Skip to main content
SpringerLink
Log in

Brand trust and avoidance following brand crisis: A quasi-experiment on the effect of franchisor statements

  • Original Article
  • Published:
Journal of Brand Management Aims and scope Submit manuscript

Abstract

Although franchising has become an important growth strategy in several industries over the last few decades, there are few empirical studies about the effects of franchisor communication strategy on customer responses in the context of franchise brand crisis. Two quasi-experimental studies were conducted to test the effect of a franchisor ownership separation statement on brand trust and brand avoidance following a brand crisis situation. Results show that a franchisor’s explicit communication of the franchise brand’s individual ownership business structure is useful in preventing further negative spillover effect throughout the franchised chain when the brand crisis occurs at a single franchise location. The authors also investigate the mechanism through which such communication influences customer behavior and the moderating effect of the brand crisis severity in affecting brand evaluation. These results offer guidance to franchise brand managers by providing insight into how to overcome a franchise brand crisis and by suggesting franchise context-specific managerial recommendations.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Figure 1
Figure 2
Figure 3

Similar content being viewed by others

References

  • Ahluwalia, R., Unnava, H.R. and Burnkrant, R.E. (2001) The moderating role of commitment on the spillover effect of marketing communications. Journal of Marketing Research 38(4): 458–470.

    Article  Google Scholar 

  • Allen, M.W. and Caillouet, R.H. (1994) Legitimation endeavors: Impression management strategies used by an organization in crisis. Communications Monographs 61(1): 44–62.

    Article  Google Scholar 

  • An, S.K. and Gower, K.K. (2009) How do the news media frame crises? A content analysis of crisis news coverage. Public Relations Review 35(2): 107–112.

    Article  Google Scholar 

  • An, S.K., Gower, K.K. and Cho, S.H. (2011) Level of crisis responsibility and crisis response strategies of the media. Journal of Communication Management 15(1): 70–83.

    Article  Google Scholar 

  • Anderson, N.H. (2014). Contributions to Information Integration Theory: Vol. 1: Cognition. New York: Psychology Press.

  • Antia, K.D., Zheng, X. and Frazier, G.L. (2013) Conflict management and outcomes in franchise relationships: The role of regulation. Journal of Marketing Research 50(5): 577–589.

    Article  Google Scholar 

  • Auh, S. (2005) The effects of soft and hard service attributes on loyalty: The mediating role of trust. Journal of Services Marketing 19(2): 80–92.

    Article  Google Scholar 

  • Aurier, P. and N’Goala, G. (2010) The differing and mediating roles of trust and relationship commitment in service relationship maintenance and development. Journal of the Academy of Marketing Science 38(3): 303–325.

    Article  Google Scholar 

  • Aycan, Z. (2006). Paternalism. In: U. Kim, K.-S. Yang and K.-K. Hwang (eds.) Indigenous and Cultural Psychology. New York: Springer, pp. 445–466.

    Chapter  Google Scholar 

  • Beomjoon, C. and Suna, L. (2013) The impact of corporate social responsibility (csr) and customer trust on the restoration of loyalty after service failure and recovery. Journal of Services Marketing 27(3): 223–233.

    Article  Google Scholar 

  • Bloom, B.V. (2009) Crisis management: What’s your strategy? Franchising World 41(1): 55–57.

    Google Scholar 

  • Boo, H.C., Mattila, A.S. and Tan, C.Y. (2013) Effectiveness of recovery actions on deviant customer behavior – The moderating role of gender. International Journal of Hospitality Management 35: 180–192.

    Article  Google Scholar 

  • Brady, M.K., Voorhees, C.M. and Brusco, M.J. (2012) Service sweethearting: Its antecedents and customer consequences. Journal of Marketing 76(2): 81–98.

    Article  Google Scholar 

  • Brookes, M., Alinay, L. and Aktas, G. (2015) Opportunistic behaviour in hospitality franchise agreements. International Journal of Hospitality Management 46: 120–129.

    Article  Google Scholar 

  • Carrillat, F.A., d’Astous, A. and Lazure, J. (2013) For better, for worse?: What to do when celebrity endorsements go bad. Journal of Advertising Research 53(1): 15–30.

    Article  Google Scholar 

  • Casidy, R. and Shin, H. (2015) The effects of harm directions and service recovery strategies on customer forgiveness and negative word-of-mouth intentions. Journal of Retailing and Consumer Services 27(1): 103–112.

    Article  Google Scholar 

  • Charmley, R., Garry, T. and Ballantine, P.W. (2013) The inauthentic other: Social comparison theory and brand avoidance within consumer sub-cultures. Journal of Brand Management 20(6): 458–472.

    Article  Google Scholar 

  • Chaudhuri, A. and Holbrook, M.B. (2001) The chain of effects from brand trust and brand affect to brand performance: The role of brand loyalty. Journal of Marketing 65(2): 81–93.

    Article  Google Scholar 

  • Clark, P. (2014a). Data breach at jimmy john’s could damage franchisees. Bloomberg Businessweek, 29 April, http://www.businessweek.com/articles/2014-09-26/data-breach-at-jimmy-johns-could-damage-franchisees, accessed 10 January 2016.

  • Clark, P. (2014b). Unions team up with fast-food owners. Bloomberg Businessweek, 18 August, http://www.businessweek.com/articles/2014-08-08/labor-unions-team-up-with-fast-food-owners-on-fair-franchising-law, accessed 10 January 2016.

  • Cleeren, K., Van Heerde, H.J. and Dekimpe, M.G. (2013) Rising from the ashes: How brands and categories can overcome product-harm crises. Journal of Marketing 77(2): 58–77.

    Article  Google Scholar 

  • Coombs, W.T. (2006) The protective powers of crisis response strategies: Managing reputational assets during a crisis. Journal of Promotion Management 12(3/4): 241–260.

    Article  Google Scholar 

  • Coombs, W.T. and Schmidt, L. (2000) An empirical analysis of image restoration: Texaco’s racism crisis. Journal of Public Relations Research 12(2): 163–178.

    Article  Google Scholar 

  • Dant, R.P. (2008) A futuristic research agenda for the field of franchising. Journal of Small Business Management 46(1): 91–98.

    Article  Google Scholar 

  • Dant, R.P., Grünhagen, M. and Windsperger, J. (2011) Franchising research frontiers for the twenty-first century. Journal of Retailing 87(3): 253–268.

    Article  Google Scholar 

  • Dant, R.P. and Nasr, N.I. (1998) Control techniques and upward flow of information in franchising in distant markets. Journal of Business Venturing 13(1): 3–28.

    Article  Google Scholar 

  • Dawar, N. and Lei, J. (2009) Brand crises: The roles of brand familiarity and crisis relevance in determining the impact on brand evaluations. Journal of Business Research 62(4): 509–516.

    Article  Google Scholar 

  • Dawar, N. and Pillutla, M.M. (2000) Impact of product-harm crises on brand equity: The moderating role of consumer expectations. Journal of Marketing Research 37(2): 215–226.

    Article  Google Scholar 

  • Delgado-Ballester, E. and Munuera-Alemán, J.L. (2005) Does brand trust matter to brand equity? Journal of Product and Brand Management 14(3): 187–196.

    Article  Google Scholar 

  • Dutta, S. and Pullig, C. (2011) Effectiveness of corporate responses to brand crises: The role of crisis type and response strategies. Journal of Business Research 64(12): 1281–1287.

    Article  Google Scholar 

  • Egbert, N., Miraldi, L.B. and Murniadi, K. (2014) Friends don't let friends suffer from depression: How threat, efficacy, knowledge, and empathy relate to college students'; intentions to intervene on behalf of a depressed friend. Journal of Health Communication 19(4): 460–477.

    Article  Google Scholar 

  • Escalas, J.E. and Stern, B.B. (2003) Sympathy and empathy: Emotional responses to advertising dramas. Journal of Consumer Research 29(4): 566–578.

    Article  Google Scholar 

  • Fornell, C. and Larcker, D.F. (1981) Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research 18(1): 39–50.

    Article  Google Scholar 

  • Frazer, L., Weaven, S., Giddings, J. and Grace, D. (2012) What went wrong? Franchisors and franchisees disclose the causes of conflict in franchising. Qualitative Market Research: An International Journal 15(1): 87–103.

    Article  Google Scholar 

  • Gauzente, C. (2003) Measuring franchisees’ satisfaction: Theoretical considerations and empirical testing. International Journal of Retail and Distribution Management 31(10): 508–517.

    Article  Google Scholar 

  • Gensler, S., Völckner, F., Liu-Thompkins, Y. and Wiertz, C. (2013) Managing brands in the social media environment. Journal of Interactive Marketing 27(4): 242–256.

    Article  Google Scholar 

  • Gillison, S.T., Northington, W.M. and Beatty, S.E. (2014) Understanding customer bargaining in retail stores: A customer perspective. Journal of Marketing Theory and Practice 22(2): 151–168.

    Article  Google Scholar 

  • Godes, D., Mayzlin, D., Chen, Y., Das, S., Dellarocas, C., Pfeiffer, B., Libai, B., Sen, S., Shi, M. and Verlegh, P. (2005) The firm’s management of social interactions. Marketing Letters 16(3/4): 415–428.

    Google Scholar 

  • Gorn, G.J., Yuwei, J. and Johar, G.V. (2008) Babyfaces, trait inferences, and company evaluations in a public relations crisis. Journal of Consumer Research 35(1): 36–49.

    Article  Google Scholar 

  • Grégoire, Y. and Fisher, R.J. (2008) Customer betrayal and retaliation: When your best customers become your worst enemies. Journal of the Academy of Marketing Science 36(2): 247–261.

    Article  Google Scholar 

  • Grégoire, Y., Tripp, T.M. and Legoux, R. (2009) When customer love turns into lasting hate: The effects of relationship strength and time on customer revenge and avoidance. Journal of Marketing 73(6): 18–32.

    Article  Google Scholar 

  • Grewal, D., Hardesty, D.M. and Iyer, G.R. (2004) The effects of buyer identification and purchase timing on consumers’ perceptions of trust, price fairness, and repurchase intentions. Journal of Interactive Marketing 18(4): 87–100.

    Article  Google Scholar 

  • Gummerus, J., Liljander, V., Pura, M. and Van Riel, A. (2004) Customer loyalty to content-based web sites: The case of an online health-care service. Journal of Services Marketing 18(3): 175–186.

    Article  Google Scholar 

  • Hampes, W.P. (2010) The relation between humor styles and empathy. Europe’s Journal of Psychology 6(3): 34–45.

    Google Scholar 

  • Hodge, C., Oppewal, H. and Terawatanavong, C. (2013) Determinants of franchise conversion: A franchisee perspective. European Journal of Marketing 47(10): 1554–1575.

    Article  Google Scholar 

  • Hoffman, M. L. (2001). Empathy and Moral Development: Implications for Caring and Justice. Cambridge: Cambridge University Press.

    Google Scholar 

  • Jayachandran, S., Kaufman, P., Kumar, V. and Hewett, K. (2013) Brand licensing: What drives royalty rates? Journal of Marketing 77(5): 108–122.

    Article  Google Scholar 

  • Jeon, H.J., Dant, R.P. and Gleiberman, A.M. (2014) National versus local brands: Examining the influences of credence and experience services on customer perceptions of quality in a franchise context. European Journal of Marketing 48(7/8): 1511–1535.

    Article  Google Scholar 

  • John, D.R., Loken, B. and Joiner, C. (1998) The negative impact of extensions: Can flagship products be diluted? Journal of Marketing 62(1): 19–32.

    Article  Google Scholar 

  • Krishen, A.S., Raschke, R., Kachroo, P., LaTour, M. and Verma, P. (2014) Promote me or protect us? The framing of policy for collective good. European Journal of Marketing 48(3/4): 742–760.

  • Lafontaine, F. and Shaw, K.L. (2005) Targeting managerial control: Evidence from franchising. RAND Journal of Economics 36(1): 131–150.

    Google Scholar 

  • Lee, E., Hu, M.Y. and Toh, R.S. (2000) Are consumer survey results distorted? Systematic impact of behavioral frequency and duration on survey response errors. Journal of Marketing Research 37(1): 125–133.

    Article  Google Scholar 

  • Lee, J. S., Pan, S. and Tsai, H. (2013) Examining perceived betrayal, desire for revenge and avoidance, and the moderating effect of relational benefits. International Journal of Hospitality Management 32: 80–90.

    Article  Google Scholar 

  • Lee, M.S., Motion, J. and Conroy, D. (2009) Anti-consumption and brand avoidance. Journal of Business Research 62(2): 169–180.

    Article  Google Scholar 

  • Lei, J., Dawar, N. and Lemmink, J. (2008) Negative spillover in brand portfolios: Exploring the antecedents of asymmetric effects. Journal of Marketing 72(3): 111–123.

    Article  Google Scholar 

  • Leslie, T.W. and McNeill, L.S. (2010) Towards a conceptual model for franchise perceptual equity. Journal of Brand Management 18(1): 21–33.

    Article  Google Scholar 

  • Mattila, A.S. (2001) The effectiveness of service recovery in a multi-industry setting. Journal of Services Marketing 15(7): 583–596.

    Article  Google Scholar 

  • Matzler, K., Grabner-Kräuter, S. and Bidmon, S. (2008) Risk aversion and brand loyalty: The mediating role of brand trust and brand affect. Journal of Product and Brand Management 17(3): 154–162.

    Article  Google Scholar 

  • Maxham, J.G. and Netemeyer, R.G. (2002) A longitudinal study of complaining customers’ evaluations of multiple service failures and recovery efforts. Journal of Marketing 66(4): 57–71.

    Article  Google Scholar 

  • Michael, S.C. (1999) Do franchised chains advertise enough? Journal of Retailing 75(4): 461–478.

    Article  Google Scholar 

  • Neff, K.D. and Pommier, E. (2013) The relationship between self-compassion and other-focused concern among college undergraduates, community adults, and practicing meditators. Self and Identity 12(2): 160–176.

    Article  Google Scholar 

  • Nunnally, J.C. and Bernstein, I. H. (1994). Psychometric Theory. New York: McGraw-Hill.

    Google Scholar 

  • Nyadzayo, M.W., Matanda, M.J. and Ewing, M.T. (2011) Brand relationships and brand equity in franchising. Industrial Marketing Management 40(7): 1103–1115.

    Google Scholar 

  • Paciello, M., Fida, R., Cerniglia, L., Tramontano, C. and Cole, E. (2013) High cost helping scenario: The role of empathy, prosocial reasoning and moral disengagement on helping behavior. Personality and Individual Differences 55(1): 3–7.

    Article  Google Scholar 

  • Pauwels-Delassus, V. and Descotes, R.M. (2013) Brand name change: Can trust and loyalty be transferred, and quest. Journal of Brand Management 20(8): 656–669.

    Article  Google Scholar 

  • Peterson, R.A. (1994) A meta-analysis of cronbach’s coefficient alpha. Journal of Consumer Research 21(2): 381–391.

    Article  Google Scholar 

  • Pitt, L., Napoli, J. and Van Der Merwe, R. (2003) Managing the franchised brand: The franchisees’ perspective. The Journal of Brand Management 10(6): 411–420.

    Article  Google Scholar 

  • Preacher, K.J. and Hayes, A.F. (2008) Asymptotic and resampling strategies for assessing and comparing indirect effects in multiple mediator models. Behavior research methods 40(3): 879–891.

    Article  Google Scholar 

  • Qureshi, I., Fang, Y., Ramsey, E., McCole, P., Ibbotson, P. and Compeau, D. (2009) Understanding online customer repurchasing intention and the mediating role of trust – an empirical investigation in two developed countries. European Journal of Information Systems 18(3): 205–222.

    Article  Google Scholar 

  • Rindell, A., Strandvik, T. and Wilén, K. (2014) Ethical consumers’ brand avoidance. Journal of Product and Brand Management 23(2): 114–120.

    Article  Google Scholar 

  • Rodriguez, M., Wilder, D.A., Therrien, K., Wine, B., Miranti, R., Daratany, K., Salume, G., Baranovsky, G. and Rodriguez, M. (2006) Use of the performance diagnostic checklist to select an intervention designed to increase the offering of promotional stamps at two sites of a restaurant franchise. Journal of Organizational Behavior Management 25(3): 17–35.

    Article  Google Scholar 

  • Roehm, M.L. and Tybout, A.M. (2006) When will a brand scandal spill over, and how should competitors respond? Journal of Marketing Research 43(3): 366–373.

    Article  Google Scholar 

  • Sanderson, R. (1995) Supporting your franchisees with publicity will pay off for the whole system. Franchise Recruiters Newsletter 6(1): 1–4.

    Google Scholar 

  • Scoot, J.F.A. (1995) Franchising vs. Company ownership as a decision variable of the firm. Review of Industrial Organization 10(1): 69–81.

    Article  Google Scholar 

  • Semetko, H.A. and Valkenburg, P.M. (2000) Framing european politics: A content analysis of press and television news. Journal of Communication 50(2): 93–109.

    Article  Google Scholar 

  • Seo, S., Jang, S.S., Almanza, B., Miao, L. and Behnke, C. (2014) The negative spillover effect of food crises on restaurant firms: Did Jack in the Box really recover from an E. coli scare? International Journal of Hospitality Management 39: 107–121.

    Article  Google Scholar 

  • Simon, F. (2013) The influence of empathy in complaint handling: Evidence of gratitudinal and transactional routes to loyalty. Journal of Retailing and Consumer Services 20(6): 599–608.

    Article  Google Scholar 

  • Simonin, B.L. and Ruth, J.A. (1998) Is a company known by the company it keeps? Assessing the spillover effects of brand alliances on consumer brand attitudes. Journal of Marketing Research 35(1): 30–42.

    Article  Google Scholar 

  • Smith, A.K. and Bolton, R.N. (1998) An experimental investigation of customer reactions to service failure and recovery encounters paradox or peril? Journal of Service Research 1(1): 65–81.

    Article  Google Scholar 

  • So, K.K.F., King, C., Sparks, B.A. and Wang, Y. (2013) The influence of customer brand identification on hotel brand evaluation and loyalty development. International Journal of Hospitality Management 34: 31–41.

    Article  Google Scholar 

  • Sobehart, J.R. (2014) Rumour has it: Modelling credibility, reputation and franchise risk. Journal of Risk Management in Financial Institutions 7(2): 161–173.

    Google Scholar 

  • Tax, S.S., Brown, S.W. and Chandrashekaran, M. (1998) Customer evaluations of service complaint experiences: Implications for relationship marketing. Journal of Marketing 62(2): 60–76.

    Article  Google Scholar 

  • Tojib, D. and Khajehzadeh, S. (2014) The role of meta-perceptions in customer complaining behavior. European Journal of Marketing 48(7/8): 1536–1556.

    Article  Google Scholar 

  • Ulmer, R.R. and Sellnow, T.L. (2000) Consistent questions of ambiguity in organizational crisis communication: Jack in the Box as a case study. Journal of Business Ethics 25(2): 143–155.

    Article  Google Scholar 

  • United States Census Bureau (2010). 2007 Economic census franchise statistics. United States Census Bureau: https://www.census.gov/newsroom/releases/archives/economic_census/cb10-141.html?cssp=SERP, accessed 10 December 2015.

  • Veil, S.R., Sellnow, T.L. and Petrun, E.L. (2012) Hoaxes and the paradoxical challenges of restoring legitimacy Dominos’ response to its YouTube crisis. Management Communication Quarterly 26(2): 322–345.

    Article  Google Scholar 

  • Vlachos, P.A., Tsamakos, A., Vrechopoulos, A.P. and Avramidis, P.K. (2009) Corporate social responsibility: Attributions, loyalty, and the mediating role of trust. Journal of the Academy of Marketing Science 37(2): 170–180.

    Article  Google Scholar 

  • Watson, A. and Johnson, R. (2010) Managing the franchisor–franchisee relationship: A relationship marketing perspective. Journal of Marketing Channels 17(1): 51–68.

    Article  Google Scholar 

  • Welp, L.R. and Brown, C.M. (2014) Self-compassion, empathy, and helping intentions. The Journal of Positive Psychology 9(1): 54–65.

    Article  Google Scholar 

  • Weun, S., Beatty, S.E. and Jones, M.A. (2004) The impact of service failure severity on service recovery evaluations and post-recovery relationships. Journal of Services Marketing 18(2): 133–146.

    Article  Google Scholar 

  • Williams, K.D. (2008) Ostracism: Effects of being ignored and excluded. In: M.P. Zanna (ed.) Advances in Experimental Social Psychology: Vol. 41. New York: Academic Press, pp. 275–314.

    Google Scholar 

  • Xiong, G. and Bharadwaj, S. (2013) Asymmetric roles of advertising and marketing capability in financial returns to news: Turning bad into good and good into great. Journal of Marketing Research 50(6): 706–724.

    Article  Google Scholar 

  • Zachary, M., McKenny, A., Short, J., Davis, K. and Wu, D. (2011) Franchise branding: An organizational identity perspective. Journal of the Academy of Marketing Science 39(4): 629–645.

    Article  Google Scholar 

  • Zavyalova, A., Pfarrer, M.D., Reger, R.K. and Shapiro, D.L. (2012) Managing the message: The effects of firm actions and industry spillovers on media coverage following wrongdoing. Academy of Management Journal 55(5): 1079–1101.

    Article  Google Scholar 

  • Zboja, J.J. and Voorhees, C.M. (2006) The impact of brand trust and satisfaction on retailer repurchase intentions. Journal of Services Marketing 20(6): 381–390.

    Article  Google Scholar 

  • Zhang, Z., Ye, Q., Law, R. and Li, Y. (2010) The impact of e-word-of-mouth on the online popularity of restaurants: A comparison of consumer reviews and editor reviews. International Journal of Hospitality Management 29(4): 694–700.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Marketing, College of Business Administration, Georgia Southern University, P.O. Box 8154, Statesboro, GA, 30460, USA

    Hyunju Shin

  2. Department of Marketing, Deakin Business School, Deakin University, Geelong, VIC, Australia

    Riza Casidy

  3. Department of Marketing, Korea University Business School, Korea University, 145 Anam-ro, Seongbuk-gu, Seoul, Korea

    Alyssa Yoon

  4. Design for User Experience with Technology Research Lab, College of Human Ecology, Cornell University, 120 Human Ecology Building, Ithaca, NY, 14853, USA

    So-Hyang Yoon

Authors
  1. Hyunju Shin
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Riza Casidy
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Alyssa Yoon
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. So-Hyang Yoon
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Riza Casidy.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Shin, H., Casidy, R., Yoon, A. et al. Brand trust and avoidance following brand crisis: A quasi-experiment on the effect of franchisor statements. J Brand Manag 23, 1–23 (2016). https://doi.org/10.1057/s41262-016-0011-7

Download citation

  • Revised:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1057/s41262-016-0011-7

Keywords

Search

Navigation