fits for their companies. They are also, at the same time, realizing the concomi tant and urgent need to measure the returns to various CSR programs. To this end, many companies are beginning to embrace practices such as social audits, corporate social reporting, and the triple bottom line. 10 Our research shows that consumer reactions to CSR are not as straightfor ward and evident as the marketplace polls suggest; there are numerous factors that affect whether a firm’s CSR activities translate into consumer purchases. Although (when asked directly) people say that CSR matters in their purchase decisions, the statistics reported in these aggregate marketplace polls mask the real nature of customer response to CSR initiatives. Take for example the case of PNC bank. Its web site documents its support of a wide variety of initiatives, C.B. Bhattacharya is an Associate Professor of Marketing at the School of Management at asserting that “from arts to education to Boston University. <[email protected]> healthcare, PNC funds programs that make Sankar Sen is an Associate Professor of Marketing a difference.” However, are each of these at the Zicklin School of Business at Baruch initiatives viewed equally favorably by College, CUNY. <[email protected]> PNC’s customers? Furthermore, in what other ways apart from a switch to PNC bank do customers react to their CSR initiatives? Price and quality are rarely equal (recall the question posed by the Cone Communications survey), making it difficult for managers to gauge the implications of the poll findings for CSR strategies in the marketplace. In other words, it is difficult for companies to formulate, implement, and evaluate effective CSR strategies based on such information alone. It is important for managers to understand how and why consumers’ respond to CSR initiatives, and our research-guided framework can help with that difficult task. By understanding consumer reactions to CSR, firms can develop CSR strategies that are optimal from not only a normative perspective, but also a business one. Such an understanding hinges on three basic ideas, depicted in Figure 1. First, in thinking about CSR initiatives from a consumer perspective, “one size does not fit all.” Second, in thinking about the consumer-specific out comes of CSR, companies need to consider not only external outcomes such as purchase and loyalty, but internal ones such as consumers’ awareness, attitudes, 10 CALIFORNIA MANAGEMENT REVIEW VOL. 47, NO. 1 FALL 2004
Doing Better at Doing Good FIGURE 1. A Contingent View of CSR Company Benefits to Company Benefits to Consumer Benefits to Issue/Cause Consumer CSR Initiatives Competition and attributions about why companies are engaging in CSR activities. This is particularly important given that in the face of decreasing product differentiation and heightened competition, CSR initiatives are an innovative and less-imitable means of strengthening customer relationships. Similarly, given the relationship- strengthening nature of CSR, companies need to go beyond brand purchase
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