Alleviating Negative Spillover of a Brand-Harm Crisis: Sensegiving vs. Sensehiding in a Competitor’s Denial Response Strategy

A brand-harm crisis not only affects the scandalized brand, but may also influence competing brands. Thus, marketers of competing brands need to develop response strategies for reducing negative spillover effects. This research takes a competitor’s perspective and introduces two types of response strategies used to convey a sense of denial: sensegiving and sensehiding. It also investigates how the effects of response strategies are contingent upon brand relatedness and individual thinking styles. The results from three experimental studies show that using a sensegiving strategy reduces negative spillover effects more than using a sensehiding strategy. Additionally, the studies suggest that the observed difference in the effects of response strategy tends to be greater when the level of brand relatedness is high than when it is low. However, individual thinking styles (holistic vs. analytic) seem to have little impact on consumers’ responses to the two denial strategies. This research contributes to the brand-harm crisis literature and provides novel insights into a competitor’s response to potential negative spillover effects.