Obviously Mengniu Dairy experienced great success in developing its business and corporation reputation before the year 2008. However, 2008 didn’t bring with it the expected leap in sales or rise in fame, both its business and corporate image suffered a lot because its product had been found to contain melamine, a fatal ingredient which has been proved to lead to kidney failure in infants and small kids. Based on the announcement from Mengniu Dairy, it might be facing a total loss of approximately RMB 900 million yuan in the financial year of 2008 (Mengniu Dairy, 2008b). More seriously, the damage to the corporate reputation was hard to imagine. Although the crisis management of Mengniu Dairy was timely and effective, yet, it is still beyond the limit of any corporation to take a blow that heavy.
3. Event Management and Crisis Management
Mengniu Dairy’s rapid development is benefit from its superexcellent strategy of building corporation reputation. From the beginning of it establishment, the rear of corporation reputation has been known as the most magnitude issue by the directorate. The board decided the strategy was ‘Showing the brand before establishing the factory’ (Sun & Zhang, 2005). Mengniu Dairy divided the progress of building its reputation into three processes—Local, China and World (Sun & Zhang, 2005). The most main method of Mengniu Dairy to building reputation is event management. In this part, the essay wants to choose three successful cases of Mengniu Dairy to do the analysis. Afterwards, the essay will analyze the crisis management of Mengniu Dairy about toxic milk scandal.
3.1 Attaching Its new brand to the Famous Brand
It was an undeniable fact that Yili Dairy Group was the biggest dairy firm in Neimenggu province when Mengniu Dairy was founded in 1999. Meanwhile, there are also several less big dairy firms existing in the same area. Compared to these corporations, Mengniu Dairy did not have any advantages in the aspects of fund, sale and resources of milk. However, Mengniu Diary allocated over 1/3 of its capital to build its corporate image (Sun & Zhang, 2005)。During this period，the publicity strategy of Mengniu is to bundle their own brand and Yili brand, the largest dairy industry in Inner Mongolia. According to the decision about ‘Establishing the brand before establishing the factory’, shortly after to establish the company，it brought the usufruct of more than three hundred billboards in Huhhot and published an advertisement said ‘Mengniu Dairy, the second brand in Inner Mongolia dairy industry’.then Mengniu also put in a considerable amount of publicity ads in Inner Mongolia dairy, and without exception these ads put first the biggest competitors on the Inner Mongolia Yili dairy, followed by Mengniu. Mengniu Dairy successfully established its local corporation reputation through this strategy. A series of PR activities based on this idea had been published on different kinds of media. This project also has brought two marked fruits to Mengniu Dairy. First, it makes customer fell that Mengniu Dairy was the leader of the dairy industry. Second, it helps Mengniu Dairy obtaining more growth space from its competitor.
3.2 Attaching its Brand with Shenzhou V Human Spaceflight Mission
Shenzhou V was the first successful human spaceflight mission of PRC in 2003. By right of this historical affair, Mengniu Dairy has been succeeded in expanding the corporation reputation to the national extension.
Mengniu product had become the designated dairy product of Chinese cosmonaut before two years of Shenzhou V mission. For using the success of Shenzhou V Human Spaceflight Mission to improve the brand ima
