Managing disinformation and its impact on brand equity – a study of the impact of fake news on motoring brand perceptions in South Africa

Abstract

The rising use of social media has presented brand managers with a tool to connect with customers and build brands using new avenues beyond traditional media. However, rising incidents of fake news threaten these efforts as they enable a rapid dissemination of negative information about brands using these very social media platforms. Using an experimental design, this study seeks to understand how fake news impacts brand equity through a customer-based brand equity lens and how organisations should respond. While confirming previous work on managing brand crises and the use of social media, this study also finds that there are contradictions with our current understanding of the benefits of brand equity in times of crisis as relates to disinformation. Strong brands are more negatively impacted by disinformation in comparison to weak brands. The study also finds that where weak brands have been able to rely on user-generated content to promote their brand, this does not hold in the case of fake news. For brand managers, disinformation presents a new crisis that requires a mix of both traditional and new strategies to mitigate the impact this can have on brand equity.