Friday, August 17, 2012

Public Readings - Bumbo Recall Shows How Companies Deal With Faulty Products

Public Readings - Bumbo Recall Shows How Companies Deal With Faulty Products. Bumbo Baby Seats are being recalled after nearly two dozen reports of infant skull fractures resulting from infants falling out of the seats.

Like many recalls, the Bumbo baby seat recall is a situation with no winners—parents are no doubt worried and frustrated, and "infant skull fracture" is not a phrase that a company would like to be associated with.

Bumbo and the U.S. Consumer Product Safety Commission issued a recall of nearly 4 million Bumbo baby seats this week. Since 2007, there have been more than 84 instances in which babies fell from the popular baby seats, with 21 infants suffering skull fractures as a result.

The company is trying to right the situation, keep its tiny customers safe, and reassure parents. In the process, Bumbo will have to answer a litany of tough questions that face any company facing a potential recall:

Was it our fault (and does it matter)?

Before a recall is even considered, the manufacturer of a consumer product has to know what customers are complaining about—and whether the company truly is to blame.

"It happens frequently there are consumer complaints because the product is being misused," says David Reibstein, professor of marketing at the Wharton School at the University of Pennsylvania. "The companies want to be polite and handle that in the best way, and try and direct people into the correct way to try and use it, and there's really nothing wrong with the product."

While Bumbo is issuing kits to parents that allow them to attach restraint belts to the chairs, it is also emphasizing to parents, as it did in a smaller 2007 recall of 1 million seats, that the seats should be used only on the floor—thus trying to reduce "user error" even while it makes the product safer.

Even if a company is firmly convinced that it is not to blame, negative attention can force its hand. An example of this could be found in the early 1980s, when Audi customers complained of unintended acceleration. A 60 Minutes segment on the problem furthered the damage, though the segment was later shown as depicting rigged cars, and a later study showed that driver error could have been to blame. Still, the company suffered.

"It was very costly, there was tons of negative publicity, and it dramatically hurt the company for several years," says Reibstein.

Can we handle it?

After recalling the seats and announcing it would issue restraint belts, Bumbo briefly took down its hotline and website to fix technical difficulties, meaning longer waits for parents wanting to claim their kits.

That sort of onslaught is something that companies have to prepare for, says Mike Rozembajgier, vice president of recalls for ExpertRECALL, which helps firms through the recall process.

"Your phone lines can't go down. Your website can't go down. People have to call and talk to a live person," he says.

In addition, the company now faces potential supply difficulties.

"You've got to make sure you've got a supply of the fix-it kit ready to go, because the last thing you want is a disgruntled consumer base."

All of this is complicated by the fact that the recall isn't just for a faulty electronics device; it involves infants, meaning very worried customers who want a fast response.

"It involves children, and when it involves children, we're in a whole different ballgame," he says.

Pay now or pay later?

Recalls can be very costly, but not nearly as costly as the blow they can deliver to a company's reputation, says Reibstein.