Information pertaining to consumer perceptions and consumer behavior is important to firms as it can serve as a tool to increase sales, but more importantly, contribute to the increase of a company’s involvement in socially responsible causes to improve overall human welfare.
In related research, there have been various methods of studying consumer perceptions of corporate philanthropy. One study was conducted in Iran that involved consumers of dairy products in which data was collected through questionnaires of 200 households via cluster sampling. The main purpose of the study was to determine the impact of a firm’s CSR (corporate social responsibility) on consumer perceptions towards a firm and whether perceptions would affect consumer purchasing behavior (Vahdati, Mousavi, & Tajik, 2015). This study measured results using an error level of .05, an estimate accuracy rate of .07 and the success ratio of 0.5. (Vahdati, Mousavi, & Tajik, 2015). The conclusion of the study found that CSR does have a positive relationship in creating a positive perception in the eyes of consumers, which has a direct effect on purchasing patterns.
Another related academic article focused on researchers gaining, analyzing and comparing data from a variety of past studies which collected data via experiments, surveys and studies regarding consumer behavior and expectations held of firms to act in a socially responsible way. The studies consisted of gauging consumer awareness of how well perceptions were of a firm’s CSR and whether a firm’s engagement in philanthropy had a significant effect on the consumer’s decision-making regarding purchases (Mohn, Webb, & Harris, 2011). The definition and existence in today’s society of “socially responsible consumer behavior” are discussed in the mentioned literature. The article defines a socially responsible consumer as one who makes a conscious effort when making purchasing decisions (Mohn, Webb, & Harris, 2011). A socially responsible consumer hopes to bring about positive social change with purchasing power, and in so, choose to support socially responsible companies.
In one study mentioned in the article, researchers examined a consumer trend report which compiled consumer responses to cause-related marketing. Cause-related marketing is defined as aligning a brand with a cause to produce profitable and societal benefits for both parties (“What is Cause Marketing?”, 2012). In the consumer report, it was revealed that 80% of respondents surveyed reported having an increased positive image of a company if it offered support to a cause the consumer held a concern for. Two-thirds of respondents of the sample revealed the likelihood of switching brands or firms to those engaged in cause-related marketing (Mohn, Webb, & Harris, 2011). It could be said that the respondents of the consumer trend report show a high degree of socially responsible consumer behavior.
On the opposition, a national telephone study was conducted and only found 46% of respondents mentioned the likelihood to switch brands to support a company known to be engaged in philanthropy. In the same telephone study, only 30% of consumers admitted occasionally purchasing products due to the fact the associated corporation engages in philanthropy (Mohn, Webb, & Harris, 2011). In comparison to the results of the consumer trend report, the positive consumer perception and behavior associated with a firm’s philanthropic engagement appears much lower which could lead one to believe that corporate philanthropy does not have a significant impact on consumer perception or purchasing behavior.
Under the same article, an experiment was discussed where researchers created fictional cause-related marketing scenarios. The experiment consisted of two studies. One study included a promotion which promised a portion of firm proceeds would be donated to a charity. The result showed an increase in positive consumer perception but had no effect on the consumer’s purchase intentions (Mohn, Webb, & Harris, 2011). The second experiment found no noteworthy difference in consumer perceptions in ads that did and did not promise charitable contributions.
Further research conducted using a database of 33,562 individual evaluations of 60 companies using Signal Detection Theory was conducted to examine how corporations engage in philanthropy to affect one’s reputation. As a result, researchers indicated the number of causes a firm supports and whether a firm creates and implements an in-house foundation effect the level of consumer awareness to consumers (Gardberg, Zyglidopolous, Symeou & Schepers, 2017). Furthermore, it is implied consumer awareness is the primary factor to consumer perceptions. The more a consumer is aware of a corporation’s philanthropy, the more influence a consumer’s perception is of the corporation.
Similarly, in the above promotions and studies, researchers over time have received a mix of results due to consumer perceptions being situational and complex. In regard to corporate philanthropy and consumer’s perception and purchase behavior, the consumer reaction depends heavily on several factors. Researchers note that the complexity of consumer reaction to corporate philanthropy primarily lies in the individual and the causes that matter to each and how causes between individual consumers differ (Mohn, Webb, & Harris, 2011). A cause or charity that matters to one person is going to be different than the next consumer. Another factor of consumer perception mentioned is the size of the contribution made by firms. Studies have indicated the smaller a firm’s donation can result in a consumer perception of exploitation of the charity, and a larger donation made by a company is seen more altruistic (Mohn, Webb, & Harris, 2011).
Overall, the many methods used to collect data through prior research have concluded varied results. Researchers have examined and concluded a factor to varied results are due to the nature of corporate philanthropy and consumer behaviors being two very complex topics to measure; possibly too complex to measure (Gardberg, Zyglidopolous, Symeou & Schepers, 2017). Another factor mentioned which questions the validity of results is consumer’s self-perceptions. When respondents are being evaluated, whether it be through interviews or questionnaires, the data may become overestimated as a result of how the respondent wishes to be perceived. Researchers have noted that consumers may wish to be seen as more socially aware and active and will thus overestimate the likelihood in supporting such firms and how the firm’s charitable efforts affect one’s perceptions and behavior (Mohn, Webb, & Harris, 2011).
Past literature provides much-needed insight regarding consumer awareness which is a determining factor in consumers gaining the information needed to affect their perceptions and purchasing behavior. Research has indicated supportive information in determining the relationship between consumer awareness and consumer perceptions. The more a consumer is aware of something the more additional information is available to influence perceptions.
The fact that the past studies mentioned have provided mixed results is helpful in current research as it provides the knowledge in understanding the complexity of the topics at hand. Whether consumer perceptions regarding corporate philanthropy are positive or negative it is beneficial to understand, from past studies, the factors that contribute to the complexity of their nature which include: individual consumer preferences of a cause, the size of a firm’s donation, how aware a consumer is of a firm’s philanthropy and a consumer’s own self-perception.