300. IJRM. Layoff Announcements & Brand Strength.
February 1, 2024
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Today’s episode features Samuel Stäbler, an assistant professor of marketing at Tilburg University in the Netherlands, and Alexander Edeling, an associate professor of marketing at KU Leuven in Belgium. They've investigated the effects of layoff announcements on consumer brand perception. Together they discuss the multifaceted relationship between layoffs, brand perception, and corporate communication strategies. By understanding the nuances of consumer behavior and the role of communication in shaping brand perception, companies can navigate layoffs more effectively while safeguarding their brand reputation in the long run.
Topics discussed include:
Layoffs vs. Brand Crises: Layoffs differ significantly from product failures or service outages typically associated with brand crises. While product harm crises directly impact consumers, layoffs primarily affect employees without a direct tangible impact on consumers' utility. Additionally, unlike other crises that require spontaneous reactions, companies control when and how to communicate layoffs, which can influence consumer perceptions.
Short-Termism vs. Long-Term Impact: Prior research on layoffs mainly focused on short-term financial performance. Layoffs are often perceived as triumphs of short-term cost-cutting but may have negative long-term consequences for brand strength.
Communication Strategies: Layoffs negatively impact brand strength in both the short and long term. However, the nature of communication during and after layoffs can mitigate or exacerbate these effects.
Communications that help & those that harm: Corporate Social Responsibility (CSR) initiatives can help alleviate the negative impact of layoffs by signaling that the company values social responsibility and contributes positively to society. High advertising expenditures during layoffs can worsen consumer perceptions. Consumers may perceive excessive advertising as contradictory to cost-cutting measures and react negatively.
Recovery Time and Brand Protection: The duration and magnitude of the negative impact of layoffs on brand strength vary across firms. Strong brands are more resilient to the negative effects of layoffs, while small companies may suffer more severely.
Importance of Marketing: Marketing should play a role in layoff decision-making processes. Top executives should involve marketing professionals in strategic decisions to mitigate negative consumer perceptions and protect the brand's long-term health.
Click here for the Research Article
The Up Next podcast’s access to this content is courtesy of the International Journal of Research in Marketing, an international, double-blind peer-reviewed journal for marketing academics and practitioners. IJRM aims to contribute to the marketing discipline by providing high-quality, original research which advances marketing knowledge and techniques. As marketers increasingly draw on diverse and sophisticated methods, IJRM‘s target audience is comprised of marketing scholars, practitioners (e.g., marketing research and consulting professionals) and policymakers.
IJRM aims to be at the forefront of the marketing field with a particular emphasis on bringing timely ideas to market. The journal embraces innovative research with the potential to spur future research and influence practice. Hence, it welcomes contributions in various aspects of marketing. The editors, while accepting a wide array of scholarly contributions from different disciplinary approaches, especially encourage research that is novel, visionary or path breaking.
Samuel Stäbler has been an Assistant Professor of Marketing at Tilburg University since December 2018. Samuel’s research approaches are empirical and quantitative, involving large databases and advanced statistical analyses. For recent research results, he has been awarded with numerous prestigious international awards such as the 2021 AMA Best Conference Paper Award in Marketing Strategy, the 2020 Best Conference Paper from the Atlantic Marketing Association, the 2020 SMA Best Paper in Marketing strategy, 2019 GAMMA Doctoral Dissertation Award, the 2014 Young Researchers' Award from the Federal Association of German Marketing and Social Researchers and the 2014 Max Weber prize for Business Ethics from the Institute of German Economy.
Samuel’s work has been published in the Journal of Marketing, International Journal of Research in Marketing, Marketing Letters and Journal of Advertising Research. His research projects are featured in a wide range of international news media outlets (e.g., the Times, Harvard Business Manager, and alike). Samuel Stäbler has also given presentations to companies and at academic conferences all over the world. For example, he has already been giving workshops and lectures for Siemens, YouGov, and Google. Additionally, Samuel disseminates research results to a general audience through a marketing audio podcast format. Through 5-minute audio clips, he educates and explains students, business managers, and other interested listeners research output in an easy, understandable and exciting manner. He also makes contributions to the academic and practitioner world by organizing conferences. He has been the host of the European Marketing Camp 2019 in Lisbon – a 4-day conference with about 200 participants. Furthermore, he teaches marketing specific courses and supervises master theses at Master degree level. For his excellent teaching skills, he was honored as an “Excellent teacher” by Tilburg University in 2021 and he won the 2017 Junior Teaching Award of University of Cologne. Through studies and research stays abroad he developed intercultural skills and competences.
Alexander Edeling is Associate Professor of Marketing at KU Leuven (Belgium), one of the oldest (founded in 1425) European universities. At Leuven, he is the coordinator of the Marketing Department (campus Leuven). Previously, he was a postdoctoral researcher at Boston University (as a visiting researcher) and at the University of Cologne, Germany, where he received his Ph.D. in 2016. He works on quantitative marketing topics at the intersection of marketing and finance, as well as social media and influencer marketing, and has published in leading marketing journals such as the Journal of Marketing, Journal of Marketing Research, International Journal of Research in Marketing and Journal of the Academy of Marketing Science. He is an alumnus of the University of Mannheim, Germany, and has worked for or cooperated with companies in the automotive, telecommunications, social media, pharmaceutical, railway and railway infrastructure industries. He is also the founder of eDOCation, the first online platform that connects aspiring young researchers with companies for upskilling activities. He enjoys tennis, running, skiing, history and traveling.
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