for four days. To placate the local community, Chevron offered 100 residents vouchers for a large pizza and a two-liter soda at Bobtown Pizza. The news of the pizza vouchers erupted in the media, incensing Greene County residents who derided it as shallow.
A representative later confirmed the voucher story with HuffPost, stating:
The situation at the Lanco well site in Pennsylvania remains serious and teams are working around the clock to safely approach and shut in the well. There has been considerable construction activity adjacent to the site, resulting in increased traffic and congestion in the area.
Recognizing that our neighbors have been affected by these activities, we are out in the community every day to listen to and address concerns. We have also offered a token of appreciation for their patience during this time, and our commitment to the community goes far beyond this and our outreach is ongoing.
In 2014, following two horrific disasters in which more than 500 people perished aboard two different Malaysia Airlines flights, the carrier created an advertising campaign to reinvigorate its declining business.
The campaign asked customers in Australia and New Zealand to answer the question, “What and where would you like to tick off on your bucket list, and explain why?” in 500 words. They announced that 16 winners would receive iPads or flights to Malaysia.
The “bucket list” campaign was undoubtedly tone-deaf, given the devastation of the loss of flight MH370, in which 239 people disappeared, and the horrific story of flight MH17, which was shot down over Ukraine and resulted in the demise of 283 people.
Malaysia Airlines’ request for bucket lists was seen as oblivious, as such lists tend to be equated with things people wish to do before they die. Shortly after the contest was announced, the carrier changed the title of the campaign to “to-do,” and claimed that it did not mean to be insensitive.