Intellectual property and brand ethics: a moral reasoning approach to brand crisis management in social media

Purpose Intellectual property (IP) issues are causing brand crises in social media marketing, threatening both reputation and business viability. Thus, this study aims to investigate IP infringement allegations under the crisis management framework. Design/methodology/approach The study explores consumers’ reactions to an IP-infringement crisis on social media by employing situation-based between-subjects experimental designs. Study 1 and Study 2 investigated how brand partnership (limited vs. co-branding) and consumer moral reasoning (rationalization vs. decoupling vs. coupling) influence negative word-of-mouth (N-WOM) intentions. Study 3 explored effective response strategies (refutation vs. reform vs. refusal) that can counteract the N-WOM toward the influencer tailored by brand partnership type. Findings The findings suggested that, akin to product harm crises, moral coupling due to IP infringement leads to N-WOM, specifically for co-branding partnerships. In addition, this study found that the perceived regret owing to the purchase of problematic products increases N-WOM. This study also revealed that proactively denying wrongdoing (i.e. refutation) or not responding at all (i.e. refusal) may be more advantageous for co-branding partnership brands than issuing apologies. Originality/value By discerning the moral reasoning types that instigate perceived regret and subsequently explain negative consumer behaviors toward influencers, as well as evaluating effective crisis management strategies, this study offers empirical and practical insights.