Consumer boycotts due to factory relocation

Multinational companies that decide to relocate subsidiaries often appear socially irresponsible. Consumer boycotts are a common response to this type of action, especially in the subsidiaryʹs homeland; however, the factors that motivate individual boycott decisions remain largely unexplored. Consumersʹ degree of concern and level of trust in the management might influence this reaction. Furthermore, consumers may distinguish between the role of the multinational holding company and that of the subsidiary when making the decision to boycott. Seven hundred and twenty-four subjects were surveyed during an ongoing consumer boycott in Germany providing data that support the assumptions of the study. Multiple-group SEM shows that the intervening variables have a stronger impact on the boycott decision for those subjects who are customers of the company. Lastly, the article provides implications of these findings for managerial strategy.