Consumer Product Safety Commission
Effective Recalls
Since the first Consumer Product Safety Commission (CPSC) recall of a kitchen range in 1973, the primary vehicle to notify the public has been the press release. Sent to the general media via the wire services and faxed to some 3000 news outlets, the press release provides the instant information for TV, radio and next day newspaper stories. Over the years thousands of press releases have been issued by the Commission. Most recently these press releases have included recalls of go carts, gas grills, infant walkers, ATVs, swim masks, juice extractors, baby carriers and gun locks.
Direct mail is probably the most effective form of notice where the company has the names of their customers. They can notify them directly and insure that purchasers have the information they need to protect themselves. This information can also be gleaned from warranty cards, at least for those who have returned them. Many retailers, especially the newer discount membership stores, today have the capacity to review their own sales records for the SKU number that would identify products, particularly those products for children. The Commission has recently held public hearings to determine new ways to encourage consumers to register their products and some new websites, such as Toddlerwatch.com, are providing space on the internet for consumer to register their products with the assurance that they’ll be notified directly is a recall involving those products is announced.
In store displays or posters are an integral part of the fast track approach to product recalls. These signs generally 8 1/2” x 11” posted either at the cash register, in the department where the product was sold or by the front door can help inform consumers who return to the store and give them instructions on how to return it. The U.S. Postal Service is now displaying recall posters in an agreement with the CPSC.
Paid ads in newspapers and magazines are another way to reach consumers directly when the target market has a specific interest. Companies have used such periodicals as American Baby, Redbook and other women’s magazines. Years ago a major manufacturer of toys recalled a tent type play house because the support rods would spring apart potentially contacting the child with some force. The company took an advertisement in the Sunday Parade Magazine, one of the most widely distributed periodicals in the nation. Another company, trying to recall a 30 year old camping heater associated with over 30 deaths by carbon monoxide asphyxiation, placed ads in Field and Stream and Hunting magazines.
More recently, the Commission has encouraged companies to use video news releases as a way to expand their presence on television, as TV news producers who receive prepackaged video concerning a recall may be more likely to put it on the air. Toaster fires and go cart hair entanglements are just two examples of recent releases.
Where companies provide consumers with information on their websites about products, many recalls include a notice on the home page concerning recall information, including the nature of the hazard, and how to return the product for a repair, replacement or a refund. Finally, incentive coupons offering consumers a percentage off their next purchase can bring consumers into the store to return products and be compensated for the inconvenience. A recent recall of a stuffed animal used the coupon providing 20 percent off their next purchase up to $100 if the consumer brought the stuffed animal back to the store.
Notices can often be sent to day care centers and pediatricians concerning the recall of products such as cribs. A number of years ago a wooden porta-crib with a large white plastic knob on the outside of the leg caused a number of injuries and deaths at day care centers. By obtaining a list of certified day care centers in the United States, the manufacturer was able to provide both notice and corrective action to basically eliminate the danger.
Recall effectiveness has been studied by the CPSC and the National Highway Traffic Safety Administration (NHTSA) for over 20 years. The typical recall identifies only about 20 percent of the defective product population.
Since the 1970’s CPSC has studied the effect of price, size, location, and scope of notice on recall effectiveness. Applying these concepts can help raise effectiveness, (water heater manufacturer can capture as many as 80 percent), however, even automobile recalls generally do not reach more than 20 to 30 percent. Some NHTSA studies suggest stronger language in recall letters. CPSC has recently held hearings on product registration, and numerous websites have recently sprung up to assist companies and provide recall information directly to product users.
Litigation Disclosure Rules
Section 37 of the CPSA (15 USC 2084) and the regulations (16 CFR 1116) require manufacturers to report information about settled or adjudicated lawsuits to the Commission when a particular product model is the subject of at lease three civil actions alleging death or grievous bodily injury. The final settlements or judgments must all occur during a specific two year period. Such periods include January 1, 1999 - December 31, 2000, January 1, 2001 - December 31, 2002 and so on. Reports of the litigation must be provided to CPSC. Unlike Section 15 reports that can be made public, Section 37 reports may not be disclosed to the public.