Direct and Indirect Effects of CSR on Customer Reactions: PLS SEM Approach

Abstract

Purpose- Study aims at finding the Direct Effects of Corporate Social Responsibility (CSR) on Customer Satisfaction, Trust and Loyalty, together called as Customer Reactions (CR) and Indirect effects via Retailer Personality (RP). Design/methodology/approach- A Food and Grocery Retail customer intercept survey was conducted with sample size 410. Links were identified followed by development of a conceptual model. EFA was conducted through SPSS (23v) and CFA through Smart PLS (3.2.7v). Structural Equation Modeling was used to test the hypotheses. Findings- It was found that perceived CSR Policy of the retailer shown a direct effect on Retailer Personlaity but shown no direct effect on CR whereas CSR Policy exhibited varied indirect effects on CR via RP. Research limitations/implications- Deficient resources led to the lacking of generalizability of research outcomes. The present research was based on Retail Service Quality Scale in Indian context, though by adopting other scales, results may vary in different cultural settings. Practical implications- Improved CSR Policy of the retailer can have a favorable indirect effect on CR via Retailer Personality. Retailer can mould the CSR Policy to enhance CR. Originality/value- Study endeavored to create a holistic view of the effects of CSR Policy on CR. Relationships among all variables give originality to the study which has never been studied in Indian context.