Consumers’ Recognition and Response towards Product Harm Crises: A Case Study of Sri Lankan Young Consumers
Journal Title: Saudi Journal of Business and Management Studies - Year 2017, Vol 2, Issue 12
Abstract
Abstract:Product harm crises are devastating events in companies. They negatively effect on organizations and society. Present study was an attempt to investigate how consumers recognize such crisis situation and their repurchasing behavior. Ninety of undergraduates of the Faculty of Agriculture, University of Ruhuna were selected for the study by stratified random sampling technique. Yoghurt was taken as the main product category. A self-administrated, case-study based, seven point Likert scale survey questionnaire was employed to collect relevant data for the study. Data analysis was monitored by SPSS and descriptive analytical tools. Results showed that 62% of the respondents identified product harm crisis as a company fault, while 48.3% of sample identified it as a brand fault. Moreover, 36.67% of them recognized it as a consumer fault. In addition, 56.7% of the respondents were not going to repurchase the crisis brand and, 47.7% of the sample was not willing to pay for the crisis brand in future. However, 35% of the respondents were mentioned that the past brand performance is important when re-purchasing the brand after a crisis situation and, 40.03% of the sample stated that such crises will not negatively impact on the brand trust that they have been already built. Furthermore, 46.67% of the sample expected a compensation for the experienced crisis, while 32.2% of them demanding recompense more than the price of yoghurt. The study suggested the best strategy is to avoid product-harm crises by implementing very careful business processes with sufficient checks and balances without harming the consumers. Moreover, as consumers willing to have compensation for the crisis, and the majority mentioned that the company is accused for the crises, compensating aggrieved parties is the most appropriate remedy for such situations. Keywords:Brand trust, brand performance, brand fault, company culpability, product harm crisis, repurchasing behavior.
Authors and Affiliations
H. M. P. M. Dayarathne, G. C. Samaraweera
Keywords
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