The

Meltdown of an Ice
Cream Empire:
An Analysis of the 2015 Listeria
Outbreaks at Blue Bell Creameries

Marika Rafte
October 22, 2014


The Meltdown of an Ice Cream Empire: An Analysis of the 2015 Listeria Outbreaks at Blue
Bell Creameries

Table of Contents

I.

II.
III.

Case Study
1. Overview
2. A Brief History and Background
2.1. Blue Bell Creameries Timeline
2.2. Blue Bells CEO and Ownership
2.3. Blue Bells Products
2.4. Advertising Efforts
3. The Listeria Outbreak at Blue Bell Creameries
3.1. Timeline of Blue Bells Listeria Outbreak
4. The Aftermath
4.1. Lay Offs and Cut Backs
4.2. Financial Troubles for Blue Bell and Brenham
4.3. The Five-Phase Plan and Comeback
5. Media and Public Response
5.1. Unsanitary Work Conditions Revealed
5.2. Lawsuits
5.3. Problems with Production
5.4. Craigslist
6. Response from Blue Bell Creameries
7. Similar Scandals:
7.1. Johnson & Johnson Tyenol Recall (1982)
7.2. Odwalla Apple Juice E.coli outbreak (1996)
8. Summary: Blue Bells challenge
Appendices
References

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10-12
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18-20
21-24
24-28


Overview
Blue Bell Creameries, an ice cream company, recently faced serious problems from a
Listeria outbreak detected in their products. The outbreak resulted in 10 illnesses and
three deaths after people consumed the contaminated products. For the first time in 108
years of business, the company voluntarily recalled its products. The Texas based creamery
is facing lawsuits, media scrutiny and was forced to close its doors during their busiest
months. Several weeks after the recall, Blue Bell had to lay off a third of their employees
and took other cost cutting measures. After investigations by the FDA and CDC, Blue Bells
fate was looking grim. The company was extremely transparent and honest about the
actions that were being taken, which allowed them to shape the conversation about them.
With the help of an investor, Blue Bell has begun the process to come back to the market
slowly. The company has set a five-phase plan to come back to the market in 15 of the 23
states that previously sold their product in. However, several negative news stories have
come out regarding their management team, the conditions in the factories and objects
found in the ice cream post Listeria scandal.
A Brief History and Background
Blue Bell Creameries is an ice cream manufacturing company located in Brenham,
Texas. According to Visit Brenham (2015), Brenham is a country town in east central
Texas. It is located approximately 70 miles northwest of Houston. Brenham is known for
being home to Blue Bell Creameries as well as the heart of the bluebonnet region. Madan
(2010) states that the company got its start producing butter but shortly after began the
production of ice cream. Originally the building was an abandoned cotton mill. At first, the
creamery was only producing small amounts of ice cream each day (Cook, 2004). About
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Blue Bell Creameries, L.P., discusses that the original three flavors that they offered were
chocolate, vanilla and butter pecan. By the 1960s Blue Bell Creameries was solely focusing
on the production of ice cream and expansion beyond Brenham. Blue Bells product was
soon being sold in Houston stores. The company then put efforts towards expanding their
market to the Southern United States and soon opened up two factories outside of Texas.
By 2014, Blue Bell was selling their product in 23 states and had an estimated annual
revenue of $680 million (Cook, 2004). There were 57 distribution facilities throughout the
states where Blue Bell was sold (Madan, 2010).
Blue Bell Creameries Timeline (Madan, 2010)
1907 On August 26, 1907 the Brenham Creamery Company opened in Brenham, Texas.
In order to produce and sell butter to people in the area, the Brenham Creamery
Company bought excess cream from farmers.
1911 At the start of the year, the Brenham Creamery Company started producing small
quantities of ice cream. Each day, the Creamery made 2 gallons of ice cream.
1919 In 1919, the Brenham Creamery Company hit financial trouble and considered
closing its doors. However, E.F. Kruse was hired to take over the company on April
1, 1919. Kruse was a 23 yearold schoolteacher at the time. When he started at
Brenham Creamery Company he did not take a salary for the first few months in
order to help the creamery get out of debt.
1930 Kruse suggested that Brenham Creamery Company be renamed. After some
consideration it was decided that the company would be named after the Texas
bluebell flower, making the name Blue Bell Creameries
1936 The creamery was making a 10-gallon batch in 20 minutes, and 30 gallons of ice
cream an hour. The creamery got its first continuous freezer, which increased
production to 80 gallons of ice cream an hour.
1951 In 1951, E.F. Kruse was diagnosed with cancer and died 8 weeks after the
diagnosis. Ed and Howard Kruse, his sons, took over the company.
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1960 At the beginning of 1960, the creamery stopped the production of butter and
focused solely on producing ice cream. The company began selling ice cream in
Houston. Later that year the company started selling to Dallas and most of Texas.
1969 Blue Bell Creameries introduced two new flavors, Homemade Vanilla and Cookies
n Cream, which they created with Nabiscos Oreos. Blue Bell was the first
creamery to produce the flavor Cookies n Cream. Later, they started baking their
own cookies for Cookies n Cream.
1979 By the end of the decade Blue Bells ice cream sales had quadrupled. By the
beginning of 1980, Blue Bell Creameries was producing over 10 million gallons a
year. The company was also making $30 million annually.
1989 Blue Bell ice cream pushed passed the Texas state lines and began selling to
Oklahoma. Throughout the 1990s the company expanded their reach throughout
the South Central and Southern U.S.
1992 Blue Bell Creameries began to look towards expansion and in 1992 Blue Bell built
a factory in Broken Arrow, Oklahoma.
1996 Four years after successfully opening the first factory, Blue Bell Creameries built
another factory east of Birmingham in Sylacauga, Alabama. This helped them
expand into Atlanta and Miami.
1997 By 1997, Homemade Vanilla was the best selling flavor of ice cream in the
country.
2001 Blue Bell ice cream was named the number 1 ice cream by Forbes in 2001.
2006 Blue Bell Creameries sales began to skyrocket and by 2006 the company had
earned over $400 million.
2007 The Company celebrated its 100th anniversary by introducing two new flavors of
ice cream, Century Sundae and Anniversary Cake
2009 By 2009 the company had three factories in Brenham, Texas, Broken Arrow,
Oklahoma and Sylacauga, Alabama. They were disturbing to 19 states and had 49
branches across the country. The creamery was employing 2,800 people, 850 of
which were in Brenham.
2011 On March 14, Blue Bell expanded to Colorado.
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2013 Following the expansion into Colorado markets, Blue Bell Creameries began
selling ice cream in Virginia.
2014 Blue Bell expanded into Las Vegas. Blue Bells estimated annual revenue was $680
million in 2014.
2015 On April 20, 2015 Blue Bell Creameries issued a series of recalls due to a Listeria
outbreak. These recalls eventually shut down production, which led to job cuts and
furloughs. Three months later, Blue Bell started production again with a five phase
plan to return to a large portion of its pre recall distribution territory. On August
31, Blue Bell product returned to the market in parts of Texas and Alabama, which is
the first phase in their plan. Blue Bell is still the fourth highest selling ice cream
brand in the United States.
Blue Bells CEO and Ownership
According to Cook (2004), Blue Bell Creameries has been in the Kruse family since
E.F. Kruse was hired to run the company in 1919. E.F. Kruses two sons, Howard and Ed
took over the company prior to his death in 1951. Howard was the chief legal council and
Ed became the CEO. Presently, Paul Kruse, son of Ed Kruse, is the CEO and president of Blue
Bell Creameries. Kruse took over the company from his uncle, Howard Kruse, in May 2004.
Prior to becoming the CEO, Kruse was the chief legal council (Paul Kruse new CEO,
president of Blue Bell, 2004). The Kruse family still largely controls Blue Bell however,
prior to the recent Listeria outbreak, 40% of the company was employee owned (About
Blue Bell Creameries, L.P., n.d.). Due to the recall, they currently have a single investor, Sid
Bass (Lorenzetti, 2015).
Blue Bells Products
Blue Bells Our ice cream, page (2015) states that Blue Bell currently has 53
flavors of ice cream and 30 different take home snacks such as cups, bars, and
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sandwiches. Additionally, Blue Bell offers four flavors of no sugar added ice cream and two
flavors of light ice cream as well as five Sherbet flavors and two flavors of frozen yogurt.
Prior to the incident in 2015, Blue Bell has never had to recall its product (Abrams &
Tabuchi, 2015). In 2004, Blue Bell accounted for 60% of ice cream sales in Texas and
Louisiana and 45% in Alabama (Cook, 2004).
Advertising Efforts

As Blue Bell grew, they needed to grow their advertising and marketing efforts. The
company began an in-house advertising agency called Blue Bell Advertising Associates
(Madan, 2010). In the early years, the agency would produce seasonal radio and television
spots, which would air between February and October (Hayhurst, 2015). These efforts
reinforced Blue Bell Creameries image as the little creamery in Brenham that makes the
best ice cream in the country (Madan, 2010). This type of advertising efforts made by
Blue Bell can be seen in Figure 1 and Figure 2. According to About Blue Bell Creameries,
L.P., In recent years, several ice cream manufacturers have slimmed down the size of their
containers in order to save costs, however Blue Bell has kept the original size of the half-
gallon. This fact is one they promote in their advertising as well.
According to Hayhurst (2015), Blue Bells agency has worked on several award
winning ad campaigns and commercials. In 2008, the company won an Addy for their 100th
anniversary campaign, which was a multi-faceted, year-long campaign. Currently, Blue Bell
Creameries use TV commercials, billboards and newspaper advertisements to market their
product. Some themes in their advertising have been wouldnt it be nice if life on earth
were really like this? (Hill, 2001). In 2002, Blue Bell Creameries had a $3 million
advertising account (Texas Dairy Puts Freeze on Blue Bell Ice Cream Account, 2002).
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The Listeria Outbreak at Blue Bell Creameries
The CDC states on their Listeria Definition page (2013) that listerosis, commonly
known as Listeria, is a serious infection that is caused when a person eats food that is
contaminated with the bacterium Listeria monocytogenes. This infection normally affects
women who are pregnant, newborns, older adults and people with weakened immune
systems. The microbes live in soil and animal feed and it can survive a frozen environment.
Once the bacterium enters a facility, it is extremely hard to remove. In some extreme cases
factories have had to be demolished. According to the CDCs Listeria Statistics page
(2014), there are approximately 1600 illnesses and 260 deaths annually due to Listeriosis
in the United States. In 2015 there have been two outbreaks of Listeriosis in the United
States, one linked to soft cheeses distributed by Karoun Dairies, Inc. and one linked to Blue
Bell Creameries Ice Cream Products. In 2014, there were four outbreaks.
The FDA published a draft guidance called Guidance for Industry: Control of Listeria
monocytogenes in Refrigerated or Frozen Ready-To-Eat Foods to help prevent food borne
illnesses. The Guidance states that if Listeria shows up in the factory, the company must
check for it in its products along with several other recommendations (Office of Food
Safety, Office of Compliance, & Office of Regulatory Affairs, 2014). The Houston Chronicle
reported that Blue Bell Creameries ignored significant parts of these federal
recommendations, which could have prevented the outbreaks (Collette, 2015). Several ice
cream manufacturers disregard the guidelines from the draft.
On April 20, 2015 Blue Bell Creameries voluntarily issued a recall on its products
currently on the market due to the fact that the CDC determined that their product was the
source of a Listeria outbreak (An Agonizing Decision, 2015). This recall included ice cream,
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frozen yogurt, sherbet and frozen snacks and resulted in eight million gallons of ice cream
being thrown away (Wray, 2015). This was the first time that Blue Bell Creameries has
issued a recall on their products in 108 years of business (Abrams & Tabuchi, 2015). Paul
Kruse, CEO and President of Blue Bell Creameries, issued a letter on March 27, 2015 prior
to the recall apologizing for the outbreak and stating that the company was working closely
with FDA to resolve this issue, as shown in Figure 3 (Press Releases, 2015).
According to the CDCs report on the outbreak (2015), there were a total of 10 people
with Listeriosis related to this outbreak, spanning across four states: Texas, Kansas,
Arizona and Oklahoma. Three deaths were reported in Kansas due to this outbreak. Figure
4 shows the distribution of the outbreak across the United States. The eight cases found in
Texas and Kansas were found in various hospitals since the start of 2014. The other two
cases were not reported at a hospital facility. The CDC conducted an investigation and
found Listeria monocytogenes in all three Blue Bell factories. The CDC released an
infographic informing people of the situation and where the cases were found, which can
be seen in Figure 5. The FDA inspection records show that Blue Bell Creameries had
sanitation problems since 2009 (Newman, 2015).
Timeline of Blue Bells Listeria Outbreak (Falkenstein, 2015)
January 28, 2015 South Carolina state inspectors revealed Listeria monocytogenes in
two products made by the Brenham plant.
February 13, 2015 Blue Bell Executives first learned about the Listeria findings in
South Carolina
February 16, 2015 Blue Bell began retrieving 10 different products made on the same
factory line. Neither the FDA nor the state regulators insisted on disclosure, so there
was no public announcement made at the time.
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March 9, 2015 Blue Bell learned that using a nationwide bacterial registry, the CDC
matched the Blue Bell outbreak to Listeria strains blamed for unsolved 2014
outbreak at a Witchita hospital. There were five patients that had been infected,
three died. It was confirmed that four of the patients drank milkshakes made with
Blue Bell ice cream. Later the company was linked to 10 Listeriosis cases dating
back to 2010.
March 13, 2015 Blue Bell announces a recall stating that it had pulled a limited
amount of frozen snacks with a potential Listeria problem. They emphasized that
the action was not involved with its other products.
March 22, 2015 Kansas authorities advised Blue Bell that they had found more
Listeria at the Witchita hospital. The Listeria had been found in the three-ounce
chocolate ice cream cup, which had been made in Oklahoma. This news extended
the problem to a second plant. Blue Bell responded with statements acknowledging
the Kansas deaths for the first time.
April 3, 2015 The CDC linked the bacteria found in the chocolate cup with five more
Listeriosis cases as far back as January 2010. In order to inspect for possible
contamination sources, Blue Bell announced that it was suspending all
manufacturing in Oklahoma.
April 6, 2015 The CDC recommended that people do not eat any of the product
produced at the Oklahoma plant. On this day, Blue Bell Creameries announced that it
was voluntarily withdrawing anything made at the Oklahoma plant.
April 7, 2015 Blue Bell was notified that the FDA had found Listeria in another flavor
made in Oklahoma. The company then announced a recall of seven more flavors,
which it was already pulling as part of its withdrawal.
April 20, 2015 Listeria was found in tubs of Chocolate Chip Cookie Dough ice cream
made in Brenham, Texas. CEO Paul Kruse released a statement apologizing and
recalled all its products.
April-July 2015 Blue Bell signed agreements that they would ensure stringent new
safety procedures. They proceeded to clean and sanitize facilities as well as retrain
their workers.
May 2015 Blue Bell laid off 1,450 of its 3,900 employees and furloughed 1,400 more.
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June 1, 2015 Blue bell made a voluntary agreement with Alabama Department of
Public Health in order to resume production in the Alabama factory.
July 14, 2015 Sid Bass, a Texas billionaire who is worth an estimated $1.7 billion,
made a significant investment in Blue Bell Creameries.
July 2015 Blue Bell resumed production in Alabama after being approved
August 17, 2015 Blue Bell releases its five-phase plan to bring back ice cream in 15
states. The first phase of the plan was to bring Blue Bells product back to Brenham,
Houston and Austin as well as parts of Alabama.
August 31, 2015 Blue Bell ice cream returns to stores in select areas. The four flavors
available in stores are Dutch Chocolate, Cookies n Cream, Homemade Vanilla and
The Great Divide.
September 1, 2015 Blue Bell resumed production in Oklahoma
November 2, 2015 Blue Bell will begin phase two. Phase two includes bringing Blue
Bells product back to north central Texas and north central and southern Oklahoma.

The Aftermath
Lay Offs and Cut Backs
Newman (2015) states that after issuing the recall, Blue Bell Creameries began to shut
down their plants in Texas, Oklahoma and Alabama in order to remove the Listeria
monocytogenes. The company began to warn shareholders that they were facing a capital
crisis, which could result in them closing their doors for good. In An Agonizing Decision
(2015), Paul Kruse discussed that the process of cleaning the factories, replacing
machinery and improving Blue Bells four production plants was going to take longer than
originally expected. Blue Bell Creameries issued a statement stating that the extended
timeline required to ensure that their facilities are once again at the highest quality they
would have to reduce the size of their workforce and take other cost cutting measures. In
May, Blue Bell Creameries laid off 37% of its 3,900 workers and 1,400 employees will be
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furloughed (Newman, 2015). Paul Kruse released a video stating, the most difficult thing I
have had to deal with in my life is the incredibly tough decision to reduce pay and lay off
some of our great people at Blue Bell (An Agonizing Decision, 2015). At that point Blue Bell
Creameries did not have a firm timeline as to when production would resume, however
they knew it would be limited and phased in over time.
Financial Troubles for Blue Bell and Brenham
At this time, Blue Bell Creameries has not released how much this crisis has cost them
but Larry Keener, president and chief executive of International Product Safety
Consultants, estimates that solving this will be an expensive undertaking. Keener suggested
that this is going to cost the company between $4 million and $10 million (Robinson-
Jacobs, 2015). Blue Bells financial hit included lost sales during their peak season, clean up
costs and pending litigation. The loss of jobs and other impacts of the Blue Bell shut down
has been predicted to impact Brenhams economy for years to come (Wray, 2015).
The Five-Phase Plan and Comeback
Lorenzetti (2015) discusses that in order to evade bringing in an outside investor
and keep the business running, Blue Bells CEO, Kruse, solicited money from stakeholders
in a letter. The letter stated that the company faced a financial crisis. However, they were
unable to raise enough, so they decided to work with a single source. According to Newman
(2015), in July, Blue Bell publicized that Sid Bass, a well-known Fort Worth investor, would
be lending Blue Bell Creameries $125 million to help them rebound from the recall. The
Bass family will acquire 33% ownership of the company before it matures in 2018.

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On August 17, 2015 Blue Bell announced their plans for return in a press release
called Blue Bell announces plans for return (2015). The company stated that at the end of
August it would begin distributing certain products to select areas. Blue Bell Creameries
only plans on re-entering 15 of the states they were distributing to due to their limited
production capacity. The company set a five-phase plan to return to the select 15 states:
Phase One (Complete): Brenham, Houston, Austin and select parts of Alabama.
Phase Two (Beginning on Nov. 2): North central Texas and southern Oklahoma
Phase Three (Date TBD): Southwest Texas and Central Oklahoma
Phase Four (Date TBD): The majority of Texas and southern Louisiana
Phase Five (Date TBD): Complete the states of Alabama, Oklahoma, Louisiana and
Texas. Begin distribution in Arkansas, Florida, and Mississippi. Begin distribution in
part of: Georgia, Kentucky, Missouri, New Mexico, North Carolina, South Carolina,
Tennessee and Virginia.
Media and Public Response
Following the outbreak, Blue Bells name was splashed on numerous headlines; some
criticized the company while others showed their support. As the outbreak caused more
coverage, the media also exposed larger sanitation, managerial and training issues at the
plants (Blue Bell faces hit worse than financial: A loss of Trust, 2015). In the aftermath,
many went into mourning over the loss of Blue Bell and the deaths the outbreak had caused
Elkind reported (2015). The publics reaction was astonishing, as they showed support for
the company and the families that had lost loved ones. The 16,000 residents of Brenham,
Texas held a prayer vigil in the town square for the three deaths that had occurred. Ted
Cruz, a 2016 presidential candidate, posted a photo with a sign reading God Bless Blue
Bell from the campaign trail. Throughout Texas people showed their support for Blue Bell

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with signs and other paraphernalia. After 108 years of business, Blue Bell Creameries had
gained a loyal following, which helped in their time of need.
Unsanitary Work Conditions Revealed
Recently, employees have revealed many problems with the unsanitary conditions
at Blue Bell Creameries. Axelrod & Rand (2015) reported that the employees claimed to
have informed management prior to the outbreak; however, the team did nothing to clean
the factory. It was reported that excess and spilled ice cream was left on the floor because
stopping to clean it up would slow down production. One employee reported, he was told
to pour ice cream and fruit juice that dripped off the machine throughout the day into
barrels of ice cream mix to be used later(Axelrod & Rand, 2015). Additionally he said that
in the past it could have been possible some of the oil from the equipment and machinery
might have ended up in the ice cream. However, the employee reported that these
practices stopped one year prior to the shutdown.

Additionally Axelrod & Rand (2015) exposed that the factories would leave water all

over the floor, which is an ideal environment for bacteria to grow in. When the FDA
inspected Blue Bells factories it found condensation dripping into the ice cream, peeling
ceiling paint falling into the ice cream mixer, and dirty machinery.
Lawsuits
To date, there have only been two lawsuits filed against Blue Bell for the outbreak. A
former Houstonian, David Shockley, filed the first lawsuit on May 20, 2015 (Davis, 2015).
Shockley reported that he was hospitalized for respiratory failure and septic shock from
consuming individual serving cups. The lawsuit states that he could not walk, talk, swallow
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or move much of his body, however he survived (Blue Bell Creameries v Pritzker, 2015). He
has since had to move in with his parents because he requires round the clock care (Davis,
2015).
Collette (2015) reported that on August 15, 2015 there was a class action lawsuit
filed against Blue Bell. This lawsuit, filed on behalf of Steven J. Leon, is seeking refunds for
Louisiana customers who bought tainted ice cream.
Problems with Production
Since Blue Bell products return to the market, there have been more new stories
released about people finding objects in their ice cream according to Ptashkin (2015). On
September 4, 2015, Blue Bell fan Marsha Carden bought her first tub of ice cream since it
had been restocked. When she opened the top she found a black object laying in her ice
cream, which turned out to be a black ring made of plastic or rubber. Blue Bell sent Carden
a certificate to replace her contaminated ice cream and issued a statement saying:
"We were alerted today to this situation by the news station and immediately contacted
the consumer. We sent a representative over to retrieve the plastic piece and ice cream,
and we will attempt to identify it in our Quality Control lab. Until we are able to analyze
the object and determine its origin, we cannot speculate on any findings.
We take all such matters very seriously, and we regret any inconvenience and concern
this may have caused the consumer. We will share all results of our investigation with
the consumer. Our number one concern is consumer satisfaction, and we are committed
to ensuring that every consumer has a pleasant experience eating our ice cream.
(Bellow, 2015)

According to Bauer (2015), on October 15, 2015 Luis Vasquez and his family found a
blue object buried deep in their Cookies n Cream ice cream. They were almost finished
with the container when they noticed a mysterious blue object at the bottom of the carton.
They have not been able to identify the object however Blue Bell is testing it in their quality
control lab currently.
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Craigslist (Bloomberg)
Bloomberg released a video titled $10,000 to Satisfy Your Blue Bell Ice Cream Craving
(2015) discussing that in response to the recall, people started posting advertisements for
Blue Bell products on craigslist for up to $10,000, as shown in Figure 6. As shown in Figure
7, some advertised that the product was Listeria free. In order to make sure that it was
Listeria free, people were eating half of it and then selling the rest. Additionally, people
were selling a $50 tub of Cookies n Cream ice cream and a $10 tub of Dutch chocolate on
eBay (Moss, 2015).
Response from Blue Bell Creameries
According to Newman (2015), throughout the crisis, Blue Bell Creameries was
transparent and accountable. When the news first broke, Blue Bell sought out the help of an
expert crisis communications team, which handled its recall messages. The team handled
the communications in a way that their honesty placed them in an excellent position to
come back from the incident. The company has shaped the conversation surrounding the
controversy and has stayed ahead of the problem. Most headlines speak of a timely,
voluntary recall rather than a forced recall due to a negative public reaction (Hemeyer,
2015).
Paul Kruse, CEO and President, remained accessible and continued to reach out to
the public by releasing letters and videos addressing the problems continued to arise. He
was extremely heartfelt yet brief by saying We are heartbroken over the situation and
apologize to all of our loyal Blue Bell fans and customers. Ice cream is a joy and pleasure to
eat and it should never be a cause for concern (An Agonizing Decision, 2015).
Additionally, with the media coverage, Blue Bell announced that they will be
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updating and revamping their website. The current page has a blue banner on it directing
viewers to the companys plan for addressing the crisis, including a press release about
their five-phase plan. The banner, which can be seen in Figure 8, also has a picture of their
Homemade Vanilla ice cream with text stating Thank you. We appreciate your patience
and support above the container, and Its great to be back. On their website (2015), the
company states:
We have upgraded our procedures and employee training and have adopted the same
overall philosophy at all of our facilities, to include:
Enhanced manufacturing procedures
Increased focus on sanitation and cleaning
Retained an independent microbiology expert for ongoing evaluation of our
procedures and facilities
Implemented a test and hold procedure, where production runs will be tested
and held until results are received before being distributed to market
Entered into voluntary agreements with the Alabama Department of Public
Health, the Oklahoma Department of Agriculture, Food, and Forestry and the
Texas Department of State Health Services

The communications team has also been utilizing social media in order to get the
word out about the progress it has made as seen in Figure 9. Initially, #BlueBell was
trending on Twitter and the response was positive as shown in Figure 10. However, until
the crisis the Blue Bell Twitter account was rarely used. The increased activity on its
Twitter account was simultaneous with the day of the product recall.
Similar Scandals
Johnson & Johnson Tylenol Recall (1982):
Rehak (2002) discusses that in 1982, Johnson & Johnson had a tragic accident when
seven people died after taking cyanide-laced capsules of Extra-Strength Tylenol. A person
popped the seal on the Tylenol containers at a store in Chicago and put cyanide in them. At
the time, the Tylenol brand accounted for 17% of the companys net income. When the
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sabotaging incident occurred, many believed that Tylenol and Johnson & Johnson would
never recover from it. The company had to recall 31 million bottles of Tylenol from store
shelves.
Johnson & Johnson set the precedent for how to handle a recall, not only because it
placed consumers first but also it rebounded from the crisis according to Rehak (2002). In
order to put their costumers first, they offered replacement products free of charge. By
voluntarily recalling the product and their transparency with the media, Johnson & Johnson
took control of the situation. Recalling and launching the product again cost Johnson &
Johnson over $100 million (Markel, 2014). Though a recall was costly, it paid off in the long
run. The company began taking measures to ensure that this would not happen again. The
packaging precautions that they developed became the industry standard for all over the
counter medications.
When crisis hit, the company acted quickly and made decisions that were best for
their consumers (Rehak, 2002). They were forthcoming, honest and took responsibility for
the incident even though it was not necessarily their fault (Markel, 2014).
Odwalla Apple Juice E.coli Outbreak (1996)
Halsey (1996) reported that on October 30, 1996 Odwalla, a health-conscious juice
company, was informed by the FDA that their apple juice had been linked to an E.coli
outbreak. The company was about to reach $90 million in annual sales when the disaster
struck. Due to the outbreak, one child died and more than 60 people became sick. There
were 20 lawsuits filed against the company and its stock fell drastically.
Kortessis (2011) stated that the company immediately ordered a recall on its
products containing apple or carrot juice. The recall cost the company about $6.5 million.
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The company set up an explanatory website and spoke to the press within the first 24
hours. The CEO of the company expressed sympathy to those affected by the juice and
promised to pay all medical costs. Additionally, the CEO not only focused on external
communications but also internal communications. He allowed the employees to ask
questions and receive the latest news by holding daily company wide conference calls
Odwalla found that the E.coli was in unpasteurized juice because that gave their
product the best flavor according to Flynn (2009). They soon began a process called fresh
pasteurization, which would leave most of the original flavor but ensure that the E.Coli had
been destroyed.
Summary: Blue Bells Challenge
Blue Bell, an ice cream empire, was struck down earlier this year by the outbreak of
a potentially deadly bacterium, Listeria monocytogenes. The outbreak caused 10 people to
become ill of which three died. The company recalled its products, shut down production
and took cost cutting measures during its typical peak season, the summer. After the recall,
the CEO, Paul Kruse, continued to update the public about the status of Blue Bell. In the
beginning, just after the recall, the Blue Bell team estimated that repairs, clean up and
machinery replacement would only take a few weeks, however as they investigated they
realized that this would be a long, strenuous and costly process. For a while, it looked as
though the ice cream manufacturer, which sold 6.4% of Americas ice cream last year,
would have to permanently close (Moore, 2015). Reports began to come out about the
unsanitary conditions at the factories and the lack of response from management.
However, despite the negative publicity, Blue Bell fans showed their support for the little
creamery in Brenham. The closing of the factories and the lay offs caused a large financial
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impact on Blue Bell and Brenham, Texas. Luckily for the creamery, Sid Bass, a wealthy
Texas investor, loaned them money. The creamery has been able to start production and
has laid out a five-phase plan to return to the market in 15 states.
Blue Bells crisis communication team handled the situation in the right way. Similar
to when Johnson & Johnson recalled Tylenol, Blue Bell recalled its product voluntarily.
Instead of waiting for investigators to ensure that the product was linked to the Listeria
cases, Blue Bell recalled their ice cream and other products. Their decisive action helped
them to avoid an even bigger scandal and showed that they put their customers first. Had
they waited, they may not have had as much support. However, they did not pull all their
products immediately. The company only pulled a few flavors of ice cream at first before
formally recalling all of its product.
Paul Kruse released several statements, letters and videos addressing the public and
informing them of the decisions he was making regarding Blue Bell. By allowing the
audience to hear from the CEO rather than just the PR representatives, it made Blue Bell
much more relatable. Additionally, when Kruse talked about lay offs and how difficult a
decision it was for him, it made it very personal. Throughout the scandal, Blue Bell was
extremely proactive about their communications and messaging. They took control of
situation and were honest about what was happening. This allowed them to shape much of
the conversation around what was happening. The company is using this opportunity to
update its website, however they have kept it user friendly by allowing viewers to see
updates on the production of ice cream.
Having a loyal brand following is extremely important when it comes to a crisis.
Blue Bell fans across the nation showed their support and love for the creamery. Texas,
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which is known for their state pride, stood behind Blue Bell by hanging signs in shop
windows, posting on social media, and adamantly demanding Blue Bells production
resume. In the end, it was this loyal brand following which found them an investor.
In the beginning, Blue Bell tried extremely hard to not have any layoffs however in
the end, they had to take cost cutting measures. One thing Blue Bell could have done better
is focus on their internal communications, like Odwalla did. Blue Bell could have kept its
employees informed and updated on what was happening internally, which may have
helped to ensure that employees that were fired would not talk to the press. Unfortunately
several employees went to the press and discussed the unsanitary work conditions.














20

Appendices
Figure 1:










Figure 3:

Figure 2:

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Figure 4:

Figure 5:

22


Figure 6:

Figure 7:

Figure 8:

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Figure 9:

Figure 10:

24

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