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Report
On
Cause-Related Marketing and Its Impact on the Purchasing Behavior of the
Customers in Bangladesh
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Report On:
Cause-Related Marketing and Its Impact on the Purchasing Behavior of the
Customers in Bangladesh
Under The Supervision of
Md. Habibur Rahman
Faculty of Business
ASA University Bangladesh, Dhaka
Bangladesh
April, 2011
Prepared By:
Tilok Das
1st
Batch, Section: MKT-1A
I.D. 071-12-188
Program: BBA
Spring Semester-2011
Date of Submission: 15th
April 2011.
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Declaration:
I am Tilok Das, student of BBA under Faculty of Business(BBA Program), major in
Marketing of ASA University Bangladesh; do hereby declare that the Project Work on Cause
Related Marketing and Its Impact on the Purchasing Behavior of the Customers of
Bangladesh has not been submitted by anyone for any degree, diploma, title, or recognition.
So, I hereby declare that the submitted project paper is true to the best of my knowledge.
Yours sincerely,
Tilok Das
ID: No. 071-12-188
Section: MKT- 1A
ASAUB, April 2011.
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ASA UNIVERSITY BANGLADESH
Certificate for Clearance:
This is to certify that Tilok Das, ID No: 071-12-188, student of ASA University Bangladesh of
BBA program, major in Marketing has completed the project work on Cause Related
Marketing and Its Impact on the Purchasing Behavior of the Customers of Bangladesh
successfully under my supervision. I also declare that;
It has been prepared under my direct supervision and guidance; It is the product of his own investigation and it is not submitted to any University or
institution for any degree;
I have gone through the final draft of the thesis and approved it for submission.
I wish him every success in life.
Supervisor
Md. Habibur RahmanLecturer
Faculty of Business
ASA University Bangladesh
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Letter of Transmittal:
January 27th
, 2011
The project Invigilator
The Faculty of Business
ASA University Bangladesh
Shymoli, Dhaka1207
Subject: Submission of Project Work Report.
Dear Sir:
I have successfully completed my project Work on Cause Related Marketing and Its Impact on
the Purchasing Behavior of the Customers in Bangladesh. This project works enabled me to
learning the implementation of the two contemporary management techniques to a great extent
as well as after implementing these methods how can be benefited to sustain in the competitive
world of an organization.
Now, I would like to submit the project work on Cause Related Marketing and Its Impact onthe Purchasing Behavior of the Customers in Bangladesh which is a mandatory course for
completing my study. I am optimistic that this report will satisfy the entire requirements.
Thanking you.
Yours Sincerely,
Tilok Das
I.D. 071-12-188
1st
Batch, Section: MKT-1A
Program: BBA
ASA University Bangladesh.
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Acknowledgement:
First of all, all praises to be to the supreme of this universe, the almighty that enabled me to
complete this project work on Cause Related Marketing and Its Impact on the PurchasingBehavior of the Customers in Bangladesh.
Next, my deepest appreciation is to my course invigilator Md. Habibur Rahman, Lecturer,
Faculty of Business, ASA University Bangladesh. Without his guidance and assistance, this
report would not have seen the daylight.
And finally, I would like to thanks to our Dean, Faculty of Business, Professor Dr. Md. Abdul
Hye, as well as Vice-Chancellor, Professor Md. Muinuddin Khan who gives us special
opportunity to complete project work Spring-2011 semester.
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Executive Summary
Marketing, now, is not merely about only the market. The focal point is getting wider day by
day. The companies are devising different schemes to contribute to societal development
activities along with their attainment of corporate goals and objectives. Cause related marketing
is one of those tactics that enables the marketers to involve the customers directly into the
process. This study tries to portray whether the customers purchasing behavior or brand
preference are influence by such marketing program. The demographic variables have great
influence on the purchasing decision making process of customer. Whether that is also being
influenced by companies cause-related marketing program is also explored here. The findings
have showed that a customer is influenced by the companies cause related marketing programs
while adopting a new brand or executing its purchase intension and the customers prefer to
support generally health and life saving issues.
In theFirst part, I discussed about the cause-related marketing, objective of the report, literature
review, scope of the study, limitations of the report. Second part, describes about my report
methodology. The Third part, describes the findings and result of analysis. Fourth Part, I
implications for future research. The last part shows recommendation and Conclusion against
the cause-related marketing and its impact on the purchasing behavior of the customers in
Bangladesh
Therefore I have tried to cover all aspects of activities to prepare an effective and useful report.
There are lots of opportunities for further study to justify the reliability of the report.
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Chapter No. Contents Page No.
01. Introduction
Chapter 1.1: Objective of the Report
Chapter 1.2: Literature Review
1.2.1: The Objectives of Cause Related Marketing
1.2.2: Corporate and Marketing Objectives
1.2.3: Brand Loyalty
1.2.4: The Expanded Benefits of Cause Marketing Framework
1.2.5: Strategy for Cause Related Marketing
1.2.6: Types of CRM Programs
Chapter 1.3: Scope of the Study
Chapter 1.4: Limitations of the Report
Chapter 2: Methodology
Chapter 3.0: Findings and Result of Analysis
3.1: Hypotheses drawn
3.2: Analysis & Calculation the Hypotheses
3.3: Interpretation of findings
3.3.1: Attitude to a cause-related marketing strategy
3.3.2: Impact on brand attitude
Chapter 4.0: Implications for future research
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Table of Contents
Chapter 1.0: Introduction
In the late fifties of the last decade Paul M. Mazoor termed marketing as the delivery of lifestyle
to people. Philip Kotler, in agreement with that idea, coined that the delivery should be made for
customers satisfaction. Thus, with elapsing of time, focal points of marketing changed
obviously towards the benevolence of consumers, intermediaries and environment in the long
run. Apart from behaving responsibly in terms of corporate governance an financial reporting,
businesses engage in a number of practices designed to engender positive attitude and comment
from major external publics that include their customer base (Potter and Adam, 2005). The
current date marketing theory and application, conceiving the gist of the earlier ones, focus on
building up association with the society in large scale because it is the relationship or feeling of
bondage that thrusts a twenty first century conscious person to be a consumer of any
organization. Customers and marketers consider relationship to be the most significant issue in
case of business. Cause Related Marketing is a marketing program of business organizations inpursuit of their maintenance of multi faceted relationship with different parts of the society.
Some other terms are used to describe such activities of the companies but now a days cause
related marketing is more commonly used (Adkins, 1999; Drumright 1996:). Through Cause
Related Marketing Companies Bridge it selves very integrated with the members of the society
by doing well to the society. There is growing evidence to suggest that consumers are willing to
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use their purchasing power to reward or punish companies based on their social responsibility
(Creyer, 1997; Sen and Bhattacharya, 2001; Sen and Morwitz, 1996). Cause-related marketing as
a marketing strategy is developing in an environment of increasing consumer interest in
corporate social responsibility (Cunningham, 1997; Ptacek and Salazar, 1997; Sen and Morwitz,
1996). In the early eighties of last century this concept got immense popularity after a successful
innovation and implementation by American Express Bank. The companies in the third world
countries like Bangladesh are also spring boarding this concept in order to present their
inclination in contributing social issues and to involve the customers in the entire process.
Chapter 1.1: Objective of the Report
This study has been endeavored to contribute to the achievement of the following
objectives:
To identify the level of the consumers understanding and attitudes towards cause-r
elated marketing.
To measure the proportion of consumers within the sample are/were influenced by
cause-related marketing in their shopping habits.
To identify whether the customers perception, preference and attitude toward a brand
and company is affected by the latters involvement with cause related marketing.
To identify the issues/charitable causes those are most likely to influence purchase
behavior.
To identify reasons that might work as the deterrents for the consumers to respond
against cause-related marketing.
To identify whether there exist and relationship between the consumers demographic
variables (age, education, income etc.) and overall perception about/support for cause
related marketing.
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Chapter 1.2: Literature Review
After finishing the previous chapter with presenting the research questions, this chapter will
continue to present theories that are relevant to our research questions. First theories that are
related to research question one will be presented followed by the ones connected to the second
research question. This chapter will end with a conceptual framework that will guide this studyinto the next chapter.
1.2.1: The Objectives of Cause Related Marketing
Objectives are described by Berman and Evans (1997) as performance targets wished to
accomplish in the long and/or short term and could aim towards such issues as: improved image,
profit, sales and satisfaction. The University of South Australia glossary provides a more
thorough definition of the term of which the most relevant parts to this study are quoted below:
Objectives are operational statements; that is, they are written in terms which make it evident
when they have been achieved. As with goals, they are descriptions of position rather than an
action. They are descriptions of a desirable future state. How far in the future is variable. They
may imply immediate action or a sequence of activities in the near future .
1.2.2: Corporate and Marketing Objectives
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When looking at the CRM objectives from a companys perspective in Varadarajan and Menons
CRM article from 1988 a large number of objectives are found. The objectives are collected
through scrutinizing previous articles where cases on the CRM topic have been presented. There
are six objectives that are given more space and time in the article than the others and these six
are described as follows:
Increase sales Which is one of the most fundamental reasons for participating in cause
marketing activities.
Enhancing corporate stature Due to association with a respected cause/organization a
company may get a better corporate image, improved national visibility and communications
toward social responsibility with the public.
Thwarting negative publicityThe use of CRM as a response to negative publicity can be an
effective weapon.
Customer pacification When companies are threatened by a boycott on their products CRM
can act as one part of a more extensive program to calm down the group who are accountable for
the boycott.
Facilitating market entry Companies entering a market and at the same time use CRM to
smooth the progress of penetration is one objective that is quite common.
Increase the level of trade merchandising activity for the brand(s) promoted Improvements in
the number of reorders, sell-through and similar measures are important objectives for a large
quantity of companies involved in CRM.
Apart from the six main objectives there are a number of other objectives that a company may
strive for when using CRM according to Varadarajan and Menon (1988). These objectives are
only treated superficially and may overlap, be an element or even be one of the six main
objectives above. A total list of the objectives provided by Varadarajan and Menon (1988) is
shown in table 2:1 which according to them is not exhaustive but purely illustrative.
Gaining
national
Visibility
Enhancing corporate
image
Thwarting
negative
publicity
Pacifying
customer
groups
Generating
incremental sales
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Promoting
repeat
Purchases
Promoting multiple
unit purchases
Promoting more
varied usage
Increasing brand
awareness
Increasing brand
recognition
Enhancing
brand
Image
Reinforcing brand
image
Broadening
customer base
Reaching new
market segments
and geographicsegments
Increasing level of
merch andising
activity at the retaillevel of the brand
Table 1.2.2: Corporate and Marketing Objectives
1.2.3: Brand Loyalty
One area that is highly discussed in articles by researchers connected to objectives/benefits,
which Varadarajan and Menon (1988) do not bring up specifically but only mention briefly, is
the importance of brand loyalty when it comes to using CRM. Dick and Basu (1994) define
brand loyalty as: The relationship between the relative attitude toward an entity
(brand/service/store/vendor) and patronage behavior. Repeated purchasing alone does not
necessary mean that a person is loyal to a brand since that decision can be based on, for example
the stores supply. If the store only offers one brand on that product the customers are forced to
a repeated purchasing behavior which is not connected to brand loyalty. The relationship
between a persons attitude and behavior is the key when studying brand loyalty, where both
parts are required (ibid). In Cone Incs (2004) customer survey, 86 percent said that they would
switch brands if price and quality were equal and instead buy a cause-supporting product.
According to Van den Brink, Odekerken-Schrder and Pauwels (2006) CRM is only effective
when it involves a product with low brand loyalty. In contrast using CRM on a product with high
brand loyalty will not affect the consumers purchasing behavior.
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1.2.4: The Expanded Benefits of Cause Marketing Framework
The expanded benefits of cause marketing framework are divided into the company involved in
CRM and the different stakeholders connected to that company (Gourville & Rangan, 2004). The
expanded benefits of cause marketing framework do not outspokenly talk about objectives as themanagerial dimensions of CRM theory do, but use the word benefit instead, which according to
the Oxford English dictionary is described as:
To do well to, to be of advantage or profit to; to improve, help forward and a company that
strive to improve in a particular area in order to reach a desirable future state could therefore use
benefits in the way of objectives. The expanded benefits of cause-marketing (see figure 6.4)
shows the potential benefits connected to the different stakeholders in a CRM relationship
Figure 1.2.4: The Expanded Benefits of Cause Marketing
Non-profitOrganization
For-Profit Firm Employees, InvestorsBusiness Associates.
1a 4
Donors to the
Cause
Clients of the
Cause
5a
PotentialCustomers
2b
Social Cause
2a
5b
1b
3
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According to Gourville and Rangan (2004) the all-black arrows in the expanded benefits of cause
marketing figure represents the relationships that contribute to first order benefits and the dotted
arrows represents the relationships that contribute to second order benefits. Gourville andRangan (2004) state that the original framework not including the dotted arrows previously
limited the focus of CRM benefits to increased sales and alike and neglected benefits that were
not as easy to observe. First order benefits are directly monetary benefits such as increased sales
while second order benefits are less focused on the direct monetary aspects and the benefits are a
result of the fit between the company and its stakeholders (ibid). Table 1.2.4 below shows the
overall benefits of the cause marketing relationship without going in-depth into the specific
benefits perceived by each party in the framework. The arrows 2b and 4 in figure 1.2.4 are
directly linked from the companys stakeholders to the company and will be more thoroughly
described from a company perspective below table 1.2.4.
Table 1.2.4: Overall Benefits of Cause Marketing
Arrow/Line First Order Benefits Second Order Benefits
1a Monetary donation
1b Monetary donation
2a Increased sales
2b Increased sales (Company benefits)
3 Funds for the cause
4 Increased stakeholder loyalty and
motivation(Company benefits)
5a Don ate directly to the cause (in creased
donor support)
5b Increased message effectiveness for the
cause
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When looking closer from a company perspective on the expanded benefits of cause marketing
framework Gourville and Rangan (2004) say that there are three main groups of stakeholders that
can be influenced by the CRM activities. The three groups of stakeholders that can be influenced
are firstly the current and potential consumers, secondly the employees and investors and finally
the general public which represent the arrows 2b and 4 in the framework above. The potential
benefits for the company connected to these stakeholders because of the influence of effective
cause marketing activities on them are according to Gourville and Rangan (2004) the following:
The current and potential consumersIncreased possibility of a sale and reduced differentiating
costs for an offering in the minds of the consumer.
The employees and investorsLower costs in investor and personnel management due to the
higher possibility of long term commitment between the parties because of a better match
between potential employees, investors and the company as well as the retention of current
employees and investors.
The general publicImproving the relations with government regulators, local interest groups
and the general public.
1.2.5: Strategy for Cause Related Marketing
This section will start with presenting the second research question and continue to discusstheories that are connected to it.
Strategy
The Oxford University press broad definition of strategy is: a specific way in which something
is to be done. The more elaborate definition of strategy provided by Johnson, Scholes and
Whittington (2005, p 9) say that: Strategy is the direction and scope of an organization over the
long term, which achieves advantage in a changing environment through its configuration of
resources and competences with the aim of fulfilling stakeholder expectations. Johnson et al.
also gives a more brief explanation of strategy as the organizations long term direction.
According to van den Brink et al. a CRM program can be described as either strategic or tactical
but often it is characterized as a mix of these two (see figure 1.2.5).
Tactical Strate ic
CongruenceLow
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Figure 1.2.5: Schematic Representation of Strategic and Tactical CRM
The level of; congruence how well the company, cause and customer fit, duration the time
frame of the program, invested resourcesfinancial commitment, management involvementtop
management commitment, will decide whether a company is using a strategic or tactical strategy
(ibid). All of these four factors will be described more in detail later in this chapter.
Quantifiers in CRM
Companies involved in CRM have a great array of choices when deciding what type of quantifier
to use in their CRM campaign. Quantifier is the format that the company uses to describe the
level of donation to a cause (Pracejus, Olsen & Brown, 2004). There are three main types of
quantifiers all of which consist of a large number of subtypes. The first and most common type
of quantifier is the abstract quantifier that is characterized by the lack of precise information to
the customer of how much that is really donated. Almost 70% of all CRM quantifiers used on the
Internet are abstract and usually use the words portion of, part of or percentage of, without
specifying the degree. The second and next largest quantifier is the estimable which gives some
information to the customer but not all information in order to know the exact amount of
donation to the cause. More than one quarter of the quantifiers used are estimable and consist of
subtypes such as: x percent of proceeds and all of the net profits proceeds. The last main type of
quantifier is the calculable quantifier which also is the least used type with 4% of the total. This
type allows the customer to calculate the actual amount of the donation. The entire price goes to
and x percent of the sales goes to, are examples of calculable quantifiers (Pracejus et al.).
High
Duration
Invested Resources
Mana ement Involvement
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Prior research have according to Pracejus et al. showed that vague quantifiers such as abstract
and estimable are by customers overestimated in terms of money donated to a cause by the
company. Pracejus et al. end the article by suggesting the use of calculable quantifiers in CRM
campaigns to not confuse the customers. Pracejus et al. are backed up by Welsh and Jerry (1999)
the pioneers in CRM responsible for American Expresss early CRM successes when they
propose the use of calculable concrete quantifiers. Welsh says that: Consumers are tired of
vague promises made by everyone from politicians to weight-loss gurus. when he stresses the
importance for companies involved in CRM to be concrete.
Developing a CRM Campaign
According to Pringle and Thompson (1999, p 143-146) a CRM campaign consists of three
development stages; commitment, due diligence and contract negotiation. When these stages
have been completed a territory is established and the development of the CRM campaign
begins.
Commitment
In the first stage of the process a company has to assure itself that they want to make a
commitment to a CRM campaign. The company has to be aware of both the advantages and
disadvantages of CRM and how long this type of marketing strategy should last. One important
thing when it comes to applying a CRM campaign is to have the chief executive committed to
the idea because of their significant influence to the organization. Support from the executive is
not the only thing that matters it is also about involving the rest of the organization into the idea
to get a broader support. One should keep in mind that the charity organizations go through the
same process and also have to be cautious when they are choosing who to cooperate with since
they often also have a strong brand to protect.
Due Diligence
The second step is the due diligence process where a company has to decide which charity or
cause to cooperate with. In this step it is essential to find a company and a charity with the same
values and common interests. Kalligeros (2005) supports this theory and states that the partners
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must have a common brand image, mission and values so they can focus on the same target
market. Nowak and Till (2000) also claim that in the process of selecting your partner the
charitys previously engagements in CRM programs should be considered, it is more effective if
the charity does not have a history with other brands. Pringle and Thompson (1999, p 147) often
compare this step of the process to the marriage because of the criteria in finding your partner.
According to Kalligeros (2005) finding your partners can be described as both an art and science.
The art is described as the relationship and the science is based on the criteria of finding your
partner. Issues to consider in this process according to Kalligeros (2005) are social change,
results, target consumers and competitors. Pringle and Thompson (1999, p 147) state that like in
marriage you do not only get into a relationship with your partner but also with its network and
other involved parties. It is important to be aware of the consequences of these unwanted
relationships but at the same time accept them. This requires that both parties do not hide
relevant information from one another and that this relationship is based on honesty and trust
(ibid).
Contract Negotiation
Pringle and Thompsons (1999, p 152) final and most important step is contract negotiation
where both parties have to sign an agreement. The agreement should state both financial
commitment and duration of the relationship. Both parties should know what to expect from each
other and both a minimum financial effort and time period should be specified. Kalligeros (2005)
agrees with this and also claims that the negotiation contract should consist of a timetable, areas
of responsibilities, wanted results and how to achieve the goal. According to Pringle and
Thompson (1999, p 152) it is such a complex process in finding a partner to cooperate with in a
CRM campaign so the contract should contain a notice period of at least 6 months. This gives
them an opportunity to finish the project in a decent way and start looking for a new partner.
1.2.6: Types of CRM Programs
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According to Polonsky and Speed (2001) there are five different types of CRM programs. These
are broad-based, limited, market focused, replacement and multi-phase programs. To decide
which program to use the following four questions need to be taken into consideration. What
type of consumers is targeted? Are there any actions required from the customer besides
purchasing the product or service? What financial commitment is the company willing to offer
and if there are any leveraging activities required?
Broad-based is the simplest program. Both existing and new consumers are targeted and fir ms
donate a certain amount of each sold product. The only action required from the consumer is the
purchasing of the product and there are no limits of how big amount that is donated. When using
broad-based CRM programs leveraging activities are needed. These could include advertising,
packaging information and sales information.
Limited CRM program is a limited version of the broad-based which also targets all kinds of
consumers. The main difference between broad-based and the limited CRM program is that firms
donate a certain amount of each sold product but only to a maximum sum. In some cases they
also offer to donate a minimum sum to increase the credibility. As in the broad- based program
the only required action from the consumer is purchasing the product. Market-focused program
targets new types of consumers. There might be an additional requirement from the consumer
besides purchasing the product, i.e. submit coupons. The financial commitment can be either
unlimited or capped and an amount is donated for all sales of a specific product. Since this
program targets a specific market the promotion needs to be adapted to that market and also in
some cases informative sales promotion is needed.
Replacement program replaces the ordinary sponsoring with sales based giving. All types of
consumers are targeted. The requirements from the consumers are similar to the market- focused
program where also a second action may be needed. As in the limited CRM program the
financial commitment is also capped which means there will be a limit of how much money thatwill be donated. Both advertising and information on the package are required leverage
activities, i.e. By purchasing this product you have donated a certain amount to a specific
cause. Additional sales promotions are also commonly used in this program.
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Multi-phase program targets all kinds of consumers, both new and existing. Here the consumers
have to purchase a product and an additional action is required. It could be submitting coupons
or mail in a barcode but the big advantage with this program is that not all customers will make
this extra effort and still the companys gain in consumers trust will be the same as if t here were
no extra requirement. The financial commitment can be either unlimited or capped and an
amount is donated for all sales of a specific product. Advertising and information of packages are
essential and should inform the consumer of the extra activity that is needed. This can also be
complemented with different types of sales promotions
Chapter 1.3: Scope of the Study
To gain the practical knowledge by doing such type of research works. To build a professional career in the field of business administration. To find out financial solution. To enable better financial decision making for future and ability to forecast the various
weakness and ability of the business.
Chapter 1.4: Limitations of the Report
Since our study based on both primary and secondary data, there is a possibility of getting fake
information. If the surveyed personnel provide us with any fabricated information about cause-
related Marketing, then the report findings may be erroneous. Above all, this study is weak in
some points. The notable ones are as under:
The surveyconducted in a very short time, so I was not able to collect more information.
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Only different segments of people consider here as sample those may not represent aswhole.
Respondents did not understand meaning of the questions in some cases; sometimes theyhad no idea at all.
In this type of questions, the respondents might provide socially acceptable answers. Thisrisk was unavoidable.
No proper directions for sampling methods in this field Lack of proper authority to conduct the interview program.
Chapter 2: Methodology
The study has initially focused on qualitative research to conceptualize the issues of cause related
marketing from the perspective of customers. Few hypotheses which were also developed tested
through survey method under quantitative research. To conduct the study, primary data were
collected through structured questionnaires (Malhotra, 2005). The questionnaire was designed to
collect information about the brand preference, purchasing attitude and perception of respondents
regarding cause-related marketing devised by an organization. Prior to that quantitative
approach, basic primary qualitative technique i.e. depth interview was conducted over the
managers of different MNCs operating in Bangladesh to shed light onto this issue. In this study,
to explore about the opinion, views, suggestions, contributions and variables emitting from mass
people about the cause related marketing in Bangladesh, the level of scale was interval and thetechnique was five point Likert type scale anchored at the numeral 1 with the verbal statement
strongly disagree and at the numeral 5 with the verbal statement strongly agree (Elbeck,
1987; Steiber, 1989). Multiple items were used to establish appropriate measurement properties
(reliability and validity) of the selected constructs. The scale was reliable as the Cronbach's alpha
was evidenced as 0.723. The questionnaire was pretested several times to ensure that the
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wording, format, length, and sequencing of questions were appropriate. Non Probabilistic
Sampling technique (Zikmund, 2004) was used to determine the elements of the sample. A total
of 120 people residing in Dhaka city were surveyed in the early April 2011. To conduct data
analysis both descriptive and inferential statistics have been executed. One sample t-test and
correlation, under SPSS program have been applied to measure the different dimensions Cause-
related marketing in Bangladesh. To shed more light on the issue a few in-depth interviews were
conducted over the corporate officials of different organizations. Simultaneously, to make this
paper more informative different published text books, related journals, reports, seminar papers,
web pages, web blogs, magazines and research works have been consulted. Literatures were
generally collected from said sources and the Internet.
As a result, a thorough review of literatures enabled us to make a consistent presentation of the
theme of study.
Chapter 3.0: Findings and Result of Analysis
3.1: Hypotheses drawn:
The exploration of the secondary literature and interview with the company officials have
contributed in the development of the following hypotheses.
H1: Cause-related marketing will generate a positive change in consumers attitude towards
the promoted brand, if they are aware of that.
1.1 I will change a brand if the company is not involved in any cause related marketing.
1.2 I will patronize that brand which has any involvement with cause related marketing.
1.3 I believe to obtain more satisfaction from a brand that supports a social cause.
1.4 In case of purchasing a new brand I will choose that which is involved anyhow in cause
related marketing.
1.5 My perception toward the brand or the company changes if it is found to be involved in cause
related marketing.
1.6 A brand affiliated with a cause can always carry the best benefit.
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H2: Consumers purchase intention will be enhanced if they are well aware of the cause
related marketing program of the company.
2.1 In order to support a cause related marketing program I, as a customer, may incur additional
costs.
2.2 I, as a customer, sometimes consider quality of the product to support cause-related
marketing program.
2.3 Sometimes I buy such products which are not necessary to me but do that only to support that
cause.
H3: Consumers support those cause spontaneously which are strategically fitted with the
brand and are related to them personally or socially.
3.1 I support that causes of any organization with which I, as a customer, can affiliate myself or
any of my closed ones.
3.2 I expect that there will prevail a synergy between the cause and brand personality.
3.3 The image and the cause must be well supported in order to get support from the customers.
3.4 The most effective cause used in a cause-related marketing campaign is one which is not
normally associated with the organizations interest.
H4:Positive attitude toward cause related marketing is a reflection of positive attitude toward
charitable activity.
4.1 The more often a person donates to charitable organizations and causes, the more positive the
attitude toward cause-related marketing activity.
4.2 Respondents preferences for the type of cause they would most like to see supported in
cause-related marketing activity are similar to causes to which individuals prefer to donate
directly.
H5: Overall the customers are satisfied with the cause related marketing strategy of the
companies
5.1 I think every company should be involved in supporting contemporary causes.
5.2 I will recommend others to patronize cause relating marketing programs.
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H6:People prefer to support local causes than international one
H7: There is a strong relationship between customers age and overall attitude toward cause
related marketing.
H8: Cause related marketing is strongly affected by the gender.
H9:More educated customers tend to show greater support for cause-related marketing
H10:People with substantial income are more inclined to support cause-related marketing
3.2: Analysis & Calculation the Hypotheses:
The following table analyzes that customers may change their attitude changed towards a
particular brand which may instigated due to the companies cause related marketing strategies.
This hypothesis is dependent on six more other variables which were tested as separate
hypotheses. All the hypotheses are significantly accepted according to our sample t-test as the
calculated value (.000), for all the six hypotheses (table 1), is less than critical value (0.05). So
we can conclude that Cause-related marketing can generate a positive change in the customers
attitude toward a promoted brand.
Table 1: Cause-related marketing will generate a positive change in consumers attitude
towards the promoted brand, if they are aware of that.Test Value = 3
t df Sig.(2-
tailed)
Mean
Difference
95% Confidence
Interval of the
Difference
Lower Upper
I will change a brand if it is not involved in any
cause related marketing.41.962 119 .000 3.9333 3.7477 4.1189
I will adopt that which has any involvement with
cause related marketing.34.133 119 .000 3.82500 3.6031 4.0469
I believe to obtain more satisfaction from a brand
that supports a social cause.49.170 119 .000 4.28333 4.1108 4.4558
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In case of purchasing a new brand I will choose
that which is involved anyhow in cause related
marketing.
55.649 119 .000 4.30833 4.1550 4.4616
My perception toward the brand or the company
changes if it is found to be involved in cause
related marketing.
51.609 119 .000 4.28333 4.1190 4.4477
A brand affiliated with a cause can always carrythe best benefit. 64.356 119 .000 4.34167 4.2081 4.4752
The second hypothesis (table 2) is also getting acceptance at 5% significant level as all of its
variables which were converted into different hypotheses are producing calculated value less
than 5%. The actual value of all the hypotheses is 0.00. So we can conclude that companys well
devised and well communicated cause related marketing strategy can enhance the customers
purchase intention significantly.
Table 2: Consumers purchase intention will be enhanced if they are well aware of the
cause related marketing program of the company.
The twenty first century customers are very much knowledgeable and aware of the endeavors of
the companies. Before patronization of any particular proposal of the companies the customers
justify the relationship between the causes supported and company image & brand personality.
Moreover the customers try to relate the probable impact of that factor on their personal and
social lives. Our third hypothesis deals with this issue particularly (table 3). This hypothesis is
later broken down into four other hypotheses in order to test quantitatively. All the four other
hypotheses are found to be accepted on a 5% significance level, as the calculated values for them
Test Value = 3
t df Sig.(2-
tailed)
Mean
Difference
95% Confidence
Interval of the
Difference
Lower Upper
In order to support a cause related marketing
program I, as a customer, may incur additionalcosts.
64.720 119 .000 4.29167 4.1604 4.4230
I, as a customer, sometimes consider quality of the
product to support cause-related marketing
program.
53.942 119 .000 4.25833 4.1020 4.4146
Sometimes I buy such products which are not
necessary to me but do that only to support that
cause
38.612 119 .000 3.85833 3.6605 4.0562
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are 0.00 whereas the critical value is 0.05. So we can infer that consumers render their support
willingly to those causes which have been able to portray its significance in the consumers
personal and social lives by binding a good strategic fit with the brand personality and company
image.
Table 3: Consumers support those cause spontaneously which are strategically fitted with
the brand and are related to them personally or socially.
Table 4: Positive attitude toward cause related marketing is a reflection of positive attitude
toward charitable activity.
Test Value = 3
t df Sig.(2-
tailed)
Mean
Difference
95% Confidence
Interval of the
Difference
Lower Upper
I support that causes of any organization with
which I, as a customer, can affiliate myself or any
of my closed ones.
58.906 119 .000 4.14167 4.0024 4.2809
I expect that there will prevail a synergy betweenthe cause supported and brand personality.
58.126 119 .000 4.18333 4.0408 4.3258
The image and the cause must be well supported in
order to get support from the customers.
41.397 119 .000 3.87500 3.6896 4.0604
The most effective cause used in a cause-related
marketing campaign is one which is not normallyassociated with the organizations interest.
53.230 119 .000 3.98333 3.8352 4.1315
Test Value = 3
t df Sig.(2-
tailed)
MeanDifference
95% ConfidenceInterval of the
Difference
Lower Upper
The more often a person donates to charitable
organizations and causes, the more positive the
attitude toward cause-related marketing activity.
27.562 119 .000 3.54167 3.2872 3.7961
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People view the cause related marketing strategy of the company as a scope for them to take part
in social development work. Peoples attitude towards the charitable activity determines their
attitude toward cause related marketing. This hypothesis (table 4) testifies whether the patronizes
of cause related marketing possess the intention to donate in charitable works. With calculated
value less than the critical value (0.00
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General people tend to prefer patronize any issue which is primarily related with local of national
interest compared to any international one. The sixth hypothesis is accepted as the calculated
score 0.00 is less than the critical value 0.05 (table 6). So we can infer that local and national
causes get more preference than the international ones.
Table 8 delineates that there is a positive correlation between age of the respondents and the
support towards Cause related marketing with r=0.363 and it is significant at 5% level.
(Calculated value is 0.00). So the hypothesis of having a strong correlation between the
respondents age and support for cause related marketing is accepted. The positive score
indicates that as the age increases the tendency to support cause-related marketing of the
company increases. On the other hand, we cannot conclude in the same way about the
relationship between gender of the respondents and Support towards Cause related marketing of
a company (table 8) as here the calculated value is 0.298 which is much higher than the critical
value 0.05 though it delineates a positive correlation (r=0.098). So we can say that the hypothesis
is not accepted an can infer that support for cause related marketing programs of the company do
not depend on whether the respondent is a male or female.
Table 7: There is a strong relationship between customers age and Support towards Cause
related marketing
Support towards Causerelated marketing
Age
Support towards Cause related marketing
Pearson Correlation 1 .363**
Sig. (2-tailed) . .000
N 120 120
t df Sig.(2-
tailed)
Mean
Difference
95% Confidence
Interval of the
Difference
Lower Upper
Local/ National cause gets more preference by the
respondents than an international one.
33.029 119 .000 3.70000 3.4782 3.9218
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** Correlation is significant at the 0.05 level (2-tailed).
Table 8: Support toward cause related marketing is strongly affected by the gender.
Support towards Causerelated marketing
Age
Support towards Cause related marketing
Pearson Correlation 1 .098**
Sig. (2-tailed) . .289
N 120 120
** Correlation is NOT significant at the 0.05 level (2-tailed).
We have also observed that educational background also do not influence the support for any
cause related marketing program of the company as the calculated value (table 9) is 0.117
whereas the critical value is 0.05 though the correlation is positive (r=0.144). So the hypothesis
of having a relationship between the respondents educational background and support towards
cause-related marketing is not accepted.
Table 9: More educated people tend to show greater support for cause-related marketing
Support towards Causerelated marketing
Age
Support towards Cause related marketing
Pearson Correlation 1 .144**
Sig. (2-tailed) . .117
N 120 120
** Correlation is NOT significant at the 0.05 level (2-tailed).
The higher the income of the respondents, the greater the support for cause related marketing
programs of a companythe last hypothesis of the study (table 10) deals with the relationship
between the income of the respondents and support towards cause related marketing. The
hypothesis is accepted at 5% significance level as the calculated value is 4.6% (sig. 0.046) and
the level of correlation is positive, though not very substantial (r= 0.182). So we can conclude
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that people of higher level of income has more tendency to share that with the society in the form
of support for cause related marketing programs of the companies.
Table 10: People with substantial income are more inclined to support cause-related
marketing
Support towards Cause
related marketing
Age
Support towards Cause related marketing
Pearson Correlation 1 .182**
Sig. (2-tailed) . .046
N 120 120
* Correlation is significant at the 0.05 level (2-tailed).
In fact hypotheses H7, H8, H9 and H10 are related with the demographic variables of the
respondents. Out of these four hypotheses two were accepted (H7 and H10) and two were
rejected (H8 and H9) at 5% significance level. Depending on the rate of acceptance of
hypotheses, we actually cannot infer anything related to the level of correlation between the
respondents demographics and the support for cause-related marketing programs of the
company.
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3.3: Interpretation of findings
Cause-related marketing is a growing area of interest as reflected in both academic and
practitioner marketing literature. As presented cause- related marketing is a relatively recent
addition to the marketing communications mix. Cause-related marketing aligns a brand with a
nonprofit organization to which a contribution will be made by the firm, contingent upon
consumers undertaking a specified purchase behavior. In general, conceptual and empirical
research suggests that consumers have a positive view of this form of marketing activity.
However, it is also acknowledged that there are risks relating to the strategy, one of the most
serious being the potential for consumer perceptions of exploitation of the nonprofit organization
by the marketer. Developing a clearer understanding of the efficacy of cause-related marketing
as a marketing strategy is a critical undertaking for marketers.
Past research, both academic and practitioner, has indicated that consumers have primarily
positive attitudes toward companies that engage in this activity (Cavill and Company 1997; Ross
et al. 1991, 1992; Smith and Alcorn 1991). Further, there has been evidence to suggest that
consumer purchase behaviour is favourably influenced by this strategy and in some cases;
consumers are even willing to pay more for a product which supports the community. It has been
suggested that critical success factors for a cause-related marketing strategy include: a strategic
fit between cause and brand; a positively perceived motive of the firm; effective management of
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the campaign and nonprofit partner; and a long term approach to the partnership (Andreason
1996; Murphy 1997; Simon 1995; Welsh 1999). However, with the exception of firm motivation,
these factors have been identified primarily based on anecdotal evidence rather than systematic
research. In addition, relatively few academic articles or research studies have examined the
effectiveness of cause-related marketing in comparison to other marketing communications
strategies.
The purpose of this study was to examine consumer attitudes to cause-related marketing and the
potential for cause-related marketing to improve attitude to the brand and to influence purchase
intention. As discussed, although cause-related marketing is perceived to offer significant
benefits, it has been emphasised in the literature that the benefits of cause-related marketing need
to be evaluated in relation to alternative strategies.
In general, the results of this research indicate that consumer attitudes to a cause-related
marketing campaign are more favorable than consumer purchasing behavior in cause marketing
when controlling for the consumers behavior of fit between the brand and cause. There was
some support for the premise that cause-related marketing is more effective at generating a
positive change in brand attitude, when controlling for attitude to the marketing strategy.
With regard to influencing purchase intention, this research did not demonstrate a statistically
significant difference between the control, cause-related marketing, sponsorship and sales
promotion groups. Finally, neither gender nor personal values were shown to impact consumer
response in either change in brand attitude or purchase intention. The following sections will
discuss these findings in detail.
3.3.1: Attitude to a cause-related marketing strategy
This study offers support for the proposition that consumers will have a more positive attitudetoward a cause-related marketing strategy than toward marketing activities. An initial
examination of the means of the three treatment groups indicated that those respondents exposed
to a cause-related marketing campaign exhibited a slightly more favourable attitude to the
strategy than did the cause marketing group. Unfortunately, the differences in the means
narrowly missed out on achieving statistical significance. However, when controlling for the
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respondents perception of fit between the brand and cause organization or brand and promotion,
the results indicates that attitude toward the cause-related marketing strategy was substantially
more favorable. As the results indicate, the treatment group had a significant main effect on
attitude to the brand, when allowing for the perception of fit.
Further examination revealed that there was a significant difference between the cause-related
marketing group and the sponsorship group as well as the cause-related marketing, in terms of
attitude to the marketing strategies. The covariate of overall perceived fit, between the brand and
cause, had a significant effect on attitude to the brand and accounted for approximately 41
percent of the difference in attitude to the strategy between groups.
These results echo the literature that suggests that consumers are supportive of organizations that
support the community and cause-related marketing strategies in general. Drumright also
introduced the proposition that advertising campaigns with a social dimension engender a greater
consumer response than do conventional advertising campaigns. However, it appears that the
consumers perception of fit has a critical impact on their perceptions of cause-related marketing.
A plausible explanation suggested in the literature is that a natural fit between firm and cause
helps to overcome consumer potential perceptions of exploitation of the.
3.3.2: Impact on brand attitude
This study offers some support for the proposition that cause-related marketing can enhance
brand attitude and that the change in brand attitude experienced by consumers will be more
positive as a result of exposure to a cause-related marketing than exposure to a sponsorship or
sales promotion. A comparison of the means of the three treatment groups and one control group
indicated that only the group exposed to cause-related marketing experienced a positive change
in brand attitude. Further examination revealed that the type of group was shown to have a
significant main effect on attitude change, accounting for approximately 23 percent of the
difference. The significant difference, however, occurred between the control group and the
other three groups. This result suggests that in terms of affecting attitude to the brand, any
marketing communications strategy is better than none.
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The positive impact of cause-related marketing on brand attitude is consistent with the findings
of previous academic research. However, there has been limited comparison in the literature
between cause-related marketing and sales promotion or sponsorship, and no comparison with
regard to their ability to influence brand attitude. It is plausible that cause-related marketing may
have been able to engender a positive response in terms of an improvement in brand attitude due
to a positive perception of the firm or brands motives. That is, engaging in an activity to benefit
the community as opposed to simply driving sales. Attribution theory could also offer some
support for this argument. This explanation is consistent with research that suggested that
consumers perceive advertising as a self-serving act on the part of the organization and, as a
result, can trigger consumer defense mechanisms. Sales promotion is more overtly self-serving
than cause-related marketing, so these same perceptions of aggressive commercialism may be
transferred to the discount promotion. The relative novelty of cause-related marketing may also
aid in the improved attitude to the brand.
3.3.3: Impact on consumers purchasing behavior
This study found that consumers purchasing behavior was not more positive as a result of being
exposed to a cause-related marketing strategy. In fact, none of the marketing strategies appeared
to differ in their impact on consumers purchasing behavior. This finding is consistent with
Drumright and conclusion upon reviewing the research in corporate societal marketing.
Drumright and Murphy (2001) suggest that many organizations have been disappointed with the
lack of impact from corporate societal marketing initiatives on the bottom line, especially in the
short term. Also found that while some consumers exhibited a positive change in their view of
the companys image, it generally was not necessarily manifested in their consumers purchasing
behavior. This was particularly the case when traditional purchase criteria were important.
Consumers purchasing behaviorwas affected by cause-related marketing.
Charity incentives have been found to be more effective in promoting frivolous products thanpractical products. Given the soft drink product category used in this research and the age group
of the majority of the respondents, it is unlikely that this product would be perceived as
particularly frivolous. Therefore, the nature of the product may have affected the potential for
cause-related marketing to influence purchase intention. An additional reason may relate to the
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single exposure of the campaign not being adequate to influence this consumers purchasing
behavior.
3.3.4: Influence of gender and personal values
It is important to consider the factors that may influence the response to a cause-related
marketing strategy. Based on prior research, this study considered gender and personal values as
potential covariates that may need to be controlled. However, the findings showed that neither
gender nor personal values influenced the response to cause-related marketing. Cause-related
marketing in terms of attitude to the strategy, change in brand attitude or intention to purchase.
These researchers found that there was in fact a significant correlation between attitude toward
cause-related marketing and the following values: sense of belonging, warm relationships with
others and self-fulfillment. Interestingly, this study was also conducted using Australian
undergraduate and postgraduate university students. A possible explanation as to why the
findings of the current research study differ is that respondents in the earlier study indicated their
attitude to the general concept of cause-related marketing as opposed to a specific cause- related
marketing strategy.
With regard to the influence of gender on response to cause-related marketing, past research has
not been conclusive in its findings. The study suggested that womens attitudes were slightly
more favorable than were mens, but this difference was not statistically significant. I did not
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find any difference in attitudes and behavior towards cause-related marketing based on gender.
Their results indicated that women had a more favorable attitude to cause-related marketing and
its participants (the firm and nonprofit organization) than did men. It is interesting to note that
research in the area of helping behavior has faced similar contradictory results when examining
the impact of gender on helping behavior.
On the basis of a review of the literature pertaining to gender-related advertising research, that
research supports a gender-based approach to information processing, whereby females are more
comprehensive at processing messages. Further, females may process advertisements more
elaborately. I investigated the differences between males and females in the threshold at
which they engage in elaborative processing of message information. Their findings suggest
that men and women have different thresholds for the elaboration of message cues. I found there
were two factors that would determine whether gender differences would be exhibited in the
consideration of specific messages. These factors related to the degree of congruity contained in
the message and the response required of the individual. It was found that gender differences
were more likely to occur when the average demands of these two factors were moderate.
The preceding findings may provide an explanation for the lack of gender difference observed in
the current study. It can be assumed that the message relating to the brands participation in the
various marketing scenarios held a low degree of incongruity for respondents of both genders;
that is, they were all plausible marketing strategies that the brand may undertake. Further, the
response required was not particularly demanding. Therefore, it would be expected that no
gender difference would emerge in their responses in terms of attitude to the strategy, change in
brand attitude and purchase intention.
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Chapter 4.0: Implications for future research
Future research that builds on the findings of this study and overcomes its limitations is
recommended. First, it is suggested that this study should be replicated using a number of other
brands and product categories to determine whether these results can be extended to other
conditions. Similarly, this study should be replicated with a nonstudent sample to determine
whether these findings can be generalized to the overall population. Most importantly, repetition
of this study may clarify the impact of cause-related marketing on consumers purchasing
behavior in comparison to other communications strategies. Based on an examination of the
means on this dependent variable, cause-related marketing appeared to have a greater impact on
changing brand attitude. However, this result did not prove to be statistically significant, albeit
by a narrow margin. As such, it would be worthwhile to repeat this aspect of the research to
resolve this issue.
Second, it is recommended that future research should control for brand loyalty. It seems
plausible that a consumers brand loyalty will impact on their attitude to the strategy and
possibly impact on a change in brand attitude and consumers purchasing behavior. Further, it
would be of interest to determine the impact of cause-related marketing on consumers with
differing levels of brand loyalty. Given the lack of reliability achieved by the scale used to
measure brand loyalty, it is recommended that a different one be used.
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Third, the findings of this research suggest that consumer perception of fit between cause and
brand, in addition to consumer attitude to the cause-related marketing strategy, are critical factors
in facilitating change in consumers purchasing behavior. Therefore, it is suggested that future
research explore these two factors in more detail. Furthermore, it would be worthwhile to
explore whether the firm could favorably influence this perception by clearly articulating the
connection in the communication of the strategy. With regard to attitude to the strategy, further
research should examine the impact of the consumers existing awareness and attitude toward the
cause and the consumers perception of the firms motivation for participating in the strategy.
Finally, further research should be done to attempt to clarify the impact of gender and personal
values on a consumers attitude and response to a cause-related marketing strategy. Research to
date has demonstrated conflicting results.
Chapter 5.0: Recommendations & Conclusion
5.1: Recommendations
The respondents level awareness about the companies such type of societal contributory
activity, before participating in this study, was 70%. But only 29% of the respondents knew the
actual term of this type of marketing program. As the companies tendency to incline to involve
the social issues in the business operations is increasing, the respondents level of awareness and
support are expected also to grow more. This study has, primarily, endeavored to explore the
impact of cause-related marketing activity over the customers preference of brand and company.
It has been found out that cause-related marketing significantly influences the consumers
attitude toward a company and any brand particularly, provided that the customers are well
aware of such activity in conceptually. The interviews revealed that the following criteria play a
pivotal role in patronizing a cause.
The cause must bear significant benevolent feature which will contribute entirely tosocial welfare.
Customers favor that kind of causes with which they feel associated. Appealing causewill be that one which is recent and create great maladjustment in the society or which
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needs support in great extent. Customers feel proud and relieved to be a part of such
contribution.
Companies, to make the program a success, should patronize a little bit of different butsignificant causes which are overlooked by others or are focused by very few firms.
Every company has a self concept so as every brand. The selected cause must becompatible with the companys present image. For example, the fast food companies
should not patronize any medical services which deal with calorie reduction and obesity.
Because it is proved that numerous high calorie items are the prime ingredients of fast
foods.
To have linkage with the companys existing and potential product line and its corporateimage is very essential for a cause. It must not be highlighting any cause that will bring
good fortune to the company at present or in near future.
There is no hard line about the number of patronizations made by the company. But it isadvised to keep that reduced to as many as possible otherwise stakeholders might surmise
about the operating credibility of the firm.
Preferences should be given more to local or national issues. This study has notconsidered all the demographic variables that affect the purchasing decision of the
customers. The size of the sample is not very big and it is confined to the capital city
only.
Further study can be conducted in these areas to shed more light over the people's view of the
companies societal contributory activities and influence of such programs on customers
decision making process.
5.2: Conclusion
In conclusion, as an emerging area within the marketing discipline, there is a critical need for
research into the various elements of cause-related marketing strategies. The findings of this
research have important implications for both practitioners and academics. This research has
provided a conceptual model to demonstrate the process that leads to a favorable consumer
response to cause- related marketing. Furthermore, this study has empirically demonstrated the
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strengths of cause-related marketing in comparison to other communications strategies. The
major finding indicates that consumers have a more favorable attitude to a cause-related
marketing strategy than to either a sponsorship or sales promotion, dependent on the consumers
perception of fit between brand and cause. Cause-related marketing also has the ability to
engender a positive change in brand attitude and to do so more effectively than a sales
promotion. This change in attitude is contingent upon the consumers attitude to the strategy
itself. Given the unique win-win-win benefits associated with this strategy, it is not difficult to
understand why both practitioners and academics suggest that cause- related marketing is likely
to continue to grow. This research was undertaken with the intention of contributing to the
understanding of the factors that can maximize the effectiveness of this strategy. This study has
added to the current body of knowledge relating to cause-related marketing and has provided
insight into areas that warrant further exploration.
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Appendices