The Effectiveness of Corporate Response to Brand Crises: The Crisis Response Strategies, and Customer-based Brand Equity
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Brand crises produce negative impact on brand reputations, and how to respond to the brand crises plays a critical role in the restoration of brand equity. The two herbal tea producers, Guangzhou Pharmaceutical Holdings Limited (GZPH Ltd.) and Jia Duo Bao Group (JDB Group) face the brand crisis in which each claims of legally holding the Wang Lao Ji (WLJ) brand. Finally the JDB Group had to change their year-long building WLJ brand into the new brand JDB which is the same as its corporation name. The purpose of this paper has twofold: (1) is to take the WLJ brand crisis as an example to investigate the differences in crisis response strategies (CRSs) in state-owned and private corporations in Chinese context, based on Situational Crisis Communication Theory (SCCT); (2) to compare the efficacy of three crisis response strategies in brand awareness and brand association, and identify the linkage of customer-based brand equity (CBBE) between old and new brands in the same products. The findings will provide insights into how crisis response activities may be controlled to generate and manage CBBE.
Crisis Response Strategies (CRSs), Situational Crisis Communication Theory (SCCT), Brand Crisis, Customer-based brand equity (CBBE)