Corporate Social Responsibility as a Sustainable Business Practice: A Study among Generation Z Customers of Indian Luxury Hotels

Abstract

Corporate Social Responsibility (CSR) has attained great interest among academicians and practitioners alike. However, the underlying mechanisms and theoretical boundaries that amplify customers’ willingness to pay a higher price towards environmentally conscious hotel brands is under researched. Thus, to accelerate this discourse, the current study explores the relationship between perceived CSR, green image of a hotel brand, and customers’ willingness to pay a higher price. Drawing insights from the stakeholder theory, this study proposes a model and empirically validates how a positive CSR perception helps Generation Z customers perceive a green image of the company and drive positive responses like willingness to pay higher price towards socially responsible luxury hotels. The study further examines the moderating role of gender on the proposed relationships. Data collected from 302 Gen Z customers from 4 and 5 star (luxury) hotels in the capital city of India were analyzed through structural equation modelling. The results of this study confirm the significant direct impacts of perceived CSR on green image of a hotel brand as well as customers’ willingness to pay higher price. Moreover, the study also demonstrates the significant positive effect of perceived CSR on customers’ willingness to pay higher price. The results also confirm the moderating influence of gender on the proposed relationships. This study has important implication for managers of luxury hotels.