Why and When Do Historical Brand Transgressions Matter?

While many brands face the after-effects of historical transgressions, prior research provides little insight into these issues. Against this backdrop, this research presents five experiments providing convergent evidence for a lingering negative effect of historical brand transgressions (HBTs) on present brand evaluation, an effect that is due to a detrimental effect of HBTs on perceptions of brand warmth. Studies 1 and 2 establish the main effect and mediation. Studies 3-5 examine mitigating effects. Study 3 checks if high institutional pressure can serve as an excuse strategy that buffers the negative effects of a transgression. Studies 4 and 5 test the mitigating effect of different response styles (recognition, apology, and/or compensation). Together, these results contribute to the business ethics and marketing literature by defining the concept of HBT and showing why it harms a current brand's evaluation and how brands can mitigate its negative effects.