Using Advertising and Price to Mitigate Losses in a Product-harm Crisis Harvard Case Solution & Analysis

 

Product-damage catastrophes are typical in the current marketplace and are anticipated to happen with escalating frequency as products become increasingly complicated, product-security legislation evolves, and consistently-demanding customers continue to press for much more. A product-harm crisis lead to expensive recalls can cause serious revenue losses, and destroy brand equity that is nurtured.

Despite these tremendous stakes, marketing managers are often not prepared to react suitably to product-harm crises. Managers frequently raise advertising support or decline price in the wake of a product-harm crisis in an effort to regain lost consumers. Adversaries in the same category may additionally foster marketing expenditures or lower their costs to enjoy the misfortune of the affected brand(s). This article provides insights regarding the effectiveness of these strategies in the aftermath of a product-harm crisis. The extant literature has indicated that the effectiveness of these strategies depends mainly on the features of the crisis and the role of the brand in the disaster--affected or not--.

PUBLICATION DATE: March 15, 2015 PRODUCT #: BH657-HCB-ENG

Using Advertising and Price to Mitigate Losses in a Product-harm Crisis Case Study Solution

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