Academic journal article Management & Marketing

Demonstrating a Lack of Brand/cause Effects on Point of Sale Donations

Academic journal article Management & Marketing

Demonstrating a Lack of Brand/cause Effects on Point of Sale Donations

Article excerpt


"Would you like to add $1.00 to your purchase today to support children's health?" Such marketing tactics may seem inconsequential at best - after all, how far can $1.00 really go? - but recent statistics indicate that during one year, 63 companies raised $358.4 million for charities using these very techniques (Cause Marketing Forum, 2013). This relatively new form of cause-related marketing (CRM), referred to herein as point of sale CRM, is being rapidly adopted by companies across the nation, yet the topic is vastly underexplored throughout the academic literature. This research is an attempt to investigate one aspect of CRM as it relates to the context of the brand/cause fit. Traditionally, a lot of the literature on the subject purports that a high brand/cause fit, typically described as natural congruence between a company and a charitable cause, is significantly better on many aspects than a low brand/cause fit (Kim et al., 2015; Robinson et al., 2012; Simmons and Becker-Olsen, 2006). However, this paper proposes an exception to this ubiquitous finding by proposing a context in which the differential effects of low and high brand/cause fits do not apply.

Utilizing a methodological technique not often published in academic literature, that of testing no-effect hypotheses (Cortina and Folger 1998), this research shows that, despite what extant literature may purport, low brand/cause fits do not always result in significant differences from high brand/cause fits. Focusing on a point of sale CRM context, it is demonstrated across three studies that, in this context, testing the differences between low and high brand/cause fits on both attitudes and behavioral intentions consistently result in non-significance. Thus, the purpose of this paper is to challenge traditional thought in this area by exploring a context in which results contrary to extant literature can be consistently demonstrated. Stated differently, this paper seeks to show that, in a point of sale CRM context, a low brand/cause fit may be just as effective as a high brand/cause fit.

Previous research

CRM is a powerful and influential tool. In their seminal study on the subject, Varadarajan and Menon (1988) describe CRM as the marketing activity in which a company makes charitable donations in tandem with consumer transactions. Extant research demonstrates the benefits of employing CRM, such as positive brand evaluations (Ellen et al., 2006; Lafferty and Edmondson, 2014; Lafferty and Goldsmith, 2005), better brand positioning (Du et al., 2007; La Ferle et al., 2013), increased firm performance (Simionescu and Gherghina 2014), and even potentially higher stock value (Luo and Bhattacharya, 2009). Similarly, consumers increasingly desire for companies to engage in socially responsible behaviors: one study reports that more than 80% of respondents feel as though companies should associate with social initiatives (Becker-Olsenet al., 2006), and a recent nationwide survey reveals that 91% of respondents desire to see more brands contributing to social issues (Cone, 2013).

In light of the growing importance of CRM to both companies and consumers, much research has been undertaken to understand the concept of the brand/cause fit. Described as the perceived link between the brand and the social cause (Varadarajan and Menon, 1988), some authors propose that the brand/cause fit "is the single most important aspect determining the quality of outcome for [CRM] initiatives" (Hamlin and Wilson, 2004, p. 675). Others conclude that "it is generally agreed that a high level of fit affects firms more positively than a low level of fit" (Kim et al., 2012, p. 163). However, several authors illuminate the complex nature of the relationship between fit and CRM effectiveness (Alacañizet al., 2010; Fleck and Quester, 2007; Lafferty, 2007). Some studies confirm the positive relationship between high fit and performance (Pracejus and Olsen, 2004; Samu and Wymer, 2009), and some findings reflect the negative relationship between low fit and performance (Becker-Olsenet al. …

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