Crisis Communications
Rebuilding Investors' Confidence after a Product Safety Allegation
A leading health supplement company in Taiwan witnessed a 30% decline in its share price over one month due to a product safety allegation. QIC was tasked with developing and implementing crisis communications and a new IR campaign to rebuild investors' confidence and maintain the trust of other external stakeholders.
Client Challenge
Effectively communicate the details of the incident and its impact to the investment community to reassure investors and support the current valuation.
The health supplement company was accused by a local tabloid magazine of repackaging its expired health food products instead of destroying them. The company denied the allegations, attributing them to a family feud related to leadership succession issues.
Management aimed to communicate the issue to the public while assuring investors that the allegation was untrue and would not adversely affect sales in the long term while awaiting an official investigation from the local health authority to conclude.
The QIC Advantage
A comprehensive communications strategy was developed, including shareholders' communications, employee and partner communications, consumer messaging, investor materials, and media statements, followed by well-planned investor site visits and non-deal roadshows (NDR).
QIC developed a strategy involving communications with major shareholders and the investment community. Messaging emphasized the company's strong track record, strict product safety controls, details of management's succession planning process, and why the current chairman is the right person to lead the company to new heights. Leadership profiling was conducted through QIC's proprietary publication, 'The CEO Conversation,' and multiple media reports. Several factory site visits and presentations were arranged for both buy-side and sell-side communities to witness actual production and safety measures, followed by a non-deal roadshow in Asia to meet key investors and discuss the incident, remedies, and future strategic plans.
QIC trained senior executives and spokespeople to respond effectively to shareholders' and investors' inquiries, aiming to demonstrate the company's primary focus on consumer safety and increase investor confidence in the company's operating outlook.
Results
Reinforced the company's reputation as a market leader and maintained support for the stock's valuation.
QIC's proactive communications plan presented a unified message of product leadership and consistent operating performance. The result enhanced consumer confidence in the company's products and solidified investor support for the stock price, which saw a strong rebound of 60% over 6 months.
