Socially Conscious Consumerism
Highlights for Educators from a Systematic
Review of the Body of Research
Dr. June Cotte
Richard Ivey School of Business
Commissioned by:
Network for Business Sustainability
The Terra Bite Case Study
• A case study (available here) was developed to support this project. It
deals with voluntary consumer payment method
• The implicit assumption of the owners is ethical behaviour on the part of
consumers, most of the time
• Another implicit assumption is that socially responsible consumers will
pay enough of a premium to more than compensate for free-loaders
• The results of a knowledge project undertaken for the Network for
Business Sustainability looked deep into the evidence underlying these
and similar assumptions
Research Question and Approach
Are consumers willing to reward firms for their positive CSR-related
actions?
• if so, by how much?
• what factors influence whether they will?
• do they also punish (monetarily)?
What is CSR?
Keywords searched:
Organic products
Local purchasing
Recycling
Slow food
Socially conscious consumerism
Environmental consumerism
Social marketing
Green consumption
Cause-related marketing
Eco-friendly products
Paying for ethical behaviour
Sustainable products / consumption
Ethical firm behaviour
Corporate social responsibility
What is included in the study?
• Search found nearly 1,700 academic articles and industry reports
• Excluded least relevant and worst quality studies
• Analyzed 91 articles on consumer willingness to pay for CSR
initiatives
Results: Types of Studies
Study Methodologies Over Time
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Unclear
Meta-analysis
Theory
Archival
Qualitative
Experiment
Survey
Results: Location of Consumers
Location of Consumers in Data
2% 1%
1%
1%
United States
5%
Canada
North America -unclear
20%
Europe
South America
57%
Asia, not including Australia
6%
Africa
7%
Australia
World
Results: Meaning of CSR
Dimensions of CSR over time
100%
Overall CSR
90%
80%
70%
60%
Overall consumer ethical
level
Animal rights
Other
50%
40%
30%
20%
Organic
Sourcing and/or
production
Cause-related/charity
10%
0%
Labor practices
Environmental/green
Results: Meaning of CSR
Dimensions of CSR Measured Various Ways
60
Overall CSR
50
40
Overall consumer ethical
level
Animal rights
30
Other
Organic
20
Sourcing and/or production
10
Cause-related/charity
0
Attitudes
(30%)
Intentions
(44%)
Behaviors
(18%)
No measures
described
(8%)
Labor practices
Results: Consumer Willingness to…
Consumer Responses Dependent on Type of Measurement
88%
Behaviors
44%
94%
Intentions
61%
39%
Attitudes
9%
Willing to Change
Behavior (% of studies
that asked)
Willing to Pay Premium
(% of studies that
asked)
Results: Attitudes
Consumer Acceptance CSR Dimensions: Attitude-Based Studies
overall CSR
0%
consumer ethics
0%
animal rights
0%
0%
other
0%
0%
5%
5%
Percentage of studies
showing willingness to
pay premium
organic
3%
sourcing
3%
3%
cause-related
3%
labor practices
3%
3%
environment
3%
5%
5%
Percentage of studies
showing willingness to
change behavior
13%
Results: Behaviours
Consumer Acceptance CSR Dimensions: Behaviour-Based Studies
overall CSR
0%
4%
consumer ethics
8%
8%
13%
13%
sourcing
labor practices
environment
Percentage of studies
showing willingness to pay
premium
0%
0%
organic
cause-related
8%
8%
8%
animal rights
other
4%
Percentage of studies
showing willingness to
change behavior
0%
0%
13%
17%
17%
38%
Results: Intentions
Consumer Acceptance CSR Dimensions: Intention-Based Studies
overall CSR
2%
consumer ethics
2%
2%
Percentage of studies
showing willingness to
change behavior
5%
5%
animal rights
other
Percentage of studies
showing willingness to pay
premium
4%
0%
0%
9%
9%
organic
14%
14%
sourcing
cause-related
labor practices
environment
4%
12%
9%
11%
23%
32%
Results: Intentions vs. Behaviours
Studies Showing Willingness to Pay as Percentage Increase
8
studies measuring actual
behaviors
7
6
studies measuring
consumer intentions
5
4
3
2
1
0
5-9%
10-19%
Note: based on a small set of the total studies that included specific increases (13/91).
More than 20%
Conclusions
Behavioural studies trump surveys
• Surveys yield wider range of results than observing consumer choices
Attitude-Behaviour gap confirmed
• Intentions > behaviours
• Biggest gap on the environment: consumers are willing to change but
not pay more
• Smallest gap on organic, ethical sourcing, and animal rights: fewer
studies show willingness to change, but those that do also show that
consumers are willing to pay more
What’s a Marketer to Do?
“…assuming all else is constant, consumers are more likely to purchase
from companies that engage in CSR actions, particularly in domains that
consumers deem appropriate and personally relevant… [but]… little is
constant in the real marketplace.” (Du, Bhattacharya and Sen 2007)
Messaging needs to position along the lines of “there is no trade-off” —
consumers expect the “better” alternative to be at least equal in price and
quality to what they are already buying
If you plan to charge a premium, messaging needs to revolve around other
ways your offering saves money (the ‘value in use’ argument from the B2B
area)
Future Opportunities
What influences consumers? We lack consensus on the profile of the
socially conscious consumer and company:
• My final report will have a model of possible influences
• But we must better understand the influences and the gaps
between attitudes, intentions, and behaviours
Research in this area needs to be more rigorous.
• Price and quality are never equal, so let’s not assume they are
Research Opportunities
Enough surveys. We need better methods:
• Self-reported survey results simply are not up to the task of
determining a price premium, or real marketplace behaviour
• Consumers often assume the socially conscious choice
must be either more expensive, or not as effective
• More rigorous methods include conjoint, forced-choice,
traditional experiments
Influences
Gender,
Age,
Education
SEC,
Culture,
Nation
Firm CSR
Actions
Involvement
Social and
Peer
Influence
Willingness to
Change
Behavior
Gov’t
Policy
Consumer
Attitudes
towards CSR
Actions
Consumer
Behavioral
Intentions
Willingness to
Pay a Premium
Willingness to
Punish
Enhancements
and Impediments
Impediments:
•Contradictory firm actions
•Prior negative consumer
knowledge or attitude re: firm
Enhancements:
•Consumer knowledge of
action
•Consumer understanding
•Prior positive consumer
attitude re: firm
•Company / issue fit
Impediments:
•Negative consumer
attributions (why?
greenwashing)
•Effect on perceived
quality
•Negative perceptions of
consumer efficacy
•Consumer sacrifice
Enhancements:
•Positive perceptions of
consumer efficacy
•Acceptance of firm and
consumer responsibility
Impediments:
Competitive actions
Confusion at POP
Habit
Misleading packaging
Required trade-offs
Enhancements:
Clear benefit
Prior small commitment
Consistency/fit with brand
Salience of issue
Simplified claims/labels
In-store education