The number of product recalls has considerably increased during the last decade resulting in escalating costs for the public and companies likewise. Companies are confronted not only with severe consequences of their short-term performance (e.g. sales) but also of long-term marketing metrics such as brand image, consumers’ attitude and perceived quality. In addition previous research showed that product recalls do decrease the financial performance of a company as well as the long time market position of a company.
In addition managers have to be aware that beside these outcome variables other important marketing instruments get affected by a product harm crisis. Previous research on a peanut butter crisis in the Australian market identified a tremendous decrease of marketing effectiveness for recalling companies, that affects as well cross-related products of the same producer or brand. In addition the recalling brands became more vulnerable for any marketing efforts executed by competitors.
To deliver more insight into how companies can overcome such crises without having to fear to risk the future of the recalling company and its stakeholders, our research attempts to gain more knowledge about how to best communicate a product recall.
Therefore we executed several studies on product recall communication. In my 2010 published study (that can be found here), Sönke Albers and me content analyze a sample of more than 250 recall messages. We identify six different general dimensions of product recall messages like different degrees of message transparency, product return convenience or stated social responsibility of the recalling company. In addition we find up to 6 different characteristics for each dimension. Companies rely on these different dimensions and adapt them according to the scenario specific circumnstances (like e.g. the degree of hazard or the overall hazard probability). With the help of a SUR-model we analyze different recall communication strategies and identiy several patterns.
Based on these dimensions we conducted three other studies, focusing on the impact of the different recall communication strategies on brand metrics, the reaction of media partners and at last the final reaction of the consumer.
Detailed descirptions for each study can be found on the specific micro-sites.
In case of requests, please do not hesitate to contact me at any time.