General Mills is a 154-year-old company that has $17.6 billion in annual revenue, a $35 billion market cap and 40,000 employees. That’s all to say, it should know what it is doing. But even big brands make stupid decisions when they are caught off guard.
Yesterday’s reaction to a consumer complaint – shrimp tails allegedly found in a box of Cinnamon Toast Crunch – only served to infuriate the customer, escalate the issue, and draw media and social media attention. And it has cost the company about $1.7 billion in market cap today.
What can we learn from General Mills’ response? First, you have to understand what you are dealing with. If a customer – especially a high-profile customer married to a Hollywood actress – claims they found shrimp tails in their breakfast cereal, use some of your $17.6 billion in annual revenue to hire an investigator to grab the box and interview the individual to understand what is going on.
Second, don’t rely on a superficial understanding of the situation to try to gaslight the customer. Claiming shrimp tails were “accumulation(s) of the cinnamon sugar” is the type of colorful detail that only escalates media and public interest. The only thing worse would have been to try to claim the shrimp tails were the special toy included in every box.
And third, try to end the situation as quietly and quickly as possible. This story is now a mystery the country is watching to see how it turns out. The customer has sent the box to a lab be tested to confirm what was found in it. It will be an entire new chapter in this saga when he announces the findings. Which will then lead to the “whodunnit” phase of the story. All of this could have been handled in the background by General Mills if they had taken the appropriate steps from the start.