Cause-related marketing : making consumers believe?

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Master Thesis

Cause-Related Marketing: making consumers believe?

University of Amsterdam

Faculty of Economics and Business

MSc. in Business Administration

Track: Marketing

Under supervision of: Dr. Lars Moratis

By:

Student: Juan Carlos Félix Olvera

Student Number: 11085479

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University of Amsterdam 2

Statement of originality

This document is written by student Juan Carlos Félix Olvera who declares to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it. The faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

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Acknowledgement

The fulfilment of this study represents the final step towards achieving my master’s degree in marketing at The University of Amsterdam. Writing this research has been an experience that doubtlessly increased my motivation to develop myself within the marketing field. The discipline of marketing has a competitive advantage compare with other business disciplines. The reason of this is that, within all of its different application fields, marketing is able to make the world a better place to live in. By using Cause-Related Marketing campaigns, marketing is able to not only create value for stakeholders but also to society, which, to my beliefs, generates a “win-win” situation if well designed and implemented. To believe that marketing is more than a tool to create value and profit for the corresponding stakeholders is what has driven me to address this research. Due to this challenging endeavor, I would like to take this opportunity to thank all the people that have supported me through every goal I set to myself. To my family because without their love and support none of this would have been possible. To my friends for their warmth and sincerity, for encouraging me when I needed the most and, last but not least, to my supervisor, Dr. Lars Moratis, for his guidance and positive criticism, which without a doubt was pivotal assistance in order to accomplish this task. I am hopeful that when reading this, you become aware of the types of Cause-Related Marketing campaigns and how trustworthiness plays an important role in its success.

Best,

Juan Carlos Félix Olvera 24th of June, 2016

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Abstract

Cause-Related Marketing campaigns play an important role in society due to managers make use of them to support social causes. The type of Cause-Related Marketing (hereinafter CRM) campaigns that is predominant in literature is the one that, in essence, once the corresponding purchase is carried out, a company pairs up with an NGO or NPO and assist them with financial resources (i.e. donations). Researches had studied these campaigns thoroughly and established that, even though these campaigns aim to elicit cooperation and create a “win-win” situation for both the company and society, mistrust lies deeply within CRM. The reason of this is that consumers believe firms focus on rising sells uniquely. Consumers’ perceptions and attitudes towards not only the company but to the initiatives they undertake (e.g. societal issues) are pivotal for firm’s business performance as they determine whether a consumer purchases from them. Due to managers are constantly striving to achieve a competitive business performance, it is important to understand how companies can reduce this mistrust. It is a fact that consumer skepticism towards CRM campaigns exists; however, little is known if a modification in the way current CRM campaigns are executed can lead to the diminishment of consumer skepticism. The dominant approach in current literature examines CRM extensively. That is to say, its main characteristics, its consumer attitudes and the level of mistrust generated. Nevertheless, it has not studied how the level of skepticism can be reduced. The current research aims to address this issue.

Is it possible to reduce consumer skepticism if instead of asking consumers to first purchase a corresponding product or service in order to provide a donation, managers provide the assistance first, on behalf of the firm’s consumers and, only then, ask them to reciprocate by purchasing either a product or service (i.e. CRM campaigns based on reciprocal altruism)? This research aims to investigate the extent to which CRM campaigns based on reciprocal altruism combined with either

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University of Amsterdam 5 financial aid (i.e. donations), non-financial aid (i.e. professional advice) or a combination of both (financial with non-financial aid) can lead to the diminishment of consumer skepticism. The objective is to observe CRM campaigns from a different perspective than that used in the main literature. This research extension is relevant as not only identifies additional arguments to understand better CRM campaigns, which could help managers to tailor its right design, but also because provides information concerning the diminishment of consumer skepticism, which impacts directly on the firm’s business performance. In order to address this proposal, survey data has been collected from 130 respondents with the aim to analyze respondents’ mistrust towards CRM. Findings suggest that indeed a different type of CRM (i.e. campaigns based on reciprocal altruism) combined with either financial aid, non-financial aid or a combination of both leads to a reduction in consumer skepticism. Interestingly, the campaign, together with the type of aid that has greater impact on skepticism, is the one based on reciprocal altruism combined with hybrid aid.

Keywords: Cause-Related Marketing; CRM; standard reciprocity; reciprocal altruism; financial aid, non-financial aid and hybrid aid and consumer skepticism.

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2.7. Contributions ...33 2.7.1 Academic contributions ...33 2.7.2 Managerial contributions ...34 2.8 Theoretical framework ...34 2.8.1 Hypotheses ...36 3.- Methodology ... 46 3.1 Research design ...46 3.2 Sample ...46 3.2.1 Survey ...48 3.2.2 Procedure ...49 3.2.3 Pilot study ...49 3.2.4 Main study ...49 3.2.5 Measure of variables ...52

4.- Results and analysis ... 54

4.1 Preliminary and exploratory analysis ...54

4.2 Reliability analysis ...55

4.3 Correlation ...56

4.4 Paired sample T-test ...57

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4.6 Skepticism towards CRM campaigns ...59

5.- Discussion and conclusions ... 69

5.1 Discussion ...69

5.2 Overall conclusion ...73

5.3 Theoretical implications ...74

5.4 Managerial implications ...74

5.5 Limitations and Future Research. ...76

References ... 78 Appendix ... 83

List of Figures

Figure 1.- Hypotheses ... 35 Figure 2.- Hypothesis 1 ... 37 Figure 3.- Hypothesis 2 ... 41 Figure 4.- Hypothesis 3 ... 43 Figure 5.- Hypothesis 4 ... 45

Figure 6.- Cronbach's Alpha ... 55

Figure 7.- Correlation matrix ... 56

Figure 8.- Descriptive statistics and Multivariate Tests ... 61

Figure 9.- Pairwise Comparisons ... 62

Figure 10.- Hypotheses' confirmation ... 63

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1.- Introduction

1.1 Consumers’ power

Consumer skepticism towards both companies, when engaging in corporate social responsibility activities, and, consequently, corporate social responsibility campaigns, has been a constant issue within the marketing field (Vanhamme, Lindgreen, Reast and Popering, 2012). Maignant et al., (2004) argues that distrust arises due to consumers are not relying on what firms state they are doing and, according to Vaaland et al., (2008), consumers believe that firm’s activities may have negative consequences for society and barely engage in initiatives that will make a novel contribution to its surroundings, regardless of the improvement of its business performance. Companies are responsible for the creation, maintenance and development of the associations its customers have of them (Keller, 2005). In every context where companies and consumers are involved, the latter will make judgements and use their power to reward “good” and punish “bad” companies (Bowd et al., 2006, used in Jahdi and Acikdilli, 2009). Consequently, companies engaging in social activities are perceived more positively and trustworthy (Green and Peloza, 2011). Positive consequences depend on how those prosocial initiatives are communicated to customers and society (Green and Peloza, 2011) and how are executed.

1.2 Role of communication strategies

In this sense, marketing carries out the communication process of societal initiatives, where credibility of the social strategy is paramount. Even though companies that engage in societal initiatives trigger positive attitudes towards the company at hand (Vanhanme et al., 2011), Achrol and Kotler (2012, p. 37) state that “marketing is well-known for having negative impacts due to

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University of Amsterdam 9 promotes rapid consumption of limited natural resources, it does not restrain the wants it encourages, and it over-fulfills materialistic wants and under-serves nonmaterial wants”. Thus far, not only companies that engage in corporate social responsibility activities and campaigns that communicate this strategy generate mistrust in the eyes of consumers, but also, according to Achrol and Kotler, marketing plays an important role regarding trustworthiness. Nevertheless, there is a realization that business and the development of social causes are convergent paths (Achrol and Kotler, 2012). That is to say, there is a connection between business and social initiatives and, therefore, marketing is able to contribute to the benefit of both.

1.3 CRM based on standard reciprocity

A marketing tool that aims to communicate social undertakings and prove a firm’s credibility in the eyes of both consumers and society is known as CRM. Predominant literature has explained CRM comprehensively; however, it has focused on one type of CRM campaigns only (i.e. CRM campaigns based on standard reciprocity). CRM campaigns based on standard reciprocity are characterized by an offer from the firm to provide a specified amount to a designated cause when customers engage in revenue-providing exchanges (Svenson and Wood, 2011). This strategy aims to elicit reciprocity by asking, for instance, consumers to purchase a product/service in order to conduct the corresponding donation. Moreover, there are two important arguments to take into account regarding CRM based on standard reciprocity. Firstly, CRM provides aid to social causes in terms of financial resources only and, most importantly, support arises when consumers have purchased the product or service the firm is offering. In other words, if consumers do not acquire the corresponding product or service there will be no assistance coming from the company. Due to this situation, consumers’ attitudes towards these types of

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University of Amsterdam 10 campaigns have not been entirely positive because it seems that they are being designed with the aim of increasing sales for its benefit solely (only if the purchase is carried out) and barely due to firms are eager to assist a social cause.

1.4 CRM based on reciprocal altruism

Taking into consideration that the dominant literature has focused on covering CRM campaigns based on standard reciprocity and its impact on consumer skepticism, it is important to acknowledge that little is known about other type of CRM campaigns (i.e. CRM campaigns based on reciprocal altruism) and how this type of campaign impacts mistrust importantly. Reciprocal altruism can be understood as the cooperation between firms and society when helpers can benefit by being helped in return. For example, a CRM campaign based on reciprocal altruism will consist of, first, providing assistance for a social cause and, then, communicating it to customers so that they feel bound to reciprocate this action to the firm at hand. In this sense, a difference can be observed in these two types of campaigns. Reciprocal altruism aims to elicit customers’ response towards CRM strategies by changing the order of the elements being used in standard reciprocity (Goldstein et al, 2011 and Griskevicius et al., 2012). The former is mainly characterized because first provides the assistance to a social cause and, only then, asks its consumers to reciprocate the aid already provided so that the company is able to recover the expense made, whereas the latter first ask its consumers to purchase a product or service and, only then, provide the aid with the resources obtained. Furthermore, little is known if other type of aid, besides donations, are capable of enhancing positive attitudes towards both the company at hand and, subsequently, have an impact on consumer skepticism towards CRM campaigns. That is to say, measure the level of mistrust when a different type of aid is provided, such as non-financial aid (providing professional

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University of Amsterdam 11 advice to social causes) or a combination of both (financial aid with non-financial aid). Not surprisingly, a number of surveys have been conducted to measure consumers’ attitudes towards CRM campaigns in which authors show that, at least, 84% of those surveyed stated that companies involved in these types of strategies have increased the positive image of the company (Svenson and Wood, 2011). Other results show that favorable attitudes towards CRM campaigns influence consumers’ satisfaction and, consequently, positive brand image increases (Galan-Ladero et al., 2013). In this regard, even though consumer skepticism with respect to CRM campaigns exists, results show that, indeed, these types of campaigns are capable of diminishing it.

1.5 Objectives

It is important to bear in mind that a plethora of literature exists regarding CRM campaigns and its impact on consumer skepticism; notwithstanding, it has focused on explaining thoroughly CRM campaigns based on standard reciprocity only, leaving behind the impact of CRM based on reciprocal altruism together with the type of aid that could be best suited to reduce consumer skepticism. Therefore, this research seeks to address whether CRM campaigns based on reciprocal altruism are capable of reducing consumer skepticism towards CRM campaigns and whether this approach varies from one another using different types of assistance (i.e. financial aid, non-financial aid or hybrid aid). In this regard, this research leads to the following question:

“To what extent Cause-Related Marketing campaigns based on reciprocal altruism combined either with financial aid, non-financial aid, or a mixture of both can lead to the diminishment of customer skepticism?”

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University of Amsterdam 12 In order to obtain data that helps to approach the research’s objectives, an online survey was conducted. Those surveyed have determined whether CRM campaigns based on reciprocal altruism combined with either financial aid, non-financial aid or hybrid aid are capable of reducing consumer skepticism towards CRM campaigns. The structure of this research proposal consists of a thorough explanation of The Literature Review followed by the Theoretical Framework, in which hypotheses are explained thoroughly. Next, the Research Design together with the Analysis of data collected are explained. Once these steps are described, results are discussed and, thereafter, the conclusion of the research proposal is presented.

1.6 Contribution

Results provide interesting insights with respect to the impact that CRM campaigns based on reciprocal altruism combined with certain type of aid have on consumer mistrust. Especially, these insights enable both practitioners and researches to not only observe the effect of each type of CRM campaign from a different point of view but also to acknowledge if a certain type of aid leads also to the diminishment of consumer skepticism. Therefore, and as due to the fact existing literature has not approached this effect yet, the main contributions are mainly two. First, in order to further analyze how consumer skepticism towards CRM campaigns can be reduced, researches can make use of the study’s findings as it provides tools to observe the impact that CRM campaigns based on reciprocal altruism combined with a certain type of aid have on consumer mistrust. So theoretical arguments are offered. Secondly, it is a fact that consumer’s perceptions towards the firm affect directly its business performance and, subsequently, managers are persistently striving to find ways to improve it. Therefore, it is relevant to observe, when designing, implementing and monitoring CRM campaigns, how managers can impact consumers’ attitudes towards the company

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University of Amsterdam 13 at hand (i.e. consumer skepticism) so that the firm can be capable of improving its corporate performance.

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2.- Literature review

2.1 Consumers’ concern

The availability of information has made consumers both more sophisticated and educated (Labrecque, Esche, Mathwick, Novak, and Hofacker, 2012), meaning that customers are eager to obtain detailed information with respect to both specific attributes of products and services and the physical and psychological consequences of purchasing them before they acquire any product or service (Wagner, 2007). Additionally, consumers show concern not only for issues that affect their own welfare but also for those that do not affect them directly, such as if the product they are purchasing is being assembled by children, if the product is environmental friendly, if the company they are buying from is seen as transparent and trustworthy, if the firm is supporting a social cause, and so on (Maignan and Ferrel, 2004). Thus, consumers, in their decision-making process (Neslin, 2009), take into account several aspects that assist them in selecting the product or service that satisfies the most their wants and needs and, importantly, that is in line with their values. Importantly, in consumers’ minds lie enough elements to decide to purchase from a certain company or not, to assess their own attitudes (positive, neutral or negative) with respect to the company at hand, to become a loyal consumer or not. This assessment has a direct impact in the company’s business performance (Keller, 2003). Maignan et al., (2004) considers that consumers react positively and support firms that assist a social cause through a partnership or joint venture with a Nonprofit Organization (NPO) or Nongovernmental Organization (NGO), and how their decision-making process (i.e. purchase intentions) is closely related to their impressions of the company. Furthermore, customers not only judge business performance, but they also communicate their personal assessment through their own means (Trusov et al., 2009). Thereby,

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University of Amsterdam 15 business performance is closely related to the consumers’ perception of the firm (Hildebrand, Sen and Bhattacharya, 2011).

2.2 Corporate social responsibility

Due to its impact on business performance, consumers’ concern and judgement of the firm is highly relevant for managers. This impact has created a managerial mind-set that led companies to engage in Corporate Social Responsibility (hereinafter CSR) initiatives, whereby many valuable resources (human capital, money, time, training, etc.) of the company at hand are allocated in order to maximize the “value for the company and society” (Porter and Kramer, 2011 used in Hildebrand, Sen and Bhattacharya, 2011). That is to say, companies are willing to undertake expenses in order to create, maintain or increase a trustworthy image in the eyes of its consumers and society. Notwithstanding, most of the times firms concentrate these resources only to enhance the firm’s image rather than genuinely getting involved in a social cause (Berglind et al., 2005). This situation, in most of the cases, develops consumers’ distrust towards both companies and CSR initiatives which, shallowly, try to come across as socially responsible. However, according to Green and Peloza (2011), consumer support is well established for CSR initiatives, and companies that expect to engage in any social activity have discovered how CSR contributes to a consumers’ sense of well-being and, not surprisingly, this benefit is rewarded in the market. In other words, and from a managerial point of view, companies that engage in CSR initiatives aim to develop positive evaluations towards the firm, increase consumers’ satisfaction, cultivate positive word of mouth, promote consumers’ purchase intentions, increase willingness to pay for a premium price and might leverage loyalty towards the brand (Green and Peloza, 2011). Moreover, Hildebrand et al., (2011) argues that companies engage in those activities because these efforts will elicit

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University of Amsterdam 16 company-favoring responses from the stakeholders’ groups (consumer, employees, investors, communities, government, environment, society and so on). Hence, it can be observed that the main reason for companies that seek to get involved in social initiatives is that they need to be seen, by its stakeholders, as honest, caring and trustworthy as this image will contribute to its business performance.

Much research has been conducted with the aim to explain CSR and whether its implications are positive or not. Vaaland et al., (2008, p. 931) defines CSR as: “the management of stakeholder concern for responsible and irresponsible acts related to environmental, ethical and social phenomena in a way that creates corporate benefit”. Thus, CSR stands for a strategy that aims to create benefit for companies, originating it from engaging in social concerns. In other words, CSR is a managerial decision that focuses on creating a “win-win” situation for both the company and society. Furthermore, plenty of research has been carried out with the intention of outlining CSR’s main conceptual viewpoints. According to Maignan et al., (2004), the main points that arise from the literature of CSR can be summarized into the following concepts: CSR as social obligation, where obligations concerning society can be seen as economic (being productive and economically viable); legal and ethical obligations (following the law, acknowledge values and norms and philanthropic obligations, and proactively giving back to society) and; CSR as a managerial process, where CSR can be seen as part of the organizational processes of the firm, monitoring and assessing environmental conditions, attending to stakeholder demands, designing plans and policies aimed at enhancing the firm’s positive impacts. Once the concept of CSR and its impact on firm’s business performance has been explained, it is important to analyze thoroughly consumers’ attitudes regarding CSR.

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2.3 Corporate social responsibility and its marketing relationship

It is fundamental for both managers and researches to understand the impact of CSR on consumers’ perceptions towards companies and why companies engage and dedicate much effort to accomplish an effective CSR strategy. When engaging in CSR activities, companies build a more congruent and coherent corporate identity and, consequently, a more enduring and significant relationship with stakeholders (Hildebrand, Sen and Bhattacharya, 2011). Hildebrand et al., (2011) argues that the discipline of marketing plays an essential role within CSR strategies due to the fact it enhances not only the understanding of company’s identity but also the responding to stakeholders’ concerns. Much research has been completed in this field and, as a result, marketing has been linked with activities that push for more socially desirable behaviors (Maignan et al., 2004). For example, Maignan et al., (2004) argues that managers are able to design business strategies and, just as importantly, communicate to stakeholders the business impacts of specific issues that serve as organizational identification. In other words, managers, through the discipline of marketing, are capable of communicating the firm’s CSR initiatives. They do so by spreading, for instance, the company’s desired social image within specifically-targeted advertising campaigns.

Before explaining the relationship between CSR and marketing thoroughly, it is relevant to define the latter. The American Marketing Association (AMA) defines it as: “the activity, set of institutions and processes for creating, communicating, delivering and exchanging offerings that have value for customers, clients, partners and society at large”. The definition states that, indeed, marketing regards as an activity that generates, communicates and provides value for customers and society. Hence, the relationship between CSR and marketing comes clear as societal initiatives must be communicated to whoever is interested in order to aim to create value for the firm.

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University of Amsterdam 18 However, Jahdi and Acikdilli (2009) state that the definition of marketing is merely utilitarian and is viewed with a great deal of cynicism and suspicion when attempts to convey a more socially responsible image. The definition itself considers that first in line is the consumer’s value and, at the end, society’s value. Due to this, marketing seems to promote overconsumption and firms use it as a tool to attain financial resources only; mistrust within the marketing discipline has been an important issue. Nevertheless, Hildebrand et al., (2011) considers that marketing is not only about a tool that firms use to increase its benefit solely but, in a more profound manner, about business strategies together with the aim to increase society’s welfare. This viewpoint strengthens Hildebrand’s argument with respect to the relationship between CSR and marketing because of how it connects the firm’s financial goals with societal improvement. Not surprisingly, CSR and marketing are not mutually exclusive, but, instead, closely related. Maignan et al., (2004) also contributes to this association stating that the enthusiasm for CSR is largely related to marketing literature as marketing comprises consumers’ response to firms’ communications, such as CSR initiatives, and takes into account these responses to analyze the impact that marketing has on business performance. Additionally, Valaand et al., (2008) states that marketing is a central business discipline (it forms part of all the organizational process within corporations) and, most importantly, it is seen as one of the disciplines that is most preoccupied with the relationship between the firm and the environment in which the firm is embedded, resulting in a pivotal aspect of the concept of CSR. Therefore, marketing is able to contribute to the benefit of society by communicating CSR initiatives that are being undertaken by the company at hand (Maignan et al., 2004). To summarize, attitudes towards CSR initiatives together with the understanding of marketing, generate both negative and positive associations in the eyes of consumers due to the fact it seems these two concepts seek nothing but create a relatively good and caring image, while

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University of Amsterdam 19 CSR assist not only companies by increasing its sales but also assist society by supporting a social cause. Additionally, and supported by examples of prior research (Green and Peloza, 2011, Jahdi and Acikdilli, 2009, Sheikh and Zee 2011, Baghi, Rubaltelli and Tedeschi 2009), the relationship between CSR and marketing is vital to a company’s reputation and, consequently, to its business performance. Nevertheless, many arguments state that marketing is indeed one of the tools managers are capable of using when it comes to contributing to the benefit of society. In this sense, combining both CSR and marketing a concept arises. This concept is denominated as CRM and aims to create a “win-win” situation for firms and society.

2.4 Cause-Related Marketing

Once the definitions of CSR and marketing have been established, along with both its main characteristics and attitudes they trigger in consumers’ eyes, it is important to explain thoroughly the relationship between CSR and marketing. The result of this dyad relationship is CRM (Vaaland et al., 2008). CRM can be understood as “the process of formulating and implementing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause when customers engage in revenue-providing exchanges that satisfy organizational and individual objectives” (Varadarajan and Menon, 1988, p. 60, used in Svenson and Wood, 2011). That is to say, CRM stands for a strategy that aims to sell products or services and donate a percentage of the sales to a social cause accordingly. The critical aspect to bear in mind about the definition of CRM is that donation is conditional upon sales of certain product or service (Chaney and Dolli, 2001, p. 157, used in Svenson and Wood, 2011). It is important to note that CRM follows this process: first, consumers have to purchase a product or service from the company and then, only then, the company at hand, once it has collected the resources from those purchases, will

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University of Amsterdam 20 transfer a percentage of the monetary resources to a social cause. As one can note, the main characteristic of CRM is that only works if consumers acquire the product or service the firm is offering. Many researches have focused on the features of CRM. For instance, Baghhi et al., (2009) argues that CRM is a communication tool that helps to emphasize the company’s standards towards CSR because it comprises a benefit for society. In this sense, CRM is a strategy that aims to convey the firm’s societal initiatives to its stakeholders (i.e. consumers and society); to create a “win-win” situation for both companies and society when communication strategies are executed correctly (i.e. when consumers purchase the corresponding product or service) and; last but not least, aims to create, grow and maintain a direct linkage between customers and company (Sheikh et al., 2011). Notwithstanding, as mentioned before, customers are more likely to suspect this type of strategy due to it seems “its goal is to increase incremental sales and corporate image while contributing to the NPO. Make no mistake about it, CRM is about sales, not philanthropy” (Ptacek and Salazar, 1997, p. 9, used in Svenson and Wood, 2011) and, additionally, an attempt to gain customers rather than genuine support of the cause (Sheikh et al., 2011). According to Svenson and Wood, 2011; and Sheikh et al., 2011, CRM campaigns can be seen as a form to exploit a social cause or merely as a promotion tactic. Marketing a product or service through triggering a relationship with a social cause does not mean that CRM is entirely “pure” in the eyes of consumers and society. For example, people are able to develop their own attitudes regarding CRS, marketing and CRM and, further, judge whether the amount of money donated will be enough to fulfill the cause or if the CRM campaign is just merely a manipulation to enrich corporation’s resources (Berglind and Nakata, 2005). Switching to positive attitudes towards CRM campaigns, Galan-Ladero, Galera Casquet and Wymer, (2013) show in their research that when consumers become aware of CRM campaigns they tend to develop more positive attitudes towards the firm at hand

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University of Amsterdam 21 due to they are supporting, somehow, a social cause and, although CRM’s primary objective is indeed financial, there are benefits arising from it, such as providing assistance to NPOs or ONGs, heightening NPOs or ONGs exposure, providing financial resources to a social cause (Bergling and Nakata, 2005), etc. Consequently, even though consumers mistrust companies when engaging CSR initiatives, both marketing and CRM campaigns aim to elicit positive attitudes, not only towards the campaign itself, but also towards the company because, on the one hand, consumers acknowledge that companies need to make profit to subsist and, on the other hand, consumers become aware that firms are involved in a social cause that will provide assistance to third parties in need. Thus far, CSR, marketing and CRM campaigns elicit both negative and positive attitudes in the eyes of consumers. Hence, the question that arises from all the research completed is which type of CRM campaigns are able to enhance positive attitudes towards the company and, consequently, how this skepticism towards both CRM campaigns and firms can be reduced, if possible. In order to understand the reasons why CRM campaigns function in a certain way and why human beings react differently to those campaigns, Griskevicius et al., (2012) establish an evolutionary approach in which the authors state the basis for sustainable behavior that comprises interesting implications for marketing. This evolutionary insight is thoroughly analyzed in the next sub-chapter.

2.5 The perspective from evolutionary psychology

2.5.1 Propensity of self-interest, kin selection and psychological kinship

Griskevicius et al., (2012) establishes an interesting topic regarding human behavior towards environmental and social problems. The authors propose that many modern environmental and social problems are caused by some tendencies rooted in evolutionary history. Subsequently,

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University of Amsterdam 22 the authors disclose arguments that marketers can harness to diminish environmental and societal problems with respect to evolved human tendencies. Griskevicius et al., (2012) depict that people have inherited tendencies from our ancestors and those affinities still affect our current behavior without us being aware of it. This is what they call “evolutionary perspective”. Griskevicius, Cantú and Vugt (2012) state that human tendencies (observed in past centuries) are useful for marketers in order to not only learn from them but also to develop strategies that are capable of altering social behavior. These authors depict that due to some strategies do not match with human ancestral tendencies (propensity of self-interest, motivation for relative rather than absolute status, proclivity to unconsciously copy others, predisposition to be shortsighted, and proneness to disregard impalpable concerns) these strategies, that have focused on changing behaviors, might be suboptimal. For example, CRM campaigns that aim to elicit social cooperation by not taking into account “propensity of self-interest”, a human tendency that affects behavior importantly, might not achieve the desired goals. Therefore, Griskevicius et al., (2012) argues that changing behavior will be more effective if managers take into consideration human ancestral tendencies of behavior. One of the ancestral tendencies is “propensity of self-interest”, which posits that humans have evolved to take advantage of opportunities and increase their own personal welfare (Hobbes, 1950; Miller 1999; used in Goldstein et al., 2011), so as to achieve more rewards for themselves whilst simultaneously forcing costs on others (Hawkes, 1992, used in Griskevicius et al., 2012). In other words, it is understandable that people base their decision making process by seeking their own benefit, especially when it comes to decide between them and strangers. Hence, propensity of self-interest is considered to prevail against the welfare of the group (Hardin, 1968, used in Griskevicius et al., 2012). That being so, marketers that deploy strategies that encourage people to value the group over themselves are less likely to be effective due to propensity of self-interest lies

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University of Amsterdam 23 deeply in the human brain and affects completely their behavior (Penn, 2003, used in Griskevicius et al., 2012).

Nevertheless, the authors portray two important concepts that help to alleviate the impact of propensity of self-interest. “Kin selection” and “psychological kinship” play an important role in self-sacrifice (seeking to benefit of others rather than the self) and, accordingly, these two concepts involve a certain level of cooperation in environmental and social issues with the aim to assist these concerns. Kin selection is a key theoretical principle of propensity of self-interest and can be understood as the process of taking care of family and relatives (Hamilton, 1964, used in Griskevicius et al., 2012). In the author’s words: “from an evolutionary perspective, benefiting an unrelated stranger at one’s expense is critically different than benefiting a genetic relative, because helping a kin member is akin to benefiting oneself” (Kendrick, Sundie and Kurzban, 2008, used in Griskevicius et al., 2012, p. 119). What the authors are trying to convey is that people will seek for their own benefit given any circumstance or context, this behavior lies on human nature, especially when the benefit can be awarded to an unknown party. However, this situation changes radically when a family member or a friend, can be awarded the corresponding assistance, meaning that people tend to be motivated to enhance the welfare of individuals, groups, and issues that are tied to their identity, beliefs or values, making people capable of sacrificing their own resources – time, effort, money- to provide assistance to these valued parties (Krosnick, 1988; Mael and Ashforth, 1992; Herzog, 1993, Boninger, Krosnick and Berent, 1995; Muniz and O’Guinn, 2001; Small and Simonsohn, 2007; used in Goldstein et al., 2011). In this sense, strategies that do not take into account propensity of self-interest and both kin selection and psychological kinship, and expecting these tactics will elicit support and encouragement for the benefit of strangers, will tend to be suboptimal. Not surprisingly, what can be learned from the research of Griskevicius et al.,

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University of Amsterdam 24 2012 and Goldstein et al., 2011, is that triggering sense of community by the deployment of CRM campaigns could have a different impact on society if the message conveys either a relationship with a kin member (i.e. children, parents, grandparents, cousins, nephews, etc.) or a relationship with unrelated groups such as friends (“brotherhoods”) and not merely focus on helping strangers because this situation, as described above, might be suboptimal due to propensity of self-interest lies deeply in the human brain.

2.5.2 Psychological distance

In order to elicit community support and reduce distance among strangers, there is another concept that is strongly connected with kin selection and psychological kinship. This concept is “psychological distance”. Psychological distance is the cornerstone of the Construal Level Theory (hereinafter CLT). Trope, Liberman and Wakslak (2007) propose that CLT explains how psychological distance influences both individual’s thoughts and behavior importantly. The authors state that: “CLT assumes that people mentally construe objects that are psychologically near in terms of low-level, detailed, and contextualized features, whereas at a distance they construe the same objects or events in terms of high-level, abstract, and stable characteristics” (Trope et al., 2007, p. 1). That is to say, individuals use concrete, low-level construals to represent near events and abstract, high-level construals to represent distant events. Low-level construals, in this context, means that individuals analyze situations in terms of concrete, pragmatic and contextual aspects due to the distance of the corresponding issue, whereas high-level construals comprises a mind-set that includes abstract, integrated and realistic thinking. For example, if a person is about to buy a television in the near future, this person will analyze the main characteristics of the television, how much it costs, etc., whereas if the same person is planning to

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University of Amsterdam 25 purchase the television in the distant future he or she will analyze the benefits of having such television such as entertaining goals, social bonding, etc. (Trope et al., 2007). Having stated that, the authors explain that psychological distance can be seen as the subjective experience that explains whether one observes something as close or far from the self, triggering different reactions (Trope, Liberman and Wakslak, 2007). A fundamental aspect to take into consideration is how social distance impacts behavior and mental representations (Leviatan, Trope and Liberman, 2006, used in Trope, Liberman and Wakslak, 2007). Trope et al., (2007, p. 5) argues that “the less similar is one to oneself, the more socially distant they typically seem…”, meaning that humans tend to see strangers as more distant to the ones they consider close and, therefore, follows the same path as propensity of self-interest, kin selection and psychological kinship concepts due to eliciting community support with respect to societal issues where a third party or a stranger is the one obtaining the benefit seems a goal difficult to achieve. To summarize, strategies that aim to trigger social support by using CRM campaigns that are being focused on enhancing social support without taking into account that humans seek their benefit solely and they are willing to assist other parties when they consider them to be kin or close, can be seen as suboptimal tactics. Strengthening this argument, Griskevicius, Cantú and Vugt (2012) propose a fundamental concept that, just as with kin selection and psychological kinship, forms part of propensity of self-interest and is pivotal for the present research. In the following subchapter, the concept of “reciprocal altruism” is analyzed.

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2.5.3 Reciprocal altruism

“Humans have also evolved to cooperate with people outside their family and evolutionary theorist explain this type of nonkin cooperation in the light of the theory of reciprocal altruism” (Trivers, 1971, used in Griskevicius et al., 2012, p. 119). This argument modifies what has been mentioned in past subchapters, where it was established that people will act in for their benefit solely and show concern for those who are seen as relatively close. This new approach does not mean propensity of self-interest, kin selection, psychological kinship and psychological distance are irrelevant for CRM campaigns; however, if human beings are able to cooperate with people outside their family and friends (e.g. help an unknown third party), CRM campaigns can be studied from a different angle. Griskevicius et al., 2012 proposes a concept that changes importantly the way CRM campaigns can be analyzed and sheds light on to how these campaigns, when deployed differently, can aim to both diminish consumer skepticism and stimulate social cooperation (Goldstein et al., 2011). Griskevicius et al., (2012) depicts that due to reciprocal altruism humans are able to cooperate outside their kin circle. The reason why this human tendency is fundamental is that through reciprocal altruism, CRM campaigns can aim to elicit greater social cooperation among members of society that are not either directly or indirectly related and, therefore, achieve social support, obtain positive attitudes towards both the company and the campaign, meaning that CRM’s campaigns reputation can indeed be changed (e.g. reduce consumer skepticism). Along with this impact, the design, development and implementation of CRM campaigns can be modified. Reciprocal altruism can be understood as the cooperation with non-kin members when helpers (firms) can benefit themselves by being helped in return (Griskevicius, Cantú and Vugt, 2012) or, in a thorough manner, as the approach by “which benefactors provide direct benefits to target individuals to elicit reciprocity, the reciprocity-by-proxy (e.g. reciprocal altruism) strategy

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University of Amsterdam 27 elicits in the target a sense of a sense of indebtedness to benefactors by providing benefits to a valued third party on behalf of the target (e.g. first making a donation to a charity on behalf of one’s employees and then later asking employees to comply with a request)” (Goldstein, Griskevicius and Cialdini, 2011, p. 441). Both definitions approach reciprocal altruism with the same view. Reciprocal altruism aims to trigger sense of cooperation within society by carrying out the donation on behalf of consumers first and, accordingly, awakening the feeling of obligation in them and aiming that consumers or employees reciprocate this novel act towards the company that is carrying out the aforementioned donations. To analyze this concept thoroughly it is necessary to define both reciprocity and altruism. Reciprocity can be understood as: “the societal rule that obligates individuals to repay gifts, favors, and services that have been performed for them” (Mauss, 1954; Gouldner, 1960; Blau, 1964; Regan, 1971; Emerson, 1976; Cialdini, 2009 used in Goldstein, Griskevicius and Cialdini, 2011, p. 441-442). For example, if someone asks for help and the other person has accepted to provide it, when the person who has helped asks for assistance as well, the person who received someone’s attention will feel that he or she needs to return the favor. Altruism1 can be understood as the “disinterested or selfless concern for the well-being of others, esp. as a principle of action. Opposed to selfishness, egoism, or (in early use) egotism.” For example, when someone volunteers to assist an NGO that is in charge to increase inmate’s life quality without expecting a remuneration. Once the elements of reciprocal altruism have been described, Goldstein et al., (2011) argues that in order to reciprocal altruism works, consumers must support or value the societal issue that CRM campaigns are trying to approach, otherwise reciprocal altruism can produce no change at all. Goldstein et al., (2011) and Griskevicius et al., (2012) portray that when a company acts as the one that is improving the welfare of a third party

1

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University of Amsterdam 28 that consumers support or value, consumers, in essence, have helped indirectly this social issue. They adopt the idea that they this support is being performed by them directly. Like kin selection, psychological kinship and psychological distance, valuing or supporting a social cause has an important effect when companies undertake the design of their CRM campaigns. In this regard, reciprocal altruism aims to achieve societal cooperation in a different manner than traditional CRM campaigns do. This research aims to discover whether or not, in the eyes of consumers, this type strategy can be seen as trustworthy and generate positive attitudes towards the company. In the next subchapter, the objectives of this research are explained comprehensively.

2.6 Objective of the research

Having stated what should be understood by reciprocal altruism, practitioners and researchers have linked reciprocal altruism to CRM campaigns. The reason of this relationship is that companies indicate they will donate certain amount of money to a social cause for every purchase the consumers make, aiming to trigger, in this sense, the concept of reciprocity (Griskevicius, Cantú and Vugt, 2012). According to Griskevicius et al., (2012), to certain extent, CRM campaigns are less likely to achieve its peak of effectiveness due to the fact they do not focus on reciprocal altruism. In this context, effectiveness2 can be regard as the extent to which CRM campaigns are able to elicit both social cooperation and trustworthiness towards not only the companies but also to CRM campaigns. By implementing CRM campaigns, companies encourage customers to purchase a product or service and, only then, firms will undertake the corresponding donation. This strategy is known as “CRM campaigns based on standard reciprocity” and, in the eyes of Goldstein et al., 2011, and Griskevicius et al., 2012, results as a suboptimal strategy.

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University of Amsterdam 29 Griskevicius, Cantú and Vugt (2012) argue that a small alteration in the way managers intend to carry out the assistance will be able to enhance these campaigns. Griskevicius et al., (2012, p. 119) state the following: “if the company were to first donate resources to a prosocial cause on behalf of its consumers (rather than first asking customers to purchase a product), it might elicit the tendency to reciprocate”. This is known as “CRM campaigns based on reciprocal altruism”. What the authors try to portray with this statement is that providing the assistance first (making the donation on behalf of firm’s consumers) and communicate it after could be able to elicit greater reciprocity on consumers rather than that of when campaigns focus the strategy on standard reciprocity only. Furthermore, the authors keep arguing that if companies were to develop an effective strategy that will engage consumers to reciprocate the action, its managers will have to take into account that the company must engage beforehand in a prosocial activity that is supported by consumers and, then, ask its customers to reciprocate by purchasing products or services. Building on the same issue, Goldstein, Griskevicius and Cialdini (2011), have proved empirically the effectiveness of this proposal. These authors conducted several experiments with the aim of demonstrating the effectiveness of reciprocal altruism (the authors measured the effectiveness of reciprocal altruism in the re-use of towels in a hotel, where they disclosed a message to customers stating that as the hotel already donates certain resources to a green company, they hoped that consumers in turn reciprocate this action by re-using their towels, so that the hotel’s managers can recover the expense made). By conducting this research, the authors observed that reciprocal altruism elicits a higher level of customers’ compliance and a higher level of obligation to help organizations or individuals than a normal CRM campaign based on standard reciprocity. Another important finding in Goldstein’s, Griskevicius and Cialdini (2011) study is that reciprocal altruism is more effective when it clearly informs to customers that the help of a third party is done on

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University of Amsterdam 30 behalf of its consumers rather than that of on someone else’s behalf. Most importantly, reciprocal altruism changed the mind-set of the hotel’s consumers. By perceiving the hotel to care more about the environment, consumers perceived positive attitudes towards the hotel and, not surprisingly, perceived the hotel as trustworthy. Goldstein’s et al., (2011) research sheds light on how CRM campaigns can be conducted differently with the aim to elicit greater social cooperation and, therefore, aim to develop an effective CRM campaign. If the arguments by both Goldstein et al., 2011; and Griskevicius et al., 2012 are trusty, then CRM campaigns based on reciprocal altruism should lead to the diminishment of consumer skepticism towards these types of campaigns.

In order to explain this research objectives, it is important to take into consideration the following aspects. First, Goldstein, Griskevicius and Cialdini (2011) proved their hypotheses within a hotel, meaning that the context of the study plays a relevant role in the way results were obtained. When people visit hotels they experience a “close relationship” with the firm (both operational and administrative employees, receptionists and so on) and, most of the time, consumers have a pleasant stay. Due to the fact they had a pleasant experience, consumers might feel obligated to reciprocate what the hotel have undertaken on their behalf (supporting a green cause); however, little is known regarding whether CRM campaigns based on reciprocal altruism could be equally effective when different types of aid can be used (financial aid, non-financial or hybrid aid) and psychological distance is greater (not the hotel-consumer scenario). Secondly, many studies have focused on simply analyzing the impact of CRM campaigns based on standard reciprocity. That is to say, on campaigns that engage in societal issues by donating financial resources only. This situation leaves room to analyze the impact of both CRM campaigns based on reciprocal altruism and CRM campaigns based on standard reciprocity. The purpose of this research is to compare the effect of each of these campaigns, combined with different types of aid

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University of Amsterdam 31 (financial aid, non-financial aid and hybrid aid), regarding the diminishment of consumer skepticism towards CRM campaigns. Furthermore, little is known whether CRM campaigns are equally or more effective when companies, instead of donating financial resources to a social cause only, provide non-financial aid or a combination of both financial and non-financial aid. For the purposes of this research, financial aid regards as carrying out monetary aid (donations), non-financial aid regards as providing professional advice (managerial advice - consulting) and hybrid aid regards as the combination of both financial aid and non-financial aid (donations as well as consulting). Liu, Heyes and Ko (2010) developed a research that argues that when companies pair up with a NGO or a NPO it is common that firms provide assistance not only with financial resources but also with professional advice with the aim of assisting in the achievements of their own goals. Nonetheless, the research of Liu et al., (2010) does not further analyze the impact of CRM campaigns based on reciprocal altruism as a way to promote collaboration, trigger customer reciprocity and conserve, improve or modify company’s reputation. In this sense, and to the extent of my existing knowledge, little is known about the effectiveness of CRM campaigns based on reciprocal altruism with respect to reducing consumer skepticism or the utilization of reciprocal altruism in a more profound manner than that of the re-use of towels. Whether that be when companies engage, beforehand, in societal initiatives that consumers value and on their behalf, whether by providing professional advice to attend to managerial issues in place of donations or if the combination of both results in a more improved strategy. This research has the goal of acknowledging whether CRM campaigns based on reciprocal altruism are a tool to develop stronger positive attitudes towards the company at hand and diminish marketing skepticism towards CRM campaigns.

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University of Amsterdam 32 It is important to bear in mind that this study compares CRM campaigns based on standard reciprocity combined with either with financial aid, non-financial aid or hybrid aid with that of CRM campaigns based on reciprocal altruism combined with the same type of aid. By comparing these two strategies, the study will shed light on which one of these is best suited to reduce consumer skepticism towards CRM campaigns. The study of CRM campaigns results interesting due to it helps to understand, in a profound manner, the impact of these strategies on consumers’ perception of the firm. Most importantly, to observe how the alteration in consumers’ mind-set arises from a modification in the structure of the message conveyed. Within the context of this research, the analysis of CRM campaigns based on reciprocal altruism combined with different types of aid can help managers and practitioners to understand, in a different manner, CRM campaigns. That is to say, to understand the main characteristics of CRM campaigns based on reciprocal altruism that arise from an evolutionary perspective (Griskevicius et al., 2012). To understand that the assistance must be provided on consumers’ behalf and; accordingly, that the company needs its help, aiming to elicit both the feeling of indebtedness and the need to reciprocate to the company. This study also might be helpful to modify consumers’ perception towards the company at hand. The understanding of CRM campaigns either based on reciprocal altruism or based on standard reciprocity by consumers might help them to acknowledge that the firm at hand is indeed committed to a social cause and is not seeking and acting purely for its own self-interest. To summarize, this research analyzes the effects of CRM campaigns based on reciprocal altruism and standard reciprocity, taking into account different types of aid to obtain, assess and discuss which type of strategy is able to reduce consumer skepticism towards these campaigns.

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2.7. Contributions

2.7.1 Academic contributions

This research aims to address an important aspect within the marketing discipline that it is yet to be studied in detail, and which could shed light on the CRM field, specifically in regards to the extent in which CRM campaigns can be enhanced by switching from standard reciprocity, which, according to Griskevicius et al., (2012) due to it goes in the opposite direction of our human tendencies, results in a suboptimal approach. Both CRM campaigns based on reciprocal altruism and CRM campaigns based on standard reciprocity are analyzed thoroughly and in three different scenarios (financial aid, non-financial aid or hybrid aid) with the objective to become aware which one of these scenarios will help to diminish consumer skepticism towards CRM campaigns. In this regard, reciprocal altruism is pivotal to elicit community support and it is a concept that has not been study in detail within the marketing field. Therefore, this endeavor will shed light on the CRM marketing field that researches could use for further research. This study does not aspire to re-write marketing rules, neither to re-write CRM campaigns, but it does seek to provide a new insight in the way researches can study CRM campaigns and its effect on consumer skepticism when using more than financial aid only. It seeks to observe, through a different point of view, the way researches look at CRM campaigns currently. Much research has been conducted within the CRM field; nevertheless, CRM campaigns based on reciprocal altruism, combined with financial, non-financial or a combination of both concepts remains unaddressed. Hence, this research seeks to understand better CRM campaigns, that has not been study in detailed before.

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2.7.2 Managerial contributions

A better understanding of CRM campaigns is pivotal for managers. Like researches, practitioners could use the research’s findings to design CRM campaigns. That is to say, this study will contribute to acknowledge, in a broader way, CRM campaigns; understand better the concept of reciprocal altruism and standard reciprocity; become aware that different types of aid can be applied with the aim to reduce consumer skepticism; and make a novel contribution to society by indeed engaging in the improvement of the welfare of third parties. It is important to bear in mind that firms are bound to make profits to cover both operational and administrative expenses and engaging in societal initiatives can help them to increase its profits. Accordingly, CRM campaigns are the tool to achieve this. Marketers will be able to change the manner they implement a “win-win” situation strategy. This research will help them to understand not only why some CRM campaigns have been suboptimal thus far, but also to gain insights in how to develop a stronger CRM campaign that, altogether, reduce mistrust in the eyes of consumers. Reducing mistrust towards both companies and CRM campaigns is fundamental. When this happens, consumers’ perceptions of the company are positive. Positive attitudes, therefore, means that consumers are more likely to repeat purchase behavior, increasing the firm’s welfare (Andersen et al., 2014).

2.8 Theoretical framework

The present research consists of analyzing thoroughly whether CRM campaigns based on either reciprocal altruism or standard reciprocity, combined with either financial aid, non-financial aid or a combination of both leads to the diminishment of consumer skepticism towards CRM campaigns and, therefore, the research hypotheses. A hypothesis can be understood as a testable proposition that aims to explain a relationship or difference between concepts or variables

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University of Amsterdam 35 (Saunders et al., 2012). In this regard, each of the hypotheses represent a specific aspect that the study intends to measure. Figure 1 comprises all the hypotheses of the research.

Figure 1.- Hypotheses

With this structure, the research intends to compare the impact of each of the hypotheses presented in Figure 1. For instance, one of the purposes of the current research is to compare whether CRM campaigns based on reciprocal altruism combined with hybrid aid leads to less consumer skepticism than that of CRM campaigns based on standard reciprocity combined with hybrid aid (hypotheses three). As explained above, the objective of this research is to compare the impact that CRM campaigns based on reciprocal altruism combined with different types of assistance (financial aid, non-financial aid and hybrid aid) have on consumer skepticism with that of CRM campaigns based on standard reciprocity combined with the same types of assistance.

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University of Amsterdam 36 CRM campaigns based on either reciprocal altruism or standard reciprocity can be regarded as the independent variables and consumer skepticism towards these type of campaigns as the dependent variable of the current research. Building on this remark, the study analyzes the impact of the independent variables on the dependent variable. That is to say, analyze whether or not a type of CRM campaign combined with a different type of aid can affect importantly the dependent variable. In this sense, Figure 1 portrays the hypotheses the study aims to address. It depicts if CRM campaigns based on reciprocal altruism combined with financial aid leads to less consumer skepticism than that of CRM campaigns based on standard reciprocity combined with financial aid (hypothesis 1); if CRM campaigns based on reciprocal altruism combined with non-financial aid leads to less consumer skepticism than that of CRM campaigns based on standard reciprocity combined with non-financial aid (hypothesis 2); if CRM campaigns based on reciprocal altruism combined with hybrid aid leads to less consumer skepticism than that of CRM campaigns based on standard reciprocity combined with hybrid aid (hypothesis 3) and; last but not least, if, overall, CRM campaigns based on reciprocal altruism leads to less consumer skepticism than that of CRM campaigns based on standard reciprocity (hypothesis 4). Next, the study discloses thorough information with respect to the preceding hypotheses.

2.8.1 Hypotheses

H1: CRM campaigns based on reciprocal altruism combined with financial aid lead to less

consumer skepticism than that of CRM campaigns based on standard reciprocity combined with financial aid.

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University of Amsterdam 37 The first of the hypotheses the study aims to observe whether CRM campaigns based on reciprocal altruism combined with financial aid are capable of decreasing consumer skepticism regarding CRM communication strategies rather than that of when CRM campaigns are based on standard reciprocity combined with financial aid. Financial aid constitutes monetary assistance such as donations. Hypotheses 1 (hereinafter H1) focuses on analyzing the impact on consumer skepticism towards CRM campaigns of not only those of CRM campaigns based on reciprocal altruism combined with financial aid but also those of CRM campaigns based on standard reciprocity combined with financial aid. As previously mentioned, CRM campaigns based on either reciprocal altruism or standard reciprocity together with the kind of aid provided are considered as the independent variables of this study. On the other hand, consumer skepticism, regarding CRM campaigns, is considered as the dependent variable of the study, meaning that the formers, throughout the research, play a dynamic role in which the type of CRM campaign and the combination of aid vary from one hypothesis to another, whereas the latter remains constant and will be considered as the variable which will determine whether or not the independent variables have an effect on consumer skepticism. By keeping constant the type of assistance (financial aid), used in both communication strategies, H1 aims to seek whether a difference lies on consumer skepticism towards CRM campaigns when CRM is being applied differently, however, the type of assistance varies. H1 can be observed in Figure 2.

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University of Amsterdam 38 There is an important difference between CRM campaigns based on reciprocal altruism and CRM campaigns based on standard reciprocity that already has been mentioned throughout this research. The former seeks to elicit community support by taking into account ancestral tendencies that shape human behavior, such as propensity of self-interest, kin selection, psychological kinship, psychological distance and, last but not least, reciprocal altruism (Goldstein et al., 2011 and Griskevicius et al., 2012), whereas, in most situations, the latter ignores that human beings are naturally driven by propensity of self-interest (Griskevicius et al., 2012) and, this type of communication strategy aims to trigger cooperation just by simply ask consumers to assist strangers (Chaney and Dolli, 2001, p. 157, used in Svenson and Wood, 2011). When CRM campaigns based on reciprocal altruism are being communicated, a modification can be observed compared with that of standard reciprocity. In reciprocal altruism the assistance is provided to a social cause first, and after that activity is carried out, the firm at hand communicates this behavior to its consumers and state that this activity has been performed on their behalf (Griskevicius et al., 2012), trying to elicit a greater sense of reciprocity among its consumers. In CRM campaigns based on standard reciprocity, in order to provide the corresponding assistance, firms need firstly that its consumers purchase the product or service so that the money collected by the company can be placed to the related societal cause (Varadarajan and Menon, 1988, p. 60, used in Svenson and Wood, 2011), otherwise the assistance will not only not be provided at all but even considered. In this sense, CRM campaigns based on standard reciprocity try to elicit community support by not only hoping people will support third parties (strangers) but also carrying out the assistance only when consumers acquire firm’s products or services. Nevertheless, the way CRM campaigns have been executed thus far (standard reciprocity) have achieved important contributions to society. As mentioned in the Literature Review, consumers that acknowledge CRM initiatives tend to regard

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University of Amsterdam 39 the company as trustworthy (Green et al., 2011). Therefore, it is important to bear in mind that this study is not ignoring CRM campaigns based on standard reciprocity achievements; however, what the study aims to measure is the level of skepticism towards these type of campaigns and whether or not reciprocal altruism can lessen this mistrust.

CRM, as explained before, by definition means: “the process of formulating and implementing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause when customers engage in revenue-providing exchanges that satisfy organizational and individual objectives” (Varadarajan and Menon, 1988, p. 60, used in Svenson and Wood, 2011). Even though the definition of CRM does not explicitly mention that the aid provided to a social cause is merely financial, it can be implied by the part when it states that: “contribute a specified amount”. Therefore, CRM comprises financial aid within its entire essence. CRM campaigns based on standard reciprocity combined with financial aid represents the manner CRM campaigns have been conducted throughout last decades (Baghi et al., 2009). Therefore, CRM campaigns based on standard reciprocity combined with financial aid can be seen as the baseline group of the research. This means that the baseline group is the one that comprises the way current CRM campaigns are being designed and managed. Nonetheless, the baseline group will be deeply explained in the following chapter, it is important to state that this group will shed light with respect to whether consumers modify their attitudes about CRM campaigns when these communication strategies differ from one another (CRM campaigns based either on reciprocal altruism or standard reciprocity).

Cause-related marketing : making consumers believe?

Master Thesis