Impact of product specific philanthropic initiatives on consumer purchasing decisions

Abstract

Philanthropic marketing or cause related marketing is a type of marketing which supports a cause to increase sales of the product. Such marketing techniques helps in creating brand recall amongst customers. Hence all SKUs of the brand enjoy the goodwill created by a few sets of products, making it easier for the brand to reach the consideration set of purchase. However, it is also true that philanthropic market creates a difference only when the products are similar in nature. Price, quality, and brand are the important factors for consumers while deciding. It is also thought that surveys and interviews might be biased as per desirability bias where people tend to give the politically correct answers. So, it is very important to quantitatively understand the influence that philanthropic marketing has on the decision of consumers. The quantitative analysis showed that the buyers switched to products despite a premium when the social cues made them realize the philanthropic agenda of the product. We could observe the behavioral change for buyers who were socially leaned, as well as those who did not have predisposition of social causes. This gave an important insight for the marketing managers who can make use this information relating to consumer purchase behavior to create social cues at the time of sales that can drive the purchasing decisions of the buyers. The qualitative analysis could identify the different kinds on consumer behavior driven by social leaning. Price-sensitive consumers may or may not choose to buy philanthropic products depending on their attitude towards social initiatives, while they also assess whether the price differentials can be justified by the social initiatives. An important insight is that it's up to the marketing manager to make sure the customer gets the proper message. Majority of respondents cited regulatory obligations as a motivator for philanthropic initiative. Businesses that integrate their social activities with their strategic business agenda can benefit from this information. It's critical to explain to customers how these efforts are linked to the company's overall business goals and commitments.