An assessment of strategic corporate philanthropy on perceptions of brand equity variables

Abstract

PurposeThis study aims to develop a classification schema for strategic philanthropy as a framework for empirical investigation and managerial decision making. Additionally it aims to present experimental assessments of various types of philanthropy based on the classification schema.Design/methodology/approachThis study presents the results of two experiments examining the effects of different types and implementation strategies of philanthropy on consumer perceptions of brand equity variables.FindingsThe experiments suggest that in a proactive condition corporate philanthropy does have an overall positive effect on consumer perceptions of corporate associations. However, the effects did not transfer to brand evaluations or patronage intentions. Additionally, philanthropy as a part of a recovery strategy has a consistent but non‐significant effect on consumer perceptions.Research limitations/implicationsIn the study manipulations respondents received the response at the same time as they read about the crisis. This generally would not happen in actual situations. A second limitation is the lack of control or manipulation for history between the company and the target segment in the directed philanthropy conditions.Practical implicationsThe findings of this study have three managerial implications. First, traditional philanthropy may be effective for corporate or brand image objectives, but ineffective for brand evaluation and purchase objectives. Philanthropy directed toward a particular segment may also have a positive effect on consumers beyond that segment. Finally, in cases in which the objective is simply to thwart negative publicity, reactive philanthropy may not be a viable strategic option.Originality/valueThis study examines the effects of philanthropic activity on consumer perceptions of firms and the brands they market.