INVESTIGATING THE BRAND CSR – CONSUMER VALUES INTERFACE
EXTENDED ABSTRACT SUBMITTED TO
THE CONFERENCE ON GLOBAL BRAND MANAGEMENT
ISTANBUL, TURKEY
by
Burcu Tasoluk*
Rajeev Batra
*Corresponding author. Both authors contributed equally. Burcu Tasoluk is Assistant Professor of Marketing, Sabanci University, Faculty of Management, Tuzla, 34956, Istanbul, Turkey; telephone +90 (216) 483 9640; fax +90 (216) 483 9699; email: . Rajeev Batra is S.S. Kresge Professor of Marketing, Ross School of Business, University of Michigan, 701 Tappan Street, Ann Arbor, MI48109-1234, USA, telephone 734 764 0118; fax 734 936 0279; email: . The authors gratefully thank Dr. Roger Calantone, the EliBroadChairedUniversity Professor of Business at MichiganStateUniversity, for financing part of the data used in the study. The research assistance of Ryan Elder, doctoral student at the University of Michigan, is also highly appreciated.
INVESTIGATING THE BRAND CSR – CONSUMER VALUES INTERFACE
THEORY
Previous research has documented that CSR initiatives can (subject to the moderators discussed below) increase company and product evaluations (Brown and Dacin 1997), purchase intentions (David, Kline, and Dai 2005; Du, Bhattacharya, and Sen 2007b; Du, Bhattacharya, and Sen 2007a; Ellen, Webb, and Mohr 2006; Pirsch, Gupta, and Grau 2007; Sen and Bhattacharya 2001), and heightened loyalty, emotional attachment, and advocacy (Lichtenstein, Drumwright, and Braig 2004). Mediators of these effects have also been studied in the literature, such as perceived sincerity (Yoon, Gürhan-Canli, and Schwarz 2006), perceived underlying motives (Du, Bhattacharya, and Sen 2007b), and trust (Du, Bhattacharya, and Sen 2007a).
Given the large sums being invested by companies today in burnishing their CSR reputations (Ellen, Webb and Mohr (2006) use a figure of $9 billion for 2001), it is natural to ask if there are some “boundary conditions” (moderators) for these preference-building effects. As prior studies have shown, a first (and obvious) moderator of the link between CSR and perceptions and behaviors is found to be consumer’s awareness of the CSR actions and their perceived efficacy (Du, Bhattacharya, and Sen 2007a). Prior research has also documented the moderating effect of the congruency (fit) of the company’s core business and the CSR cause itself.
However, only a small amount of prior research has examined the possibly moderating role of the life-values considered important by the consumer being influenced (see Gurhan-Canli and Fries (2009) for a review). As we will show later, these few prior papers do not study this question using theoretically-acceptable constructs and measures. This omission is both surprising and important. Consumer segments naturally differ in the types of attributes they consider important in their brand choice within a category (Batra and Homer 2004). Since a company’s reputation for CSR activities is different from its reputation for product quality (Brown and Dacin 1997; Gurhan-Canli and Batra 2004), it ought to be more influential and diagnostic among consumers who weight such “socially-relevant” aspects more heavily. We know, for example, that certain consumer segments (such as the ‘greens’ in Western Europe (Camus 2009) seem to care more than others about companies’ records on social and environmental factors. A company investing in CSR efforts with a view to influencing evaluations thus ought to get more benefit from these if it can identify and target consumer segments more likely to care about such CSR efforts.
Addressing this gap, we study in this paper whether the impact of CSR activities on product evaluations is greater among consumers who place a greater weight on life-values (Schwartz 1992) reflecting the welfare of their communities, such as universalism and benevolence, rather than their individual hedonism, power and achievement. By using a cross-national data set that spans 30 countries, we further study here the moderating impact on the CSR-to-evaluation relationship of a country’s national culture, thus providing insight to global brand managers not only about which consumer segments to target, but also in which parts of the world.
MODEL & HYPOTHESES
We have three formal hypotheses to test:
H1: At the individual consumer level, the impact of a brand’s CSR reputation upon the overall attitudes towards it are greater among consumers who place higher importance on the achievement of social and collective responsibilities and obligations (Schwartz’s ST values) than on the achievement of their own individual, self-aggrandizing goals (Schwartz’s SE values).
H2: At the national (cultural) level, the impact of a global brand’s CSR reputation upon the overall attitudes towards it are greater in national cultures that place higher importance on the achievement of social and collective responsibilities (Schwartz’s ST values) and obligations than on the achievement of individual, self-aggrandizing goals (Schwartz’s SE values).
H3: A global brand’s CSR reputation will contribute significantly to the overall consumer attitudes towards it, even after controlling for consumer perceptions of its quality and prestige.
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A Hierarchical Model of Corporate Social Responsibility and Schwartz’s Values
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METHOD
Our model variables cover both consumers and countries. These variables belong to different units of analysis that form a hierarchical structure: consumers (individuals) are nested within countries (groups). Combining all variables that belong to different levels of analysis into one regression equation (e.g., via OLS) would undermine two basic assumptions of traditional linear model analysis: homoscedasticity and independence. Therefore we used Hierarchical Linear Modeling (HLM) (Bryk and Raudenbush 1992; Raudenbush and Bryk 2002), also called multi-level or mixed-effects models, in our analysis below, since this technique was developed to deal specifically with hierarchical (nested) data. Our model equation is:
Yij = γ00 + γ10*(CSR)ij + γ11*(CSR)ij*(CRST)j + γ20* (RST)ij + γ30*(CSR*RST)ij + γ40*(QUALITY)ij + γ50*(PRESTIGE)ij + γ60*(CSR*BAuto)ij + γ70*(CSR*BMedia)ij + γ80*(CSR*BConsG)ij + γ90*(CSR*BPersC)ij + γ100*(CSR*BFin)ij + γ110*(BAuto)ij+ γ120*(BMedia)ij+ γ130*(BConsG)ij+ γ140*(BPersC)ij+ γ150*(BFin)ij+ u0j + u1j*(CSR)ij + u2j*(RST)ij + u3j*(CSR*RST)ij + u4j*(QUALITY)ij + u5j*(PRESTIGE)ij + rij
HLM 6.03 (Raudenbush, Bryk, and Congdon 2000) software was used for the parameter estimation. We perform our empirical tests on a data set that covers 36 global brands, across 6 product categories, rated by over 30,000 consumers, in 30 countries.
RESULTS
Same- and Cross-level Interaction Effects: The Moderating Effects of Individual and Country-Level Values
The interaction effect of brand CSR and individual-consumer RST is positively and significantly related to brand attitude, supporting our first hypothesis, that consumers higher in self-transcendant values would weight CSR more in forming brand attitudes. The effect of brand CSR on brand attitude is stronger for higher RST consumers than lower RST consumers.
The interaction effect of brand CSR and country-level RST is also positively related to brand attitude. This supports our second hypothesis as well, that countries (cultures) higher in self-transcendant values should also weight CSR more in forming brand attitudes. On average, the effect of brand CSR on brand attitude is stronger in higher RST countries than lower RST countries[1].
Brand CSR, Quality, and Prestige
Concerning our third hypothesis, which said that for these global brands individual-level CSR would still significantly predict brand attitudes, even after controlling for a brand’s perceived quality and prestige, perceived brand CSR is indeed significantly positively related to brand attitude, supporting the hypothesis. We also note that, as found in the prior literature on global brands, perceived brand quality is positively related to brand attitude[2].
Product Category Interactions with CSR
Although no a priori hypotheses were stated for the category-specific effects of CSR, we found a significant, negative categorical interaction effect for brands in the finance product category. The negative interaction effect of CSR and the finance category implies that the effect of brand CSR on brand attitude for global finance brands is lower, on average, than its impact in other categories. This is plausible, since consumers may be expecting financial services brands to focus on making money, rather than engaging in CSR behavior, leading to greater skepticism regarding their motives (Du, Bhattacharya, and Sen 2007b).
References
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[1]We also tested the interaction effects of brand CSR with quality and prestige; neither of them was significant.
[2] However, perceived brand prestige does not seem to have a significant effect on brand attitude in our data. This non-significant effect may be due to a positive correlation between such prestige and price, with high-prestige, high-price brands possibly having lower ownership levels in our data, decreasing our brand attitude composite scores. Our data set unfortunately does not include a price variable.