Research Highlights

Rivalry Reference Effect: Study Reveals How Brand Rivalries Beyond Sports Can Boost Consumer Engagement

Gavin Kilduff

Sports rivalries, like Real Madrid vs. FC Barcelona, generate enormous excitement. A new paper entitled, “The Rivalry Reference Effect: Referencing Rival (vs. Non-Rival) Competitors in Public Brand Messages Increases Consumer Engagement,” published by the Journal of Marketing Research and co-authored by NYU Stern Professor Gavin Kilduff, Johannes Berendt (Hochschule Hannover - University of Applied Sciences and Arts), Sebastian Uhrich (German Sport University), and Abhishek Borah (INSEAD), sheds light on the dynamics of rivalries beyond the playing field, finding a positive influence of brand rivalries on consumer engagement due to their engaging, storytelling nature.

Whether it's McDonald's vs. Burger King, Coke vs. Pepsi, or Apple vs. Samsung – some companies have a special competitive relationship based on a shared history that goes beyond normal competition. These rivalries not only play out behind the scenes but are often publicly contested, especially on social media platforms, where companies enjoy needling and provoking each other. Samsung, for example, might tweet about pushing an apple down the stairs, Burger King might mock clowns, and Pepsi might express horror at the mere thought of consuming Coca-Cola – much to the delight of the audience.

"For consumers, openly contested rivalries have a special appeal," said Johannes Berendt, Professor at Hochschule Hannover - University of Applied Sciences and Arts. "Messages between rivals are processed differently than between ordinary competitors who have no shared history but merely a conventional competitive relationship. This is known as the Rivalry Reference Effect."

The authors conducted five studies, exploring whether social media posts by a brand directed at a rival generate more engagement on social media than posts targeting a "normal" competitor. In two field studies, they analyzed over 1.5 million real tweets from brands and found that posts referring to rivals received significantly more likes and retweets than posts mentioning normal competitors or no competitors. The team then replicated these findings in three additional experimental studies, using fictional posts in the product categories of fast food, soft drinks, and team sports.

"Rivalry transforms ordinary communication into captivating stories,” said German Sport University Professor Sebastian Uhrich, who shares the first authorship with Berendt. “Consumers can place posts to rivals into a familiar, ongoing narrative. This is because rivalry has two central elements of exciting stories: familiar antagonists, such as McDonald's and Burger King, and a classic plot, recurring conflict.”

For marketing managers, two aspects may be of particular interest: First, the Rivalry Reference Effect becomes even stronger when the rival is addressed negatively.

"In past comparative advertising research, brands are generally advised against addressing their competitors in a negative manner because it violates fair play standards and social norms," said INSEAD Professor Abhishek Borah. "But apparently, different laws apply to the perception of communication from rivals."

Secondly, the Rivalry Reference Effect is not only observed among loyal brand followers but also among neutral consumers who do not have a particular brand preference.

“Rivalry appeals to both target groups,” said NYU Stern Professor Gavin Kilduff. “This is an interesting finding for marketing managers because the group of neutral consumers is usually much bigger than the group of loyal consumers. This illustrates how widely the effects of rivalry can be felt.”

Overall, the study underscores the potential of brand rivalries to increase customer engagement. Brands could capitalize on this by targeting rival competitors rather than non-rival competitors in their communications.

This article was adapted from a research summary originally published by Hochschule Hannover - University of Applied Sciences and Arts. See the original publication in German here