The Contingent Effects of Firm Response Tactics on Firm Legitimacy During a Secondary Boycott

Abstract

Firms are unable to address the issues behind secondary boycotts, unlike with primary boycotts. In a secondary boycott scenario, firms have a choice of tactics to mitigate the negative effects on firm revenue: distraction, where firms introduce new information to divert consumer attention away from the issue, and persuasive refutation, where firms directly address the issue. This paper argues that a tactic’s effectiveness is based on the salience of the boycott to consumers and the amount of exposure that consumers have to the boycott. The results indicate that when boycott issue salience is high, distractor tactics produce higher revenue, but when repeated exposure is high, persuasive refutation tactics achieve higher revenue. When both issue salience and repeated exposure are high, distractor tactics produce higher revenue.