Loading...

Cause-related Marketing: The Influence of the fit among partners, brands and cause

©2014 Textbook 42 Pages

Summary

The combination of efforts of Profit-Organizations and Non-Profit-Organizations to benefit from a collaboration has gained increased attention throughout the last couple of years. Events such as the BP oil leak in the Gulf of Mexico, the Enron scandal or the fraudulent participation of investment banks in the most recent financial crisis have fueled the discussion of ethical codes of conduct for corporations, their social responsibility in society and thus their social commitment. The contribution of business entities in social causes made them consider their possibilities to not only act socially responsible, but profitable at the same time. This called marketers to action, designing a new type of marketing, CRM, that would highlight a company’s willingness to do good, advance the company’s reputable image, enhance customer retention and increase sales.The aim of this study is the presentation of the current state of research on the impact of fit on the success of CRM. A further objective is the systematic elaboration of empirical studies to identify interactions on the fit and draw conclusions about possible effects on the success of CRM campaigns.

Excerpt

Table Of Contents


8
Insight of the influence of fit on the success of CRM can help companies in answering
marketing policy issues and help in marketing resource allocation. For example,
companies are enabled to plan and execute customer-specific marketing strategies by
incorporating the effects of fit in their techniques and therefore avoid unnecessary
money spending. High levels of fit among two partners are more harmonious than a low
suitability. Using fit in CRM as a deliberate marketing tool can e.g. increase customers
purchase intentions and change company perception in the aspired direction. Conse-
quently, the identification of influence of fit on the success of CRM and interactions on
the fit are of central importance to marketing decisions.
The present work is divided into six chapters. Following this introductory section, the
basics of CRM and fit are explained in 2.1 and 2.2. For the further development of fit in
CRM, a conceptual framework is compiled in 2.3. In 2.3. the impact of fit on the
success of CRM is illustrated, taking moderating, intervening effects into consideration.
Chapter 0 contains the methodological exemplification of the empirical studies used to
examine the effects of fit on the success of CRM. The results of the empirical studies
are separated into direct and biased effects of fit on the success of CRM in chapter 4.
Chapter 5 offers practical as well as research oriented implications. Finally, in chapter 6,
findings are summarized and in regard to the research objectives critically reviewed.

9
2 .
BACKGROUND
An introduction to CRM is provided by defining the term and distinguishing it from similar
marketing concepts, taking several dimensions of fit into consideration. Afterwards, the
conceptual framework is presented by introducing independent and dependent variables as
well as moderating effects on fit in CRM.
2.1.
DEFINITION OF CAUSE-RELATED MARKETING
Since discussions erupted that there is a need for companies to act socially responsible,
as mentioned in the introductory chapter, organizations gave not only in to the demand,
but created a business strategy, Corporate Social Responsibility (CSR)
6
, to distinguish
themselves from competitors (Werther & Chandler, 2011). Acting socially responsible
has become an increasingly important goal of companies to add value to organizations
besides monetary intentions (Fries & Müller, 2011). Integrating CSR into the organiza-
tion's external communication is called CRM (ib.). CRM brings social issues to
attention and links them to a product or service (Andreasen, 2006). In short, CRM is the
tie of a social cause to a product or service, which are then promoted together (Kurtz,
2008) for multilateral benefit (Adkins, 1999). Customers benefit from the satisfactory
feeling of acting socially responsible, the "warm glow"
7
(Arora & Henderson, 2007).
POs profit from image enhancement through associations to a socially responsible
cause, brand awareness and brand credibility (Zdravkovic, Magnusson, & Stanley,
2010), (Keller, Apéria, & Georgson, 2008) as well as brand loyalty and increasing sales
(Lafferty, 2009). NPOs gain advantages from the attention drawn to them and the
financial support (Oloko, 2011). Still, there is no agreed definition for CRM and many
researchers use different classifications. Two main categorizations can be identified
when looking for a CRM definition: A broad or a narrow approach (Oloko, 2011).
6
The European Commission defines CSR as voluntary concept, which embeds social and ecological
features in an entity's operations and relations to stakeholders (Commission of the European
Communities, 2001).
7
The feeling, which is aroused in a customer by purchasing moral satisfaction. For further information
refer to Andreoni (1990).
Chart 1: Broad and Narrow Definition of CRM (Oloko, 2011, p. 38)

10
Researchers favoring a broad outline, such as Kurtz (2008) and Adkins (1999), relate
social marketing activities to the seven types of Business-Nonprofit Alliances as shown
in Chart 1. This definition consists of Joint Ventures, philanthropic involvement,
foundations and sponsorships as well as Transaction-Based Promotions, Joint Issue
Promotions and Licensing. Following a more narrow approach, Andreasen (2006)
clearly differentiates CRM from sponsoring or philanthropic activities by getting
involved in a partnership rather than donating money.
In accordance with Andreasen (2006), Wymer and Samu (2003) separate CRM into
three types, Joint Issue Promotions, Licensing and Transaction-Based Promotions as
illustrated in Chart 1. Joint Issue Promotions refer to the cooperation of a PO and NPO
to increase awareness of social ills (Oloko, 2011), which is often accomplished by non-
monetary support (Fries & Müller, 2011). Licensing gives POs the possibility to use
logos or brands of a NPO in return for licensing fees or shares of sales (Geißel, 2011).
Andreasen and Kotler (2008) refer to CRM as sales-related promotion. Thus, they
emphasize that a certain amount of the PO's sales is donated to a designated cause (ib.).
This type of CRM campaign is also called Transaction-Based Promotion, emphasiz-
ing the PO's additional contribution, depending on consumer consumption levels
(Wymer & Samu, 2003).
The most widely accepted definition of CRM has been developed by Varadarajan and
Menon (1988). They define CRM in accordance with Andreasen, Kotler (2008) and
Wymer, Samu (2003) as "The process of formulating and implementing marketing
activities that are characterized by an offer from the firm to contribute a specified
amount to a designated cause when customers engage in revenue-providing exchanges
that satisfy organizational and individual objectives." (Varadarajan & Menon, 1988, p.
60).
Terminology Type
Description
Busin
ess-Nonprofit All
iance
Joint Venture
PO and NPO collaborate to create a certification
trademark.
Corporate Philanthropy
PO donates fixed amount of money to NPO.
Corporate Foundation
PO establishes foundation, which funds charitable
projects.
Sponsorship
PO donates to social or ecological events.
Cause-related
Marketing
Joint Issue Promotion
PO and NPO increase awareness of social or
ecological ills.
Licensing
PO uses logo of NPO in return for a fee
Transaction-Based Promotion
PO donates money to NPO according to consumer
consumption.

11
In the following parts of this book the term initiated by Varadarajan and Menon (1988)
will serve as definition of CRM to insure cohesiveness and comparability.
2.2.
DEFINITION OF FIT IN CAUSE-RELATED MARKETING
Fit is often not specified in marketing literature and simply considered as "perceived
similarity of the brand and other entity" (Keller, 2003, p. 599). The roots of fit in
marketing evolve from brand extensions, which consider the perceived fit by customers,
between allying or transferring brands (Schaffmeister, 2008). This level of relatedness is
synonymously called congruence, match and similarity (Trimble & Rifon, 2006),
(Cornwell, Pruitt, & van Ness, 2001).
Huber, Regier and Rinino (2008) characterize fit as perceived similarity and thus
subjective suitability of two entities. The concept of fit has been transferred to CRM,
evaluating the relatedness of e.g. cause and brand.
Due to the extensiveness of the term fit, Trimble and Rifon (2006) divided the expres-
sion into image-based fit and functional fit, calling the overall fit `global fit'. Image
orientated fit is the perceived value of PO and NPO, whereas functional fit is the
contextual compliance of product features or business model and the cause (ib.).
According to Koolman (2006) fit is a crucial success factor in the accomplishment of a
CRM campaign.
Various theories on how fit is determined by customers have been introduced (Mangold,
2007), (Geißel, 2011). According to Keller, Apéria and Georgson (2008), fit is per-
ceived via attributes or benefits. Two popular models are congruence and consistency
theories. Congruence theory proposes that stowing and remembering information is
related to the similarity of information observed and recalled (Cornwell, Weeks, & Roy,
2007). Therefore, people memorize anticipated information more easily (Lynch & Srull,
1982). Heider (1958) takes this concept further in the balance theory, where he claims
that individuals attempt cognitive consistency and avoid seeming inconsistency. Thus,
people try to adapt inconsistent observations to make them fit and create a tension-free
cognizance (Mangold, 2007). Contrarily, Hastie (1980) suggests that due to complexity
in processing data, individuals retrieve incongruent information more effectively and
hence consider unlikely combinations to be more proactive.
Besides cognitive factors, perceived fit is determined by customer's emotions
(Koolman, 2006). Emotions are triggered and aroused by precedent cognitive processes
(ib.). All in all fit is very complex and depended on the eye of the beholder.

12
The
succe
succe
As s
depe
fit, P
ating
tors a
camp
cogn
Figur
b
P
P
conceptual
ess of CRM
ess of CRM
hown in Fi
endent varia
PO-NPO fit
g effects, wh
are categori
paign-relate
nitive, affect
re 1: Concep
Fit
brand-cause fi
PO-NPO fit
PO-cause fit
framework
M. It connec
M considerin
igure 1, the
able, the suc
and PO-cau
hich can enh
ized by the
ed moderato
tive and con
eptual Fram
fit
brand-related
brand familia
brand awaren
brand percep
type of produ
cause-related
cause familia
cause affinity
consumer-re
gender
value structu
PO credibilit
campaign-re
brand/cause d
promotional
2.3.
CONCE
k clearly ou
cts all curre
ng interactin
e fit, being
ccess of CR
use fit. The
hance or dim
ir interactio
ors. The de
native effec
mework (own
Moderator
d moderator
arity
ness
ption
uct (frivolous
d moderators
arity
y
elated moder
ure (materialis
ty
elated moder
dominance
extend of CR
EPTUAL FRA
utlines the p
ent empiric
ng influence
2.3.1.
OVE
the indepe
RM. Fit has
e independe
minish the e
on character
ependent va
cts. Supplem
n figure)
rs
s
s/practical)
s
rators
stic/social)
rators
RM campaign
AMEWORK
potential cou
cal findings
es on the fit
RVIEW
endent varia
been measu
ent variable
effects of fi
ristics into b
ariable of s
mentary det
n
urses of act
of the imp
as shown in
able, directl
ured threefo
is further b
t on its own
brand, caus
success is f
ails in regar
Suc
cogniti
brand a
affectiv
PO per
brand p
brand v
cause p
conativ
financi
willing
purchas
tion of fit o
pact of fit o
n Figure 1.
ly influence
old: Brand-
biased by m
n. These mo
se, consume
further split
rd to the co
ccess of CRM
ive stage
awareness
ve stage
rception
perception
value
perception
ve stage
al payoff
gness to contr
se intention
on the
on the
es the
-cause
moder-
odera-
er and
t into
ompo-
M
ibute

13
sition of the conceptual framework and its components are elaborated in the following
chapters.
2.3.2.
FIT IN CAUSE-RELATED MARKETING
An independent variable is directly causing or affecting the result of a research study
(Hall, 2008). Hence, the fit directly influences the outcome on how successful a CRM
campaign is.
Due to time restrictions, this book highlights the influences of fit on the success of
CRM campaigns only. Even though, further factors besides fit affect the success of a
CRM campaign such as cause, product, company and consumer characteristics, design
elements and the NPO (Fries, 2010).
The fit in CRM is one success factor that determines the success of CRM campaigns
directly (Fries, 2010). Kotler and Lee (2005) even describe fit as one of the most
important keys to success in CRM. Generally speaking, high fit results in positive
effects of consumer attitude towards the PO or brand (Aaker & Keller, 1990). Conse-
quently, low fit leads to low brand or PO perception, which then triggers diminished
consumer reaction (Simmons & Becker-Olsen, 2006).
Fit can take various dimensions in a CRM context, namely brand-cause fit, PO-NPO fit
as well as PO-cause fit. Further relations of fit are not taken into consideration as the
mentioned dimensions offer the broadest research background. Researchers mainly
focus on the brand-cause fit. Brand-cause fit describes the suitability of a brand and/or
product and a social cause based on the consumer's opinion (Lafferty & Goldsmith,
2005). It includes two aspects of fit, functional fit and image fit (Trimble & Rifon,
2006). Functional fit is the comparison of product functions to a brand, which is then
paralleled to a cause (Bigné-Alcañiz, Currás-Pérez, & Sánchez-García, 2009). Image fit
relies on similar image and positioning features of a brand and a cause (ib.). High fit
occurs when the PO's core consumer values are integrated in the brand and cause
(Trimble & Rifon, 2006). A popular example is the Volvic campaign where one liter of
Volvic bottled water helps to build a water well in Ethiopia and thus provides 10 liters
of drinking water in Africa (Blumberg & Conrad, 2006). 94,7 percent of participants in
a German survey considered the fit of Volvic and the correlating water aid campaign to
be of high fit (ib.).
The fit of PO and cause describes a suitable association between the PO's image,
positioning and target market on the one hand and the cause's reputation and clientele
on the other (Varadarajan & Menon, 1988). Gürhan-Canli and Fries (2010) describe the

14
fit of PO and cause as the match of the PO's characteristics, including all business
activities with a social cause. Hereby, the fit of the company instead of a brand or
product with a cause is displayed. Again taking the Volvic campaign into consideration,
it would be altered to Danone
8
as promoted partner to the water aid campaign instead of
the bottled water brand itself. Even though, a product might highly fit the cause, the PO
does not necessarily follow the pattern as the Volvic example illustrates. A conglomer-
ate like Danone does not solely stand for water or social responsibility. Since conglom-
erates hold numbers of brands, the PO's image consist of fractures of their brand's
images. Thus, POs that only contribute to a cause with one of their many brands might
not enhance their entire corporate image. Gupta and Pirsch (2006) therefore suggest that
the cause should be harmonious with the PO's identity and main recipient.
PO-NPO fit refers to the relevance of sponsor and the sponsored (Geißel, 2011). Using
the Volvic case as example, the fit of Danone, as PO, and the United Nations Children's
Fund (UNICEF)
9
, as NPO, would be compared. To generate a high fit, the PO's core
values should be parallel to the NPO's.
2.3.3.
SUCCESS EFFECTS OF CAUSE-RELATED MARKETING CAMPAIGNS
The major incentive to form a marketable collaboration of a PO and NPO are beneficial
advantages from the partnership to vend an image and a product (Adkins, 1999). Thus,
organizations opt for monetary goals, such as profit maximization, on the one hand and
the achievement of non-monetary goals, such as catering to the cause, on the other hand
to achieve success in CRM. Whereas financial ambitions are considered to be short-
lived, altruistic motives are long-term orientated. Acquisition of new customers as well
as sales increase through CRM sales promotions are short-term goals (Fries & Müller,
Konsumentenbezogene Wirkungen von Cause-Related Brands, 2011). Long-term goals
are meant to enhance the PO's and brand's image, increase customer loyalty and the
PO's credibility (Lafferty, 2009), (Zdravkovic, Magnusson, & Stanley, 2010).
As mentioned in 2.3.2, the fit determines the success of a CRM campaign intensely and
its outcome cannot only be displayed in short and long-term success, but further divided
into the consumer's affective, cognitive and behavioral reactions as displayed in Figure
1. In this book, the effects of success are sorted according to the AIDA concept (Atten-
8
Danone is a multinational consumer goods corporation and the world leader in fresh dairy products and
bottled water. It's leading brand for bottled water is Volvic.
9
NPO, created by the United Nations to help children in need in terms of healthcare and wellbeing.

15
tion, Interest, Desire, Action)
10
, which describes consumer reactions from initial contact
with a product to a triggered response (Hackley, 2010). This can be understood in three
steps of consumer involvement: the cognitive, the affective and the behavioral, respec-
tively conative stage (Lamb, Hair, & McDaniel, 2008).
Cognitive effects
Achieving cognitive effects is a long-term oriented goal, that a company seeks to
achieve (Kotler & Armstrong, 2010). The favorable relation of consumer and brand,
caused by high consumer familiarity and recognition with the brand (Keller, Apéria, &
Georgson, 2008) is referred to as brand awareness. It influences consumer emotions,
associations and actions towards a brand and occurs in the consumer's mind (Kotler et
al., 2009).
Affective effects
Affective effects are strongly embedded emotional elements of the customer's brand
knowledge (Kotler & Armstrong, 2010). Boundaries between cognitive and affective
effects often overlap due to combined factors of emotional as well as mental details in
one marketing concept (Oloko, 2011). Cognitive effects can be preceded and vitiated by
affections (Lafferty, 2007). For instance, brand perception is mentally activated by
attributes and emotionally caused by associations.
Consumer perception is actively shaped by the acquisition and assignment of meaning
to a stimulus (Hawkins, Mothersbaugh, & Best, 2007). The consumer's perception of
the PO is affectively shaped by brand associations (Keller, Apéria, & Georgson, 2008).
Positive associations are evoked when the consumer believes that the PO offers prod-
ucts with qualities and benefits that meet their needs and wants (ib.). Hence, the
corporate image of a PO benefits or detriments depending on the consumer's associa-
tions towards the PO's involvement in CRM.
Besides PO perception, brand perception is the image a consumer forms of a brand
(Kotler et al., 2009). It is caused by exposure, attention and physical characteristics of
the product, which evoke emotions in the consumer and induce brand value (Hawkins,
Mothersbaugh, & Best, 2007).
Brand value can be examined in a twofold way. On the one hand brand value is
reflected financially, on the other hand it can be measured non-monetary (Wymer &
10
Model for achieving promotional goals. For further explanations on the principles of the AIDA model
and its origin, refer to Hackley (2010) and Strong (1925).

16
Samu, 2009). In financial terms, the brand value accounts for the company's added
value obtained through advantages over competitors (Kotler et al., 2009). The financial
benefit can be described as the customer's willingness to pay more for a product, which
is combined with a cause. Non-monetarily, customers assume a brand to be more
worthy when paired with a cause, since CRM campaigns give back to society (Wymer
& Samu, 2009). Hence, the consumer feels involved in "doing good" and contributing
their share to society. The consumer's willingness to contribute to a CRM campaign
depends not only on brand-related facts, but is constrained by the consumer's cause
perception. Cause perception is the development of an entity's image in the customer's
mind. It reflects the observed trustworthiness of the cause and whether the cause is
meaningful to the customer or not.
All affective effects combined have the ability to change the consumer's attitude
towards PO, brand and/or cause. CRM seeks to change the consumer's perceived image
into a more positive disposition in order to alter the consumer's shopping habits in the
POs and NPOs favor (Kotler et al., 2009).
Conative effects
Conative effects on the success of CRM campaigns are mostly short-term oriented goals
(Kotler & Armstrong, 2010). They are measured in consumer participation as their
active contribution results e.g. in higher purchase intentions, which then lead to in-
creased sales. Weighting the cost of a CRM campaign against the sales surplus, generat-
ed through CRM, the profit margin sheds light on the campaigns profitability and
financial payoff. To achieve maximal success, short-term, financial measures need to
be carefully aligned with social considerations (ib.). When consumers are asked to
decide whether they want to donate to a cause or rather obtain the same amount as a
cash discount, donation levels are evaluated (Pracejus & Olsen, 2004). This measure-
ment offers insight on consumers' willingness to contribute to a cause. Consumers
might be willing to pay more for a CRM-related product to avoid remorse or on the
contrary be too penurious to purchase a CRM-related product since they cannot see
additional benefits from the donation. Purchase intentions apply before the actual
consumption in the purchase decision process. They are formed by preferences for a
certain brand (Kotler et al., 2009) and purchase motives (Belch & Belch, 2004).
Consumers just looking for a specific product, regardless of the brand are less likely to
change their purchase intention for the sake of a cause. Consumers shopping without set

Details

Pages
Type of Edition
Erstausgabe
Year
2014
ISBN (eBook)
9783954896943
ISBN (Softcover)
9783954891948
File size
385 KB
Language
English
Publication date
2014 (March)
Keywords
Cause-related Marketing brands and cause fit among partners
Previous

Title: Cause-related Marketing: The Influence of the fit among partners, brands and cause
book preview page numper 1
book preview page numper 2
book preview page numper 3
book preview page numper 4
book preview page numper 5
book preview page numper 6
book preview page numper 7
book preview page numper 8
42 pages
Cookie-Einstellungen