How and When does strategic CSR work? : Experimenting the Impact of Brand Equity and Persuasive Story on Consumer Response to Imitated CSR Initiatives

Abstract

TOMS is a shoe company that gives away a pair for each pair you buy. In light of their success, the imitator BOBS entered offering similar shoe design and the same buy one give one initiative. Corporate Social responsibility (CSR), by its definition, is a noble cause that benefits society, thus, one would expect consumers' response to BOBS would be equally favorable as they didi to TOMS. However, this was not the case (Jørgensen & Pedersen, 2013). Intrigued by the story of TOMS vs BOBS we arrived to the following decision problem: How can companies that imitate CSR initiatives alleviate unfavorable response from consumers? In order to operationalize this research question, two specific questions were investigated: (1) Can brand equity alleviate consumers' unfavorable response to imitated CSR initiatives, and (2) Can a persuasive story alleviate consumers' unfavorable response to imitated CSR initiative? These questions were addressed with a 2x2 factorial design experiment where the dimensions were known brand/unknown brand and persuasive story/ no persuasive story. The persuasive story yielded significant main effects on product attitude and purchase intentions. However, simple effects analysis revealed that it was persuasive story alongside the known brand that provided the significant results. The implication for managers is that persuasive story with a strong brand can jointly bring forth more favorably consumer response to imitated CSR-products. Interestingly, the present study found significant correlation between perceived sincerity of the company and perceived fit (between CSR initiative and the company), recognizing that this correlation may not necessarily mean causation, future studies may consider investigation of the causal analysis between the two variables.