The Moderating Role of Power Distance on the Reaction of Consumers to the CEO as a Spokesperson During a Product Harm Crisis: Insights From China and South Korea

Abstract

During a crisis the corporate message is not the only issue facing the company. The role of the spokesperson is an under-researched area which is examined in this paper. In studies conducted in South Korea and China we examine the reaction of consumers to the CEO as a spokesperson during a product harm crisis. We find in both countries that consumer responses to the CEO was contingent on the consumers' level of power distance. When consumers had high levels of power distance they had higher future purchase intentions when compared with consumers who had low levels of power distance when the CEO was the spokesperson during the crisis. In addition, in a study conducted in South Korea we find that higher levels of power distance generate increased levels of brand trust when the CEO is the spokesperson, which in turn increases future purchase intentions. Our studies have important theoretical and managerial implications which are discussed in the paper.