Cause-related marketing and consumer behaviour in the greater eThekweni area

Cause-related marketing (CRM) is a marketing strategy in which a company’s name, brand or service is partnered with a cause or a charity. This type of link has become increasingly popular throughout the world, presenting economic and social opportunities for businesses. Various research studies in such first world countries as the United States and the United Kingdom reveal that a large proportion of consumers are responsive to CRM. One of the objectives of this study was to establish whether selected socio-demographic factors affect the evaluation of a CRM offer in the eThekweni region of South Africa. It is anticipated that, its findings will be of assistance to marketers enabling them to make a more accurate identification as to the responsiveness of various groups to a CRM strategy. A quantitative study was conducted in shopping malls, using a structured questionnaire administered via interviews. Results established that there is a relationship between socio-demographic characteristics and the evaluation of a CRM offer.


INTRODUCTION
Helping others is an impulse, recognised worldwide (Benapudi et al., 1996).Over time, the pressure on business to contribute towards non-profit causes has increased (Cui et al., 2003).Cause-related marketing (CRM) has become a popular marketing strategy used by brand managers, retailers and service companies.Shabir et al. (2009) define CRM as a "process of formulating and implementing marketing activities that are characterized by a promise of the firm to donate company resources to a worthy cause for each sold product or service, satisfying organizational and individual objectives".Charities are faced with an increasing struggle as demand for their service escalates, and government support diminishes (Alam, 2009).For these reasons, charities have had to look beyond traditional methods for support (Benapudi et al., 1996).
Various research studies conducted in such first world countries as the USA and the UK, show that many consumers would be prepared to change to brands that *Corresponding author.E-mail: karenc@dut.ac.za.Tel: +27(0)31 373 5393.Fax: +27(0)86 674 0607.
were supportive of a cause, especially if all other factors such as price and quality were seen as equal (Subrahmanyan, 2004;Till and Nowak, 2000).It has also been suggested that, consumers that differ according to socio-demographic variables such as age, gender and income, would also have varying opinions towards CRM.Meaningful research such as this has only been conducted in a few countries.Such data is not yet available for South Africa or more specifically, the eThekweni market.
Marketers often make use of demographics when segmenting markets.Demography is useful to marketers as it is easily obtainable and can usually be connected to consumer buying behaviour (Lamb et al., 2008).This article concentrates on cause-related marketing in South Africa, specifically the eThekweni (Durban) region.It focuses on the socio-demographic characteristics of participants and any possible links to their attitudes towards CRM.Cui et al. (2003) state that, marketers might find socio-demographic variables useful in identifying whether various groups would be responsive towards CRM.Furthermore, the same characteristics could be studied to establish which causes, each group would be more likely to respond to as well as whether that profile fits a particular brand.As the South African and the eThekweni consumer profile are very different to those of other countries that have already conducted some research in this field, it is believed that more localised information on this topic would be most useful for both academic and business purposes.

Background to the eThekweni region
The eThekweni municipal area is located in the province of KwaZulu-Natal, on the east coast of South Africa.This area covers 1.4% of the province's total land area, but has over a third of its population and 60% of its economic activity (eThekweni Municipality, 2004).The city has a population of more than 3 million of which, 68% are of an economically active age and 38% are under the age of 19 (South African Yearbook, 2005).The population is made up of approximately 3 million inhabitants with 60% being black, 21% Indian, 11% white and 3% coloured (Moodley, 2004).

Corporate social responsibility
Corporate social responsibility (CSR) refers to companies, recognising that they have an obligation towards a broad range of entities, such as customers, employees, suppliers, shareholders and the broader community.Kotler and Lee (2005) define CSR as the contribution of both business resources and practices towards the betterment of the general community.Many causes throughout the world look to the corporate sector for assistance because of the financial power they are believed to wield (Adkins, 2000).
Possible benefits to businesses that engage in CSR include a better reputation and greater retention and loyalty of employees (Moir, 2001).Business people recognise that their success is often linked to the well being of the community in which they operate.Corporations that have CSR as a core value often make more than purely profit driven companies in the same sector (Ali et al.,2010).Businesses that support social causes receive good publicity, as well as favourable responses from consumers.Furthermore, as time passes, consumers develop the expectation that this behaviour is normal for the business involved (Alam et al., 2010).CSR is thus becoming an important differentiator in competitive environments.As price and quality barely vary between offerings, consumers become increasingly demanding and expectant (Ali et al., 2010).

Cause related marketing
There are a number of ways in which CSR could be initiated.Kotler and Lee (2005) identified six major initiatives.

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First, cause promotions is used to describe a method in which business would provide funding, contributions and concern towards a cause.Second, corporate social marketing describes behaviour focused on behaviour change, where a campaign designed to improve a situation is implemented.A direct contribution towards a charity or cause is termed corporate philanthropy, while the involvement in adopting practices and investments that support social causes is called socially responsible business practice.Staff can be encouraged to give their time to support causes.This is described as community volunteering.Lastly, cause related marketing (CRM) is a marketing practice where a contribution is made towards a cause based on the number of sales that are generated.As a type of CSR, CRM has received particular corporate interest as it has been established that it can have a positive impact on consumer behaviour (van den Brink et al., 2006).
In a seminal study, Varadarajan and Menon (1988) identify two main objectives of CRM.One is to be of assistance towards a social cause and the other is for the benefit of the business.Berglind and Nakata (2005) described CRM as a mutually beneficial relationship.A CRM campaign is specific as it has a prescribed end date and it is for an indefinable product and charity (Kotler and Lee, 2005) and the transaction is emphasised.As a result of the consumer's behaviour, a donation is made to the cause that the company has identified (Cornwell and Coote, 2005).
To sum up, there is a connection between product sales, the raising of funds for a charity, and potential increased sales for the business with all parties benefiting (Kotler and Lee, 2005).Nelson et al. (2007) describe CRM as a 'win-win' situation as both the business and the cause benefits.Carringer (1994) believes that CRM has become a good choice for corporations as it provides a message that is unique, well targeted and effective.It is a most efficient way for companies to differentiate themselves in a highly competitive environment.

Benefits of CRM
Successful CRM initiatives can assist in attracting new customers, reach unique market segments, build sales, and build equity.Furthermore, CRM is a highly effective strategy for raising funds for worthwhile causes (Kotler and Lee, 2005).Central to a successful CRM campaign is the consumer who is demanding social responsibility from business.Consumers benefit as well from the intangible feelings associated with giving as well, the tangibles received from the product itself (Tustin and Pienaar, 2005).Finally, leaders of not-for-profit organizations are most appreciative of the flow of funds and publicity coming their way through these initiatives (Berglind and Nakata, 2005).

CRM research
Although CRM has expanded throughout the world, only a few countries have conducted meaningful research in areas involved with this topic.Some of the countries where research has been identified include, Europe, the USA, Australia, New Zealand, Mexico and the UK (Endacott, 2004).Results have established that there is a more favourable attitude towards businesses that have strategies that involve a relationship with a cause.In turn, consumer decision-making is affected by these attitudes through a more positive evaluation of the business and product (Szykman et al., 2004).
Although international research is evident on attitudes and opinions towards CRM, it was more difficult to find information on behaviour according to detailed socio-demographic standing.For example, Cui et al. (2003) stated that consumer research on CRM seldom focused on age.
Their study found that Generation Y respondents were generally positive towards CRM.This view was supported by Tustin and Pienaar (2005), who stated that, those born between 1977 and 1994 are a particularly philanthropic generation.Cui et al. (2003) went on to establish that female students had a more positive outlook on CRM than male students did.Cone Roper (1994) also found that education could be a defining factor, as those with a higher education were more likely to be positive towards CRM.Previous studies conducted by Cui et al. (2003) and Kotler and Lee (2005) suggested that, those in middle to higher income categories were more open towards CRM.Research carried out in 2001 by Cone Roper (cited in Kotler and Lee, 2005) concurred with this view stating that those in higher income categories were more receptive towards CRM.Furthermore, those who had families also seemed to make more purchases associated with CRM.A reason for this was that many in this group wished to support causes, but did not have sufficient free time to do it in any other way (Business in the Community, 2003).
Business in the Community is an organization in the UK that specializes in CSR and represents many companies.A number of research studies have been commissioned by Business in the Community in the field of CRM.Statistics revealed that, 98% of respondents in the UK and USA are aware of a CRM program, 83% of respondents had been involved in a CRM program and 48% of consumers had responded to a CRM programme by adjusting their purchasing behaviour (Catalyst, 2006).Catalyst (2006) established that, 82% of the population in general had been involved in CRM during the previous year.
The amount was even more for the 35 to 44 year old age group (89%) and 94% for those who were members of a household with children.

CRM in South Africa
There is not a lot of information on consumer opinions and attitudes toward CRM in South Africa.A study was commissioned by Nedbank (one of the major banking groups) in 2002, that established five top causes that South African consumers prefer business to support.These were (in descending order); crime/personal safety, poverty, HIV/Aids, unemployment and the economy.However, it provided no data on attitudes and opinions towards brands that were involved with CRM (Endacott, 2004).
Most major fast-moving consumer goods companies in South Africa are aware of CRM, but many of them still have their doubts about how to action CRM, in order for it to be beneficial to all.There is a perception by a number of businesses in South Africa that charities are not always accountable for the funds that they receive (Tustin and Pienaar, 2005).Nevertheless, investors (both locally and abroad) are placing increasing pressure on businesses to be involved in good causes.Therefore, CRM is one of the ways in which South African businesses and stakeholders can demonstrate their commitment towards social responsibility (Tustin and Pienaar, 2005).
It has been established that knowledge of CRM in South Africa is limited.Therefore, this paper attempts to provide marketers with additional information on the relationship between causes and socio-demographic factors.In order to meet this objective, a relationship between socio-demographic characteristics and the evaluation of a CRM offer, has been hypothesised.It has also been hypothesised that, eThekweni consumers would be more likely to switch brands to one that is involved with CRM, given equal price and quality.

METHODS
The study was cross-sectional and made use of a quantitative methodology.The setting was non-contrived and minimal interference was made in the participant's normal pattern of life.Non-probability sampling; quota sampling was used to select respondents (Cooper and Schindler, 2001).The relevant control dimensions are given in Table 1.The age divisions were based on generations that are recognised as potential market segments.Generation Y (or Generation next) -born between 1977and 1994, Generation X -born between 1965and 1976, Baby Boomers -born between 1946and 1964, and the elderly or 'grey' market -elderly baby boomers and those born before 1946 (Lamb et al., 2008).Controls to guide final selection were 200 per category for gender and 50 per category for other variables.
Specific respondents were chosen via systematic sampling, which involved the selection of individuals as they entered the shopping centre, according to a predetermined number sequence.The number sequence was chosen according to a random element between 1 and 10 (Leedy, 1993).
For populations from 75 000 to one million, a sample of between 382 and 384 should be used (Cavana et al., 2001).Therefore, a sample of 400 was selected, but because of spoiled questionnaires, the final number used in the analysis was 391.To collect the empirical data, a survey was conducted.The data was gathered through the use of questionnaires administered during mall intercepts at, The Pavilion (a large regional mall that draws clientele from throughout the region) and The Workshop (a smaller mall in the city centre).A number of students were trained to conduct the Post-graduate interviews.
The questionnaire was derived from literature, highlighting research conducted elsewhere in the world, predominantly Business in the Community studies (2002 and2003) and the article written by Cui et al. (2003).The data was analysed and shown in the form of frequency tabulations and cross tabulations and the appropriate significance tests were applied.The Statistical Package for the Social Sciences (SPSS) Version 13.0 was used to analyse the data.

RESULTS
The demographics of the sample are shown in Table 2.This study concentrated on seven socio-demographic variables: Age, gender, income and education as in Table 2, plus marital status, and children (stage of the family life cycle).It was difficult to obtain sufficient respondents in some sub-sections of education, so, these results were interpreted with care.

Univariate analysis
A number of opinions and attitudes were identified in this section.These did not pertain to socio-demographics, but were nevertheless useful to know.Chi square goodnessof-fit testing was carried out on all questions.The 0.05 level of significance was used.Significant findings were that, 94% of respondents believed that it was important for businesses to spend money on charities, and 88% agreed that a business that practiced CRM had a better image.Sixty-nine percent of respondents stated that they had purchased a CRM product, but 25% could not recall whether they had purchased a CRM product.Twenty-four percent of respondents felt that CRM would not influence their purchase decision, whereas, 76% of respondents stated that they would choose to buy from a retailer that practiced CRM.A high percentage (87%) of respondents agreed that they were happy to support CRM initiatives as such initiatives provided them with an opportunity to support deserving causes, with 65% of respondents preferring CRM to putting money in a collection box.Many of the respondents (64%) said that they were short of time and so a CRM project enabled them to contribute towards a cause without using too much time.However, 76% of the respondents indicated that they had already participated in some activity to raise funds for charity.

Bivariate analysis
The main objective of this research was to establish whether socio-demographic variables have an affect on various opinions and attitudes towards CRM.To assess this, cross tabulations of two variables was conducted.The chi-square test of dependence was applied to most questions.When conditions were not met, a Fisher's exact test was carried out.Exact tests provide a way of obtaining accurate results when the data fails to meet the underlying assumptions necessary for reliable results using the standard asymptotic method.
Opinions and attitudes towards CRM were crosstabulated against the socio-demographic variables identified in the study.It was found that more females than males agreed that it was important for businesses to spend money on charities.When it came to the purchase of a CRM product, significant links were found between education, gender, marital status, children and income.Those who recalled purchasing a CRM product were more likely to be highly educated, female, married, had older children and earned a higher income than average.Results are illustrated in Table 3.
Analysis shows that respondents who have very little education and earn a lower income were more likely not to be aware of whether they have purchased a CRM product.A higher proportion of males also indicated that they "did not know".These results could be useful in that, they show that there are groups that would be less responsive to a CRM offer.However, they might be more likely to respond if they are better educated as to the nature of CRM.This has implications for marketing communications by businesses practicing CRM.These results are shown in Table 4.
Respondents were requested to select between a retailer that supported CRM and any other retailer, given that the product was equal in quality and price and the retailer was accessible.Only one socio-demographic variable showed significance (p = 0.18 <. 05) with this question, and that was age.More elderly people (> 60 age group), were found to respond positively to retailers who support causes.One might question whether the elderly have more time to be more selective in their choice of retailer.
This study established that there is a relationship between socio-demographic characteristics, such as, age, income, gender, education, marital status and age of children and the evaluation of the CRM offer.

DISCUSSION
The overall objective of this study was to gain an understanding of consumer behaviour towards companies using CRM in the greater eThekweni region.Results gathered in the eThekweni area were similar to those from elsewhere in the world, despite different lifestyles and socio-demographics.
Of the respondents that were interviewed, 94% agreed that it was important for businesses to spend money on charities.The number of respondents that had recalled purchasing a CRM product amounted to 69%, which was a little lower than previous international results.This could be attributed to the fact that CRM is not yet common in South Africa and a number of respondents had to have the concept explained to them.They also could be a link with perceptions that charities in South Africa are not all professionally managed (Tustin and Pienaar, 2005).In a similar result to those gained else-where in the world, 88% of respondents agreed that a business would have a better image if they were seen to be supporting a cause in some way.
It was interesting to observe that 76% of respondents indicated that they had participated in some activity to raise funds for charity.This figure is substantially higher than the figures of 21 and 35% obtained by Business in the Community (2003).A possible explanation for this could be the highly visible needs in the eThekweni region and the rest of South Africa.
Where these results did correspond to some extent with the international results was that, 58% of the respondents claimed that they did not get involved with charity because of time pressure problems.Despite the similarity, the international figures were higher.A possible explanation for this is that those residing in first-world countries such as the UK or USA might be more aware of time-pressure than those in an emerging economy such as South Africa.Less than the international figures, but still quite high, 64% of respondents agreed that getting involved with a CRM purchase was a time-saving exercise, in that they could support a charity by purchasing a product, rather than having to go out and make an active contribution.
Cross-tabulations were carried out in order to establish whether any socio-demographic variables were related to opinions and attitudes towards CRM.It was found to be significant that females were more positive about the importance of business, spending money on charities.Regarding level of education, there was a more positive relationship between respondents with degrees and the purchase of a product linked with CRM than those who had less education.It was also established that married people were more likely to have purchased a CRM product.Fewer single people had purchased a CRM product.
However, parents of smaller children (under 12) are not as aware whether they have purchased a CRM product or not.Fewer parents of young children recalled purchasing a CRM product.When it came to age, the younger age group (12 to 29) disagreed with the suggestion that a business would have a better image if it supported a CRM product.In contrast, older people (> 60 age group) were more positive towards supporting a retailer who supported a cause.Regarding income, fewer people in the lowest income group recalled purchasing a product linked with CRM, compared to those in the higher income groups.
It was interesting to observe that many of the results above were similar to those from studies conducted elsewhere in the world.Areas in agreement with previous findings include the finding that females are more responsive towards CRM than males.Furthermore, there is agreement that those that are better educated (university level qualifications) and are in a higher income group are also more positive towards CRM.
Married people seem to be more positive towards CRM, although, those with small children do not seem to recall purchasing a CRM product as much as would be expected.A possible reason could be that a mother of small children might be more preoccupied with other things when shopping than those with older children.The lack of time that parents of small children seem to experience could be a possible explanation for this situation.
The one area that did not appear to give similar results to previous research was that of age.Younger respondents did not appear to be impressed by a business that was practicing CRM, whereas among those over the age of 60, a more than expected number would support a retailer that practised CRM.This could possibly be explained by the fact that this generation has grown up in a media-saturated environment and is very aware of marketing hype (Schiffman and Kanuk, 2004).They are generally seen as sceptical of the media.A suggestion would be that, if businesses selected a cause to support that this generation identified with, the response might be different.

IMPLICATIONS FOR MARKETERS
Marketers should find this research useful for a number of reasons.Firstly, it would of interest to the local marketer to have confirmation that the consumers in the eThekweni area are supportive of CRM.It means that, this is a valid form of marketing that is not only acceptable to the consumer, but actually improves the image of the business in the eyes of most consumers.Consumers also indicated that they would actually be prepared to change brands to one that is supporting a cause that they cared about.There is still a small proportion of consumers that views this form of marketing with some scepticism as to the motives of the business, but they are in the minority.For the academic, this research has contributed to the body of knowledge on CRM.Information on attitudes and opinions towards CRM has added to that of previous studies.

LIMITATIONS
When bi-variate analysis is conducted, the cross tabulation, results in a table of many more cells than that with uni-variate analysis.Because of this, some cell frequencies could be quite small, and therefore, the precision of estimates within cells could be less than those obtained in a uni-variate analysis.For this reason, analysis was conducted with care and significance tests including a Fisher's exact test that was carried out when cell numbers did not meet the required conditions.
Furthermore, questions that have an element of prestige or adherence to social norms can typically result in an upward response bias (Kinnear and Taylor, 1991).It could be said that questions related to charitable support and giving, could be seen in this light.This is unavoidable and it is impossible to know if, and when it occurs, and therefore, it should be borne in mind when interpreting results.
Findings are limited to eThekweni and should therefore be generalised to the rest of South Africa with care.

RECOMMENDATIONS
This study could be expanded by gathering information on a wider scale.For economical reasons, only the eThekweni region was used.Research could therefore be expanded to encompass the whole of South Africa, which would provide marketers with information to guide national, rather than just regional, marketing.
Further studies could also incorporate a number of additional socio-demographic variables, and even psychographics.It has also been observed that not much research has been carried out to examine CRM from the cause's point of view.This could be an important angle to provide charity marketers with helpful information on which to base their marketing strategies when seeking to form alliances with the corporate sector.

Table 2 .
Socio-demographics of the sample.

Table 3 .
Demographics and purchase of a CRM product.

Table 4 .
Demographics and lack of knowledge of a CRM purchase.