Product Recalls and the Moderating Role of Brand Commitment

• Main Authors: Germann, Frank, Grewal, Rajdeep, SRIVASTAVA, Rajendra Kumar
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2014
• Subjects: Brand commitment; Product recall; Corporate crises; Experiment; Event study; Marketing
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/4124
• Institution: Singapore Management University

We assess attenuating and augmenting effects of brand commitment on consumer responses when product recalls occur. Consistent with our theorization, results from a laboratory experiment and an event study show that high levels of brand commitment attenuate negative consumer responses in low-severity product recalls but augment them in high-severity product recalls. Thus, while brand commitment seems to provide a reservoir of goodwill in the former case, it acts as a liability in the latter. These findings add to the extant brand and product recall literature by demonstrating that brand commitment has a complex effect on consumer responses when product recalls occur. Because product recalls are widespread, these findings also have managerial relevance.