Shifting standards in consumer evaluations of global and local brands after product-harm crises

Abstract

Building on shifting standards theory from social psychology, the authors suggest global versus local branding as an important categorization that affects consumers' reactions to product-harm crises in emerging markets. Specifically, the distinct associations attached to global and local brands create shifting standards and lead to differential consumer expectations and evaluations. In four main and two supplementary experiments, the authors demonstrate that consumers from emerging markets react more negatively toward a product-harm crisis by global (vs. local) brands. Higher initial expectations for global brands are the underlying cause of this more pronounced consumer response to failures. The authors demonstrate which specific expectations are driven by the shifting standards around global and local brands and identify product category as a relevant boundary condition. Finally, consumers with high ethnocentrism appreciate it directionally more when a local brand provides compensation after a product-harm crisis than when a global brand provides compensation. The results have important implications for brand management and crisis management strategies.