Effects of consumer type on product evaluations in the
context of different corporate social responsibility activities
by luxury brands
Statement of originality
This document is written by Student Mingrui Ren 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.
Master Thesis Author: Mingrui Ren
Student ID:11238569
Master Thesis Supervisor: Marlene Vock
August 16, 2017| Second Version
MSc. In Business Administration-Marketing Track
University of Amsterdam
1
ABSTRACT
The research explores whether different corporate social responsibility (CSR) activities by
luxury brands lead to different product evaluations. The existing academic literature neglects
the difference among luxury consumers and neglects the characteristics of each CSR program.
Findings from an empirical study regarding three CSR categories indicate that luxury brands
should avoid product-related CSR. Different responses to three CSR categories, philanthropy,
business practice and product-related, are due to consumers’ perceived trade-off between
CSR and corporate abilities (CA). Luxury consumers can be divided into two types,
self-oriented and other-oriented, which moderates the effect of CSR type on product
evaluations. In product-related CSR activities, self-oriented consumers have much lower product evaluations than other-oriented consumers. For non-product related CSR, such as
philanthropy and business practice CSR activities, the product evaluations from both two
types of consumers do not differ too much. Despite the increasing concerns of consumers
about the preservation of the planet, luxury companies should choose the suitable CSR
programs which do not influence luxury product attributes. Different social responsible
programs lead to different outcomes. No matter what CSR programs are initiated, luxury
companies should always maintain the high quality and craftsmanship.
INDEX
A
BSTRACT... 1
I
NDEX... 2
1.
INTRODUCTION
... 4
2.
L
ITERATURE REVIEW... 7
2.1
L
UXURYB
RANDS... 7
2.1.1
D
EFINE LUXURY... 7
2.1.2
L
UXURY VALUE PERCEPTIONS... 9
2.1.3
L
UXURY VALUE MEASUREMENT... 11
2.2
CSR
... 13
2.2.1
D
EFINECSR
... 13
2.2.2
CSR
ACTIVITY CATEGORY... 14
2.2.3
CA
ANDCSR
A
SSOCIATIONS AND CONSUMERS’
PRODUCT EVALUATIONS... 18
2.2.4
CSR
ANDCA
BELIEF... 19
3.
H
YPOTHESIS AND CONCEPTUAL MODEL... 21
3.1
H
YPOTHESES DEVELOPMENT... 21
3.2
C
ONCEPTUAL MODEL... 26
4.
M
ETHODOLOGY... 27
4.1R
ESEARCHD
ESIGN... 27
4.2
P
RETEST... 29
4.3
S
AMPLE... 33
4.4
M
EASURES... 34
5.
D
ATA ANALYSIS ANDR
ESULTS... 36
5.1
R
ELIABILITY CHECK... 36
5.2
D
ESCRIPTIVE STATISTICS... 37
5.3
S
TUDY1
... 38
5.4
S
TUDY2
... 40
5.4.1
H
YPOTHESIS1
A TESTING... 40
5.4.2
H
YPOTHESIS1
B TESTING... 42
5.4.3
H
YPOTHESIS1
C TESTING:
MEDIATION... 42
5.4.4
H
YPOTHESIS2
A AND2
B... 45
5.4.5
H
YPOTHESIS3:
MODERATED MEDIATION... 48
5.4.6
A
DDITIONAL ANALYSIS... 50
6.
D
ISCUSSION... 52
6.1
D
ISCUSSION OF FINDINGS... 52
6.2
T
HEORETICAL CONTRIBUTIONS... 57
6.3
M
ANAGERIAL CONTRIBUTIONS... 59
6.4
L
IMITATIONS AND FUTURER
ESEARCH... 60
7.
C
ONCLUSION... 62
R
EFERENCES... 63
3
A
PPENDIXB
... 78
A
PPENDIXC
... 97
A
PPENDIXD
... 101
A
PPENDIXE
... 104
A
PPENDIXF
... 109
A
PPENDIXG
... 111
A
PPENDIXH
... 114
A
PPENDIXI
... 115
A
PPENDIXJ
... 127
A
PPENDIXK
... 130
1.INTRODUCTION
There is a surge in the number of companies which are involved in corporate social
responsibility activities, such as cause-related marketing, donation and employee engagement.
As a new way to show social responsibilities, corporate social responsibility(CSR) programs
have become a new and unique communication tool to enhance companies’ reputation, arouse
goodwill among consumers and increase product evaluations (Chernev and Blair,2015).
In recent years, luxury brands have also started to launch corporate social responsibility
(CSR) programs, which gain wide attention. For example, luxury brands including Armani,
Cartier, and Chanel have initiated CSR initiatives. Luxury brands design CSR initiatives to
minimize or eliminate any adverse impacts of their operations on stakeholders, as well as maximize beneficial effects on society as a whole (Mohr et al. 2001; van Marrewijk 2003).
For example, Gucci endorses the development of each worker’s professional skills and
competencies, recognizing the value of diversity and equal opportunities, improving
behavioral factors and ensuring that the potential and creativity of individuals are fully
realized from a professional point of view source. In the meantime, luxury brands are also
striving to make sure that their business practices become more environmentally responsible
(Kendal 2010). For example, Tiffany accessory boxes are made of recycled materials and
promise never to destroy the natural environment of the mine areas. Also, lots of luxury
companies choose to partner with a third institute, such as Louis Vuitton collaborates with
5
Although luxury brands make efforts to build ‘responsible luxury’ image, findings
suggest that consumers may not have favorable evaluations of luxury brands’ CSR
engagement. Luxury brands may take a risk with the launch of CSR programs, which to a
large extent results from the incompatibility between CSR and the brand image of luxury
brands. For example, Torelli et al. (2012) claim that consumers think CSR and luxury brands don’t fit and respond with lower brand evaluations. They explain that consumers think luxury
brands possess self-enhancement value (i.e., dominance over people and resource) while CSR
emphasizes helping others and reflects self-transcendence values (i.e., protecting the welfare
of all). According to Schowartz (1992), self-enhancement and self-transcendence values are
opposite to each other in the value circle and are in motivational conflict. Because these two
values cause conflict, the notion of ‘responsible luxury’ will be evaluated unfavorably by
consumers (Schwartz 1992; Torelli et al. 2012).
However, these researchers didn’t take customer types and CSR activity difference into
consideration when investigating consumers’ evaluations of CSR activities. The consumer
types are important in studying evaluations of CSR activities (Golob et al., 2008). Findings
suggest that CSR evaluations by stakeholders are interest-based, and thus stakeholders evaluate CSR activities related to their own interests, values, and priorities (Rowley and
Moldovan, 2003, p.206). Some scholars indicate that luxury consumers are particularly
concerned about the impression they make on others and more concerned about physical
appearance (Husic and Cicic, 2009). In contrast, luxury consumers consume luxury product
diverse nowadays (Wiedmann et al., 2009). Since consumers evaluate CSR actions of a
company based on their own interests, values, and priorities (Green and Peloza, 2011; Rowley
and Moldoveanu,2003; Basil and Weber,2006), different luxury consumers may differently
respond to luxury CSR activities as they own different value perceptions. Basil and Weber
(2006) find that individuals who are more concerned about how they appear to others are expected to express more personal support for CSR products for socializing. Based on this,
we can assume that luxury consumers who care more about others’ opinions should evaluate
CSR products favorably. Thus, there is a need to investigate if luxury consumers’ own value
perceptions may influence their evaluations of certain types of luxury CSR activities.
In light of the above, this study aims to answer the central research question: how do
different types of luxury consumers evaluate luxury products in the context of various CSR
activities? To answer the central question, the following sub-questions are formulated: Will
different CSR activities lead to different product evaluations? Is the effect of different types
of CSR activities on consumers ‘product evaluations’ mediated by consumers’ perceived
CSR-CA trade-off? Will the different types of luxury consumers moderate the effect of
luxury CSR on product evaluations?
The research questions which are particularly relevant to the field of luxury CSR is
relatively unknown. The theoretical contribution of this study is the extension of the
knowledge about luxury CSR. This study categorizes CSR activities into three types:
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responses to each group in one study. This study adds to the literature about CSR activities by
luxury brands, among which luxury consumer type is rarely studied. This research answers
questions whether luxury consumers evaluate luxury CSR differently and explain why they
have different responses. Furthermore, this study can contribute to practice because luxury
brands are trying to meet expectations of their consumers, who are more interested in “responsible luxury” and care about the environment. This study helps luxury firms decide
which types of CSR programs they should initiate. Should it be product-related or
non-product related? How will their consumers respond to CSR programs?
In the next section, an overview of the relevant literature will be given. It proceeds first
by reviewing the existing literature on luxury value perceptions, luxury consumer
segmentation, and CSR categorization. Next, the paper outlines the methodology adopted and
presents findings from the empirical analysis of different luxury consumers’ preference s for
three CSR categories. Finally, the paper draws a conclusion of key findings, offers theoretical
and managerial implications and presents limitations.
2.LITERATURE REVIEW
2.1LUXURY BRANDS
2.1.1DEFINE LUXURY
Luxury is a subjective concept (Phau and Prendergast, 2000). To distinguish between luxury brands and non-luxury brands, scholars have identified a few characteristics that luxury
brands should own. I summarized some characteristics issued in the previous researches, see
Table 1.
Table 1: Adapted from Phan and Heine (2011)
Major characteristics Manufacturing characteristics Concrete product characteristics Abstract product characteristics
Price (Phan and Heine,2011; Tynan et al.,2009)
Quality (Tynan et al.,2009；Vigneron and Johnson,2004) Aesthetics (Phau and Prendergast 2000;
Nueno and
Quelch,1998; Tynan et al.,2009)
Rarity (Phau and Prendergast 2000; Tynan et al.,2009) Extraordinariness （Phan and Heine,2011） Exclusivity(Phau and Prendergast 2000;Tynan et al.,2009 ) Expertise of manufacturer (Phan and Heine, 2011) Manufacturing complexity (Phan and Heine, 2011) Technology(Vigneron and Johnson, 2004) Craftsmanship (Nueno and Quelch,1998; Vigneron and Johnson, 2004) Design (Vigneron and Johnson,2004) Authentic(Tynan et al., 2009)
Durability and value (Phan and Heine,2011) Comfortability and usability (Phan and Heine,2011) Functionality and performance (Phan and Heine,2011; Wiedmann et al.(2009)
Symbolism（Tynan et al.,2009; Berthon et al. 2009）
Prestigious（Tynan et al.,2009; Li et al,2011）
Except for the characteristics summarized above, luxury brands can satisfy consumers’
psychological benefits which are the primary factor that distinguishes luxury brands from
non-luxury brands (Nia and Zaichkowsky, 2000). Tynan et al. (2009) find that luxury brands
9
and Johnson (2004) suggest the term ‘luxury’ is more inclusive in the sense that it includes
both interpersonal aspects (i.e., snobbery, conspicuousness and bandwagon motives) and
personal aspects (i.e., hedonist and perfectionist). Wiedmann et al. (2009) also suggest that
luxury goods bring esteem for its owner, luxury goods satisfy consumers’ both psychological
and functional needs. Since luxury brands can provide both functional and psychological benefits, consumers may seek different values from luxury brands.
In sum, the luxury will be defined as one proposed by Tynan et al.(2010). They argued
that key identifiers of luxury brands are high quality, expensive and non-essential products
and services that appear to be exclusive, rare, authentic, and prestigious and offer high levels
of symbolic and emotional/hedonic values through customer experiences.
2.1.2LUXURY VALUE PERCEPTIONS
Consumers have various perceptions of luxury brands and buy luxury products to satisfy
different needs. Zeithaml (1988, p 14) has suggested that consumers’ perceived value can be defined as a “consumer’s overall assessment of the utility of a product (or service) based on
perceptions of what is received and what is given.”, which can be referred as a trade-off
between ‘get’ and ‘give’ of a product or service, i.e. a trade-off between perceived benefits
and perceived costs. However, scholars have their own interpretation of values. For example,
Husic and Cicic (2009) suggest that luxury products with high quality which is indicated by
high prices make consumers feel superior to others. In contrast, some consumers purchase
luxury products for the longevity and durability because of high quality and craftsmanship
consumer values: (1) perceived conspicuousness, (2) perceived uniqueness and (3) perceived
quality, (4) perceived extended-self, and (5) perceived hedonism.
A lot of luxury values have been identified, and the ways to categorize luxury values can
be different. The present study summarizes the value categorization frameworks by scholars
for identified luxury consumer values (Table 2). These value perception frames represent an objective luxury valuation but reflect individual consumers’ perceptions of a certain luxury
brand or product (Wiedmann et al., 2009).
Table 2
Vigneron and Johnson (2004) non-personal related and personal-related
Smith and Colgate(2007) utilitarian, experiential/hedonic, symbolic/expressive, relational and cost/sacrifice.
Kim et al.(2012) utilitarian, hedonic, symbolic and economic
For the purpose of the study, the present study will categorize the luxury consumer
values into two types, self-oriented and other-oriented (Tynan et al. 2010). Tynan et al., (2010)
categorized luxury values based on the customer value framework in Holbrook (1999). Tynan
et al. (2009) suggested that consumers who seek self-oriented values focus on excellence
(quality), aesthetics (beauty) and hedonic value (Smith and Colgate, 2007), while
other-oriented value seekers focus on status (impression management) and esteem
(possessions). The self-oriented or other-oriented dichotomy determines whether the value
exists directly for the self or whether the value perceived requires some relevant other
(Holbrook, 1999). Value is self-oriented when I prize some aspects of consumption selfishly
11
1999). Other-oriented value looks beyond the self to someone or something else, where my
consumption experience or the product on which it depends is valued for their sake, for how
they react to it, or the effect on them (Holbrook, 1999). For example, if a consumer buys or
wants to buy luxury products for high quality in order to improve his or her own life, the
consumer is self-oriented.
2.1.3LUXURY VALUE MEASUREMENT
Consumers’ luxury value perceptions can be measured, however only quite a few
scholars have developed luxury value perception measurement scales. The scales they issued
can work as a tool to measure the amount of luxury contained in a given brand
(Christodoulides et al., 2008), consumers’ perceived luxury brand value (Kim et al., 2010; Li
et al., 2011;) or work as a general basis for identifying value-based consumer segments
(Wiedmann et al., 2009). The present study summarizes the measurement scales applied in
the previous studies (Table 3). Christodoulides et al. (2008) applied the scales among real
luxury consumers to understand how consumers view luxury brands. Some of the others are regionally specific and applied in the fashion industry which is not suitable for the luxury
industry in the present study. Wiedmann et al. (2009) created the scale by interviewing
students and applied the scale among potential luxury consumers to cluster consumers. Table 3
Articles Measurement metrics
Brand Luxury Index(BLI) scale (Christodoulides et al.,2008)
conspicuousness, uniqueness, quality, hedonism, extended self
Berthon et al. (2009) objective (material), subjective (individual), collective (social).
Luxury Value Segments prestige value in social network, quality value, usability value, unique value, materialistic value,
(Wiedmann et al.,2009) hedonic value a –self-gift giving, hedonic value b-extravagance, hedonic value c – self-directed pleasure, hedonic valued – life enrichment
Kim et al.,2010 expressive/social value, utilitarian value, emotional
value, economic value
Li et al.,2011 social/emotional value, utilitarian value, economic
value
Shukla, 2012 social value perceptions: conspicuous value, status
value; personal value perception: materialism,
hedonism; functional value perceptions: uniqueness and price-quality perceptions
In the present study, I will adapt the most comprehensive measurement scale developed
by Wiedmann et al. (2009). This scale covers the most commonly found factors that comprise consumers’ value perceptions and is used to segment luxury consumers. For the purpose of
grouping consumers into self-oriented type and other-oriented type, I will select five luxury
value dimensions from the whole measurement scale that make considerable contributions in
characterizing clusters such as quality, prestige and hedonic value(self-directed) (Wiedmann
et al. 2009). The five selected luxury perceptions show as Table 4. I will categorize them into
two groups based on the value framework in Holbrook (2006) and Tynan et al. (2009) by
including prestige value and uniqueness value into other-oriented value group and categorizing
self-identity value, hedonic value and quality value into self-oriented value group. Wiedmann
et al. (2009) name four clusters of potential luxury consumers based on the values they
associate with luxury products, such asrational functionalists. Accordingly, in the present study, consumers who mainly associate values from self-oriented value group will be named as
self-oriented consumers. For example, consumers buy luxury products for hedonic value are
the self-oriented type, for the reason that they can enjoy the whole consumption themselves
13
Table 4 Self-oriented values
Self-identity value: Self-identity value refers to one’s internal aspect in terms of self-perception. (Jamal and Goode, 2003)
Hedonic Value: Products and services offer an emotional value in addition to their functional utility (Hirschman and Holbrook, 1982)
Quality: perceived quality that luxury brands offer greater product quality and performance than non-luxury brands (Nia and Zaichkowsky, 2000; Vigneron and Johnson, 2004)
Other-oriented values
Prestigious value: Consumers emphasize the role of status that takes place in communicating information about the possession of goods and social relationships (Dittmar, 1994).
Uniqueness value: An individual’s pursuit of differentness relative to others achieved through the acquisition, utilization and disposition of consumer goods for the purpose of developing and enhancing one’s social identity (Christodoulides et al.,2008).
2.2CSR
2.2.1DEFINE CSR
There has been a lot of discussion in the academic literature on the socially responsible
behavior of companies, and scholars still find it hard to define the particular construct of
corporate social responsibility (CSR) (McWilliams et al., 2006; Barnett, 2007). Some
scholars define CSR as a function of a firm’s behavior toward its different stakeholders, such
as customers, suppliers, regulators, communities, investors, and employees (Campbell 2007;
Cooper, 2004). Corporate social responsibility (CSR) activities include prosocial activities
that satisfy social needs beyond legal responsibilities of a firm (Angelidis and Ibrahim 1993).
The other scholars consider CSR as a company’s directional multi-dimensional activities
Devinney, 2009). CSR can work as a tool to minimize or eliminate any harmful effects of a
company’s commitment to society or maximize its long-run positive effects on society (Mohr
et al., 2001). The concept ‘responsible luxury’ has gained substantial attention in the past few
years. In response, luxury companies also took actions to engage in corporate social
responsibility (CSR) activities to minimize the adverse effects of their stakeholders. In the present study, I will investigate the effect of CSR activities on stakeholders and
define CSR as the companies’ activities – voluntary by definition – demonstrating the
inclusion of social and environmental concerns in business operations and interactions with
stakeholders (van Marrewijk, 2003).
2.2.2CSR ACTIVITY CATEGORY
Researchers have categorized CSR initiatives in different ways. The present study
summarizes the categorizations in Table 5. Table 5
Lantos (2002) ethical, altruistic and strategic
Hietbrink et al.(2010) congruous and incongruous
Cho and Hong (2009) philanthropic foundation, monetary donation, voluntary
activities by company employees, cause-related marketing, sponsorship and others
Bhattacharya and Sen (2004) community support, diversity, employee support, environment, out of country operations, product Peloza and Shang (2009) philanthropy, business practices, and product-related
These categorization ways are mainly developed based on real cases in given purposes of
CSR and product attributes of CSR. Lantos (2002) categorized CSR based on the purpose of
the company running CSR programs. He suggested that ethical CSR represent a minimal level
15
society even if at the expense of company profits. Hietbrink et al.(2010) categorized CSR
activities based on whether the actual products have socially responsible attributes. Cho and
Hong (2009) identified CSR activities by coding the 239 CSR stories and 414 CSR cases on
the websites of two Korean newspapers, Chosun Ilbo and Hankyoreh Shinmum, from 2003 to
2006. Bhattacharya and Sen (2004) categorized CSR initiatives into six broad domains according to the database that encompasses CSR records from over 600 real companies.
Compared to these categorization ways, Peloza and Shang (2009) offer a simple and
comprehensive categorization. The three broad categories are philanthropy, business practices,
and product-related. The forms of philanthropy are cause-related marketing, cash donation
and product donation, etc. (Peloza and Shang, 2009). The second common category of CSR
encompasses all CSR activities related to business practices of the firm, such as
environmental protection and package recycling (Peloza and Shang, 2009). The least common
category includes initiatives related to product-related features (Peloza, Shang, 2009). For
example, companies produce products with less pollution generation or change product
ingredients.
Luxury companies must start conveying environmental and humane values to establish a
long lasting consumer relationship (Kim and Ko, 2012). Nowadays, luxury companies do start taking socially responsible actions as the Table 6 summarizes.
Table 6
Tiffany Make iconic blue boxes and bags in recycled paper;
Only use diamonds from countries that are members in the Kimberley Process Certicication Scheme(The process was set up "to ensure that diamond purchases were not financing violence by rebel movements and their allies seeking to undermine legitimate governments)
Protect mining environment; monitor supply chain; Care employees
Save energy in real stores by using LED lights
Burberry Use sustainable cotton Become a founding partner of the Sustainable Fibre
Alliance (SFA), a UK-based NGO working with key stakeholders in Mongolia to restore grasslands, promote animal welfare and ensure a decent living for cashmere goat herders;
Partnership with CottonConnect
Armani Chemical safety of the product;
Made a firm commitment to abolish the use of animal fur in its collections
A strict control system to ensure that its supply chain complies with the principle rules governing
ethical-social behavior, safety regulations in the workplace and respect to the environment
Coach Set up Coach foundation to help young woman; supply
chain stewardship; environmental conservation; employee engagement; community empowerment
Gucci Enhance issues human rights and employees; enhance
supply chain;
Eco-friendly program; preservation and promotion of the arts and solidarity initiatives
Hermès Fondation d’entreprise Hermès supports men and
women seeking to learn, perfect, transmit and celebrate the creative skills that shape our lives today and into the future.
LVMH The “Mission Handicap” initiative, a network of 30
disability coordinators;
EllesVMH: a community with more than 850 members worldwide (men and women), a discussion platform and intranet for sharing information and best practice.
Louis Vuitton has placed CSR at the heart of its marketing strategy with a three-year commitment to help young people engage with art through a specially created website.
17
Stella McCartney Use recycled materials in products, such as handbags and coats
In the present study, I will adapt and narrow down the categorization way by Peloza and
Shang (2009) which are applicable to the real luxury CSR activities reported on company
official websites and newspapers. In this article, the present study will include three types of
CSR: 1) philanthropy 2) business practice and 3) product-related. The three selected CSR types are widely accepted by real luxury companies, such as Burberry and Louis Vuitton,
according to the author’s research (Appendix J). Philanthropy is that firms donate funds to a
worthy cause because they want to be a good corporate citizen without seeking to generate
any association with the cause (Shaw and Post, 1993). If a company is trying to do something
beneficial to the society during the product production or transportation, it will be regarded as
a business practice (Peloza and Shang, 2009). The product-related CSR activities mean that
luxury firms create a certain level of CSR by embodying their products with CSR attributes or
by using CSR-related sources (Mahoney and Thorne,2005), such as recycled and renewable
sources. Product-related CSR activities focus on the environmental-friendly dimension of the company’s products, and the company’s innovative improvements are motivated by the drive
to be more environmentally friendly (Husted and Allen, 2007). The rest two CSR categories
do not change product attributes or embody products with CSR attributes, such as money
donation and saving energy consumption, and they will be included in non-product related
CSR category. The way in which non-product related CSR influences consumers’ product
2.2.3CA AND CSRASSOCIATIONS AND CONSUMERS’ PRODUCT EVALUATIONS Different types of corporate associations result in different effects on consumers’
evaluations of a company and its products (Sen and Bhattacharya, 2001; Wigley, 2008;
Biehal and Sheinin, 2007). The product evaluations are consumers ‘overall impression of
products. (Kim, 2011). The product evaluation are about respondents’ evaluations about
product’s reliability, trust worthiness, quality, attractiveness (Kim, 2011). Some scholars
argue that CSR associations exert only indirect influence on product evaluations (Brown and
Dacin, 1997). Brown and Dacin (1997) indicated that CSR associations are often unrelated to
the company’s abilities in producing services and goods, the primary influence of CSR associations comes through their influence on the corporate evaluation rather than through
any influence on specific product attributes (Brown and Dacin, 1997). However, later some
scholars proved direct relationships between CSR and product evaluations (Kim et al., 2009;
Kim, 2011). Wigley (2008) found out a positive correlation between consumer product
purchase intention and knowledge about a company’s CSR activities. Kim (2011) suggested
that consumers tend to assume a company is good at making reliable products when they
associate the company with CSR efforts, indicating that consumers transfer effects of CSR
associations onto CA associations, and onto product evaluations.
Recent studies find the positive effects of CSR on product evaluations happen only in
specific conditions. Luchs et al. (2010) suggest that the positive effects of companies’
sustainability on consumers’ product preferences depend on the type of benefits consumers most value for the product categories. They demonstrated that consumers associate higher
19
product ethicality with gentleness-related attributes (e.g., “good for children,” “healthy
product”) and lower product ethicality with strength-related attributes (e.g., “effective
product,” “get the job done”). They found that the positive effect of product sustainability on
consumers’ preferences decreases when strength-related attributes are valued, even resulting
in preferences for less sustainable product alternatives. However, their findings can only be applied in product categories in which either strength attribute or gentleness attribute is an
important determinant of the product. Since product quality and brand reputation constitute
decisive selection criteria in luxury products (Achabou and Dekhili, 2013), findings from
Luchs et al. (2010) are not applicable in luxury industry. Recently, Chernev and Blair (2015)
have found the positive effect of CSR on product evaluations is dependent on consumers’
expertise, such that CSR is more likely to influence perceived performance for consumers
who are less familiar with the particular product category (Chernev and Blair,2015). Besides,
the positive impact of CSR on product evaluations can be found when the company’s
prosocial behavior is not related to the functional performance of its products and to its core
business competency (Chernev and Blair, 2015). However, they do not include the luxury
product category into the experiments. In this study, I will investigate the effects of CSR by
luxury companies on their product evaluations.
2.2.4CSR AND CA BELIEF
CSR and CA belief can influence CA and CSR associations. Sen and Bhattacharya (2001)
define CSR-CA beliefs as consumers’ beliefs about the relationship between CSR and a
tradeoffs that a company makes between CSR and CA efforts influence consumers’
evaluations of the company and its products. Consumers perceived tradeoff increases when
they think the CSR efforts drain the corporate sources or CSR activities are realized at the
expense of corporate sources (Webb et al. 2008).
Consumers’ reactions to a company’s CSR efforts are also likely to depend on the extent to which they believe that such CSR efforts distract from rather than reinforce the company’s
CA development (Sen and Bhattacharya, 2001). Sen and Bhattacharya (2001) suggest that if a
substantial proportion of a company’s potential customers believe that CSR initiatives are
typically realized at the expense of CA, then the company’s CSR efforts may hurt it.
Achabou and Dekhili (2013) support the findings, such that CSR initiatives taken by firms
must not be a detriment to intrinsic quality of the products, which is a priority requirement
among consumers. CSR’s effectiveness on a company’s evaluation significantly decreases if
product quality was to be inferior (Folkes and Kamins, 1999).
When consumers do not believe that the company’s CSR efforts enhance its CA (i.e.,
CSR domain is CA irrelevant) and that its products are of high quality, such adverse effects
are particularly likely to hurt sales (Sen and Bhattacharya, 2001). Webb and his colleagues
(2008) also find that individuals who believe CSR comes at the expense of other corporate abilities will be less socially responsible in their consumption than those who do not. In
summary, the positive impact of CSR on product evaluations can only be found in three cases:
when the consumers have a high level of CSR support, when the product is still of high
21
2001). More importantly, this adverse effect of CSR-CA trade-off appears to be more
prevalent among the low-CSR support consumer segment and distinct from high-CSR support
consumers (Sen and Bhattacharya, 2001). Deng (2012) verified the existence of CSR-CA
belief and indicated that CSR-CA belief is one of the influence factors of consumers’
response to a firm’s ethical behavior.
3.HYPOTHESIS AND CONCEPTUAL MODEL
3.1HYPOTHESES DEVELOPMENT
Researches into the specific case of CSR in the luxury industry are very limited. The
following paragraphs discuss the findings in the literature relevant to luxury CSR.
Torellie et al. (2011) study the outcomes of luxury CSR on brand levels. Park et al. (1991) define brand concepts as “unique, abstract meanings” associated with brands. Torellie et al.
(2011) explain that brands such as Rolex and BMW are associated with an abstract concept of
self-enhancement (dominance over people and resources). Brand concepts can automatically
activate their related motivations and goals outside of conscious awareness (Chartrand et al.,
2008). Similarly, CSR information activates abstract prosocial goals of protecting the welfare
of all (Verplanken and Holland, 2002). The conflicting motivations triggered by brand
concepts versus CSR can strongly affect brand perceptions (Torellie et al, 2010). They state
that the CSR actions of a luxury brand concept cause disfluency and a decline in evaluations,
relative to the control. The findings show that self-enhancement luxury brands and CSR
Some scholars suggest that luxury CSR leads to consumers’ positive attitudes. Janssen et
al. (2013) extend the literature on luxury CSR to the product level. They study the effect of
scarcity and ephemerality (the fact that goods are short-lived) of luxury products. Janssen et
al. (2013) claim that the scarcity of luxury products restricts availability and helps protect
natural resources. They suggest that a rare luxury product evokes a perception of fit with CSR. Ephemeral, fashionable products are also be associated more easily with conspicuous
consumption and hedonism (Berthon et al. 2009). Janssen et al. (2013) conclude that when
luxury products are scarce, an enduring product is perceived more socially responsible than
an ephemeral one, which leads to more positive attitudes toward the enduring product. This
result shows that CSR is effective in some cases. Achabou and Dekhili (2013) study the
luxury CSR concerning luxury product materials. They suggest that consumers perceive the
use of organic materials in luxury products positively while perceiving the introduction of
recycled materials negatively. This result shows that recycling and the category of luxury
products are incompatible. The reason why luxury consumers have negative evaluations on
recycled materials in luxury products is left to investigate.
One of the characteristics that distinguish luxury brands from non-luxury brands is
superior quality, suggesting that product quality and brand reputation are still determinants of selection criteria in the case of luxury products (Vigneron and Johnson, 2014; Achabou and
Dekhili,2013). Luxury is associated with respect for materials (Vigneron and Johnson, 2004).
Product quality and brand reputation still constitute decisive selection criteria in the case of
23
challenges (Dereumaux, 2007) without ruining the intrinsic quality of the products. In some
case, recycled products are perceived to be of lower quality than products made from virgin
raw materials (Reid, 1990; Biswas et al., 2000). Despite the increasing concerns of consumers
about the preservation of the planet, the responsible behavior of the brand remains a
secondary selection criterion and consumers of luxury goods primarily focus on the intrinsic quality of the product (Murphy and Schlegelmich, 2013).
The product-related CSR changes the product attributes by using CSR-related sources
(Mahoney and Thorne, 2005) while the non-product related CSR, such as business practice
CSR and philanthropy, does not. The introduction of recycled materials in a luxury garment
reduced the perceived value of the product. Thus the product-related CSR leads consumers to
evaluate recycled materials in luxury products unfavorably. Philanthropy and business
practice CSR activities are not product-related, and they do not reduce the value of luxury
products. The pro-social behaviors by companies lead consumers to trust their products and
increase their product evaluations (Wigley, 2008; Kim, 2011). Thus, I assume that
non-product related CSR leads to more favorable product evaluations than product-related
CSR does. In luxury brands, product premium quality is critical compared to non-luxury
brands (Fionda and Moore, 2009; Arnault, 2000; Phau and Prendergast (2000). Companies with high CA are taken to have quality products (Lee et al., 2011). Thus, luxury companies
are related to high corporate abilities. When luxury brands initiate product-related CSR by
introducing recycled materials, their core brand competencies, premium quality, is influenced.
products while they are initiating CSR activities and CSR activities cannot enhance luxury
companies’ abilities. Thus, I assume that consumers perceive a greater trade-off between CSR
and CA in product-related CSR than in non-product related CSR. According to CSR-CA
belief (Sen and Bhattacharya, 2001; Chernev and Blair,2015), if consumers perceive the
company’s trade-off between corporate abilities and CSR efforts, they will think the CSR activities are at the expense of the corporate abilities, and then the less favorable product
evaluations will be given by consumers. Thus, I assume that effect of luxury CSR activities
on luxury products is mediated by consumers’ perceived trade-off between CSR and CA.
Therefore, the following is expected:
H1a: Non-product related CSR activities have more positive influence on product evaluations
than product-related CSR activities do.
H1b: Compared to non-product-related CSR, product-related CSR activities are more likely
to lead consumers to perceive a trade-off between CSR efforts and corporate abilities.
H1c: Consumers’ perceived trade-off between CSR and CA mediates the effect of CSR
activities on product evaluations.
Consumers can be segmented based on their luxury value perceptions (Wiedmann et al.
2009). The identified luxury value perceptions can be categorized based on the consumer value framework in Holbrook (1999). Tynan et al. (2010) include luxury consumers’
perceived high quality value, self-identity and hedonism values in self-oriented values and
consumers’ perceived status value and uniqueness values into the other-oriented value type.
25
luxury products. Compared to other-oriented consumers, self-oriented consumers mainly
associated premium quality with luxury products rather than prestige and uniqueness. They
tend to care more about what they will get from consumption and less about how other people
perceive them or their effect on others (Holbrook’s, 1999). They pursue luxury products for
the excellent quality rather than impress others by being prestigious. If a consumer perceives a product to have a high value, he or she would be more willing to buy the product, be more
willing to recommend the product and expect fewer problems with the product (Sweeney and
Soutar, 2001). In product-related CSR, the introduction of recycled materials is associated
with poor quality (Reid, 1990; Biswas et al., 2000) and a decrease in product value (Achabou
and Dekhili, 2013). Self-oriented consumers who seek high quality value in luxury products
will face a decline in intrinsic value. The introduction of recycling is not linked to prestige
(Achabou and Dekhili, 2013). Other-oriented consumers who seek prestige and uniqueness
values will not face variance in values of luxury products. In non-product related CSR, CSR
activities such as money donation and green production do not change luxury product features
at all, and the luxury products by CSR initiators cannot differentiate the product buyers from
others. Therefore, the following is expected:
H2a: When consumers seek self-oriented values in luxury products, their product evaluations
of product-related CSR will be much lower than those of consumers who seek other-oriented
H2b: When in non-product related CSR activities, the difference between product evaluations
of self-oriented consumers and those of other-oriented consumers will be smaller than in
product-related CSR activities.
If consumers are self-oriented, they mainly associate excellent quality values with luxury
products. They pay more attention to the luxury product quality than other-oriented consumers do. The product quality is CA-related (Sen et al., 2007) thus self-oriented
consumers are more likely to associated recycled materials in luxury products with low
quality and then with decreased CA. Self-oriented consumers may have a higher perceived
company’s trade-off between CSR and CA than other-oriented consumers do. According to
CSR-CA belief, if consumers think luxury companies’ CSR efforts come at the expense of
other corporate abilities and CSR efforts cannot enhance product attributes, their response
will be even less favorable. Thus self-oriented consumers may have less favorable product
evaluations than other-oriented consumers. The non-product related CSR such as charity
giving does not appear to influence consumer perceptions of product attributes (Brown and
Dacin,1997). Thus self-oriented and other-oriented consumers will perceive less CSR and CA
trade off and give more favorable product evaluations. Therefore, the following is expected:
H3: The interaction effect of consumer types and CSR types on product evaluations is
mediated by consumers’ perceived trade-off between CSR and CA.
3.2CONCEPTUAL MODEL
27
4.METHODOLOGY
4.1RESEARCH DESIGN
The aim of the research is to study the effects of non-product related and product related CSR on consumers’ product evaluations. The independent variable is CSR type, namely
product-related CSR and non-product related CSR. An experimental design by means of a
survey with three conditions (philanthropy, business practice CSR, and product-related CSR)
will be used to test the hypotheses. The three selected CSR types are widely accepted by real
luxury brands. Philanthropy and business practice will be investigated as non-product related
CSR. Although these two CSR types share the same features that they do not involve products
or change product attributes, they still distinguish each other in terms of the nature of the
action and how the activities are done (Ashley and Haysom, 2006). Thus, they will be both
tested in the survey as non-product related CSR. The research is divided into two studies. The
first one is performed to determine if it is possible to identify two consumer groups depending on their luxury value perceptions. In the second one, the research hypotheses are tested.
Participants are presented with carefully written scenarios about a fictions luxury brand and
CSR descriptions during the study. Respondents will be randomly assigned to one CSR
description which is adapted from real CSR program descriptions by luxury brands. Each
stimulus featured a luxury brand description and a CSR activity by the luxury brand. The
choice of a non-existing coat brand, Delvoda, is to avoid prior experience and knowledge
biasing the results. A coat brand is chosen for the reason that coat brands won’t cause gender
bias (Stokburger-Sauer and Teichmann, 2011). This makes the results more realistic and
credible. To make sure that the luxury brand description and three CSR scenarios have the
intended effect on the participants, a pretest will be conducted to measure consumers’ perceived quality before the main survey. After reading the scenario description, respondents
need to report their product evaluations and perceived Delvoda’s trade-off between CSR and
CA. To categorize consumers into self-oriented and other-oriented groups, a luxury value
perception measurement scale adapted from Wiedmann et al. (2009) is presented at the end of
the survey. Consumers are asked to report what values they associate with luxury
consumption.
Overall, the survey includes four parts, see Appendix B. The first part is to show
participants one of three scenarios. Subsequently, participants answer questions about their
product evaluations and perceived trade-off between CSR and CA. During the survey,
participants cannot go back to the previous pages. After previous two parts, attention check is
used to measure whether respondents focused on the questionnaire and read the scenario
descriptions carefully. The third part is used to measure consumers’ luxury value perceptions and segment consumers. In case that respondents know the purpose of the survey and give
biased answers, the value perception scale comes after perceived CSR-CA trade-off
measurement scale. The final part is to query about personal details. The main survey is
29
Chinese by a professional translator and re-translated into English by the author before
distribution. The data is only collected among Chinese to avoid cultural bias.
4.2PRETEST
Before the main survey, the pretest is conducted to ensure the written scenarios have the
desired effect on participants. The pretest can be used to check the effectiveness and
credibility of the manipulated scenario (Saunders and Lewis, 2012). Participants are randomly
assigned to one of the scenarios (philanthropy, business practice, and product-related CSR),
and 39 completed responses are collected in the end with an approximately equal number of
respondents (11-15 respondents) per CSR sceario. The luxury brand description comes before
the CSR description. The pretest can be seen in Appendix A.
The brand descriptions and CSR descriptions are developed based on luxury program
reported on luxury websites and in the past studies. The summary of the real luxury brand
descriptions can be seen in the Appendix J. I extracted the key words which are related to the
luxury brand characteristics in Phan and Heine (2011) and developed a Delvoda brand
description. The thesis supervisor helps to read and revise it. The following is the Delvoda
brand description:
Delvoda is a luxury coat brand of over 150-year heritage. Delvoda products represent
the pinnacle of craftsmanship and are unsurpassed for their superior quality and attention to
detail. Delvoda is committed to the creation of authentic and distinctive products in diverse
fashion. Every collection expresses new forms of aesthetics, presenting itself as a modern
classicism, based on superior sartorial content and creativity.
Few scholars introduce non-existing luxury brands in the study and they do not do
credibility check of luxury brands either. In the present study, I will adapt the brand prestige
scale in Kim and Yu (2010) and developed a 7-item bipolar scale to measure the credibility of the luxury brand description. I supplement the measurement metrics according to the major
luxury brand characteristics (price, quality, aesthetic, rarity, extraordinariness and symbolism)
in Phan and Heine (2011). After reading the description of the luxury brand Delvoda, I will
ask participants to fill in the scale based on their subjective perceptions of Delvoda. In order
to be valid for the main test, the mean scores for the luxury brand perception need to be over
4, which indicates that the fictitious luxury brand description makes participants regard
Delvoda as a luxury brand. By evaluating the means of all item in the luxury brand value
perception scale, I conclude that the manipulation of the luxury brand is successful, with
means of all the items is 5.87, over the value of 4 (see Table 7). The scale is reliable with
Cronbach’s Alpha=0.919, see Appendix K. Table 7
Item Mean StD
1. Delvoda coats are… 1=very cheap 7=very expensive 6.03 .74
2. Delvoda coats are… 1=not luxurious at all 7=very luxurious 5.92 .70
3. Delvoda coats are… 1=not prestigious at all 7=very prestigious 5.85 .96
4. Delvoda coats have… 1=very low quality 7=very high quality 6.18 .94
5.Delvoda coats can support in displaying …
1=low status 7=high status 5.85 .84
6. Delvoda coats is produced with…
1=low craftsmanship 7=high craftsmanship 6.13 1.06
31
The CSR scenarios are developed based on the CSR descriptions reported by real luxury
brands and CSR descriptions in previous studies. To manipulate the CSR types, the key words
are extracted from real CSR descriptions which have been highlighted in Appendix J. I apply
the method in Tian et al. (2014) by using one specific CSR activity to stand for one CSR
category. For example, they use money donation activity to stand for philanthropy CSR category. Three CSR selected activities are about philanthropy, business practice and product
related CSR respectively which are widely accepted by real luxury brands. All CSR
descriptions are about environment protection because nowadays luxury brands must convey
environmental values for a lasting relationship with consumers (Ageorges, 2010 ; Kim and
Ko,2012) and luxury consumers have extended their quality expectations to environment care
(Lochard and Murat, 2011). The three CSR program descriptions are written by the author
and revised by the author’s supervisor. The following are the descriptions:
The first message contained a ‘philanthropy’ appeal, as described below:
Delvoda is committed to funding organizations which protect the environment. Every
year, Delvoda donates a fixed amount of coat sales to the ‘Tree Care Organization’, a
non-profit organization which aims to protect trees and environment.
The second message contained a ‘business practice’ appeal, as described below: Delvoda is committed to reducing environmental impacts of
production. Delvoda protects the sustainability of cotton farmlands and adopts specific cloth
processing technique to reduce carbon dioxide discharge and chemical pollution during
The third message contained a ‘product-related’ appeal, as described below:
Delvoda is committed to offering environmentally friendly products. Delvoda uses
sustainable materials in coat design. Delvoda recycles all textiles that could be used and
apply them in coats. The buttons and belt buckles are made from recycled metal.
To make sure participants understand what the CSR description is about and exclude the distracting participants, respondents are asked to select the correct summary of the CSR
program after reading the CSR description assigned to them without returning to previous
pages. Since three CSR scenarios are all about environment protection, there is a need to
measure consumers’ perceived environment protection effectiveness of each CSR activity.
Alliances between a brand and a social cause that trigger positive attitudes toward the
sponsoring brand lead to both increased sales and brand loyalty (Zdravkovic et al. 2010).The
control variables such as CSR’s environmental performance (Wagner et al., 2009) and
brand-cause fit (Stanley et al. 2010) are measured in bipolar Likert scales, see Appendix A.
Results (see Appendix K) show that there are no significant differences in environmental
performance and brand-cause fit across three CSR types, which means participants regard
three CSR scenarios equally effective in environment protection and equally fit the luxury
brand. Importantly, respondents answer to what extent they think the Delvoda’s product quality would be impacted by the CSR activity assigned to them and significantly different
results are found across three CSR scenarios, with F=10.489, p< .05. The perceived product
quality is one of the aspects of the product evaluations (Kim, 2011). This result indicates that
33
likely to evaluate products differently. The results of the pretest give necessary confidence in
the credibility of luxury brand description and three CSR scenarios. The results give the
confidence that the main survey can continue. Before posting the main survey, some changes
are made to according to the thesis supervisors’ and participants’ advice. The main survey can
be seen in Appendix B.
4.3SAMPLE
The participants are all Chinese. The survey was distributed via WeChat which is a Chinese
social tool. The snowball sampling method was used as all participants were asked to forward
the survey to their friends. All participants will be randomly assigned to one CSR scenario.
The questionnaire ended up with an overall sample 190 respondents for three CSR scenarios. After removing the error data and respondents who do not pass the attention check question
“You just read about Delvoda being involved in environmental practices, please indicate
which of the following 3 statements is correct:”, there are 52 for product-related CSR, 64 for
business related CSR and 68 for philanthropy CSR in the end. The majority of respondents
fall in the age group 24 to 20, see Figure 2. Female respondents account for 66% of the
sample, male respondents account for 32% and 2% of sample are not willing to disclose
gender information, see Figure 3. Over 80% of sample possess at least a bachelor education
degree, see Figure 4.
42 74 32 20 14 0 10 20 30 40 50 60 70 80 18-23 24-29 30-35 36-41 >41
Figure2: age distribution
Figure3: gender distribution Figure4: education level distribution
4.4MEASURES
After reading the luxury brand description and its CSR initiative, participants were asked to
complete several items that measured variables under the investigation. What’s more,
questions related to the participants’ luxury value perceptions and some demographic
questions are added in the end.
The measures used for variables are applied in previous studies and some of them are
adapted for the purpose of the present study. All the items can be seen in Table 8. Table 8 measurement scales
Product evaluation(dependent variable)
1. I am interested in this company’s products. 2. I assume this company’s products are reliable. 3. I think this company’s products are trustworthy. 4. I think this company’s products have good quality.
Level of CSR support(control variable)
1. I consider the ethical reputation of businesses when I shop I avoid buying products from companies that have engaged in immoral actions.
2. I would pay more to buy products from companies that show care for the well-being of our society. Female 66% Male 32% Not applicable 2%
Female Male Not applicable
3; 3%
43; 47% 42; 46%
4; 4%
35
3. If the price and quality of two products are the same, I would buy from a firm that has a socially responsible reputation.
Perceived CSR-CA trade-off(mediator)
1. Delvoda's socially responsible behavior reduces Delvoda's ability to provide the high quality products.
2. Delvoda's socially responsible behavior is a drain on Delvoda’s resources. 3. Socially responsible companies like Delvoda are likely to have higher prices than
companies that are not socially responsible.
4. Delvoda can be both socially responsible and make products of high quality at a fair price.
The independent variable is CSR type. The dependent variable, product evaluations, is
measured using four-item, seven-point Liker scale (1=strongly disagree, 7=strongly agree)
used in Kim (2011). The four items include respondents’ evaluations about the product’s reliability, quality and trustworthy（Kim, 2011）. The 4 items focus on an overall impression
of a company’s products including respondents’ evaluations about a products’ reliability,
quality, trustworthiness and likeability. In this study, it will reflect respondents ’overall
impression of coats produced by Delvoda. The second measured variable is perceived
trade-off between CSR and CA. For this variable, four items relevant to corporate abilities
and CSR efforts developed by Webb et al. (2008) are measured. When consumers think CSR
activities are realized at the expense of corporate abilities, they will have higher ratings,
indicating more trade-off between CSR efforts and corporate abilities. The consumers’ CSR
support impacts their behavior when faced with CSR information (Podnar and Golob, 2007). To avoid the influence of consumers’ willingness to support CSR on product evaluations (Sen
and Bhattacharya, 2001), the control variable, level of CSR support, is measured by the
seven-point Likert scale in Ramasamy et al. (2010). The control variables such as gender,
items relevant to what values potential luxury consumers associate with luxury products are
selected from the luxury perception measurement scale in Wiedmann et al. (2009). In this
study, I am going to include five luxury value perceptions: uniqueness, quality, hedonism,
self-identity and prestigious which are mentioned as key luxury value perceptions in Tynan et
al. (2009) and make considerable contribution in characterizing consumer segments
(Wiedmann et al., 2009). The whole survey and the value perception measurement items can
be seen in Appendix B.
5.DATA ANALYSIS AND RESULTS
The current section describes the steps taken to analyze the collected data. Study 1 consists of a cluster analysis which provides information about luxury consumer groups classified
according to their luxury value perceptions. Study 2 is used to test whether differences exist
in the way different clusters of consumers evaluate products. Both the analytical procedure
and the results of the performed analyses are presented in detail, which is possible for future
replications.
5.1RELIABILITY CHECK
The reliability test was conducted to test the internal consistency for items in all measurement
scales. The following scales were tested: product evaluations, perceived CSR-CA trade-off,
the level of CSR support and luxury value perception. Reliability is the extent to which data
collection techniques or analysis procedures yield consistent findings (Saunder et al., 2009).
According to DeVellis (2003), a Cronbach alpha coefficient of α=0.7 or above means that the
37
which indicates that all the scales have a good consistency. The scale for perceived trade-off
between CSR and CA has the highest reliability, with Cronbach’s Alpha = 0.905. Table 9: measurement scale reliability scores
Scale α N of items
Product evaluation .840 4
CSR-CA trade-off .905 4
Level of CSR support .822 3
Luxury value perception .821 22
5.2DESCRIPTIVE STATISTICS
Means and standard deviations are reported in Table 10. Participants indicate a high level of
CSR support (M=5.50) and a low level of product evaluations (M=3.58). Moreover, to give
the readers some additional insights into the relationships between the variables, a full
correlation matrix is conducted for each CSR scenario, see Table 11, Table 12 and Table 13.
The results reveal that the perceived CSR and CA trade-off is negatively correlated with
product evaluations, indicating that when respondents perceive higher trade-off between CSR
and CA, they will have lower product evaluations. Table 10: Descriptive statistics
N Minimum Maximum Mean Std. Deviation
product evaluation 184 1.00 6.00 3.58 1.21
CSR-CA trade off 184 1.00 7.00 4.25 1.22
level of CSR support 184 1.00 7.00 5.50 1.34
Table 11: Correlation matrix for product-related CSR
Mean SD product
evaluation
CSR-CA trade off
CSR support
level gender age
product evaluation 1.99 0.59
CSR-CA trade off 5.54 0.51 -.479**
CSR support level 5.45 1.61 -0.222 0.11
gender 0.121 0.01 -0.09
education 0.183 -0.12 -0.19 -0.03 0.12 ** Correlation is significant at the 0.01 level (2-tailed).
Table 12: correlation matrix for business practice CSR
Mean Std. Deviation product evaluations CSR-CA trade off level of CSR support age education product evaluations 4.22 0.77
CSR-CA trade off 3.67 0.90 -0.084
CSR support level 5.73 1.24 0.002 0.041
age 0.051 0.025 -0.193
education -0.062 -0.198 -0.074 .345**
gender -0.058 0.111 -0.092 0.089 -0.090
Table 13: correlation matrix for philanthropy
Mean Std. Deviation product evaluation CSR-CA trade off level of CSR support age education product evaluation 4.18 0.70
CSR-CA trade off 3.63 0.85 -.548**
CSR support level 5.61 1.19 -0.04 -0.11
age .308* -0.12 -0.08
education 0.002 -0.07 0.05 0.13
gender 0.030 0.03 0.06 0.10 -0.14
5.3STUDY 1
As mentioned in Chapter 4, the data used in the following analyses are from the respondents
who pass the attention check question. The sample size is 184.
In the present study, I am going to divide consumers into two groups, self-oriented and
other-oriented. In the self-oriented group, respondents should have higher scores in
self-identify value perception, quality value perception and hedonism value perception out of
five value perceptions. In other-oriented group, respondents should have higher scores in
uniqueness value perception and prestige value perception out of five value perceptions. I
39
begin with, a hierarchical clustering procedure was conducted to get a possible number of
clusters for k-means analysis. To identify the right number of clusters, I applied Ward’s
method. The results suggest that three clusters or four clusters will be the possible numbers of
clusters, see Appendix H. I conducted two k-means analyses by choosing k=3 and k=4
respectively. The results in 4-cluster analysis show that one of the four clusters have much less cases (N=12) compared to the other three clusters (N cluster1=56, Ncluster2=56,
Ncluster3=60), see Appendix I. In addition, the 4-cluster results cannot help to cluster
consumers into two consumer groups. A second k-means analysis was conducted by deciding
three clusters. From result table 14, I observed that in the cluster 1, the respondents give high
scores in uniqueness (5.31) and prestige (4.56) and quality (4.88). In the cluster 2, the
respondents give high scores in self-identity (5.33), quality (4.9) and hedonic (3.82), see table
14. In the cluster 3, the respondents give high scores in self-identity (6.51), uniqueness (5.09)
and quality 5.88), see table 14. Wiedmann et al. (2009) feature each cluster according to the
top three ratings for value perceptions. As discussed before in Chapter 2, respondents who
value self-identity, quality and hedonism in luxury products in cluster 2 and 3 can be grouped
in self-oriented group because they buy or intend to buy luxury products for their own sake
without impressing others. The respondents in cluster 1 seek uniqueness and prestige will be grouped in other-oriented group because they look beyond the self to someone or something
else (Holbrook, 1999). The cluster of each case is marked as Appendix I shows. In the end,
into self-oriented type, see table 15. The result is similar to the division in Wiedmann et al.
(2009) as the proportional distribution is similar. Table 14
Final Cluster Centers
Cluster 1 Cluster 2 Cluster 3
N=68(36%) N=82(46%) N=34(18%) F Sig. Uniqueness 5.31 3.21 5.09 71.536 .0000 Quality 4.88 4.9 5.88 22.377 .0000 Prestige 4.56 3.15 4.49 53.499 .0000 Hedonic 4.35 3.82 4.28 94.573 .0000 Self-identity 4.26 5.33 6.51 100.418 .0000 Table 15
Number of Cases in each Cluster
Cluster 1 Other-oriented 68 2 Self-oriented 82 3 34 Valid 184 Missing 1 5.4STUDY 2 5.4.1HYPOTHESIS 1A TESTING
H1a: Non-product related CSR activities have more positive influence on product evaluations
than product-related CSR activities do.
To test the first hypothesis, a one-way ANOVA and a post hoc analysis (LSD) were
conducted with CSR types (philanthropy, business practice and product-related) as the
independent variable and product evaluation as the dependent variable. From the analysis,
there is no significant difference between how philanthropy and business practice influence
product evaluations, with p=0.69, see table 17. The result shows that in non-product related
CSR activities, philanthropy and business practice CSR have the statistically same impact on
41 Table 16 SS df MS F Sig. Between Groups 182.180 2 91.090 188.073 .000 Within Groups 87.664 181 .484 Total 269.844 183
Table 17: post hoc analysis
After the post hoc analysis, a one-way ANOVA was conducted with CSR type (product
related vs. non-product related) as the independent variable and product evaluation as the
dependent variable. From the analysis, the CSR type has a significant effect on participants’
evaluations of the products by the company (F = 377.74, p=.000), see table 19. Table 18
shows that consumers’ product evaluations in non-product related CSR (M=4.20) are higher
than those in product-related CSR (M=1.99). The mean lot can be seen in Appendix C. Thus;
there is evidence that in support of H1a. Table 18 N Mean SD Non-product related 132 4.20 .72901 Product related 52 1.99 .59607 Total 184 3.58 1.21431 Table 19 Product evaluation
Dependent Variable: Product evaluation
(I) CSR type (J) CSR type Mean
Difference (I-J)
Std. Error Sig. 95% Confidence
Interval Lower Bound Upper Bound
LSD product-related business practice -2.23422* 0.12993 0.000 -2.4906 -1.9779
philanthropy -2.18609* 0.12821 0.000 -2.4391 -1.9331
business practice product-related 2.23422* 0.12993 0.000 1.9779 2.4906
philanthropy 0.04814 0.1212 0.692 -0.191 0.2873
philanthropy product-related 2.18609* 0.12821 0.000 1.9331 2.4391
