While dealing with a recall crisis companies should

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While dealing with a recall crisis, companies should be communicating with large televisionmedia outlets. However, there is also the social media aspect that companies will now have toensure to address when situations like this arise. Unfortunately, avoiding social media responsescan cause a greater negative impact on a company’s brand reputation via this perverse haloeffect.Companies Create the Halo EffectCompanies have a large responsibility in creating and/or influencing the halo effectwithin their consumer base and the public. Halo effect is not just a psychology behavior, but itcan also be useful tool that can help the company to increase market share. A more notableexample of this strategy is how Apple created a positive halo effect by the efficient launch oftheir Apple Ipod. From this one successful product, Apple was able to gain significant marketshare and also increase popularity in the minds of consumers. Apple has been able to organicallycreate a positive halo effect and use its positive brand image to its advantage. Currently, Applehas been able to survive in the market with little to no advertisement.Even when it comes to loyalty programs, the halo effect can also leave a mark. AbrahamPizam lays out a compelling argument regarding the link between loyalty programs and the haloeffect. Pizam (2015, p.167) states that in his opinion, “hotel loyalty programs failed because ofthe two main reasons as follows: (1) the “halo effect” of airline and cruise lines loyalty programsand (2) the proliferation of loyalty programs both within the hotel industry as well as outside it”.Based on several of his personal experiences with airline and cruise loyalty programs, he8
THE HALO EFFECT: A LITERATURE REVIEWestablished a negative view of all loyalty programs. Companies have the choice and power tosteer the consumer perception and in turn create a halo effect. Whether positive or negative,companies can create this halo effect through employee behavior and corporate socialresponsibility as well.Employee morale and behavior.Internal factors can directly or indirectly contribute tothe halo effect within a company. Employees can be key to the customer interaction and can bethe cause of a positive or negative halo effect. Within their early research, Grove and Kerr (1951,p. 170) establish that employee morale and satisfaction impact the level of service that they willeventually provide to the customers. Job security is also a large factor within their research thatalso affects the customer experience.Through the process of selective halo effect, Dagger et. al. (2013, p. 488) claim thatcustomers can develop perceptions from their interaction with frontline employees. The authorsstate that “under a selective halo effect, the customer’s evaluation of the frontline employeeinterpersonal skills should have a halo effect on attributes that are difficult to evaluate, such asthe expertise of medical personnel” (p. 497). Therefore, the process of establishing a proper

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Term
Spring
Professor
RErickson
Tags
Brand, A Literature Review

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