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Weathering product-harm crises
Authors:Kathleen Cleeren  Marnik G Dekimpe  Kristiaan Helsen
Institution:(1) Faculty of Economics and Business Administration, Department of Marketing, Maastricht University, P.O. Box 616, 6200 MD Maastricht, The Netherlands;(2) Faculty of Economics and Business Administration, Department of Marketing, Tilburg University, P.O. Box 90153, 5000 LE Tilburg, The Netherlands;(3) Faculty of Economics and Applied Economics, Catholic University Leuven, Naamsestraat 69, 3000 Leuven, Belgium;(4) School of Business and Management, Department of Marketing, Hong Kong University of Science and Technology, Clear Water Bay, Hong Kong, China
Abstract:To counter the negative effects of a product-harm crisis, brands hope to capitalize on their equity, and often use advertising as a communication device to regain customers’ lost trust. We study how consumer characteristics and advertising influence consumers’ first-purchase decisions for two affected brands of peanut butter following a severe Australian product-harm crisis. Both pre-crisis loyalty and familiarity are found to form an important buffer against the product-harm crisis, although this resilience decreases over time. Also heavy users tend to purchase the affected brands sooner, unless their usage rate decreased significantly during the crisis. Brand advertising was found to be effective for the stronger brand, but not for the weaker brand.
Contact Information Kristiaan HelsenEmail:
Keywords:Product-harm crises  Brand equity  Advertising  Multiple-event hazard model
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