Brand Involvement in Retaining Customers despite Dissatisfaction

By Shiue, Yih-Chearng; Li, Lisa Shih-Hua | Social Behavior and Personality: an international journal, May 2013 | Go to article overview

Brand Involvement in Retaining Customers despite Dissatisfaction


Shiue, Yih-Chearng, Li, Lisa Shih-Hua, Social Behavior and Personality: an international journal


Especially on the Internet, consumers' dissatisfaction spreads rapidly and broadly ("virally") by word-of-mouth (WOM). The online consumer review, one type of electronic WOM (eWOM), involves positive or negative statements made by consumers about products sold in virtual shopping malls on the Internet (Park & Lee, 2008). This type of consumer-created information supports later consumers' decision-making about purchases by providing them with indirect experiences (Park, Lee, & Han, 2007). Park et al. found that the number of consumer comments on a product forum could represent the product's popularity. Several positive consumer reviews may allow potential consumers to rationalize their desire to purchase the product as it gives the impression that many others have bought it and been satisfied (Chiang & Hsieh, 2011). In contrast, the more negative comments that are posted, the more potential consumers that are lost.

Many businesses attentively create and maintain their brand to attract more consumers and earn greater benefits. A positive purchase experience tends to elicit a positive emotional response and enhance customer perceptions of the brand's reliability (Song, Hur, & Kim, 2012). When customers are satisfied with a brand, they develop emotional ties to it, and this brand affect leads to greater commitment in the form of attitudinal loyalty (Chaudhuri & Holbrook, 2001). However, dissatisfaction, complaints, undesirable rumors, or any related negative information could adversely affect a business. When dissatisfaction is sufficiently serious, consumers tend to complain, regardless of other factors in the situation (Richins, 1983). The more consumers are dissatisfied, the more they are inclined to switch brands, complain, and discuss their dissatisfaction with others (Zeelenberg & Pieters, 2004).

Lativ, an online-only popular casual clothing company in Taiwan, opened their e-commerce platform in 2005. Focusing on natural material, simple design, and comfort, Lativ provides high-quality, low-priced products. Saving Taiwan's textile and apparel industry through its "Made in Taiwan" (MIT) designation is the company's mission. With great diligence and effort, Lativ grew from its 2007 revenue of TWD$10 million (USD$343 thousand) to TWD$4 billion (USD$137 million) in 2011. However, as early as 2010, Lativ had secretly switched the manufacturing of certain product lines to Vietnam, Indonesia, and China. Several consumers observed this fact, questioned Lativ, and spread negative WOM. Lativ tried to maintain their brand promise by explaining that meeting the demand for high quality and low prices had become increasingly difficult in Taiwan's textile and apparel industry because the need to expand manufacturing capacity, the aging labor force, quality control difficulties, and competition from other brands prevented it from remaining strictly MIT (Lativ, 2012). Their consumers rejected these excuses. Meanwhile, Taiwanese television news channels exposed this information and a great deal of negative reviews ensued from netizens (users of the Internet), including several famous bloggers (e.g., Jimmy, 2012; Randbb, 2012). They were sufficiently angry to launch an event to reject Lativ for cheating and betraying people who believed its "Made in Taiwan" slogan and its supposed mission to save Taiwan's textile and apparel industry.

This case revealed several interesting phenomena. Lativ made a serious mistake in betraying its brand promise, but its consumers continued returning to the e-commerce website, even after considering rejection. As has been indicated in previous studies, attitude is theoretically related to actual behavior (Fishbein & Ajzen, 1975; Miniard & Cohen, 1983; Warshaw, 1980). In the present study we investigated customers' reasons for staying despite negative circumstances.

We also explored the role of brand involvement in repatronage by investigating the following questions:

1) How does brand involvement relate to each kind of dissatisfied consumers' responses? …

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