The impact of cause-related marketing on store switching: An analysis of the chain convenience stores in Taiwan

Abstract

Corporate Social Responsibility (CSR) has long been a concern of large corporations. Small Taiwanese convenience store chains have recently joined larger firms in regard to embracing CSR. This study examines the acceptance by customers of cause-related marketing (CRM) as a component of CSR, as practiced by convenience stores in Taiwan. Our results indicate that Taiwanese consumers believe that convenience stores engaging in CRM do so for the dual motives of altruism and self-interest. As a result, our results suggest that Taiwanese evaluate CRM less positively than past research suggests is true. We find that Taiwanese consumers tend to suspect the motives of stores when price trade-off is higher than the donation. In such price trade-off situations, CRM strategy has a limited effect on strengthening store loyalty. Conversely, when the donation is higher than the price trade-off, CRM strategy can boost store loyalty. In the latter case, CRM is an efficient way for Taiwanese retailers to increase market share. The managerial implications of this study are as follows. First, CRM may be regarded as a useful marketing/promotional strategy. Second, use of a CRM program may encourage customers to switch to stores engaging in CRM. Third, the amount of donation should not be lower than the price difference between the stores with and without CRM.