Familiarity and format: cause-related marketing promotions in international markets

Abstract

PurposeThe purpose of this paper is to demonstrate cause-related marketing (CRM) promotions as a brand-oriented international market entry strategy that can leverage an unfamiliar brand in a new international market. One of the challenges CRM promotions face is skepticism toward the campaign and for that reason, many brands form alliances with well-known charities familiar to the consumer, hoping that the trust and goodwill generated by the charity will be transferred to the brand. The authors manipulate price and donation presentation formats to show an alternative means for overcoming skepticism.Design/methodology/approachThe research is undertaken in two studies. Study 1 uses a sample collected on Amazon’s MTurk, whereas study 2 is undertaken in the real world with participants from Norway. Analysis of variance and partial least square are, respectively, used to test the hypotheses.FindingsThe first study shows that presenting the donation explicitly vis-à-vis the price makes a less familiar charity produce the same trustworthy effects as that a well-known one does. Moreover, the second study shows that it strengthens utility from the transaction and weakens skepticism of CRM promotions to impact brand evaluations.Research limitations/implicationsThe primary focus of the research was consumers’ familiarity with the charity but other variables could have a significant impact in judgments. For instance, the importance consumers attach to the cause that the charity supports, spatial distance of the brand and charity, brand familiarity. Manipulating these in future studies would not only contribute to the CRM literature but also to that of international marketing.Practical implicationsFirms in international markets can derive competitive advantages with the help of CRM campaigns. Moreover, alliances with familiar charities that are local can help combat nationalistic feelings prevalent in many markets. The separated presentation format can also help overcome some of the additional skepticism found in international markets.Social implicationsThe findings support the Better Business Bureau’s Standards for Charity Accountability that seek transparency in communicating CRM promotions. The explicit presentation of price and donation, in addition to providing this transparency, also gives consumers a clear understanding of the CRM promotions’ details, which will increase their self-efficacy in making more informed decisions.Originality/valueThis research contributes to strengthening knowledge on donation-price formats, offers brands entering international markets a singular way of gaining credibility and competitive advantage, and empirically confirms the proposed outcomes of a theoretical model for promotions.