Corporate Responses to the Coronavirus Crisis and their Impact on Electronic‐Word‐of‐Mouth and Trust Recovery: Evidence from Social Media

Abstract

This study examines how corporate responses to service failure, caused by the coronavirus (COVID-19) crisis, influence electronic-word-of-mouth (E-WoM) and trust recovery around lockdown, using multiple data sources. A dataset of 398 valid COVID-19 announcements from 50 UK food retailers posted on the social media platform Twitter, and 21,960 consumer comments associated with these announcements, are analysed using content analysis and social media analytics, respectively. In Study 1, we test the effects of corporate crisis response strategy (defensive vs. offensive) and response framing (emotional vs. rational) on consumer E-WoM (measured as 'consumer sentiment'). The results reveal that using a defensive corporate response strategy with emotionally framed announcements leads to more positive consumer E-WoM. In Study 2, we advance the findings of Study 1 using a vignette-based experimental design to examine how social media announcements made by food retailing brands influence consumers' trust recovery. We find that consumer trust recovers significantly when corporate COVID-19 responses are framed in an emotional manner. By drawing upon signalling theory, this study makes an important contribution to public health crisis communication and service failure literature by demystifying consumers' reactions towards corporate crisis responses amid a pandemic.

Eliciting positive emotion through strategic responses to COVID-19 crisis: Evidence from the tourism sector

“…As a result, we provide novel findings, compared to the findings of prior research (e.g., Novelli et al, 2018 ), suggesting that when formulating tourism crisis response, tourism practitioners should consider a shift in emphasis away from a response strategy per se towards focusing on linguistic cues and response framing. This is evident by a recent study undertaken by Wang et al (2021) where it was found that consumer trustworthiness could significantly recover when firms frame their COVID-19 related tweets in an emotional way, regardless of what response strategy is used.…”

“…Signalling theory provides the grounds to explain the various types of existing signals and the situations in which they are used ( Filieri, Raguseo, & Vitari, 2021 ; Spence, 2002 ). This theory has been frequently used to study relationship recovery ( Kharouf et al, 2020 ) organisational communication to customers ( Wang et al, 2021 ), and to assess product quality signals in eWOM research ( Filieri, Raguseo, & Vitari, 2021 ). In our study, signalling theory is applied to explain how tourism organisations (as signallers) utilize COVID-19 responses (as signals) posted on social media during the global pandemic crisis (as a signalling environment) to communicate with a wide range of consumers (as receivers).…”

“…In order to satisfy customer's expectations, a cohesive crisis response strategy, as well as an appreciation of linguistic cues, is essential. Furthermore, consumers expressing positive emotions can be used as a surrogate measure for managers to measure the success of crisis management ( Argenti, 2020 ; Rocklage & Fazio, 2020 ; Wang et al, 2021 ). Consumers often express their emotions during a major crisis at their loved destination to demonstrate their support, closeness and to help its recovery ( Filieri, Yen, & Yu, 2021 ).…”

“…In this study, consumer emotion is the primary outcome variable for two reasons. First , based on research on crisis management ( Argenti, 2020 ; Wang et al, 2021 ), it is more likely that companies who are able to engage their customers on social media will survive during a crisis and remain competitive afterward ( Yuan et al, 2020 ). Thus, it is crucial to understand consumer reaction to firms' crisis responses in times of crisis.…”

COVID‐19 Pandemic: The Interplay Between Firm Disruption and Managerial Attention Focus

“…Wang et al . ( 2021 ) stress the importance of action in response to the COVID‐19 crisis, examining the relationship between firm communication (signals), consumer response and impact on trust recovery. In a conceptual paper, Hitt et al .…”