Csr and Consumer

The impact of perceived CSR initiatives on consumer’s buying behaviour: An empirical study

Abu Bashar, Assistant Professor, Institute of Management Studies, Dehradun.

ABSTRACT

Although research into CSR and consumer behavior is still relatively young, there exists a growing interest in studying the links between CSR and marketing. The Indian consumers are now well aware that, in pursuing their business endeavors, companies now have to show more responsibility towards society and the environment where they are operating and at the same time do managers increasingly see CSR as a marketing tool to help create a competitive advantage. But what is the actual impact of companies’ engagement in CSR on consumer behavior? The consumers are getting more aware of the corporation involved in corporate social responsibility (CSR) through better education and the increased influence of the media. The companies up to a certain extent has already been realized that their socially responsible behaviour have a direct impact on the consumer buying behaviour.

In this research paper effort has been employed to investigate that how consumers are considering corporation’s CSR initiatives at the time of deciding on their purchase decision of products and services. For measuring CSR economic, legal, ethical and philanthropic variables have been considered from Carroll's definition.

A random stratified sample of 250 respondents have been considered, the data have been collected with the help of structured questionnaire. After the data collection appropriate statistical data analysis was performed in the software program SPSS.

Results confirm a positive relationship between perceived CSR activities and consumer buying behaviour.

Keywords: corporate social responsibility, consumer behaviour, Philanthropy, Consumer buying behaviour.

1. Introduction

Multinational corporations first introduced the term stakeholder in the late 1960’s. Stakeholders were described as those who were in

References: Ali, I., Rehman, U. K., Yilmaz, K. A., Nazir, S. & Ali, F. J. 2010. Effects of CSR on ConsumerRetention. African Journal of Business Management. Vol. 4, pp. 475-485. Altman, W. (2007/2008, January). Working for the greater good? Engineering Management. Retrieved 27 July 2010, from www.theiet.org/management Anderson, E Argandona, A. (1998). The stakeholder theory and the common good. Journal of Business Ethics, 17(9/10), 1093–1102. Ashforth, B. & Mael, F. 1989. Social Identity Theory and the Organization. Academy of Management Review. Vol. 14, No. 1, pp. 20-39. Aupperle, E. K., Carroll, B. A. & Hatfield, D. J., 1985. An Empirical Examination of the Relationship between Corporate Social Responsibility and Profitability. The Academy of Management Journal, Vol. 28, No. 2, pp. 446-463. Baldinger, A. & Rubinson, J. 1997. The jeopardy in double jeopardy. Journal of Advertising Research. Vol. 37, No. 6, pp. 37-49. Bandyopadhyay, S. & Martell, M. 2007. Does attitudinal loyalty influence behavioural loyalty? A theoretical and empirical study. Journal of Retailing and Consumer Services. Vol. 14, pp. 35-44. Bayus, B. 1985. Word of Mouth: The Indirect Effects of Marketing Efforts. Journal of Advertising Research. Vol. 25, pp. 31–39. Becker-Olsen, K. L., Cudmore, B. A. & Hill, R. P. (2006). The impact of perceived corporate social responsibility on consumer behavior. Journal of Business Research. Vol. 59, No. 1, pp. 46–53. Bendapudi, N. & Berry, L.L. 1997. Customers’ motivations for maintaining relationships with service providers. Journal of Retailing. Vol. 73, No. 1, pp. 15-37. Bhattacharya, C. & Sen, S., 2003. Consumer-Company Identification: A Framework for Understanding Consumers ' Relationships with Companies. Journal of Marketing. Vol. 67, No. 2, pp. 76-88. Black, L. D. (2001, March). Towards understanding corporate social responsibility in Australia. Paper presented at the Conference on Monash University, Melbourne, Australia. Retrieved 10 July 2007, from http://www.aph.gov.au. Brown, T. J., & Dacin, P. A. (1997). The company and the product: Corporate associations and consumer product responses. Journal of Marketing, 61(1), 68–84. Carroll, A. B. (1979). A three-dimensional conceptual model of corporate performance. Academy of Management Review, 4(4), 497–505. Carroll, A. B. (1998). The four faces of corporate citizenship. Business & Society Review, 100/101, 1–7. Clarkson, M. E. (1995). A stakeholder framework for analyzing and evaluating corporate social performance. Academy of Management Review, 20(1), 92–118. Conchius, T. (2006). Corporate social responsibility in Dutch SME: motivations and CSR stakeholder. Final thesis, Maastricht University, Netherlands. Retrieved from http://www.basisboekmvo.nl/images/mvo-scriptie/ 4%20Timo%20Cochius.pdf Cochran, P Cone Inc. (2004). Cone corporate citizenship study. Retrieved from http://www.coneinc.com. Creyer, E. H., & Ross, W. T. (1997). The influence of firm behavior on purchase intention: Do consumers really care about business ethics? Journal of Consumer Marketing, 14(6), 421–432. Dahl, D. W., & Lavack, A. M. (1995). Cause-related marketing: Impact of size of corporate donation and size of cause-related promotion on consumer perceptions and participation. Donaldson, T., & Preston, L. E. (1995). The stakeholder theory of the corporation: Concepts, evidence, and implications. Academy of Management Review, 20, 64–91. Ellen, P. S., Webb, D. J., & Mohr, L. A. (2006). Building corporate associations: Consumer attributions for corporate social responsible programs. Journal of the Academy of Marketing Science, 34(2), 147–157. Folkes, V. S. & Kamin, M. A. 1999. Effects of Information About Firms’ Ethical and Unethical Actions on Consumers’ Attitudes Forster, T. (2007). Die grünen Yuppies. Werben&Verkaufen, (51), 45 Freeman, R Friedman, M. 1970. The Social Responsibility of Business is to Increase Its Profits. The New York Times Magazine. September, 13th. Garbarino, E. & Johnson, M. S. 1999. The different roles of satisfaction, trust, and commitment in customer relationships. Journal of Marketing. Vol. 63, No. 2, pp. 70-87. Gronroos, C. 1983. Strategic Management and Marketing in the Service Sector. Marketing News. Vol. 17, No. 19, pp. 215-222. Grunert, G. K. 2005. Food quality and safety: consumer perception and demand. European Review of Agricultural Economics. Vol 32, No. 3, pp. 369–391. Gürhan-Canli, Z. & Batra, R. 2004. When Corporate Image Affects Product Evaluations: The Moderating Role of Perceived Risk. Journal of Marketing Research. Vol. 41, No. 2, pp. 197-205. Gustafsson, A., Johnson, M. D. & Roos, I. 2005. The Effects of Customer Satisfaction, Relationship Commitment Dimensions, and Triggers on Customer Retention. Journal of Marketing. Vol. 69, pp. 210-218. Hair Jr., F. J., Babin, B., Money, H. A. & Samouel, P. 2003. Essentials of Business Research Methods. John Wiley & Sons, Inc: USA. Herr, P. M., Kardes, F. R., & Kim, J. 1991. Effects of Word-of-Mouth and Product- Attribute Information on Persuasion: An Accessibility-Diagnosticity Perspective. Journal of Consumer Research. Vol. 17, pp. 454–462. Henning-Thurau, T., Gwinner, K. & Gremler, D. 2002. Understanding relationship marketing outcomes: An integration of relational benefits and relationship quality. Journal of Service Research. Vol. 4, No. 3, pp. 230-247. Lafferty, B., Barbara, A., & Ronald, E. G. (1999). Corporate credibility 's role in consumers ' attitudes and purchase intentions when a high versus a low credibility endorser is used in the ad. Journal of Business Research, 44(2), 109–116. Maignan, I., & Farrell, O. C. (2004). Corporate social responsibility and marketing: An integrative framework. Journal of the Academy of Marketing Science, 32(1), 3–19. McAlister, D. T., Ferrell, O. C., & Ferrell, L. (2003). Business & society: A strategic approach to corporate citizenship. Boston, MA: Houghton Mifflir Company. Mitchell, R. K., Agle, B. R., & Wood, D. J. (1997). Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts. Academy of Management Review, 22(4), 853–887. Mohr, L. A., & Webb, D. J. (2005). The effects of corporate social responsibility and price on consumer responses. The Journal of Consumer Affairs, 39(1), 121–147. Pirsch, J., Gupta, S., & Grau, S. L. (2007). A framework for understanding corporate social responsibility programs as a continuum: An exploratory study. Journal of Business Ethics, 70, 125–140. Pomering, A., & Dolnicar, S. (2006). The limitations of consumer response to CSR: An empirical test of Smith 's proposed antecedents (ANZMAC 2006), Queensland University of Technology, Gardens Point Campus, Brisbane, 4–6 December 2006. Pomering, A., & Dolnicar, S. (2006). Customers ' sensitivity to different measures of corporate social responsibility in the Australian banking sector, Brisbane, Queensland, 4–6 December 2006. Post, F. R. (2003). A response to the social responsibility of corporate management: A classical critique. Mid-American Journal of Business, 18(1), 25–35. Roscoe, J. T. (1975). Fundamental research statistics for the behavioural sciences. (2nd ed.) New York: Holt Rinehart & Winston. Saleh, M. (2009). Corporate social responsibility disclosure in an emerging market: A longitudinal analysis approach. International Business Research, 2(1), 131–141. Savage, G. T., Nix, T. W., Whitehead, C. J., & Blair, J. D. (1991). Strategies for assessing and managing organisational stakeholder. Academy of Management Executive, 5(2), 61–75. Schwartz, M. S., & Carroll, A. B. (2003). Corporate social responsibility: A three-domain approach. Business Ethics Quarterly, 13(4), 503–530.