Negative Publicity And Branding: Lessons From Uber And Phantom Brands

Negative Publicity: WOM Marketing Communication and Coping Strategies

Discuss about the Regarding Growth And Decline Of Manufacturer.

Negative publicity as a concept was unfamiliar until I studied MKTG 3307.WOM is a public relation strategy of marketing communication that entails the written recommendations by customers on the services provided by an organization. Throughout the lectures, tutorials and other required materials for MKTG 3307, I learned that WOM marketing communication is when the interest of the customers on the company’s activities are shown in their commutations every day. It is initiated by various publicity activities set by the company like peer-to-peer influencer programs, buzz, viral and social media marketing (Yu, Duan, and Cao, 2013, pg.922). from my group presentation looked at several cases of negative effects of WOM marketing communication including the news on Disney gator attack, Uber credit card scandal and the cricket Australia ball-tampering scandal. I realized that understanding how deal with negative publicity is key to my future career of becoming a successful entrepreneur.

From various explanations in the case study and lecture tutorials, I can say that there are various method that Uber could have used to mitigate this challenges of negative publicity posed by the news warning customers over unrealistic credit card charges. Consequently, they choose to use diminishment by communicating to the public in an attempt to reduce the perception of the company’s responsibility for the crime (Ahluwalia Burnkrant, and Unnava, 2013, pg.210). In order distance the company from the crisis, they instead blamed the rideshare provider for stealing customer’s passwords. My perceived good strategy was rebuilding the policies and operation tactics so as to save the reputation of the company and avoid losing customers to Ola. I also learned that Uber established an all-day telephone hotline and an online blog for customers to air the complaints. Therefore, Uber denied the organization’s intent to steal from the customers and hence gave guarantees to the dissatisfied customers.

As per my point of view, our group’s main arguments of coping with the problem relied on two theories; diminishment and rebuilding. However, according to me, the best coping strategies is denial. Therefore I felt that the company would have denied NWOM by the company official while seeking to build back trust with the unpleased customers. They could also remind customers of any another stakeholder of how trustworthy the business has been in the recent past (Williams and Buttle, 2013, pg.304). if such I situation arise in my organization, I would appeal to the public that we are also a victim and are working very hard to get the people behind the crisis. In addition, our professor felt that the presentation didn’t explain in details how most of the theories can be relevantly applied to the case study. Therefore, I would recommend that our presentation emphasize more on the explanations of the methods that Uber could have used to.

Uber’s Coping Strategy: Diminishment vs. Rebuilding

However, the presentation adequately handled the methods of coping with negative WOM and the crisis management. Since my goal is to be a successful entrepreneur in future, this lectures helped me to identify how important public relations is to any organization. I  also learned the methods of different types of the marketing process and advertising from influencer marketing to corporate advertising. as a future marketer, I can deduce that even though public relation strategies are necessary for marketing sometimes they may impact negatively on the company’s operations. Moreover based on our group’s research, lecture notes and tutorials, I have appreciated the influence of issue management like involving the external parties through the media as a better method of reducing the negative effects of public relations disaster. Finally, the presentation covered the crisis development plan using the four theories of crisis mitigation: denial, diminishment, rebuilding and bolstering.

In this course and presentation, I have learned the importance of branding for every business. before this course, I associated branding with McDonalds’ marketing strategies. Systematically, branding is the act of creating a unique name, term symbol, design and image in the consumers’ mind mainly through advertising campaigns with a consistent theme(Maurya and Mishra, 2012, pg.123). as I read through branding articles, some important issues stand out to me like the idea that branding works to increase customer’s value. For example, when Starbucks puts a logo on their products there is apperception by its customers that it’s a premium brand. However, most supermarkets and other private retailers have adopted the phantom brand’s system of marketing in the recent past. Phantom brands are private-label brands that are positioned as premium brands by one company to be offered by another company Pepe, Abratt and Dion 2012, pg.159). Currently, it is difficult to identify the products of retailers due to the secret labels with no logo related to the retailers. Private branding has been on the rise among retailers like Woolworths, Coles, and k-mart.in Australia for example, Woolworth’s essentials like Baxter’s dog food or Coles’s fussy cat pet food have dominated the supermarket shelves. In my opinion, Phantom branding provides the consumers with a product which has national outlook at a fair price.

Based on the lectures and the presentation I realized that selling of manufacturer’s brand is beneficial to a retailer because if the manufacturer is well known the brand it will help attract customers giving the retailers easy time to market the goods. Also, national brands command higher prices in the market that store brands (Goaill, Perumal, and Noor, 2014, pg.140). It’s established that heavy advertisement by manufacturers makes customers to be hooked to certain products thus leading to the loyalty of customers like myself who value the attributes of the product or service from the ads. Therefore, outlets carrying the brand will demand more of it while other outlets also get attracted. Also, manufacturers provide frequent delivery allowing the dealers to stock less inventory.

Private-label Brands/Phantom Brands: Advantages and Disadvantages

On the one hand, private brands are very effective because wholesalers and retailers can increase sales on brands that are not from very famous manufacturers thus earning profits. For example, when I see any product with the apple logo, I associate it with an innovative and powerful company. Also due to lack of total control on the distribution patterns and intensity of the manufacturers, dealers get an exclusive right to sell their phantom brands (Cuneo, Milberg, Benavente, and Palacios-Fenech, 2015, pg.79). It also gives the wholesalers and retailers the right to charge a premium or attract customers by providing additional items. Private brands increase the loyalty of the customers as it ties them to the retailer or wholesaler as customers are made to feel that like they are buying a national brand at a fair price.

One of the main arguments from the presentation was that effective positioning, targeting, and market segmentation is very important in marketing. Also, I learned that effective communication to the target audience is necessary to conduct perceptual mapping (Maurya, and Mishra, 2012, pg.128). Consequently, the repositioning of products entails consistency on the part of the retailers, simplicity and distinctiveness and the ability to deliver when the products are required. In my view, phantom brands do not allow consumers to make informed choices since they can’t see the name of the manufacturer (Maurya, and Mishra, 2012, pg.131). Due to this reason, it is considered deceptive thus it’s difficult to convince the customers of value perceptions.

References

Ahluwalia, R., Burnkrant, R.E., and Unnava, H.R., 2013. Consumer response to negative publicity: The moderating role of commitment. Journal of marketing research, 37(2), pp.203-214.

Chang, H.H., and Wu, L.H., 2014. An examination of negative e-WOM adoption: Brand commitment as a moderator. Decision Support Systems, 59, pp.206-218.

Cuneo, A., Milberg, S.J., Benavente, J.M. and Palacios-Fenech, J., 2015. The growth of private label brands: a worldwide phenomenon? Journal of International Marketing, 23(1), pp.72-90.

The goal, M.M., Perumal, S. and Noor, N.A.M., 2014. The impact of retailer’s economic and social satisfaction on its commitment, and the moderating effect of manufacturer brands’ strength. Asian Social Science, 10(8), p.140.

Maurya, U.K., and Mishra, P., 2012. What is a brand? A Perspective on Brand Meaning. European Journal of Business and Management, 4(3), pp.122-133.

Pepe, M.S., Abratt, R. and Dion, P., 2012. Competitive advantage, private-label brands, and category profitability. Journal of Marketing Management, 28(1-2), pp.154-172.

Romaniuk, J., Dawes, J., and Nenycz-Thiel, M., 2014. Generalizations regarding the growth and decline of manufacturer and store brands. Journal of Retailing and Consumer Services, 21(5), pp.725-734.

Williams, M. and Buttle, F., 2013. Managing word-of-mouth: a nonprofit case study. Journal of Nonprofit & public sector marketing, 25(3), pp.284-308.

Yu, Y., Duan, W. and Cao, Q., 2013. The impact of social and conventional media on firm equity value: A sentiment analysis approach. Decision Support Systems, 55(4), pp.919-926.