Trust Repair Efforts and Repurchase Intention after Negative Publicity of Milk Powder in Sri Lanka

Abstract

This paper aimed to examine the impact of trust repair efforts on consumers repurchase intention of milk powder products affected by negative publicity in Sri Lanka. Consumer response to business entity's effort to mitigate negative information are understudied in developing economies including Sri Lanka. A quantitative survey design was opted for this study. Data was collected from 140 consumers residing in the western province of Sri Lanka employing a questionnaire during the pandemic. The proposed hypotheses were analyzed using an OLS regression. Our findings revealed that functional repair efforts, affective repair efforts, and informational repair efforts have a significant and positive impact on repurchase intention. Among the three trust repair efforts, informational repair efforts were found to be the most important trust repair efforts that influence the repurchase intention. Based on the findings, milk powder producers in Sri Lanka should pay attention to strengthening ties with the consumers and consider trust repairing efforts to negate negative campaigns. The main limitation of the study is that data collection had to be limited among the urban consumers and collecting data randomly was challenging due to the pandemic. Nevertheless, our study contributes to the growing body of literature on trust repairing and trust theory from an under-explored economic and socio-cultural context.

How Brand Preference Shapes Brand Loyalty of Milk Powder Through Young Consumers’ Eyes: The Moderating Role of Health Consciousness

“…In addition, high population pressure of developing countries demands importation of milk powder that incurs high risk. For instance, laboratory tests conducted using several imported milk powder brands in Sri Lanka confirmed that four of the tested brands were contaminated with dicyandiamide (DCD) that alarms the risk of importation (Ranasinghe and Shamil, 2021). At present, Sri Lankan consumers' preference for milk powder brands has been changed showing a high inclination towards local milk powder brands owing to the disputable information released via mass media (Economic and Social Statistics of Sri Lanka, 2018).…”

“…Due to self-insufficiency in milk production, Sri Lanka depends to a large extent on imported milk powder from countries such as Australia and New Zealand (Gunarathne et al, 2015;Krishnapillai et al, 2020;Wijesinghe et al, 2021). Owing to that, the annual importation of milk powder to Sri Lanka amounts hundred thousand metric tons in order to meet the consumption requirement of the country (Ranasinghe and Shamil, 2021). However, the quality and the safety of imported milk powder had been questioned in several occasions during the past decade (Stewart, 2021;Wijesinghe et al, 2021).…”

“…However, the quality and the safety of imported milk powder had been questioned in several occasions during the past decade (Stewart, 2021;Wijesinghe et al, 2021). This was triggered by the recently released mass media reports on the contamination of imported milk powder with hazardous chemical compounds (Wijesinghe et al, 2021;Ranasinghe and Shamil, 2021). These controversial facts regarding the contamination of milk powder in Sri Lanka had given rise to negative impacts on consumer brand preference (Wijesinghe et al, 2021;Stewart, 2021).…”

Effect of Marketing Mix Antecedents on Consumer Brand Preference of Milk Powder

“…Domestic milk production in Sri Lanka meets only about 38% of the national requirement (Central Bank, 2019). Hence, milk products, primarily in the form of powdered milk, are imported to Sri Lanka (Ranasinghe and Shamil, 2021). As a result, per capita consumption of milk powder in Sri Lanka exceeds that of liquid milk.…”

“…For instance, it has recently been found that imported milk powder has been contaminated with hazardous chemicals and foreign fats that create a threat to human lives (Wijesinghe et al, 2020). In 2014, a famous New Zealand company that operated in Sri Lanka faced a crisis of detection of dicyandiamide in their milk powder (Ranasinghe and Shamil, 2021). Therefore, on one hand, this study helps to better focus on significant marketing mix antecedents attached to powdered milk brand preference from consumers' point of view, and on the other hand, it may support the development of the social and economic status of the domestic producers.…”