Spillover of distrust to an industry

A severe brand scandal has strong negative spillover effects. This paper aims to apply associative network theory and prototype theory as a theoretical lens to investigate how a brand scandal spills over to an industry. We research how brand equity of the focal brand influences its perceived prototypicality during a product-harm crisis and causes a spillover of distrust in the industry. We further investigate this spillover effect in a single-brand crisis and a multiple-brands crisis. This paper contains an experiment with data from 304 participants. The results indicate that brand equity of the focal brand influences industry trust through the mediator of perceived prototypicality during a single-brand crisis. But the mediation doesn’t exist during a multiple-brands crisis. This paper contributes to understanding the negative spillover effects on an industry and offers implications for crisis management.