Responsible Retailing and Corporate Responsibility

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Responsible Retailing and Corporate Responsibility

• Paul N. Bloom
• Kenan-Flagler Business School
• University of North Carolina at Chapel Hill

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Basic Argument

• Among the many social responsibility initiatives
  a retailer can pursue, corporate societal
  marketing programs deserve close attention, as
  they can differentiate your brand in the eyes of
  (skeptical) consumers and enhance your bottom
  line, while also improving social welfare.

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Agenda

• Review trends in corporate societal marketing
• Discuss why it can work
• Cover the implications for retailers
• Highlight the biggest implementation challenges

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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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Statement of Ethics
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Corporate Societal Marketing

• Marketing initiatives that seek to differentiate
  a brand/company through social involvement
• Cause-related marketing
• Corporate social marketing
• Strategic philanthropy and sponsorship
• Community relations projects
• Sustainable development and environmental (green)
  programs
• Economic development programs
• Quality/safety improvement programs
• Self-regulation initiatives (e.g., ethics codes)
• Consciousness raising

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(No Transcript)
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Outlook for CSM

• Promises to become more prevalent
• Hard to differentiate brands through better
  product features, better service, cleanliness, or
  more clever and visible advertising.
• Therefore need to turn to
• price (i.e., Wal-Mart) or
• pulling on heart strings to create affinity and
  limit skepticism
• CSM may do this better than CRM (and loyalty
  programs) or sports sponsorships
• Examples Newmans Own, Whole Foods, Starbucks

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What CSM Can Do

• Can improve social welfare
• Through the program itself
• Through helping nonprofits be more effective
• Can improve corporate social reputation
• Can improve brand image and equity
• Can improve employee loyalty and service
• Can improve brand sales and profits

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How CSM Does What It Does

• All marketing initiatives are designed to create
  more favorable beliefs, attitudes, intentions,
  and behaviors toward brands
• Compared to other actions, adding social content
  to an initiative may create stronger changes in
  beliefs, etc. by getting consumers to weight
  style of marketing more positively and strongly
  in evaluating a brand than other functional and
  image attributes
• It may do this whether the cause-brand fit is
  strong or weak

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More Specifically

• Consumers have persuasion knowledge
• They are always trying to figure out what
  marketers are up to
• High levels of skepticism
• Reward what they like (Attitude toward Ad a
  strong predictor of Attitude toward the Brand)
• Hence, style of marketing becomes an important
  attribute in evaluating a brand
• When its social it may get weighted more heavily
  and positively than when its more conventional.
• Also, halo effects on other functional and image
  attributes
• When its a good fit, it may be better or worse,
  depending on consumer feelings about sincerity

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Pilot Study Demonstrating Effect

• Asked consumers to rank eight different
  profiles of a beer brand, where they were
  varied systematically based on container type,
  price, calories, protein, and type of sponsorship
  (2 levels of each).
• Can infer how much they weight these attributes
  based on the rankings
• Some of the participants ranked a brand that had
  a social sponsorship as an option and others had
  a sports sponsorship as an option

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12 ounce Bottle 5 per 6 pack 150 calories per
serving Fortified with 1.5 grams of Protein per
serving Sponsor of the Budweiser Designated
Driver Program RANK IS 1 2 3 4
5 6 7 8 (no ties please)
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Conjoint Results
Designated Driver and Help Kids Read gt
NASCAR and ABC Family Movie A high fit social
cause will lift the ranking of a
profile equivalently to a 50 cent price cut per 6
pack.
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Implications for Retailers

• Look for social causes as a way to differentiate
  yourself
• Avoid really low fit social causes, but lower fit
  may work better if it is distinctive and credible
• In addition to differentiability, pay attention
  to how substantial the market is that cares about
  the cause
• May require a more subtle approach if not
  substantial
• Examples in the Green Marketing context

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Green Marketing Strategy Matrix
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Implementation Challenges for Retailers

• Making your (necessary) responsible drinking and
  tobacco control efforts be perceived as credible
  and distinctive
• Avoid being seen as a tool of the big alcohol
  and tobacco companies (although working with
  their social programs is fine)
• Strike out on your own with alliances with
  community groups
• Need a portfolio of causes
• Since you need to be supporting responsible
  drinking and tobacco control, which is risky,
  look for less risky other causes (e.g.,
  education, the elderly, auto safety)
• Sustaining the effort and continuing to inform
  consumers about what you are doing
• Needs attention similar to what is given to
  displays, signage, and advertising
• Need internal marketing to get all employees
  cooperating