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Journal of Communication Management Emerald Article: Amazon.com's Orwellian nightmare: exploring apology in an online environment W. Timothy Coombs, Sherry J. Holladay

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To cite this document: W. Timothy Coombs, Sherry J. Holladay, (2012),"Amazon.com's Orwellian nightmare: exploring apology in an online environment", Journal of Communication Management, Vol. 16 Iss: 3 pp. 280 - 295

Permanent link to this document: http://dx.doi.org/10.1108/13632541211245758

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Amazon.com’s Orwellian nightmare: exploring apology

in an online environment W. Timothy Coombs and Sherry J. Holladay

Nicholson School of Communication, University of Central Florida, Orlando, Florida, USA

Abstract

Purpose – The purpose of this paper is to contribute to understanding of crisis communication application and theory by analyzing online reactions of discussion board participants to assess the effectiveness of an apology issued online. Design/methodology/approach – This paper uses a content analysis of naturally-occurring online reactions to an apology issued as a crisis response strategy. The Janis-Fadner Coefficient of Imbalance was used to quantify the magnitude of negative and positive reactions to the apology. Findings – Most posts indicated acceptance of the apology and positive purchase intentions, thus confirming its effectiveness in managing the crisis as prescribed in Situational Crisis Communication Theory. Analysis of rejection reactions provided insights into additional actions crisis managers might take in this situation and how organisations might make their crisis communication more interactive in an online environment. Research limitations/implications – The study is limited by the focus on people responding to the apology online. It does show the potential value of online responses as a data source for crisis communication research. Practical implications – The paper demonstrates the utility of the research method for future studies designed to monitor and evaluate the effectiveness of crisis communication strategies. Real time monitoring may signal if the response strategy is effective and, if not, reveal stakeholder concerns that should be addressed in follow-up responses. Originality/value – The paper provides insight into how online comments can be used to evaluate reactions to apologies used in a crisis. The method can be helpful when crisis managers have access to online reactions to their crisis communication.

Keywords Apology, Crisis, Crisis response, Internet, Online communication, Social media, Communication

Paper type Research paper

An important trend in crisis communication research is the move from a sender perspective (what the organisation communicates) to a receiver/stakeholder perspective (how stakeholders perceive the messages). Early crisis communication research reflected a sender orientation and focused only on what the organisation said, with the assumption that the messages would have the desired effect on stakeholders. In contrast, the receiver/stakeholder perspective examines how stakeholders perceive the crisis and the organisation’s response to the crisis (Lee, 2004). It is important to consider both perceptions of the crisis and the response because the nature of the crisis affects the appropriateness of the response (e.g. Coombs, 1995; Coombs and Holladay, 1996, 2002, 2006). Research on contingency theory and situational crisis communication theory (SCCT) has used experiments and surveys to map factors that shape stakeholder perceptions of the crisis situation and how they perceive and/or react to various crisis response strategies (e.g. Coombs, 2007b).

In contrast to experimental research, the online environment provides a naturally occurring forum for exploring stakeholder reactions to crisis communication. The

The current issue and full text archive of this journal is available at www.emeraldinsight.com/1363-254X.htm

Received 10 November 2010 Revised 2 April 2011 Accepted 12 April 2011

Journal of Communication Management Vol. 16 No. 3, 2012 pp. 280-295 r Emerald Group Publishing Limited 1363-254X DOI 10.1108/13632541211245758

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challenge is to identify an appropriate crisis, an appropriate online forum for studying responses, and a large enough sample to study. These types of studies would be exploratory because people who post online are not representative of all stakeholders.

There are two unique characteristics of people who go online. First, they are the ones who are online and not all stakeholders are online or want to go online. Second, they often are active and willing to post messages about topics that interest them. We could use these characteristics to advance our understanding of people’s perceptions of and reactions to crises, as long as we acknowledge the limitations of such a sample. Examining online responses to crises that are relevant to those online would allow us to get a sense of how people in that stakeholder group of online, motivated stakeholders perceive the crisis and the organisation’s crisis response. Practitioner interest in stakeholders who are active online has grown rapidly and beyond the available empirical research (e.g. Media Vantage, 2009; Reputations Online, 2009). Exploratory online research could contribute new insights into our understanding of stakeholder perceptions that could then be examined more rigorously through research questions and hypotheses in later experiments.

Apology holds a central role in the discussion of crisis responses (Coombs et al., 2010; Frandsen and Johansen, 2010; Vigso and von Stedingk Wigren, 2010). The term apology is used frequently with various definitions ranging from a simple expression of concern to accepting responsibility for the crisis (Cohen, 2002; Kellerman, 2006). For this paper we are viewing apology as a clear acceptance of responsibility for the crisis. It is the acceptance of responsibility that creates legal liability and leads some crisis managers to shy away from an apology (Tyler, 1997). In July of 2009, Jeffrey Bezos, CEO of Amazon.com, apologised online at the Kindle Community discussion board to Kindle owners for removing access to copies of George Orwell e-books and other e-books they had purchased. Several days earlier the company had refunded their money for the e-books (only 99 cents). Amazon.com deleted the books because the third-party seller on Amazon.com did not hold the copyright so the books legally never should have been sold.

The Kindle crisis presents a unique opportunity to study stakeholder responses to a crisis apology. Bezos posted the message to the Kindle Community, an online discussion board for Amazon.com customers and potential customers. Within a six-day period, there were over 600 responses to the apology. While we cannot claim these responses are representative of all Amazon.com stakeholders, they do provide insights into how people who participated in the Kindle Community discussion board at that time perceived the crisis, reacted to the apology, and evaluated the effectiveness of the apology as a response. Although some may argue that the vocal online stakeholders are simply an aberration to be dismissed, the growing industry built on monitoring online conversations about organisations and their products suggests these stakeholders are harbingers to taken seriously (Baksky et al., 2011). We subscribe to this later view when considering online responses to crisis communication to be a valuable source of information about crisis communication effectiveness.

Review of the relevant literature Following Sturges (1994), crisis communication can be divided into three broad categories: first, instructing information which helps people cope physically with the crisis, including an explanation of what happened; second, adjusting information which helps people cope psychologically with a crisis; and finally, reputation repair. Corrective action involves repairing damage inflicted by the crisis and efforts to

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prevent a repeat of the crisis (Coombs, 2009). Efforts to prevent a repeat of the crisis address psychological concerns by reassuring stakeholders they will not be subjected to the negative event again.

Reputation repair is the most researched of three categories of crisis communication (Coombs, 2010). Apology is central to discussions how crisis communication is used strategically to protect reputations during a crisis (Coombs et al., 2010). Apology’s role in protecting reputations is found in three of the dominant crisis communication research lines: image restoration (Benoit, 1995), corporate apologia (Hearit, 1994), and SCCT (Coombs, 2007b). It is useful at this point to consider the strong connection between crises and reputations.

Reputation, how stakeholders perceive the organisation, is a valuable, intangible asset for organisations (Watson, 2006). The perceptions are evaluative (behaviours are compared to expectations) and produce both cognitive and affective reactions that shape how the stakeholders interact with the organisation (Argenti and Druckenmiller, 2004; Dowling, 1994). Reputations can affect sales, share prices, and the quality of job applicants (Davies et al., 2003; Fombrun and van Riel, 2004). Both direct and indirect experience with an organisation influence stakeholder evaluations of reputations. Indirect experience includes traditional media coverage, social media, and traditional word-of-mouth (Deephouse, 2000; Romenti, 2010; Wartick, 1992).

It is common for stakeholders to rely upon just fragments of information when making reputation evaluations (Carroll and McCombs, 2003). The ability of bits of information to shape a reputation has fuelled the concern over the impact of social media in reputation management. Corporate executives seem preoccupied with how negative comments in social media (content generated by online users) can affect reputations (Blackshaw and Nazzaro, 2004; Tucker and Melewar, 2005). The social networking research by Duncan Watts (2007) reinforces this concern over social media content.

Watts (2007) argues that the “influentials hypothesis” is flawed. The “influentials hypothesis” posits that some people are more important than others and have disproportionate influence over events and trends. The “influentials hypothesis” originated in the opinion leadership research and is represented in how many experts approach the influence of social media (Burson-Marsteller, 2010; Gladwell, 2000; Lazarsfeld et al., 1968). However, through online experiments, Watts has found that it is not the select influentials that create successful viral messages – social media messages that have an impact spreading to a wide number of people. Instead, it is generally an average person that creates a successful viral message. Watts calls this the “big seed” approach. Instead of relying on a few big seeds (influencers), people trying to create a viral message should use a large number of average seeds (Baksky et al., 2011; Watts and Peretti, 2007). Following the logic of Watts, executives should be concerned about social media message because of their potential to harm reputations by spreading negative word-of-mouth to other stakeholders.

Crises are a threat to reputations (Barton, 2001). Scholars in both crisis communication and reputation management recognise that crisis communication can lessen the reputational damage inflicted by a crisis (Benoit, 1995; Coombs, 1995; Murray and White, 2005). Moreover, the anger generated by crises can increase the likelihood of negative word-of-mouth (Coombs and Holladay, 2007). Apologies are one means of trying to reduce the reputational threat from a crisis, thus we return to the discussion of apologies in crisis communication. There is a large literature on apology spanning a diverse array of disciplines including interpersonal communication,

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sociology, rhetoric, and psychology. (Please refer to Hargie et al. (2010) for a more detailed discussion of apology and diversity of that literature.) For this case, we are focusing on the application of apology to crisis communication. The crisis dynamic differs from the interpersonal context; thus, the literature review focuses on how apology has been applied in crisis communication.

Discussions of apologies are common in the crisis communication literature as part of strategic efforts to help repair damaged relationships and reputations (Coombs et al., 2010). Three aspects of apologies have been the focus: content, source, and timing (Wooten, 2006). Literature focusing on the content of apologies often references legal advice to avoid self-incrimination (Cohen, 2002). Literature demonstrating a source focus often stresses how organisational leaders are ideal sources of apologies and that apologies are likely to be perceived as more effective when communicated by top leaders. For instance, Kellerman (2006) claims that CEO apologies are useful because they acknowledge the leader is ultimately responsible for the problem and serve an institutional purpose by seeking to restore the organisation’s reputation. Kellerman also notes that apologies can serve a moral purpose when the source demonstrates genuine remorse and asks for forgiveness. However, executives often underestimate the benefits and overestimate the costs of apologizing (Kellerman, 2006). Third, the timing of apologies has been examined as a factor affecting the value of apologizing. As with all crisis responses, a response should be issued quickly because a lack of response is likely to keep the story in the media limelight. A time lapse may lead receivers to question the sincerity of the apology. But a late apology is better than no apology (Wooten, 2006).

We favour Hearit’s (2005, 2006) view of apology as conciliation. Conciliation involves mortification, where the organisation accepts its guilt, accepts the criticisms it has received, and seeks forgiveness for the transgression. Apology as conciliation captures the two common components of apology identified by Hargie et al. (2010): first, admission of blameworthiness; and second, regret for the negative event. The apology must accept responsibility and express regret for the act. The apology literature suggests that the strategy need not occur in isolation and may be more effective when combined with other crisis response strategies (e.g. Bradford and Garrett, 1995; Wooten, 2006). Bradford and Garrett (1995) found that conciliation often is used in conjunction with corrective action and compensation strategies (giving people money or goods) in order to restore faith in the relationship.

Overview of the Kindle crisis case Amazon.com has thrived as a seller of online books, magazines, newspapers, and other more traditional merchandise. To strengthen its position in the digital world, Amazon.com introduced the Kindle in 2007. The Kindle provides a combination hardware and software platform for reading e-books and other digital media. However, the e-books cannot be shared because of a Digital Rights Management (DRM) system that is designed to protect copyrighted material in a digital age. The beauty of e-books is ease of storage and portability. Readers can take notes and mark text on the Kindle as well. On 16 July 2009, some Kindle users found another difference from paper books. Amazon.com could delete books from its servers, thereby “erasing” books from a Kindle.

In July 2009, Amazon.com realised that a third party had sold copies of George Orwell books, including 1984, without holding the copyright. The pirated books were “illegal”. Without advance notice or explanation, Amazon.com deleted those e-books

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from its servers and reimbursed customers who had purchased them. The absence of an explanation for the deletions led to a firestorm on the internet and spread to the traditional media. Some customers were outraged that Amazon.com “took” their books. The deletion also meant that people lost any notes they made on the e-books when the files were unexpectedly removed from Amazon.com’s servers. People were quick to point out the irony that 1984 was among the deleted books and the similarities to the world of Orwell’s Big Brother. Blogs and tweets complained about the heavy-handed tactics. The traditional media talked of “memory holes” and employed other terms from 1984. Clearly the situation was escalating into a crisis.

Technically, Amazon.com did not go into people’s Kindles and erase e-books. The e- books were erased from the Amazon.com server and were deleted when people synced through Whispernet. If a customer had not synced, they would still have the copy. Or if the customers had saved their books to a storage device and only accessed the stored books when Whispernet was off, they would still have the books. Amazon.com maintained the action was permissible under its Kindle user agreement. Whether the “illegal” e-books were deleted from a server or directly from a Kindle is a technical distinction that most people involved in the controversy did not care to make. The bottom line remained the same; the books disappeared from the Kindles with no warning or reasons given to the customers. The actions violated customer expectations. In July of 2009, Amazon.com faced the Kindle crisis.

The Kindle crisis had upset some customers, could turn off potential customers, and was reaching other stakeholders via online and traditional media. Consider how a lawsuit was filed by a teenager because the action resulted in him losing his homework – the Kindle “ate his homework” legal case in the USA (Kellogg, 2009). The Kindle crisis was damaging Amazon.com’s reputation and posed a potential financial threat as well. Action was needed because the threat could spread and become a serious disruption for Amazon.com. A crisis can be defined as “the perception of an unpredictable event that threatens important organisational expectancies of stakeholders and can seriously impact an organisation’s performance and generate negative outcomes” (Coombs, 2007a, pp. 2-3). Stakeholders did perceive that Amazon.com had violated their expectations by deleting the books. The crisis was generating negative outcomes by inflicting reputational damage on the organisation. If the situation was not addressed, there was real possibility of additional damage that could impact organisational performance. The Kindle situation met the requirements to be designated a crisis and required the application of crisis management.

The Kindle crisis is an example of an internet-oriented crisis. The crisis originated and transpired predominately online. Moreover, the primary constituents (customers and potential customers) were online because Amazon.com is an online retailer and the product involves e-books. While the internet environment does not change the fundamentals of crisis management and communication, it does change the tools and the timing. Because “internet time” moves faster than traditional time, speed is even more essential. Crisis managers must utilise internet-based communication as part of their response because they need to be where the crisis action is. If the action is primarily online, crisis managers need to identify where online their messages need to appear in order to be consumed by the relevant stakeholders. This is not a new strategy because media selection always begins with how best to reach the intended targets with the message.

The event was breaking online on 17 July, following the 16 July deletion of the books. Just fewer than 2,000 people were notified the books had been deleted and their purchase price refunded. The e-mail read: “The Kindle edition books Animal Farm by

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George Orwell. Published by MobileReference (mobi) & Nineteen Eighty-Four (1984) by George Orwell. Published by MobileReference (mobi) were removed from the Kindle store and are no longer available for purchase. When this occurred, your purchases were automatically refunded. You can still locate the books in the Kindle store, but each has a status of not yet available. Although a rarity, publishers can decide to pull their content from the Kindle store”. People were not satisfied by this vague statement and wanted clarification. Customers sought clarification with posts on the Amazon.com discussion boards under the folder heading “Mysterious George Orwell refunds”. These comments helped to create the need for the crisis response.

The Kindle crisis communication unfolded in two steps beyond the initial e-mail notification. The first step was a statement issued by Amazon.com spokesperson, Drew Herdener: “These books were added to our catalog using our self-service platform by a third party who did not have the rights to the books. When we were notified of this by the rights holder, we removed the illegal copies from our systems and from customers’ devices, and refunded customers. We are changing our systems so that in the future we will not remove books from customers’ devices in these circumstances”. This statement was delivered to traditional and online media outlets on 17 July, shortly after the deletions. Although Herdener’s statement did not appear online at the Kindle Community site, bloggers and traditional media outlets used his statement in their discussions of the Kindle crisis. Herdener’s statement was primarily a form of instructing information designed to explain the actions taken by Amazon.com (Sturges, 1994). Compensation and a suggestion of corrective action appear in the message as well. The refund was offered (compensation) and Amazon.com promised not to repeat such remote deletions in the future (corrective action).

The second statement was an online apology from Amazon.com CEO Jeffrey Bezos on 23 July 2009, at 12:16 p.m. (PDT):

This is an apology for the way we previously handled illegally sold copies of 1984 and other novels on Kindle. Our “solution” to the problem was stupid, thoughtless, and painfully out of line with our principles. It is wholly self-inflicted, and we deserve the criticism we’ve received. We will use the scar tissue from this painful mistake to help make better decisions going forward, ones that match our mission. With deep apology to our customers, Jeff Bezos Founder & CEO Amazon.com

The message was posted to the Kindle Community discussion board on Amazon.com. The primary users of the discussion board are Kindle users and/or those interested in learning more about Kindles. However, anyone who joins the Amazon.com discussion boards could read and post to that area. Given the book deletions occurred several days before, it is unclear why Bezos elected to post at that time. Some speculated the timing of the posting was related to earnings reports that were to appear around that time. Regardless of the reason, the response was slow in internet time. However, as noted earlier, a late apology is still better than no apology at all.

At this point we have a descriptive analysis of the Kindle crisis response. Based upon existing theory and research, the Amazon.com communication could be judged effective. There was a progression from instructing and adjusting information followed by reputation repair through an apology. SCCT offers prescriptive advice for using crisis response strategies, including apologies. The foundational response for SCCT is instructing information followed by adjusting information. SCCT has some

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specific recommendations for crisis response strategies based upon the nature of the crisis situation. A key element of the crisis situation is the crisis type. The Kindle crisis is a type of management misconduct. Management acted in way that was deemed inappropriate by its stakeholders. Amazon.com erased the books without warning and without explanation. SCCT posits that apologies and/or compensation should be used for a management misconduct crisis. SCCT suggests either strategy can be used because legal and financial concerns might limit the use of apologies (Coombs, 2007b). Amazon.com’s response would be deemed appropriate according to the recommendations of SCCT.

However, such descriptive analysis is speculative in nature. We know that the theoretical recommendations were followed but we lack evidence that the suggested communicative measures were effective. We are positing that online reactions provide a source of evidence-based assessment of crisis communication effectiveness. The online reactions can provide markers of crisis communication success or failure.

Analysing stakeholder reactions is critical when an apology is utilised. We cannot assume that just because an apology is used, positive results will ensue. An apology can have positive or negative effects on a relationship (Lazare, 2004; Risen and Gilovich, 2007). One key factor that determines the effects of an apology is acceptance. Accepting an apology is taken as a sign of forgiveness (Lazare, 2004; McCullough, 2001). Rejecting an apology indicates a lack of forgiveness. The benefits of apology are a result of forgiveness. Hence, accepting an apology is critical to its beneficial effect in a crisis and an indicator of its success. Crisis managers utilise apologies to create positive feelings among stakeholders that help to protect the organisational reputation (Coombs, 1995, 2007a).

Examining online reactions to this online apology is an important step forward in the research on stakeholder reactions to apologies. The online environment enables us to analyse responses/reactions that are in direct response to the crisis communication. Stakeholder reactions to the apology provide crisis managers with evidence of the apology’s effectiveness. It also allows us to explore if people are willing to voice their support or rejection of the crisis response. In addition, it permits us to examine their reasons for supporting or rejecting the crisis response. Finally, it enables us to see if those people report the incident and the subsequent crisis response will affect their purchase intentions.

Research questions The goal of this exploratory research was to examine the Kindle Community discussion board reactions to the 23 July 2009 online apology from Jeffrey Bezos. The following research questions were posed:

RQ1. How did the Kindle Community postings indicate the apology was received by this community?

RQ2. How did the Kindle Community postings indicate the apology affected the behavioural intentions of these writers?

RQ3. Did reactions to the apologies differ for Kindle owners and Kindle non- owners?

RQ4. What suggestions for additional corrective action appear in the posts?

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Method Procedure The data for this investigation were 210 relevant responses that appeared on the Kindle Community discussion board in the two-day period following Bezos’s apology on 23 July at 12:16 p.m. PDT. Each post was treated as the unit of analysis. The Kindle Community provides an appropriate forum for the analysis of reactions to the apology because participants are Kindle users, potential Kindle users, and/or Amazon.com customers. By posting on this site, Bezos indicated this is the intended audience for the apology and therefore responses appearing on the Kindle Community are appropriate data for our analysis.

In order to be included in the data set the posting had to indicate it was a response to the apology. Examples of phrases signalling it was a response include: “That took a lot of courage”, “Thank you for posting”, “Amazing apology”, and “Actually, I don’t think an apology was needed”. Postings unrelated to the apology and postings indicating they were responses to other people’s postings also were excluded from the data set because we wanted to examine only online comments that were reactions to Bezos’s apology. Only the first 48 hours were coded because after that point the posts were predominantly reactions to other posts with few unique posts in direct response to the apology itself. Of the 210 posts, 65.7 per cent (n¼138) followed Bezos’s apology on 23 July and 34.3 per cent (n¼72) appeared on 24 July.

Coding categories Four categories of information in the responses pertained to our research questions and were coded for the analyses. First, the writers’ reactions to the apology were coded into one of three mutually exclusive response categories: first, acceptance of the apology (e.g. the writer indicated s/he accepted the apology through comments that praised the apology or Bezos); second, conditional acceptance of the apology (e.g. these comments took the form of “yes [y] but [y]”; posts indicate the apology was appreciated but lacking in some way. For example, the writer indicated the apology was accepted but the problem was not solved or it was nice that an apology was posted but the books were still deleted); or finally, rejection of the apology (e.g. the writer indicated s/he rejected the apology outright or the apology was unacceptable because it was insufficient in some way). These reactions are important indicators of crisis response effectiveness.

Second, message contents were coded for statements of intended purchase behaviours. The purchase behaviour categories were positive behavioural intention (e.g. will remain a loyal customer, will continue to buy e-books, intend to purchase Amazon.com products); negative behavioural intention (e.g. will no longer use the Kindle or purchase e-books from Amazon.com); or no purchase-related behavioural intention.

Third, posts were coded according to whether the writers included a statement about Kindle ownership. Two categories were used: first, stated they owned a Kindle; or second, did not mention they owned a Kindle.

Fourth, messages were coded for the inclusion of suggestions for additional corrective action. The four categories were no call for corrective action; a call for corrective action as a solution to this specific situation (e.g. provide free copies of the deleted Orwell books); a call for corrective action to address the larger issue of the user agreement and/or terms of service that allows Amazon.com to control Kindle user’s libraries of e-books (e.g. calling for an end to Amazon.com’s ability to delete books, or to

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end DRM or digital rights management); and a general call to replace “illegal” e-books with legal copies of the book (e.g. how “illegal e-book” problems will be handled in the future).

Two coders coded the Kindle Community postings. The coders reached 95 per cent agreement on the first three categories and 88 per cent agreement on the fourth category. Coding discrepancies were then resolved through discussion.

Results Reactions to Bezos’s apology Reactions to the apology were coded as follows: 71.4 per cent (n¼150) accepted the apology; 15.7 per cent (n¼33) indicated conditional acceptance of the apology; and 12.9 per cent (n¼27) rejected the apology. To address RQ1, a one-sample w2-test was performed. Results demonstrated a significant difference in the proportions, w2(2, N¼210)¼137.40, po0.001. The effect size was 0.33. Follow-up tests revealed two pairwise comparisons differed significantly. Proportions of those who “accepted” and “conditionally accepted” the apology differed significantly, w2(1, N¼183)¼74.80, po0.001, as did those who “accepted” and “rejected” the apology, w2(1, N¼177)¼85.47, po0.001. The proportions of those who “rejected” and “conditionally accepted” the apology did not differ significantly, w2(1, N¼60)¼0.60, p¼0.44.

Behavioural intention The analysis of the behavioural intention variable (RQ2) revealed 68.1 per cent (n¼143) of the postings did not state purchase-related behavioural intentions towards Amazon.com. About 21.4 per cent (n¼45) reported positive behavioural intentions while 10.5 per cent (n¼22) reported negative behavioural intentions. A one-sample w2-test indicated a significant difference in the proportions, w2(2, N¼210)¼117.97, po0.001. The effect size for the test was 0.28. The follow-up pairwise comparisons revealed all comparisons differed significantly. The difference between proportions of positive and negative behavioural intentions differed, w2(1, N¼67)¼7.90, p¼0.005, as did the comparisons between no behavioural intentions stated and positive behavioural intentions stated, w2(1, N¼188)¼51.08, po0.001, and no behavioural intentions stated and negative behavioural intentions, w2(1, N¼188)¼51.08, po0.001. Overall, the majority of the reactions to the apologies did not include statements of behavioural intentions. But when statements of behavioural intention were included, twice as many reflected positive behavioural intentions than negative intentions.

The Janis-Fadner coefficient of imbalance was used to examine RQ3. The Janis- Fadner coefficient of imbalance was originally developed to detect bias in news media coverage but has been extended to other types of messages and has been used to evaluate organisational reputations (Deephouse and Carter, 2005). The limitation is that the data must be consistent with the tri-part structure of the formula (Hurwitz et al., 1976). The Janis-Fadner coefficient of imbalance utilises three coding categories: first, favourable; second, unfavourable; and finally, neutral. When the numbers are entered into the formula, a value ranging between þ1 and �1 is created. Values near 0 indicate balanced treatment in the messages. The Janis-Fadner coefficient of imbalance is designed so that it will always increase when the frequency of favourable content increases; decrease when the frequency of units of unfavourable content increases; equal 0 if the units of content are balanced/neutral; and equal 0 if the number of units of favourable content are equal to the number of unfavourable content ( Janis and Fadner, 1943). The Janis-Fadner coefficient of imbalance is superior to simple proportions

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because the resulting value provides an assessment of the strength and direction of the imbalance; and is standardised so that researchers can compare the scores from different data sets. For instance, the Janis-Fadner coefficient of imbalance for two different media channels could be compared or messages from different stakeholder groups could be compared. The formula for the Janis-Fadner coefficient of imbalance is presented in Figure 1 along with how it was applied to apology reaction and behavioural intention data in this study.

For RQ3, we compared comments posted by self-identified Kindle owners (n¼61) and non-owners (n¼25). The 124 posts that did not explicitly reference Kindle ownership status were excluded. For reactions to the apology, the Janis-Fadner coefficient of imbalance for owners was 0.53 compared to a score of 0.09 for non-owners and 0.40 for the entire sample. For behavioural intention, the Janis-Fadner coefficient of imbalance for owners was 0.11 compared to �0.20 for non-owners and 0.02 for the entire sample. The data indicate that those who own Kindles were more accepting of the apology and indicated positive behavioural intentions. Non-Kindle owners were near the neutral point for accepting the apology and indicated they would not purchase or use a Kindle. These findings are consistent with research that demonstrates positive feelings towards an organisation and/or product affect reactions to crises (e.g. Pullig et al., 2006).

One could argue that the non-Kindle users were irrelevant to the crisis response and that Amazon.com rightly chose to focus on retaining current users. However, the non-Kindle owners were still Amazon.com customers and many indicated they had considered buying Kindles but the crisis reinforced their choice not to buy or triggered a decision not to buy a Kindle. Although the non-Kindle owners are still relevant to the crisis response because they are potential owners, they would be a lower priority than retaining customers. Even though the Janis-Fadner coefficient of imbalance score was negative, there were non-Kindle owners who indicated they still intended to purchase a Kindle.

To address RQ4 we examined the posts for suggestions of additional corrective action (n¼88 posts). Two dominant themes emerged in posts that rejected the apologies: first, failure to provide compensation in the form of free copies of the deleted books (n¼8, 9 per cent); and finally, failure to prevent future remote deletions of books (n¼74, 84 per cent). Although those who rejected the apology were in the minority of those posting, their comments offered insights into what else Amazon.com could be doing to address the crisis.

Janis-Fadner coefficient of imbalance

When there are more favourable than unfavourable units the formula is:

Cf = (f 2–fu)/r 2

When there are more unfavourable than favourable units the formula is:

Cf = (fu –u2)/r 2

Cf is the coefficient, f the messages coded as favourable, u the messages coded as unfavourable, r the relevant units (favourable + unfavourable + neutral).

Notes: For reactions to the apology, the “conditional acceptance” was treated as neutral. For behavioural intention, “no indication of behavioural intention” was treated as neutral

Figure 1. Janis-Fadner coefficient of

imbalance

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Discussion This exploratory study examined Kindle Community reactions to Bezos’s online apology and offers unique contributions to the literature in a number of areas. First, it focused on the online environment and a particular group of constituents who would be especially relevant to the apology and interested in the contents of the apology. Bezos’s apology was posted online to a group that consists either of current Kindle users or Amazon.com customers, a target audience for future Kindle purchases. Thus, the sample included people who are the target audience for the apology and appropriate to the study of reactions to apologies. Online comments made during a crisis can impact an organisation’s reputation. The potential danger online comments present to organisational reputations (Baksky et al., 2011) reinforces the value of analysing online response to this apology. However, it is important to note that not all Kindle users, or potential Kindle users, participate in the Kindle Community. Hence, the sample was not truly representative of those who may have been affected by the e-book deletions.

Second, this research method enabled us to examine Kindle Community participants’ direct responses to the apology. By studying unsolicited posts we saw unfiltered reactions to the apology as well as spontaneous statements of purchase intention. This provided naturally occurring, rich data. The method did not require researchers to intervene in the data collection process. Writers posted what was important to them. The direct responses provide insights into reactions to the crisis communication, behavioural intentions, and reasons for rejecting the apology.

Third, the research demonstrated the utility of the Janis-Fadner coefficient of imbalance for examining online responses to crisis communication. The Janis-Fadner coefficient of imbalance provides a way to gauge the favourable-unfavourable nature of responses in a standardised measure that allows for comparison between data sets or subsets of one data set. In this case we could compare the reactions of Kindle owners to non-Kindle owners to gain additional insights.

The findings suggest that the significant majority of Kindle Community readers accepted Bezos’s apology – the crisis response was effective. A few endorsed the product and/or organisation by claiming they will continue to be loyal customers. Based on these results, we can determine the apology seems to have been effective for members of this Kindle Community group who posted in response to the apology.

Acceptance of the apology is like account acceptance in the crisis response literature. It signals receivers find the response to be effective. Fuchs-Burnett (2002) notes this generally requires that the apology be accompanied by a course of action that exhibits awareness of the wrongdoing coupled with corrective action (Cohen, 2002; Fuchs-Burnett, 2002; Hearit, 2005, 2006). Herdener’s statement and Bezos’s apology indicates Amazon.com will learn from the incident, make better decisions in the future (although exactly what that will involve is unspecified), and stop the remote deletion practice. However, the dominant theme in the suggestions for additional corrective action was remote deletion. The lack of specific corrective action seems to be a weakness in the Amazon.com crisis response. Interestingly, our analysis showed that within two days of posting the apology, Amazon.com should have been aware of that weakness.

The apology was a singular post during the Kindle crisis. While stakeholders publicly responded to the apology, no one from Amazon.com responded to these comments. Granted, the majority of the comments were positive but there is an undercurrent of negativity that warrants attention. Stakeholders raised two concerns that reflect the limited corrective action by Amazon.com. First, some stakeholders felt

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people should be given free copies of the books that were deleted. Their point was that Amazon.com made the error in allowing the sale of the e-books yet customers were paying the price. In September of 2009, Amazon.com offered customers whose Orwell books had been deleted either a free replacement book or $30 (either a cheque or Amazon.com credit) (Metz, 2009). This correction occurred nearly two months after the initial incident and over a month after posts had suggested Amazon.com take the action.

Second, many posts indicated they were upset that Amazon.com still had the capability to delete copies. The vast majority of additional correction action suggestions urged Amazon.com to renounce the policy of remote removal and even create software to prevent Amazon.com from having that “power”. The discussion centred more on DRM in general rather than the Orwell deletion situation and was a minority of those posting (74 out of 210). People either did not find the Amazon.com statements about ending remote deletion reassuring or did not realise the statement had been made. Whatever the reason, DRM and remote deletion remained a concern among those posting to the discussion board. Bezos’s apology triggered feedback from stakeholders but Amazon.com was slow to process the feedback. Even if Amazon.com did not want to enter into a public debate over its policies, it could at least have posted to the Kindle Community that they were aware of the concerns and were considering their options. Bezos’s apology posting provided an opportunity for engagement that was underutilised. Although stakeholders responded to the apology post, Amazon.com did not publicly engage the stakeholders or acknowledge those online comments.

Limitations There are limitations to this work. First, it was exploratory. Second, Kindle Community members who voluntarily posted in response to Bezos’s apology provided the data. The sample was not representative of all Kindle owners and the results are based only on those who were motivated enough about the organisation and its products to join the Kindle Community. Furthermore any online posting run the risk of being artificial. Organisations have been known to pay people for favourable tweets and postings (Sams, 2009). People could have been paid to post favourable comments about the apology. We have no viable means of assessing whether or not the posts were authentic or fake.

Conclusion In one respect, Bezos’s apology was a type of “preaching to the choir”. It was a safe bet that Kindle users would be sympathetic to the situation. The data analysis proves that the response was effective, particularly with Kindle owners. Overall, most posts accepted the apology and indicated positive behavioural intention. An organisation must reinforce its loyal stakeholders so the Bezos apology is effective in that regard. The effectiveness claim is based upon two critical pieces of evidence. First, most posts reflected an acceptance of the apology. Acceptance of an apology is crucial in deriving relational and reputational benefits from an apology. Second, the majority of posts that mentioned behaviour intentions were positive and indicated continued support of Amazon.com. The positive reactions to the apology support SCCT’s assessment that apology is the appropriate response to this human error crisis. The negative reactions to the initial instructing and adjusting information reinforced that positive results were not achieved until an apology was utilised.

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While generally effective, we can identify weaknesses with the Amazon.com crisis response based upon the postings. There was a small subset of posts, mostly by non- Kindle owners, who rejected the apology and were concerned about a perceived failure to eliminate the remote deletion technology. Amazon.com would have been aware of the concern through a cursory examination of the response postings. We should note DRM and remote deletion is a complex and technical issue that would be difficult to address fully through online postings. For whatever reason, this issue of concern to a minority of the stakeholders was ignored. Perhaps more importantly, we can argue that Amazon.com did not follow through on an engagement opportunity.

Even though Bezos’s apology was posted on a discussion board that promotes interaction, the apology was not interactive. Amazon.com offered no additional messages beyond Bezos’s original apology on the discussion board. The engagement aspect of the apology post was lost. Of course, that lost opportunity may be a function of crisis communication in general. The organisation’s reaction to the crisis is the priority rather than using the situation as an opportunity for engagement. It could be crises are not considered an appropriate time for engagement – but that is a larger issue for future research. While Amazon.com could have done more, it was successful in reassuring its Kindle user base and keeping them happy.

Online postings can be useful to organisations trying to gauge stakeholder reactions to crisis communication strategies. Examining online reactions may allow them to assess the effectiveness of the crisis response, identify potential weaknesses in the response, and determine if additional crisis responses are needed. Online postings provide real-time, unobtrusive feedback. The results suggest this type of data holds promise for future investigations.

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