Bottled Water Purity and Advertizing at Spring Water Company, Essay Example

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Essay

The present case study relates a situation at a bottled water bottler. They had a contamination that was deemed unharmful to the public. Although the production facility has been sufficiently clean, there may still be minute amounts of the contaminants of the machinery.

The advertising department had just launched a pure water campaign and the company is still trying to bounce back from lost market shares due to production cut backs caused by union strikes and costs incurred in renegotiating contracts. What should the company do?

The company should first junk the 120,000 contaminated bottles. If there is a hint of any kind of contamination at any food packaging facility, it is standard quality assurance procedures to quarantine and dispose of contaminated products. It is only 10,000 cases. That is about 200 skids, about $12,000 of product. Furthermore, if the company is concerned about the honesty of its ad campaign, it should not use the word “pure.” The fact of the matter is that unless it is distilled water, it is not pure anyway. There are trace amounts of a number of minerals and other impurities present to some extent in every bottle. Even distilled water has that to a much lesser extent.

A noteworthy point from a business standpoint is that words that indicate product quality in advertising only works well with lower priced products and usually among people who are not that conscious of advertising slogans (Tellis & Fornell, 1988). In other words, the company could sell their product at a higher price without mentioning quality to regain some of the revenue lost. During this phase of production, the trace contaminants should be sufficiently flushed from the system such that the company would have no question about water purity and could reuse the word “pure.” So, long as they would sell more bottles at a lower price, they could make the same amount of money anyway.

Reference

Gerard J. Tellis, G.J. & Fornell, C. (1988). The Relationship between Advertising and Product Quality over the Product Life Cycle: A Contingency Theory. Journal of Marketing Research. 25(1): 64-71.

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