Today in History: Pepsi Syringe Hoax Costs the Company $35 Million
June 9, 1993, was the beginning of a costly hoax for PepsiCo, requiring ultimate damage control to keep the company afloat.
The story begins in Tacoma, Washington, with an elderly couple that found a syringe inside a can of Diet Pepsi that was left overnight. On June 10, the couple immediately contacted their lawyer, who called the press and notified health officials and the police.
The following day, a second case was reported by a woman in Federal Way, Washington, close to Tacoma. The FDA responded by advising consumers in the Pacific Northwest (near the company bottler in Washington State) to pour their soda into a glass before drinking. The FDA did not order a recall because no injuries were reported.
Pepsi sprang to action, ensuring the local bottler executives were available for the media. They considered a voluntary recall but ultimately chose not to due to advice from the FDA. Public affairs manager Andrew Giangola said, "The FDA told us there was no need, that there wasn't a health risk."
At this point, the hoax was far from over. Reports began pouring in nationwide with claims of various items in Pepsi bottles, including pins, screws, sewing needles, a bullet, and more.
Upon realizing the magnitude of the crisis, Pepsi compiled a crisis team. Craig Weatherup, the company's president, made rounds to various newsrooms for damage control. The company also put out a video news release and a press release showing the mechanics of the production process, demonstrating the impossibility of foreign objects being placed in the bottles as it took a mere 0.9 seconds to fill and seal each can.
The company finally caught a break when surveillance footage from a Colorado supermarket captured a shopper inserting a syringe into a can of Diet Pepsi. The video was sent to television stations around the country.
On June 17, The LA Times reported that FDA officials believed the claims were mainly from copycats following the initial complaint in Washington state. They said false claims frequently follow product-tampering reports, especially cases that receive widespread publicity.
Dr. Park Dietz, a psychiatrist, and consultant to Federal authorities in tampering cases, told The Associated Press that greed likely motivated most of the hoaxes. Dietz also said a desire for attention or to appear as a victim could also play a role.
On June 18, The New York Times announced that the dozens of complaints of objects in Pepsic turned out to be hoaxes, with seven people arrested. The numbers continued to grow.
According to The Associated Press, Spokesman Gary Hemphill said the episode cost the company and its bottlers about $25 million in lost sales and increased marketing and labor costs during those two weeks. A discount coupon program in July cost another $10 million.