PROBLEM STATEMENT

The business domain has changed to such an extent over the past decades that firms are compelled to increase their societal involvement by means of approaches that provide measurable returns (Misra, 2014). CARE represents such a strategy and offers several benefits for firms, NPOs and consumers (Kim & Johnson, 2013; Pharr & Lough, 2012; Sheikh & Beise-Zee, 2011; Krishna, 2011; Tustin & Pienaar, 2005; Varadarajan & Menon, 1988). However, the effectiveness of CARE seems to depend on the CSEs that are selected for the campaign (Grau & Folse, 2007). These elements transmit cues to consumers and have an impact on their responses to CARE (Grau & Folse, 2007). Research has suggested that CSEs are contextual, thus resulting in different consumer responses across cultural contexts (La Ferle et al., 2013; Subrahmanyan, 2004; Strahilevitz, 1999). Further, CARE studies have indicated that the influence exerted by CSEs often occur in an interactive manner rather than in isolation (Chang & Cheng, 2015; Chang, 2008). To avoid complexity, many CARE studies have assessed only two or three independent variables simultaneously and insights about the combined effect of several CSEs are lacking (Chang & Cheng, 2015). Given the number of potential CSEs, the multiplicity of their possible permutations, the simplicity of several previous studies and the contextual nature of CARE (La Ferle et al.,

9

2013; Subraymanyan, 2004; Strahilevitz, 1999), further inquiry into the combined influence of these elements on consumer responses is the broad purpose of this study.

A limited number of previous studies have assessed the influence of CSEs such as campaign duration, geography and strategic orientation (Ellen et al., 2000; Skitka, 1999). Although providing meaningful insights, these elements are often not revealed to consumers in CARE campaigns. Therefore, more research about the CSEs that are visibly communicated to consumers during CARE campaigns is required to enable the development of more effective campaigns. These CSEs include the cause-linked product, the donation recipient, donation magnitude and the donation expression format.

Most CARE studies that have investigated the role of the cause-linked product have focused on the hedonic-utilitarian framework (Strahilevitz, 1999). The approach has yielded inconsistent findings in different contexts (Subrahmanyan, 2004; Strahilevitz, 1999). Researchers have also mentioned the limitations of assessing only the hedonic-utilitarian framework and have called for inquiry into the influence of alternative product classification systems (Christofi, Leonidou, Vrontis, Kitchen & Papasolomou, 2015; Christofi, Vrontis & Leonidou, 2014). CARE also represents a co-branding relationship – a field in which product research often utilises the product involvement framework (Li & He, 2013; Simonin & Ruth, 1998). Given the above-mentioned co-branding guidelines, the call for research and the differential product-related findings deriving from different contexts, this study focused on the involvement framework as guideline for assessing the influence of the cause-linked product in CARE.

The majority of CARE studies have focused on investigating the for-profit partner (Lafferty & Edmondson, 2014; Chang, 2011; Chang & Liu, 2012; Lavack & Kropp, 2003; Strahilevitz & Myers, 1998; Strahilevitz, 1999). Despite indications that the donation recipient fulfils a key role in driving CARE effectiveness, research pertaining to this CSE has been scant (Lafferty & Edmondson, 2014; Engelbrecht & Du Plessis, 2004) Further, many firms promise a donation to a vague recipient (e.g. cause or charity in general) in their CARE campaigns (Kim, 2005; Pracejus, Olsen & Brown, 2003). Such an approach hampers the positive affect transfer that could happen from a branded donation recipient to the firm or the cause-linked brand and also contributes to consumer scepticism (Chang & Cheng, 2015; Galan-Ladero et al., 2013; Kim, 2005). However, whether a specified (branded) donation recipient would have a more positive impact than a vague donation recipient in CARE has not yet been assessed and was therefore addressed in this study.

10

Donation magnitude and donation expression format have been investigated in previous CARE studies (Das et al., 2014; Chang & Liu, 2012; Chang, 2011; Chang, 2008). The results have suggested that the influence exerted by these elements often occur in interaction with other elements, but research consensus has been elusive (Chang, 2011; Chang, 2008). Also, an indication of the most suitable donation magnitude to feature in CARE has not yet been confirmed. This study acknowledges the interactive nature of donation magnitude and donation expression format and therefore explores it in conjunction with the other two CSEs that are typically communicated to consumers, namely the product and the donation recipient. The study also attempts to provide donation magnitude guidelines for CARE campaign design.

In CARE studies, researchers often focus on assessing consumer responses pertaining to aspects that exist irrespective of the CARE campaign, such as attitude toward the brand or attitude toward the cause (Lafferty & Edmondson, 2014; Ellen et al., 2000). However, few studies have focused on those aspects that exist only as a result of the campaign. These aspects include the CARE advertisement, the CARE offer and the CARE alliance. Therefore, in this study, consumer attitudes toward these attitude objects were assessed. As the acknowledgement of the importance of emotion in marketing is growing and limited research has been conducted about this construct in the CARE domain, both cognitive and affective attitude toward the CARE offer were assessed in this study. To influence affection and cognition effectively, different persuasion attempts are required (Friestad & Wright, 1994). The lack of knowledge about whether CARE appeals more to consumers’ affection or cognition makes it more difficult to develop effective persuasion attempts (Friestad & Wright, 1994).

Behavioural intentions are extensively influenced by consumer attitudes (Schiffman & Kanuk, 2015; Ajzen & Fishbein, 1977). In this study, purchase intention and participation intention were assessed. CARE studies often assess participation rather than purchase intention as an indication of consumer conation (Folse et al., 2010). However, successful CARE strategies require that consumers purchase the products and therefore participation intention may be a misguided indication of success. The similarity and differences pertaining to these two constructs have not been assessed and was thus addressed in this study.

Research about CARE in South Africa has been limited despite the potential value of the strategy and evidence of its contextual nature (Corbishley, 2014; Corbishley & Mason, 2011; Tustin & Pienaar, 2005; Engelbrecht & Du Plessis, 2004). Whether CARE results from other countries are applicable in the South African market is unclear. Likewise, South African

11

consumers’ perceptions, knowledge, opinions, attitudes and intentions pertaining to CSEs are not known, thereby hindering local effective CARE campaign design.