Call In Responsiveness to Product Recalls

In January 2007, Consumer Reports published a report announcing a serious safety problem with certain infant car seats. Understandably, consumer demand for the car seats promptly cratered. Adding to the evidence of the power of the notice is that when, two weeks later, Consumer Reports announced that the earlier report was in error, demand quickly rebounded.
     Researchers at Freie Universität Berlin, University of Connecticut, and Stockholm School of Economics note that this sort of responsiveness is often not seen when it comes to product recalls. Owners of the affected items are frighteningly unwilling to take corrective action. As a result, there are increased risks of physical damage to consumers and of lawsuits against marketers. The researchers analyze the reasons for failures to act and then identify tactics for increasing consumer responsiveness to product recalls.
     People are more likely to respond when less effort is required of them and when they believe themselves capable of taking the corrective action. Thus, full remedy—offering the owner product replacement or refund of the purchase price—works better than partial remedy—offering a do-it-yourself repair kit, for instance.
     Beliefs about the probability of damage also count. But with both the nature of the offered remedy and perceived probability of damage, there’s an interaction with firm reputation, defined as the extent to which the consumer considers the marketer issuing the recall to be trustworthy. For low-reputation firms, there’s little difference in effectiveness between full- and partial-remedy offers. And for low-reputation firms, perceptions of high damage likelihood actually make it less likely the consumer will respond to the recall offer. Customers don’t trust low-reputation firms to correct the product defect in those circumstances.
     For the marketer, the upshot, then, is to maintain a reputation of trustworthiness and, if a recall is necessary, portray the maximum extent of the possibility of danger and offer the consumer a remedy which requires minimum consumer effort. In the researchers’ field study, recall effectiveness climbed twenty-four percentage points when a high-reputation firm offered a full instead of partial remedy, all else being equal.
     Results from other studies indicate it’s better to describe to the consumer the possibility of damage rather than the probability of damage if the problem which led to product recall isn’t corrected. Also, limit the descriptions of possible damage to only the most serious. Including minor concerns leads to lower estimates by the consumer of total risk.

Successfully influence the most prosperous & most loyal consumer age group. For the specific strategies & tactics you need, click here.

Click for more…

Keep Up On Your Promises 

Maintain Store Distinctiveness in Ad Groups 

Betray the Betrayal Effect 

Add Risk Notices to Dilute Risk Opinion 

Estimate Imprecisely When Harboring Doubts