Brand Lovers and Brand Haters: Product-Harm Crises as Antecedent of Brand Dispersion

This study examines the influence of recalls on the degree of polarization among consumers into brand haters and brand lovers. Analyses multi-industry product recalls in 2008-2011 together with daily customer brand evaluations show that brand dispersion increases in the days after the recall. Furthermore, the study finds that the portion of brand haters increases in the days after a product-harm crisis and that in situations where the average evaluation does not suffer, dispersion increases more. The increasing heterogeneity poses a threat to firms because the more inconsistent the brand image among customers, the more it reduces a firm’s brand equity.