Over the long term, corporations spend a great deal on promotional activities enhancing
their image and reputation (Hooghiemstra 2000). The marketing environment, over the last
few decades, has grown much more fast-paced and complicated. Communication strategies,
too, are becoming diverse yet integrated. Corporate communication today includes public
relations, corporate advertising, sponsorship, social responsibility activities, and so forth.
Marketers and marketing scholars have recently been paying closer attention to these
practices. Since each of the corporate communication strategies is coordinated, the whole
endeavor systematically affects the long-term corporate image/reputation.
As seen with the Toyota recall crisis last year, a single corporate crisis can quickly mar a
once sterling image, precipitating the collapse of a corporation’s long-cherished reputation.
Hence, crisis communication is critical to a corporation’s long-term success. In recent
years, crisis communication and its effectiveness have been given due attention by
academic scholars and practitioners. However, a large body of research has leaned toward a
macro approach, presenting crisis communication as a part of the whole crisis management.
Also, not a few studies approached the topic mainly from a public relations perspective.
This paper, therefore, attempts to explore the effectiveness of crisis communication from
another perspective by taking a micro approach that focuses on the effect of corporate
advertising in a corporate crisis.
*Email: sojungkim@mail.utexas.edu
Literature review
Corporate advertising
Corporations sell themselves through corporate, or institutional, advertising (Duffy 1951).
During the early 1970s, institutional advertising that focused on ‘goodwill’ was generally
called corporate image advertising. Such advertising was defined by its goal to alter or
improve public attitude toward a corporation (Pashupati, Arpan, and Nikolaev 2002).
Therefore, this kind of advertising often centered on ‘good citizenship’ or ‘social
responsibility.’ It in turn led to issue or advocacy advertising. In such advertising, a
corporation expressed political, social, or economic ideas or it elicited public support for
its views or stands (Schumann, Hathcote, and West 1991; Pashupati, Arpan, and Nikolaev
2002). After this type of ad enjoyed a period of popularity, corporate advertising began
leaning toward ‘hybrid’ or ‘umbrella’ ads. These ads promoted products and services as
well as the corporation itself. Since the 1980s and the emergence of a pro-business
environment, we have seen frequent sales-related corporate advertising (Public Relations
Journal 1988).
Financial and special opportunity messages are the two generally known categories of
corporate advertising. A study by Schumann, Hathcote, and West (1991) made a
comprehensive review of the literature of corporate advertising in America. Interestingly,
it added two categories to the two listed above – corporate image and issue/advocacy
advertising. Advertising focusing on financial investment has a relatively specific
objective and target (e.g. potential investors). On the other hand, a special opportunity
message refers to advertising that presents special statements to the public. According to
the researchers’ analysis, special opportunity messages have mainly been used to respond
to negative corporate events – denouncing rumors, financial problems, labor union
boycotts, and so forth. They are deployed to overcome negative publicity and raise
attitudes toward a corporation.
Journal of Marketing Communications 295
Theoretical framework
While advertising in a corporate crisis is a fairly common strategy, there has been little
research, aside from some case studies cited above, conducted on how consumers respond
to corporate advertising in a crisis situation. The rest of this paper, therefore, focuses on
how corporate advertising during a crisis can be interrelated with pre-crisis corporate
advertising. The paper will also show how four types of external impacts on a crisis
situation – the crisis, the corporation, the media, and individual differences – will affect
296 S. Kim
Crisis
Perception of ad credibility
Perception of corporation trustworthiness
Attitude toward the ad
Attitude toward the corporation
the credibility of the attacker. According to their findings, the type of defense was the most
important factor. All defense types – refutational-same self-disclosure (e.g. an ad message
specifically counters specific points addressed in the upcoming attack), refutational-
different self-disclosure (e.g. an ad message counters points different from the ones in the
upcoming attack), and supportive ad message (e.g. ad messages absent of negative
information and only positive statements were found to be more effective than those
offering no defense). Furthermore, the results show refutational-same message as superior,
followed by supportive and refutational-different. Similarly, Easley, Bearden, and Teel
(1995) also found that, in terms of inhibiting belief change in the presence of an attack, a
refutational-same defense was more effective than either a refutational-different defense
or no defense at all. The refutational-different defense, however, was found to bear little
significant difference from offering no defense. This finding suggests that if advertisers
know beforehand of an upcoming attack, they can benefit most by deploying in advance a
refutational-same self-disclosure ad.
In reality, however, corporations can seldom predict what sort of negative press they
will be forced to defend themselves against. It seems impossible to develop refutational-
same messages prior to some future crises. As described above, some researchers
found that a supportive message prevented an erosion of existing favorable attitudes
toward a corporation (Easley, Bearden, and Teel 1995). This finding is more evidence
supporting the idea that corporate advertising can prevent changes in consumer attitude
caused by negative information. This is because typical corporate advertising –
corporate image ads or issue/advocacy ads – generally contains a supportive defense of
the corporation.
If corporate advertising fails to address a weak form of the coming attack (e.g. self-
disclosure statements regarding the coming attack), yet still serves as a supportive defense
by preventing the erosion of positive attitudes toward a corporation, inoculation theory
may explain such effects. Burgoon, Pfau, and Birk (1995) examined the inoculation effect
of issue/advocacy corporate advertising that could prevent attitude slippage from being
exposed to the subsequent attack. They confirmed the ability of inoculation theory to
explain such effects by showing that issue/advocacy corporate advertising campaigns
inoculate against attitude change by counterargument.
Therefore, in the current study, the author investigates further the ability of corporate
advertising, in general, to protect against erosion of existing attitudes that may follow a
future corporate crisis. It seems logical to suggest that corporate advertising has, on
consumers, an inoculation effect against future negative information involving a
corporation. The following proposition is thus proposed:
P1: Exposure to pre-crisis corporate advertising will, in a corporate crisis, bolster
consumer resistance to negative news about a corporation.
Reactance theory deals with how people react to denied or threatened freedom.
Freedom, here, is defined as people’s specific attitudinal and behavioral rights to choose
their own options. People react when their freedom or free will is threatened or eliminated
by a social influence or barrier. In so reacting, people bring pressure for change (Clee and
Wicklund 1980). That is, freedom and a threat to that freedom are antecedents for
reactance arousal. In addition, reactance is proportional to the importance of the freedom
threatened (Brehm 1966; Clee and Wicklund 1980).
In a marketing context, researchers have observed reactance theory at work in
consumers’ responses to the following: sales representatives (Wicklund, Slattum, and
Solomon 1970; Reizenstein 1971), advertisements (Robertson and Rossiter 1974; Koslow
2000; Edwards, Li, and Lee 2002), product availability (Brehm 1966; Mazis, Settle, and
Leslie 1973; West 1975), pricing (Wicklund 1970), and still others. Studies on consumer
reactance to salespeople and advertising provide rationales to support this paper’s
argument. Consumers reject sales representatives or advertisements that employ explicit
persuasive tactics. Clee and Wicklund (1980) call this the ‘boomerang effect.’
The literature on reactance theory asserts that, to be effective, corporate advertising in
a crisis must reduce consumer reactance, which as noted is often aroused by explicit
persuasive tactics. Consumer reactance may also be aroused by post-crisis corporate
advertisements. Supposing, just after a crisis occurs, consumers are flooded with negative
news about a corporation. If the corporation hits the airwaves with an ad, consumers are
likely to perceive it as calculating and not entirely honest. They may rather doubt the
image the ad tries to project (Pashupati, Atpan, and Nikolaev 2002). Thus, when a
corporation bombards consumers with ads intended to clamp down and secure positive
perceptions (or to ward off negative ones), consumers might feel that their freedom to form
their own judgments is being threatened. Consumers want the freedom to change their
attitudes about a corporation. Such freedom, however, may appear to be threatened by ads
that draw a positive image of the corporation. Such ads, in short, may be counter-
productive. The opportune time for a corporation to run ads may not necessarily be during
or immediately after a corporate crisis.
The Persuasion Knowledge Model (Friestad and Wright 1994), drawn from reactance
theory, provides an additional theoretical foundation to explain consumer resistance toward
corporate advertising during a crisis. The Persuasion Knowledge Model predicts that when
consumers are exposed to an agent’s (advertiser, corporation) persuasion attempt, they are
likely to fall back on their knowledge of persuasion: persuasive knowledge, topic
knowledge, and agent knowledge. This latter type, agent knowledge, refers to one’s general
knowledge of or schemas about marketing agents. Along with the two former types, it is a
critical factor in determining how consumers respond to marketing efforts (e.g. corporate
advertising during a crisis).
In the context of a corporate crisis, when consumers are exposed to corporate
advertising, they may use what they know about the corporation to determine the sincerity
of its message. This implies that if consumers are bombarded with negative news about a
corporation in a crisis situation, they may start to feel negatively toward the corporation.
Their reaction may be mediated by their consumer memory, which in turn may influence
how they evaluate a persuasive message. Hence, if pre-crisis corporate advertising has
built up their resistance to negative news, when faced with corporate advertising during a
crisis, they are more likely to maintain positive perceptions about the corporation. This
logic, therefore, leads to the following:
Journal of Marketing Communications 299
affects behavioral intentions. The findings imply that, assuming they hold some degree of
reactance toward corporate crisis communications (corporate advertising), consumers’
resistance may be influenced by the type of crisis. In turn, consumer resistance will be less
when a crisis is unintentional. From a review of the literature, the following is postulated:
P3: An accidental crisis will lead to less consumer resistance toward corporate
advertising in a crisis than will a transgression crisis.
. Impact of corporation
Another critical factor in crisis communication is the corporate response strategy
(Dutta and Pullig 2011; Ahluwalia, Burnkrant, and Unnava 2000; Dawar and Pillutla
2000; Coombs 1998, 1999). The type of corporate response strategy has been identified
namely based on two important dimensions: (1) the degree of explanation about the crisis,
and (2) whether the response strategy assures the prevention of the crisis. Past studies have
used response strategies categorized in various ways: for instance, denial, reduction-of-
offensiveness, and corrective action (Dutta and Pullig 2011); counterargumentation and
diagnosticity response (Ahluwalia, Burnkrant, and Unnava 2000); attack the accuser,
denial, excuse, justification, ingratiation, corrective action, and full apology (Coombs
1998); and unambiguous stonewalling, ambiguous response, and unambiguous support
(Dawar and Pillutla 2000). What strategy is most effective? A common finding suggests
that assuming responsibility (i.e. full apology or unambiguous support) is more effective
than denying responsibility (i.e. simple denial or unambiguous stonewalling). If a
corporation, through its ads, gives the consumer the impression that it is avoiding
responsibility or not explaining the crisis, its messages will be not just unpersuasive but
damaging. Therefore, the following proposition is postulated:
P4: Assumption of responsibility will lead to less consumer resistance to corporate
advertising in a crisis than will avoidance of responsibility.
Crisis management literature suggests that corporate reputation affects consumer
perception of an ongoing crisis. Siomkos and Kurzbard (1994) found that when a crisis
involved a reputable and well-known company, consumers perceived the degree of danger
associated with it as relatively small. Mowen (1980) also showed that corporate reputation
influences consumer response to product recalls; a familiar company was blamed less for a
product defect than was an unfamiliar company. Similarly, Mowen, Jolly, and Nickell
(1981) showed that consumers perceived a product defect differently depending on a
corporation’s reputation. Such a different consumer perception due to corporate reputation
ultimately may affect consumer resistance to corporate communication activities (such as
corporate advertising) dealing with a crisis. This review of the literature leads to:
P5: A more reputable corporation will, in a crisis, encounter less consumer resistance
to corporate advertising than will a less reputable corporation.
. Impact of media
The media impacts a corporate crisis. Depending on how the media deals with it, a
crisis can remain a small incident or be turned into a severe crisis (Keown-McMullan
1997). In a crisis, the media is, after all, the main influence on public opinion. Hence, it can
either mar the organizational image by impacting public opinion with negative press or
Journal of Marketing Communications 301
influence, during a crisis, consumer resistance toward corporate advertising. The following
is thus postulated:
P8: Individuals who had more favorable attitudes toward a corporation before a crisis
will have less resistance toward corporate advertising in a crisis than will those
who had less favorable attitudes toward the corporation.
The intensity or severity of a crisis can be perceived differently depending on an
individual’s proximity or connection to the company dealing with the crisis. Suppose, for
example, that a corporation faces a product defect. Who feels a connection to this news?
Owners of the product might feel a connection and become involved in following news
of the company’s handling of it. Non-owners might care little about the corporation’s
crisis. When people are more involved in a crisis, they are more likely to search for
information regarding the crisis. Consequently they are more likely to perceive the crisis
as severe. The relationship between crisis involvement and other consumer behavior (e.g.
news media consumption, perception of a crisis) explains the potential for negative
effects on ad-related consumer behaviors. That is, it is assumed that highly involved
consumers may feel stronger resistance to a corporation’s persuasion than less involved
consumers.
P9: Individuals who are less involved in a corporate crisis will have less resistance
toward corporate advertising in a crisis than will those who are more involved in a
corporate crisis.
Notes on contributor
Sojung Kim (M.A.) is a doctoral candidate in the Department of Advertising and Public Relations at
The University of Texas at Austin. She received her M.A. in advertising from Michigan State
University. Her research interests include corporate communication, corporate credibility, and
consumer psychology in a computer-mediated environment. Her work has been published in
Journal of Internet Commerce and Journal of Social Science Research and a number of conference
proceedings.
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