consumers and brands: the influence of perceived corporate social responsibility on brand loyalty...
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Consumers And Brands: The Influence Of Perceived Corporate Social Responsibility On Brand Loyalty And TrustBy: Vesna Zabkar
Sabina Suler
Agenda
1. Purpose 1. Purpose
2. Approach2. Approach
3. Main Findings 3. Main Findings
4. Limitations and Future Research 4. Limitations and Future Research
5. Recommendations 5. Recommendations
Qualitative Analysis: product recall consequences
Recalled over 21m toysStock has ↓ roughly 7%
Mattel’s executive VP has admitted that the company’s reputation
has been damaged
June 14th 2007, press release
about counterfeit toothpaste
incorrectly packaged
as “Colgate” has been foundOn press release date,
Colgate shares ↓ 0.9% to $66.85
Warning from the FDA
Sales ↓ 3% from a year earlierFaced approx. 486 lawsuits
Quantitative Analysis
H1: H2: H3: H4:
The more
positive a
person’s
perception of
CSR, the
higher is the
brand loyalty
Trust in a
company
will worsen
after a recall
People will
be less likely
to trust
brands that
have been
recalled
North
Americans
are differently
affected
by product
recalls than
Europeans
Figure 1: Fabricated Article
News & Features December 6, 2007, 2:46PM
Colgate toothpaste recalled
Antifreeze chemical found in tubes; no injuries reported
By David Riley
The Colgate-Palmolive Company said
Thursday that 5-ounce tubes of Colgate
toothpaste sold in discount stores are being
recalled because they may contain a
poisonous chemical.
A Food and Drug Administration official,
Doug Arbesfeld, said Wednesday that testing
had found the chemical in the Colgate
product.
MS USA Trading, Inc. of North Bergen, N.J .,
the importer involved in the initial recall
announcement, said the toothpaste may
contain diethylene glycol, a chemical found
in antifreeze.
The company said the toothpaste, imported
from China, was sold in discount stores in
New J ersey, New York, Toronto and Eastern
Europe.
“Made in China” is printed on the box and
includes Regular, Gel, Triple and Herbal
versions.
The trading company said the problem was
discovered in routine testing by the Food and
Drug Administration. It said no illnesses
have been reported to date.
Consumers who have purchased 5-ounce
toothpaste under the Colgate label can
return them to the place of purchase for a
refund, MS USA Trading said.
Riley is a senior correspondent in BusinessWeek's Detroit bureau.
3.39
3.54
4.29
0 1 2 3 4 5
How bothered are you by the reportedproduct recall?
To what extent are you concernedabout product recalls?
How important or unimportant is it toyou that firms such as Colgate avoid
product recalls.
Scale:n=5
Product recalls
Scale: 1= strongly dissagree, 5= strongly agree
H1: Perception of CSR Issues
0% 20% 40% 60% 80% 100%
SR behavior detracts from companies’ ability toprovide the best possible products.
SR behavior is a drain on a company’s resources.
SR behavior by firms is often a cover-up for inferiorproduct offerings.
SR firms produce worse products than do firms that donot worry about SR.
Firms that devote resources towards SR actions havefewer resources available for increasing employee
A company can be both SR and manufacture productsof high value.
Firms engage in SR behaviors tend to compensate forinferior product offerings.
Resources devoted to SR come at the expense ofimproved product offerings.
strongly disagree disagree indifferent agree strongly agree
H2: Trust in the Organization
Trust in Organization After the Recall
7
6
5
5
30
16
28
8
42
36
31
47
19
35
27
30
2
7
9
10
0% 20% 40% 60% 80% 100%
I believed the organization could not berelied upon to keep its promises.
I believed the organization was trustworthy.
I would find it necessary to be cautious indealing with this organization.
Overall, I believe this firm was honest.
strongly diagree disagree indifferent agree strongly agree
Trust in Organization Before the Recall
14
3
19
3
34
7
34
10
36
36
35
31
13
46
8
49
2
7
3
6
0% 20% 40% 60% 80% 100%
I believed the organization could not berelied upon to keep its promises.
I believed the organization was trustworthy.
I would find it necessary to be cautious indealing with this organization.
Overall, I believe this firm was honest.
strongly diagree disagree indifferent agree strongly agree
H2: Trust in the Organization
3.21
3.47
0 1 2 3 4 5
I believed theorganization w as
trustw orthy(after recall)
I believed theorganization w as
trustw orthy(before recall)
Mean
Scale: 1= strongly dissagree, 5= strongly agree
H3: Trust in BrandTrust in Brand Before Recall
4
9
3
1
9
19
13
13
27
40
38
23
42
21
42
51
18
11
4
12
0% 20% 40% 60% 80% 100%
I trust this brand.
I rely on this brand.
This is an honest brand.
This brand is safe.
strongly diagree disagree indifferent agree strongly agree
Trust in Brand After Recall
3
13
3
3
15
24
11
19
34
36
54
38
35
19
25
29
13
8
7
11
0% 20% 40% 60% 80% 100%
I trust this brand.
I rely on this brand.
This is an honest brand.
This brand is safe.
strongly diagree disagree indifferent agree strongly agree
H3: Trust in Brand
3.4
3.61
0 1 2 3 4 5
I trust this brand(after recall)
I trust this brand(before recall)
Mean
Scale: 1= strongly dissagree, 5= strongly agree
H4: Difference Between Groups
3.700
3.800
4.450
0 1 2 3 4 5
How bothered are you by thereported product recall?
To what extent are youconcerned about product
recalls?
How important or unimportantis it to you that firms such asColgate avoid product recalls.
Mean
3.183
3.367
4.183
0 1 2 3 4 5
How bothered are you by thereported product recall?
To what extent are youconcerned about product
recalls?
How important or unimportantis it to you that firms such asColgate avoid product recalls.
Mean
North Americans Europeans
Convenient, non-random sampleSample size
Multiple products on a larger, random sampleTwo-group pre-test post-test experimental designOther media
Limitations and Future Research
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