Measuring the effect of Viral Negative Sentiment on Market Value : Case Study on United Airlines Crisis 2017

Abstract: Negative word of mouth is something most businesses try to avoid, It could affect the reputation and vision of a company in a consumer’s mind. The success of a company lies in the connection of a product or service with a satisfying good image that has been formed on the back of consumer’s mind. This image can be the result of a positive past experience or the good reputation a company already has. On the other hand, negative word of mouth specifically in social media has the power to destroy the reputation of a company, because of the fast and wide spreading of a crisis in no time. This research will answer the question of how is the market value of a company affected by viral negative sentiment in social media? Focusing on the case study of United Airlines crisis 2017. We show that viral negative sentiment can have a short term effect over a company’s market value, but might not affect in the long term in a counter-intuitive manner.