Managing negative eWOM in the retail industry : A qualitative study of proactive and reactive strategies

In the fast pace of the development of the Internet and the increased use of it more and more people use interactive platforms to connect with each other. The increased opportunity and ability to share content with people around the globe has led to the emergence of eWOM. eWOM means that consumers generate content that is consumption-related and mainly directed towards other consumers. Today, social media sites are the biggest source to eWOM. Consumers are actively searching for eWOM in order to gain information and reduce uncertainty, as a part of their purchasing process. In general, consumers tend to trust consumer generated content more than marketer generated content. Therefore, eWOM becomes a crucial component to business performance. Negative eWOM has been shown to affect the purchase intentions, loyalty and trust in a negative way, which eventually affects the turnover for a company. Negative eWOM has further been seen to have a larger impact on consumers, compared to positive eWOM. These consequences emphasize the importance of marketers being aware of negative eWOM and have strategies to manage it. The subject of eWOM has been acknowledged by practitioners and researchers. However, despite the increased interest in eWOM and its effects on business performance, there are still research gaps on how to proactively and reactively avoid and manage negative eWOM. The purpose of this study was to examine and understand what strategies companies use in order to avoid and manage negative eWOM on company owned and external interactive platforms. To fill the identified research gaps, this study took an inductive approach and the authors conducted a qualitative study using semi-structured interviews. The sample was purposively selected to include respondents within different companies that had knowledge about the companies’ strategies and approach towards managing negative eWOM. The sample consisted of companies of different sizes, which provided different perspectives and rich information of how companies can approach negative eWOM. A thematic analysis was conducted in order to analyze the empirical data and present relevant findings from the data collection. As a result of the thematic analysis, two global themes were identified: proactive strategies and reactive strategies. Within the global theme proactive strategies, five sub- themes were found: observation, detect critical potential scenarios and questions, communicate expectations, encourage feedback and facilitate contact. Within the global theme reactive strategies, six sub-themes were found: acknowledge or leave, do not delete, accommodative, defensive, answer in public, drive to private, and humorous and cleverly. These themes laid the foundation for a final conceptual model. The findings of this study suggest that marketers in retail use different proactive strategies to avoid negative eWOM from occurring in the first place. Moreover, the findings of this study show that marketers in retail, depending on the content of the negative eWOM and the platform it is taking place on, also use different reactive strategies to manage negative eWOM. The results also show that what strategy to use is to a large extent dependent on the individual’s subjective ability to interpret the negative eWOM.