Crisis Communication:
Organizations’ response to a crisis and the commitment
effect
Master thesis
Graduate school of Communication
Master track: Persuasive Communication Name: Emina Bričić
Student number: 10000198 Date: 01 February 2017 Supervisor: Hanneke Hendriks
Abstract
In the field of crisis communication there have been a lot of case studies done in order to form guidelines for practitioners in the field. This study aims to go deeper into the
characteristics of good corporate responses, in order to add to that broader body of work. Especially the commitment effect is taken into account. Highly committed consumers supposedly use coping tactics to protect themselves from negative information about a company which they have already invested in. Though hypothesized, no significant effect was found of the moderating effect of commitment on brand attitude and purchase intention. Future research with bigger sample groups is advised to confirm these results.
Introduction
Introduction
Organizations, both large and small, sometimes have to deal with negative news which comes to light about them in the media. These negative situations, also referred to as crises, need to be managed carefully in order to limit the possible losses as much as possible. When Burger King was accused of mixing horse meat into their 100% beef burgers back in 2014, they denied the accusation in the first two weeks (Walker, 2014). After seeing the difficult-to-dispute-evidence, they finally admitted to the crime. Unsurprisingly, their image took a hard hit and consumers’ brand attitude went down (TheHuffingtonPost, 2013). Another recent example of companies being presented negatively in the news is the case of the exploding Samsung Galaxy Note 7 cell phones. After numerous reported incidents, Samsung decided to recall every single Samsung Galaxy Note 7 as of October 13 (Hollister, 2016). Samsung is still unable to explain why the phones caught fire (Walter, 2016), and it is still unclear in what way exactly the brand will suffer from these undesirable incidents. These examples show that crises are inevitable in everyday life and that even big corporations have to deal with them. Some are small and go unnoticed. However, in this time
of social connectivity, where every consumer has a worldwide platform to broadcast events and opinions, it is becoming increasingly difficult to cover up a crisis. It is therefore
important to shed light on which is the best way to handle a corporate crisis. The present study will present an experiment in which different types of reactions to a crisis are given, after which brand attitude is measured.
Some research has already been done with regards to the effect of crises in the public domain of the corporate world. In the study of Dean (2004) corporate reactions were divided into appropriate and inappropriate responses to crises. Appropriate responses are those in which the company gives reasons for why it couldn’t have prevented the situation, and plans to take action to make the situation better. Inappropriate responses are those which do not incorporate these elements. The case of the Burger King is an example of an inappropriate response, because it was in their power to prevent the scandal, and they did not give good reasons for why this happened. Dean (2004) showed that companies which respond appropriately to a crisis situation are regarded higher by consumers than companies which respond inappropriately. Thus, looking at the examples above, one would expect that the public’s brand attitude after the scandal would be much lower for the Burger King than for Samsung.
Besides appropriate and inappropriate responses, there is another factor which
influences the public’s perception of a crisis; the commitment effect. For example, When Bill Clinton was accused of having an affair with Monica Lewinsky in 1998, he first denied everything. After a few months he finally admitted to the crime. Remarkable about this scandal is that it had a different effect on different types of voters. People could be separated in either highly committed voters or lowly committed voters. For the voters who were lowly or not committed to Clinton, the scandal had a devastating effect on their trust in the
protect the image that they held of their president from the negative news that came to them. They focused on his other aspects instead, causing their overall image of Bill Clinton not to be influenced (Ahluwalia, 2000). This study will investigate if commitment is also an important factor for corporate crises.
The current research aims to shed light on whether highly committed consumers are less perceptive to the type of response that a company gives, as can be deducted from the Bill Clinton example. Therefore, it will be investigated what the effect is of the type of response on people’s brand attitude and purchase intention. In addition, people’s commitment to the company will be explored as an important moderator. Now the question is whether
commitment has the same effect for companies. The research question for this study is as follows:
RQ: What effect do different types of corporate responses to a crisis situation have on receivers’ brand attitude and purchase intention who are either highly or lowly committed to the company?
To answer the central question, this research will focus on technological manufacturer Apple. By some it is said that Apple is the most valuable company in the world (Scheidies, 2012). Apple’s strong brand identity makes it a fitting case to star in a research. Virtually everyone in the western world knows the brand, and what’s best is that it has both loyal fans and sceptics (Rose, 2016; Times, 2016). In an experiment this will be beneficial, as they will be easily divided into committed and non-committed users. This research will focus on a fictitious piece of negative news about reported incidents on iPhone 7 defects.
The societal relevance for this research can be found in the effects of companies’ crisis communication. By exploring the different ways of handling a negative situation and the effect that it has on consumers, this study can contribute to building a stronger
learn how to keep their customers satisfied, and from an economical point of view; they can learn which type of responses have an aversive effect. In a recent evaluation of crisis
communication research, it was stressed that research in this field should be of a more normative nature (Schwarz, 2016). This study therefore aims to help provide a framework which could be applied in companies and larger organizations in these situations, contributing to a more efficient process.
Theoretical outline Organizational crises
Unfortunately for organizations and their audience, crises occur when negative information about the organization comes to light. A crisis is defined as a both unexpected and negative event (Coombs, 2007). These negative events can have a diminishing effect on the organization’s reputation, which can both lead to stakeholders pulling out of a company, or consumers not purchasing a product anymore. In order to prevent a reputation from being ruined, organizations must manage the negative situation with care and an eye on the goal they want to accomplish. Moreover, in the case of multiple crises spread over time, it is important to remain trustworthy. The handling of a negative situation in the past can have a tremendous effect on the perception of a crisis in the future. The building of a strong relationship is therefore vital for a good handling of a negative situation. (Rogers & Pearce, 2016). A good image and reputation have shown to act like a buffer in negative situations; the better the reputation, the more willingly consumers are to accept a company’s apology or to regard the company’s response more positively (Wei, OuYang, & Chen, 2017).
A lot of research has been done on the topic of communication and responses after a crisis. Especially the rise of social media usage in crisis communication and management has made it’s way to academic research (Patashnick, 2016). These studies focus on the medium through which the communication is spread, the nature of the responses which are possible,
and which characteristics build up a response. In 2011 Schultz et. al conducted the first experimental study which focused on the role that the type of medium plays in the
communication of responses to negative news. It was found that the medium matters more than the message; the medium through which the response was sent had a larger effect on secondary crisis communication, reactions and reputation than the message itself (Schultz et al., 2011).
Types of responses to a crisis situation
Responses can be categorized in various sets of categories. In 1997 L. Benoit
characterized 5 main categories: denial, evasion of responsibility, reducing the offensiveness of the event, corrective action and mortification (Benoit, 1997). Under corrective action the solving of a problem is understood and under mortification the apologizing for a negative event.
Earlier, Siomkos and Kurzbard (1994) identified four partially overlapping categories of company responses to product harm situations: denial, forced compliance, voluntary compliance and super effort. Denial means that the company denies the existence of a harmful situation, forced compliance refers to the company being forced by the government to take action, voluntary compliance means that the company itself proposes to take actions against the harmful situation and super effort means that the company goes out of its way to make the situation better. Coombs and Halladay (2016) explored the topic as well, and confirmed that giving no response or denying are the least favourable options for an organisation.
Some researchers (Weiner 1986; Coombs 2007) have connected crisis communication to Attribution theory (Weiner, 1986), the framework of attributing blame in the matter of a crisis. Two elements are particularly important in attribution theory; namely the reputation of the company and the characteristics of the person attributing blame. Consumer characteristics
like gender, race and age determine for a large part the perceived severity of a harmful situation, which in turn also influences the attribution of blame (Laufer & Coombs, 2006). Research has shown that well-known brands or brands with a good reputation are less likely to get blame assigned to them than lesser known brands. For well known brands people tend to find other parties to assign the blame to; for instance, the consumers themselves who are said to not be using the product properly (Laczniak et al., 2001). Another study connects Attribution Theory as a logical link to crises, stating that the two characteristics of crises (it being a negative event and coming up unexpectedly) are the same two reasons for people’s need to look for the causes of that event, or the ones who are responsible. If the organisation is deemed responsible, this will have a negative effect on the brand attitude (Coombs, 2007; Weiner, 1986) Attribution theory explains why good crisis communication is so important, and the different types of responses, in all their categories, form the handles from which to approach it.
Characteristics of responses
Deriving from Attribution theory it can be concluded that when a company has acted in a fair way, the negative news of the crisis will have less of a negative influence on one’s brand attitude. Fairness theory (Folger & Cropanzano, 2001) imposes a framework which explains how blame is assigned in a harmful situation. At the basis of this framework lie three components; the Would, Could and the Should component.
The Would component consists of the harmful experienced event and a contrasting counterfactual event which serves as a referent standard where no harm would have been done. The difference between the actual negative and the counterfactual positive event is what matters for the emotional reaction to it. When the difference is relatively small, this means that it is easier to imagine how things would have been better if a small part of the actions which lead to the situation would have been done differently. This also means that
when the difference is small the negative emotional reaction to it is bigger. Missing a bus by one minute for example, upsets people more than missing a bus by five minutes, because it is easier for them to imagine how they would have been on time e.g. if they hadn’t stopped to tie their shoelaces.
The Could component entails the question of could the one who is responsible for a harmful situation have acted differently. So even if a person or company is clearly
responsible for a harmful situation, the could counterfactual refers to all the different viable options that were available at the time of conduct and one’s control over these options. In other words; if one could not have acted differently because there were no other options or one did not have the power over these options, then blame will most probably not be assigned to him.
The Should component is reflected against a counterfactual of morality. Even if all agree that a harmful situation occurred and that the decision maker could have acted differently, the actor might still be proud of what he has done. Should judgments rely on moral ideologies which are usually shared by most people from a certain culture or grouping. If the actions taken do not stroke with one’s moral tenets, that person will be more obliged to assign blame to the actor (Folger & Cropanzano, 2001).
According to Dean (2004), corporate responses which suppress the activation of Could and Should counterfactuals will be regarded more highly by consumers after the response. These type of responses are labelled appropriate responses. Suppressing Could and Should counterfactuals can for example be done by giving reasons as to why the company couldn’t have prohibited the harmful situation (Could) and which steps it’s going to undertake to make the situation better (Should).
Reflecting on the literature which draws a line between Attribution theory and Fairness theory and its components, and seeing their effect on a corporation’s reputation and consumers’ brand attitude, the following hypothesis can be derived:
H1: The type of response (appropriate or not appropriate) has a positive effect on brand attitude and purchase intention; meaning that an appropriate response will lead to higher brand attitude and purchase intention, and vice versa.
Commitment and type of responses
Thus, it can be argued that the reputation factor ties together with the commitment effect on brand attitude, because a brand’s reputation can be considered as a consumer’s perception of that brand which is either positive or negative. It can be assumed that a consumer who has a brand’s reputation in high regard, will have a higher chance of being a committed consumer. In the case study about Bill Clinton, Ahluwalia (2000) discusses three different coping tactics in his text which are found when people are faced with negative information about a political figure they are either committed or not committed to.
Committed voters reduce the impact of the negative information by rating the other attributes of a product higher. In this way their overall opinion about the political figure does not have to change. Low committed users on the other hand, show a spill over effect; the notion that receiving a negative piece of information about one attribute of the political figure, makes them value other attributes dramatically less as well. In difficult to refute information committed voters turn to the weighting of attributes; where the other attributes are valued as more important. When information is easy to refute, voters rely on biased assimilation; refusing a source and turning to other sources which align with one’s opinion. In another study the relation between brand familiarity and the perception of news was studied more closely. Instead of centring around a political figure it centred around brands. It was found that people with a higher brand familiarity were more inclined to weigh the negative news
about a brand less than other aspects which they find important in the brand (Ahluwalia, 2002). These findings make the previous results from the case study about politics applicable to the commercial field. Therefore, the second and third hypothesis can be formulated as such:
H2: Commitment is positively correlated with brand attitude and purchase intention, meaning that a higher commitment level results in higher brand attitude and purchase intention scores.
H2: An inappropriate response to negative news will have a negative effect on brand attitude and purchase intention in lowly committed consumers, but will not have less effect on highly committed consumers.
Brand attitude and purchase intention
To measure if something has had a negative or positive effect for a brand, it’s usual to have the variable Brand Attitude as a measure. A brand is usually invoked to help the
company behind it be profitable, or to help it grow, or in any other way sustain itself. To do this they need the affability of their customers or their audience. It is this affability which can be measured with the variable Brand Attitude. The interest in attitude measuring has been around for 20 years in marketing research (Mitchell & Olson, 2000). Mitchell and Olson define attitude as ‘an individual’s internal evaluation of an object such as a branded product’ (2000).
Previously, attitude has been defined by Fishbein and Ajzen as ‘a function of a person’s salient beliefs at a given point in time’ (1975), in an effort to end the ambiguity around the term. Spears and Singh later elaborate on the definition by stating that attitude towards the brand is ‘a relatively enduring, one-dimensional summary evaluation of the brand that presumably energizes behaviour’ (2004).
Purchase intention with a brand is strongly correlated to the brand attitude. Naturally, when someone thinks highly about a product, his or her intention to buy it will go up as well. Another interesting take on purchase intention as a function of the company’s behaviour or response, is that purchasing a product can be seen as a risky behaviour. It can prove to either have been fruitful, if the product brings a lot of gains, or to have been a loss of investment. If a negative situation occurs around a company and it is being broadcast in the news, like for instance the defective smartphones in this research, and the company responds to it
inappropriately, the company hereby increases the risk in a future investment for a consumer. Prospect theory (Kahneman and Tversky, 1979) describes the evaluation of risky choices and the unequal division between the assessment of losses and gains. It is found that people value a loss far more than a gain of the same amount. The losses and gains are hereby being
compared to a reference point, the status quo. In the example of negative news coming out about a company, the status quo would be considered as the company responding in an ethical, appropriate way. That is why the company needs to make a super effort, as described above, to increase brand attitude and purchase intention in consumers, but might they respond inappropriately, brand attitude and purchase intention will decrease much more easily.
We have already argued that committed users will protect themselves by using coping tactics to reduce the impact of the negative news. As Kahneman and Tversky have proved, people tend to have an aversion of loss. To a committed consumer, accepting that the company or product that they’re committed to is actually unworthy of their commitment would mean a loss of already invested emotions, energy and funds. This could be an explanation of their coping tactics. To an uncommitted user, there is no need to protect oneself from already suffered losses, and therefore they will be more likely to protect themselves from future losses by decreasing their purchase intention.
The present study
Even though crisis communication is a diverse field and every crisis situation is different, several have tried to create frameworks and guides for practitioners which would be applicable to their specific situations. Though standardisation in this field is useful, one should be aware that best practices can be not specific enough, while step-by-step guides can be too restricting to one’s situation (Seeger, 2006). The Situational Crisis Communication Theory (Coombs, 2007) is an aim at one of those frameworks which practitioners can use. It offers a guide in which attention to company history, organizational reputation and
responsibility are all embedded. It tries to move away from case studies, on which research in the crisis communication field had always been based, and moves to more widely applicable literature. In this research the main effect of the type of response on brand attitude and purchase intention will be measured in an attempt at reaching that same goal, but instead of creating another general framework, it aims to zoom in on the response itself, and makes an effort to analyse which building blocks it should consist of.
Methods Participants and design
In the current study a quantitative method was used. By means of a quantitative method it is possible to externalize the results. For this research an online experiment was conducted. The study contains a 2(appropriate or inappropriate response) x2(committed or not committed) between subjects factorial design. The independent variable in the present study is the appropriateness of the message, which stands for the type of responses which Apple can give to fictitious negative news. In this experiment the manipulated negative news will be about defects in the iPhone 7. It says there have been reported incidents from
touchscreen failure also known as ‘touch disease’. De dependant variables are brand attitude and purchase intention; commitment was expected to have a moderating effect.
The participants in this study were recruited via Facebook, friends and family. They received online invitations which were spread through social media. 158 participants
eventually filled out the survey online. 36 participants were omitted from the final data due to an insufficient answering rate. Everybody who answered less than 97% of the questions was left out of the results. Which made the sample group consist of 122 participants. Participants did not receive any course credits or money for their participation. The respondents were mostly (72.1%) Dutch university students of which 36,9% were male and 63.1% were female between 18 and 60 years old (M = 25.00, SD = 8.35). 18.9% had enjoyed a higher vocational education, 1.6% had an intermediate vocational education, and 7.4% was at a high school education level. Finally, there were no outliers found based on age or education level.
Materials & procedure
The experiment was conducted by spreading a link on the internet, which took the participant to the online environment where first the commitment level was measured through a series of 7-point Likert scaled questions. After being assigned to either one of the two groups, the participants were all presented with the same piece of negative news about Apple. It featured a news article about touchscreen malfunctioning in the new iPhone 7, and contained Apple’s response. Before presenting the participants with the news article followed by one of the two responses, Likert scale question were asked to determine if the participants belonged to the committed or the non committed group. Following the responses another set of questions were asked to determine brand attitude and purchase intention scores.
The experimental stimulus. The experimental stimulus consisted of a fictional news article, followed by an official response from Apple. Participants would have a 50% chance of seeing either the appropriate or the inappropriate response. The fictitious news article can be seen in figure 1.
Figure 1. Fictitious news article
Type of response. The appropriate response acknowledged the problem and offered a
free repair program to those who had a phone affected by touch disease. Firstly, by
acknowledging the problem and explaining why it couldn’t have been prevented, the could counterfactuals were suppressed. Secondly, by offering a free repair program the should counterfactual was suppressed as well. The inappropriate response denies the existence of ‘touch disease’, and ascribes it to possible improper handling by the consumer. This response doesn’t suppress any of the counterfactuals. The consumer should still think that the defect is Apple’s fault, that the problem could’ve been prevented by Apple and that they should offer a compensation to affected consumers. Both responses can be seen in figure 2 and figure 3.
Figure 2. Appropriate response
Commitment. The commitment towards Apple was assessed before exposure to the
stimulus by calculating the mean of the responses to 4 statements measured on seven-point scales (“I love Apple as a brand”; “Using Apple products gives me great pleasure”; “I am happy that Apple products are available” and “Apple rarely disappoints me”). The seven-point scales ranged from strongly disagree (1), to strongly agree (7) (M = 4.87, SD = 1.09, α = 0.80). Afterwards it was computed into a dichotomous variable with values below the mean coded into value 0 as non committed to the brand Apple, and values above the mean coded into value 1 as a committed Apple user. 46.7% of the participants was coded into value 0 and 53.3% was coded into value 1.
Brand attitude. The dependent variable brand attitude was measured after exposure
to the stimulus, also by measuring the mean of five statements on seven-point scales. The statements were based on literature in which a validated operationalization of the concept was developed (Spears and Singh 2004). Participants were asked to indicate their feelings about Apple on seven-point scales ranging from Unappealing (1) to Appealing (7); Bad (1) to Good (7); Unpleasant (1) to Pleasant (7); Unfavourable (1) to Favourable (7); and Unlikeable (1) to Likeable (7; M = 4.55, SD = 1.24, α = 0.94).
Purchase intention. The dependent variable purchase intention was also measured
after exposure to the stimulus, by measuring the mean of five statements on seven-point scales. These statements were based on a study in which a standard operationalization for this dependent variable was validated (Spears and Singh 2004). Participants were asked to
indicate their feelings about purchasing Apple products, on seven-point scales ranging from Never (1) to Definitely (7); Definitely do not intend to buy (1) to Definitely intend to buy (7); Very low purchase interest (1) to Very high purchase interest (7); Definitely not buy it (1) to Definitely buy it (7); and Probably not buy it (1) to Probably buy it (7; M = 4.68, SD = 1.40, α = 0.963).
Data analysis
Manipulation check. In the last section of the survey a manipulation check was
incorporated. After exposure to the stimulus the respondents were asked whether they thought the response was either appropriate or inappropriate in a two-option multiple choice question. Value 1 indicated that the respondent perceived the response as appropriate, and value 2 indicated a perceived inappropriate response. Value 3, which gave respondents the freedom to indicate what they thought of the response in words, was recoded where possible into either 1 or 2. The left over values 3 were coded as missing values. A Chi Square test was done to measure whether there was a significant consistency between the appropriateness variable and the perceived appropriateness variable.
Hypothesis 1. To test hypothesis 1, the effect of type of response (independent
variable) on brand attitude and purchase intention (dependent variables) was measured. Because the independent variable is a dichotomous, nominal variable and the dependent variables are numeric, a one-way ANOVA was used.
Hypothesis 2. To test hypothesis 2, the effect of commitment (independent variable)
on brand attitude and purchase intention was measured (dependent variables). Because the independent variable is a dichotomous, nominal variable and the dependent variables are numeric, a one-way ANOVA was conducted.
Hypothesis 3. To test hypothesis 3, the moderating effect of commitment (moderator)
was measured on the main effect of the type of response (independent variable) on brand attitude and purchase intention (dependent variables). In this hypothesis, commitment and type of response are both dichotomous, nominal variables and brand attitude and purchase intention are both numeric. A one-way ANOVA was used with type of response and commitment as the two fixed factors, and brand attitude and purchase intention as the dependent variables.
Results Manipulation check
To test whether the manipulation had been successful, a Chi square test of
independence was calculated comparing the frequency of perceived appropriateness for both appropriate and inappropriate responses. We used an alpha level of .05 for all statistical tests. A significant interaction was found (χ2(1) = 6.836, p = .009), indicating that appropriate responses were significantly more often perceived as appropriate compared to inappropriate responses. The manipulation check was successful.
Hypothesis 1
For the first hypothesis the effect of the type of response on both brand attitude and purchase intention was tested. To test whether the type of response had a significant effect on brand attitude, a one-way ANOVA was conducted with the type of response as the
independent variable and brand attitude as the dependent variable. No significant effect was found, meaning that an appropriate response does not necessarily lead to significantly higher brand attitude scores (F (1) = .091, p = .763).
To test whether the type of response did have a significant effect on purchase intention, a second one-way ANOVA was conducted with the type of response as the independent variable and purchase intention as the dependent variable. Again, no significant effect was found, meaning that the type of response does not lead to higher purchase intention scores (F (1) = .577, p = .449). Taking these results into account, hypothesis 1 can be refuted.
Hypothesis 2
The second hypothesis stated that people with a higher commitment towards a brand would also have higher scores in brand attitude and purchase intention. To test the effect of commitment on brand attitude, a one-way ANOVA was done with commitment taken as the independent variable and brand attitude used as the dependent variable. A significant effect
was found (F (1) = 31.68, p = .00), meaning that respondents who were highly committed to Apple also had significantly higher brand attitude scores.
To test whether commitment would have the same effect on purchase intention, a second one-way ANOVA was conducted with commitment as the independent variable and purchase intention as the dependent one. Another significant effect was found (F (1) = 26.53, p = .00), meaning that respondents who were highly committed to Apple also scored significantly higher on purchase intention.
Hypothesis 3
For the third hypothesis it was tested whether highly committed consumers were less affected by the type of response than non-committed consumers. For this analysis, first a one-way ANOVA was conducted where the type of response functioned as the independent variable, brand attitude functioned as the dependent variable, and commitment functioned as the moderator. No significant interaction effect was found between the three variables (F (1) = .842, p = .461). This means that highly committed users do not appear to be affected differently by the type of response in their brand attitude than non-committed users do. Secondly, the same analysis was done with the type of response as the independent variable, purchase intention as the dependent variable, and commitment as a moderator. Again, no significant interaction effect was found (F (1) = .272, p = .603). This indicates that highly committed consumers were not affected differently from non-committed consumers in their purchase intention.
Discussion
This study’s aim was to find whether the level of commitment from a user towards a certain brand would have a moderating effect on how the company’s response to negative news was formulated and its effect on brand attitude. Specifically, the question was whether the type of response would have less to no impact on the brand attitude of consumers who
were highly committed. Four main findings can be distinguished. First of all, the type of response showed to have no significant effect on brand attitude and purchase intention. Secondly, commitment did show a significant effect on brand attitude and purchase intention. Finally, commitment showed to have no significant moderating effect on the main effect of the type of response on brand attitude and purchase intention.
Findings and implications
The first main finding was that the type of response showed to have no significant effect on brand attitude and purchase intention. This was not in line with our expectation that the appropriate response would lead to higher scores of brand attitude and purchase intention and vice versa. This was also not in line with literature on Fairness theory (Folger &
Cropanzano, 2001) and not in line with literature on appropriate and inappropriate responses (Dean, 2004) which argue that a response suppressing could, would and should
counterfactuals would be considered an appropriate response and therefore incite less assignment of blame. This implicates that the type of response in a crisis situation does not affect the profitability of the brand. Thus, the results would implicate that companies can be economic in their handling of a crisis.
The second main finding was that commitment showed to have a significant effect on both brand attitude and purchase intention. This was in line with our expectation that people who are highly committed to a brand will naturally think higher of it and want to buy it more than people who are not committed. This was also in line with the literature on Prospect Theory (Kahneman and Tversky, 1979), arguing that people have an aversion towards loss, that being committed to a brand can be seen as having invested energy, emotion and time into it, and having a low brand attitude or purchase intention would mean a loss of that
The final finding was that commitment was not found to have a significant moderating effect on brand attitude and purchase intention. This was not in line with the literature on the three different coping tactics found by Ahluwalia (2000) in highly and lowly committed consumers, because highly committed consumers would supposedly reduce the impact of the negative news by rating the other attributes of a product higher, and in literature on Attribution theory (Weiner, 1986), where the reputation factor of a company is taken into regard in the assignment of blame. It is also not in line with the literature on prospect theory, which implicated that people are more inclined to keep buying the same products even though they have a negative experience, because considering that they may have wasted investments would be considered a loss that people feel a natural aversion to. This implicates that negative news about a company which a consumer is highly committed to doesn’t differ in its affection of committed and non-committed consumers.
Limitations
This study has a number of limitations. Firstly, the sample group consisted of 158 participants and was therefore relatively small. Especially after cleaning the dataset not many participants were left. This might threaten the external validity of the experiment. It might also have been a reason for not finding a significant effect in hypothesis 1 and 3. The small sample size therefore makes the internal validity questionable. More research is advised in which a larger sample group is used. Also, the selection of participants could have had an effect on the results. For this study a convenience sample was used, which makes it not representative for the entire population because of the high level of education of the participants. It is possible that people with higher cognitive capabilities such as the higher educated, are differently affected by advertising and news messages, because they process information differently and respond to other cues in a message (Smith, 1996).
A second, internal limitation can be found in the design of the experiment. There was no control over the environment in which respondents processed the news article. Due to possible distractions, they could have not taken in the meaning of the news. A timer was used to ensure that they couldn’t skip it too quickly, but the effectiveness of the timer is up for discussion. Moreover, it is unclear whether the type of product which was used in the experiment (an iPhone 7) had different effects on people who have that type of smartphone and people who do not. The study only focused on one type of company; a technology producer, one type of product; a smartphone, and one type of negative news; a production flaw. It is therefore not generalizable to the broad spectrum of firms and organisations and other types of crises.
Finally, the dependent variables were measured immediately after the respondent read the negative news, while it can be argued that brand attitude and purchase intention are subdue to a so-called sleeper-effect. This means that a message’s effect can grow over time, because with time counterarguments fade but the emotion and the familiarity with the brand which are experienced while processing a message linger (Kumkale & Albarracín, 2004; Park & Lessig, 1981).
Advice for practitioners
Based on the results of this study and its significant effect between commitment, brand attitude and purchase intention, it is recommended for organizations/companies to invest in their relationship with their consumers. The more committed consumers are more inclined to keep buying the products of the brand or company in situation. Moreover, in line with the revised literature it would be advised to emphasize how much the consumer has already invested in the company in the past.
Finally, based on the finding that the level of commitment does not influence how consumers perceive negative news, it can be argued that companies need not take this into
account when giving a response. They do not need to differentiate between their consumers and they can work more efficiently because one size fits all.
Conclusion
This study focused on the ways in which organisations can respond to negative news about them which has been spread through the media. In this study the main question was how the commitment effect in consumers would affect their perception of the type of
response. The possible responses were divided into appropriate and inappropriate responses. Hypothesised was that both the type of response and the commitment level would have a positive correlating effect on brand attitude and purchase intention, and that highly
committed consumers would be less affected by the type of response than the non-committed consumers; meaning that an inappropriate response would have less of a negative effect on a highly committed consumer than on a non-committed consumer. Surprisingly, a significant effect was found only in the effect of commitment on brand attitude and purchase intention. Deriving from the results in this study, one could argue that there is no difference in the perception of the response in either committed or non-committed consumers. Therefore, it would not be necessary to target and adapt the response to subsets of consumers. The aim of this study was to make the process of crisis management more efficient and to add to the existent literature of advice and step-by-step guides. Nevertheless, future research is advised on this topic which can be more broadly applied to a wider spectrum of crises and
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