Cause related marketing in the automotive industry
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Cause related marketing in the
automotive industry
Bachelor Thesis
to graduate as BACHELOR OF A RTS (B.A.)
presented to the Department of Business and Economics
German-British study program I NTERNATIONAL B USINESS (IBU)
1st examiner: Prof. Dr. Andrea Rumler
2nd examiner: Prof. Dr. Andrea Plinke
Melanie Engelhardt
Matriculation number: 283665
Am Sagisdorfer Park 28, 06116 Halle (Saale)
engelhardt.melanie@gmail.com
Berlin, August 13, 2013Contents
List of Figures II
List of Tables II
Abbreviations IV
1 Introduction 1
1.1 Problem definition and objectives . . . . . . . . . . . . . . . . . . . 1
1.2 Structure of the thesis . . . . . . . . . . . . . . . . . . . . . . . . . 3
2 Cause related marketing 4
2.1 Conceptual framework . . . . . . . . . . . . . . . . . . . . . . . . 4
2.1.1 Defining cause related marketing . . . . . . . . . . . . . . . 4
2.1.2 Classification of cause related marketing in the context of
corporate social responsibility and the marketing mix . . . . 8
2.2 History of cause related marketing . . . . . . . . . . . . . . . . . . 11
2.3 Managerial objectives and restrictions of cause related marketing . . 14
2.4 Cause related marketing and consumer behavior . . . . . . . . . . . 17
3 Empirical study concerning cause related marketing in the automotive
industry 20
3.1 Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3.2 Results of the empricial study in the automotive industry . . . . . . 22
3.3 Analysis of the results . . . . . . . . . . . . . . . . . . . . . . . . 27
4 Comparison and conclusions 30
4.1 Frequency of cause related marketing in other industries . . . . . . 30
4.2 Discussion on the potentials of CrM for the automotive industry . . 32
5 Summary and future prospects 35
Bibliography 36
Appendix 50
Eidesstattliche Erklärung 69
IList of Figures
3.1 Turnover of the eight largest car manufacturers in 2012 and 2011 . . 21
4.1 Frequency of CrM in different industries in Germany . . . . . . . . 31
List of Tables
2.1 Terminology and typology classification of CRM . . . . . . . . . . 7
3.1 Results of the empirical study: Campaigns classified as CrM . . . . 28
B.1 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Toyota USA . . . . . . . . . . . . . . . . . . . 54
B.2 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Toyota Germany . . . . . . . . . . . . . . . . . 54
B.3 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of VW USA . . . . . . . . . . . . . . . . . . . . . 55
B.4 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of VW Germany . . . . . . . . . . . . . . . . . . . 57
B.5 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of GM USA . . . . . . . . . . . . . . . . . . . . . 58
B.6 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of GM Germany . . . . . . . . . . . . . . . . . . . 58
B.7 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Daimler USA . . . . . . . . . . . . . . . . . . . 59
B.8 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Daimler in Germany . . . . . . . . . . . . . . . 60
IIList of Tables III
B.9 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Ford USA . . . . . . . . . . . . . . . . . . . . . 62
B.10 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Ford Germany . . . . . . . . . . . . . . . . . . 63
B.11 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Honda in the USA . . . . . . . . . . . . . . . . 64
B.12 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Honda in Germany . . . . . . . . . . . . . . . . 65
B.13 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of Nissan in the USA . . . . . . . . . . . . . . . . 66
B.14 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of BMW in the USA . . . . . . . . . . . . . . . . 67
B.15 Result of desk research concerning business-nonprofit alliances and
CSR campaigns of BMW in Germany . . . . . . . . . . . . . . . . 68Abbreviations
AG Aktiengesellschaft (stock corporation)
BMW Bayerische Motoren Werke
CrM cause related marketing
CSR corporate social responsibility
e.g. exempli gratia (for example)
et al. et alii (and others)
et seq. et sequens (and the following page)
GM General Motors
NABU Naturschutzbund Deutschland (German Nature and
Biodiversity Conservation Union)
NPO nonprofit organization
UNESCO United Nations Educational, Scientific and Cultural Or-
ganization
p. page
pp. pages
USA United States of America
US American
UWG Gesetz gegen den unlauteren Wettbewerb (German Act
Against Unfair Competition)
VW Volkswagen
WWF World Wildlife Fund
IV1 Introduction
The following introduction provides the reader with an outline of the motivation to
conduct this research on cause related marketing, and presents the objectives and the
structure of this thesis.
1.1 Problem definition and objectives
In the last decade, the trend of corporate philanthropy, socially responsible initiatives
and the implementation of giving into a corporate strategy has obviously accelerated
(see Kotler and Lee, 2005, p. 4). Summarized by the term “corporate social re-
sponsibility (CSR)”, companies take more and more responsibility for value-adding
processes, their products and services (see Chapter 2.1.2 for an exact definition of
CSR). There are various reasons for this kind of social consciousness. In a mature
market, where products are similar in quality, price and service, this corporate be-
havior provides an opportunity to stand out from competitors and distinguish a brand
or product from competitors’ brands and products (see Baumgarth, 2008, pp. 10-13;
Oloko, 2011, p. 21; Roos, 2012, p. 1). The competition has clearly increased by the
ongoing globalization and the further development of communication technologies
like the internet (see Oloko, 2011, p. 20 et seq.). A great potential for success is seen
in the conjunction of brands with emotions, which, among others, can be reached by
CSR (see Meffert et al., 2012, p. 113; Oloko, 2011, p. 21).
Moreover, customers’ behavior has changed within the last years (see Roos, 2012,
p. 1). Customers worldwide demand to know where products come from, how they
are being produced and what a company does to improve sustainability and social
circumstances along the supply chain (see Oloko, 2011, p. 19). Due to globalization
and global networking, the public uncovers and denounces inappropriate corporate
behavior (see Oloko, 2011, p. 20). Also, research suggests that consumers use their
purchasing power to reward or punish companies based on their responsible or irre-
11.1 Problem definition and objectives 2
sponsible behavior (see Roos, 2012, p. 2; Westberg and Pope, 2012, p. 1).
Next to the aim of showing their social responsibility, companies mainly want to
maximize profits. Indeed, those two objectives are compatible, because only a prof-
itable business can invest in CSR (see Oloko, 2011, p. 21). Studies even show that
corporate charity contributions can enhance revenue growth (see Falck and Heblich,
2007; Lev et al., 2010).
One of the most effective ways for companies to invest in society and combine
this responsible behavior with maximizing profits and the differentiation of products
is cause related marketing (CrM)1 (see Lewis, 2003, p. 26). It links a donation to a
purchase and can directly influence the purchase decision of customers (see Roos,
2012, p. 2). CrM is often described as a triple win situation, because the company,
the society and the customer can benefit from it (see Huber et al., 2008, p. 2; Oloko,
2011, p. 22). In most cases, the society is represented by a nonprofit organization
(NPO) that supports a good cause.
CrM is a very popular marketing tool, especially in the USA. That is why the will-
ingness to support social causes is much higher, due to the fact that here the social
welfare state is just providing a low level of security (see Roos, 2012, p. 3). Mean-
while, CrM has recently gotten more popular in Germany, too. It has a great growth
potential because it is a fairly new instrument in Germany. All this justifies the inves-
tigation of CrM in this thesis. According to O LOKO the instrument is most common
in the food sector (see Oloko, 2008, p. 34). However, there is no research concerning
the use of CrM in the automotive industry being a highly competitive market. Ac-
cordingly, the goal of this thesis is to examine whether or not the instrument is used
in the automotive industry in Germany and the USA and how widespread it is. In
this context, the automotive industry includes the car manufacturers and at rare in-
tervals their company-owned dealerships and service centers. In this thesis, the topic
is described and evaluated from a business perspective, not from a customer or NPO
perspective.
1
In this thesis the acronym CrM with a small “r” is used for the term “cause related marketing” to
prevent a confusion with the acronym used for the term “customer relationship management”1.2 Structure of the thesis 3
The research is aimed at answering the following questions:
1.) Is CrM in widespread use in the automotive industry?
2.) Is CrM a more common instrument in the US American than in the German
automotive sector?
3.) How is CrM used in the automotive industry?
4.) Is there untapped potential for the automotive industry in the use of CrM?
1.2 Structure of the thesis
Based on the objectives defined above, the thesis is divided into three main chapters
and framed by this introduction and a brief summary at the end.
First of all, the background of CrM is thoroughly explained in Chapter 2. This in-
cludes the conceptual framework (Chapter 2.1) where a definition of CrM is given in
Section 2.1.1, and the instrument CrM is distinguished from other CSR instruments
and marketing tools in Section 2.1.2. Furthermore, the history and development of
CrM is described in Chapter 2.2, focusing on the USA, Great Britain and Germany.
Chapter 2.3 contains the objectives for companies to engage in CrM and reveals
some restrictions of this instrument. The theoretical part is completed with a brief
comment on the influence CrM can have on consumer behavior in Chapter 2.4.
Subsequently, Chapter 3 illustrates the empirical research of this thesis concerning
the automotive industry. The methodology of the study is explained in Chapter 3.1,
followed by the description and classification of several campaigns in Chapter 3.2.
In this context, emphasis is placed on the eight biggest car manufacturers in matters
of turnover. The results are summarized and commented on in Chapter 3.3, which
also contains the hypotheses testing.
Chapter 4 focuses on the implications the study has for the automotive industry.
After briefly commenting on the frequency of CrM in other industries in Chapter 4.1,
the potentials CrM could have for the automotive industry are discussed in detail in
Chapter 4.2.2 Cause related marketing
The following chapter is going to clarify the terms relevant for this thesis, and it pro-
vides background information concerning the topic of cause related marketing. First,
the term “cause related marketing” is defined and distinguished from corporate social
responsibility and other marketing instruments in Chapter 2.1, before the history of
CrM is shortly described in Chapter 2.2. Furthermore, Chapter 2.3 is focusing on a
selection of managerial objectives and restrictions behind CrM, whereas Chapter 2.4
comments on the influence CrM can have on consumer behavior.
2.1 Conceptual framework
2.1.1 Defining cause related marketing
Considering the variety of definitions concerning cause related marketing, two ap-
proaches are described in the literature, a narrow one and a broad one (see Oloko,
2011, p. 35; Roos, 2012, p. 11). In 1988, VARADARAJAN and M ENON defined CrM
in an article of the Journal of Marketing as follows:
“Cause-related marketing is the process of formulating and implement-
ing marketing activities that are characterized by an offer from the firm
to contribute a specified amount to a designated cause when customers
engage in revenue-providing exchanges that satisfy organizational and
individual objectives” (Varadarajan and Menon, 1988, p. 60).
This definition is considered to represent the narrow approach, because it ties CrM
to a purchase. For VARADARAJAN and M ENON, CrM is transaction based and the
customer is triggering the CrM donation by purchasing a product or service (see
Varadarajan and Menon, 1988, pp. 59 et seq.; Oloko, 2011, p. 35). Thus, the CrM
campaign is of a certain benefit for the company and the cause as well as the con-
sumer.
42.1 Conceptual framework 5
G UPTA and P IRSCH criticized the limitation concerning the objectives in that def-
inition (see Oloko, 2011, p. 35). They further developed the narrow definition of
CrM, now including the benefit of CrM for all company stakeholders:
“Cause-related marketing is the process of formulating and implement-
ing marketing activities that are characterized by an offer from the firm
to contribute a specified amount to a designated cause when customers
engage in revenue-providing exchanges to induce favorable responses
from all company stakeholders (e.g. investors, suppliers, employees, cus-
tomers) which in turn satisfy organizational and individual objectives”
(Gupta and Pirsch, 2006, p. 39).
Another slightly simpler narrow definition was suggested by Y ECHIAM et al. It
focuses on the promotion effect that companies aim at with CrM campaigns:
“In cause-related marketing (C[r]M) a product is promoted by the infor-
mation that part of the payment for the product will be donated to some
cause” (Yechiam et al., 2002, p. 321).
There are more narrow definitions found in the literature which are not or only
slightly different from the above mentioned definitions with regards to content.
The broad approach of CrM definitions is not necessarily presuming a transaction.
A common example is the broad definition by A DKINS. She defined cause related
marketing as:
“[A] commercial activity by which businesses and charities or causes
form a partnership with each other to market an image, product or ser-
vice for mutual benefit” (Adkins, 1999, p. 11).
In that context, CrM includes all forms of commercial collaboration between a non-
profit organization and a company.
Another broad definition is that given by A DLER:
“C[r]M is a strategy employed to build a better relationship with a com-
pany’s core customers through a cooperative effort with a charitable
organization that shares the company’s customer base” (Adler, 2006,
p. 5).2.1 Conceptual framework 6 This definition focuses mainly on the aims and effects CrM has and again does not emphasize the necessity of a transaction to generate a donation. Like A DKINS, A DLER does not even include a donation in his definition, but talks about the co- operation between business and NPO. In line with broad definitions A NDREASEN distinguishes between three forms of CrM alliances. The most common form is the transaction-based promotion (see An- dreasen, 1996, p. 49). A specific amount of money, food or equipment is donated to one or more NPOs in direct proportion to sales revenue (see Andreasen, 1996, p. 49). One example for a transaction-based promotion is the campaign of the mail- order business OTTO in Germany that donated 10 e to the Aid by Trade Foundation for each garment sold of their Youth Against Labels collection (see Oloko, 2011, p. 365). Another form of cause related marketing alliance is the joint issue pro- motion (see Andreasen, 1996, p. 49). In this kind of partnership, a company and one or more NPOs are jointly trying to cope with a social problem. There is not necessarily money passed between the partners, but the business is helping to in- crease awareness, e.g. through advertising or promotional materials (see Andreasen, 1996, p. 49). An example for joint issue promotions is “Hand in Hand”, a program by the Glamour magazine and Hanes Hosiery with the National Cancer Institute, the American College of Obstetricians and Gynecologists and the American Health Foundation to increase women’s information about breast cancer by distributing and advertising educational material (see Wymer and Samu, 2013, p. 13). The third form of CrM alliance is licensing. Here, the NPO provides the company with its name and logo for a specified fee (see Andreasen, 1996, p. 50). The cooperation of the World Wildlife Fund (WWF) with the company Uniross, that used the WWF logo for a battery brand, is an example for that kind of alliance (see Oloko, 2011, p. 36). Both, the joint issue promotion and licensing are not transaction based. Therefore, E LLEN et al. combine those two under the term “cause marketing”, whereas cause related marketing in its narrow sense and the transaction-based promotion are con- sidered to be identical (see Ellen et al., 2000, p. 405). W YMER and S AMU used the broader generic term “business-nonprofit alliances” that includes cause related mar- keting and the cause marketing forms as well as corporate foundations, sponsoring, joint ventures and corporate philanthropy (see Appendix A for definitions). For a
2.1 Conceptual framework 7
Terminology Typology
CRM
Cause Marketing
Transaction-Based Promotion
Business-Nonprofit Alliance
Joint Issue Promotion
Licensing
Joint Venture
Corporate Philanthropy
Corporate Foundation
Sponsorship
Table 2.1: Terminology and typology classification of CRM (adapted from Oloko,
2011, p. 38)
general overview see Table 2.1.
There are still more definitions found in the literature concerning narrow and broad
approaches of CrM than described above. However, those cannot contribute to this
thesis. The most commonly used definition is that of VARADARAJAN and M ENON.
It will be the basis for this thesis, because it clearly separates the term from other
corporate social responsibility and marketing tools (see Chapter 2.1.2).
According to KOTLER and L EE a company can engage in CrM by donating a spec-
ified amount of money for each product sold, a specified amount of money for every
application or account opened, a percentage of the sales of a product or transaction,
a particular share of the sale of an item, a percentage of net profits from sales of a
product, or the company can match the contributions made by consumers in relation
to a product-related item (see Kotler and Lee, 2005, pp. 83 et seq.). In that context,
the offer can be for a specific product or for multiple or all products of a line or brand
(see Kotler and Lee, 2005, p. 84). Furthermore, the campaign can be open-ended or
last for a particular span of time (see Kotler and Lee, 2005, p. 84; Varadarajan and
Menon, 1988, pp. 63 et seq.). A company can also decide to determine a minimum
or/and maximum amount of donation (see Kotler and Lee, 2005, p. 84; Oloko, 2011,2.1 Conceptual framework 8
p. 73). In addition to the definition of CrM, the above mentioned statements are
considered basic principles for this thesis.
2.1.2 Classification of cause related marketing in the context of corporate
social responsibility and the marketing mix
Cause related marketing can be seen as an instrument of corporate social responsi-
bility (see Lewis, 2003, p. 32; Lii and Lee, 2012, p. 71; Oloko, 2011, p. 50; Roos,
2012, p. 19). According to KOTLER and L EE, CSR is
“a commitment to improve community well-being through discretionary
business practices and contributions of corporate resources” (Kotler
and Lee, 2005, p. 3).
Further, it is considered to have three pillars: an economic, an ecological and a social
pillar (see Roos, 2012, p. 16). A company acting socially responsibly is commit-
ted to each of the pillars well over the legal requirements (see Lii and Lee, 2012,
p. 69; Roos, 2012, p. 16). Of course, the three pillars can be at odds with each other,
but only a profitable organization can afford to operate in accordance with CSR (see
Roos, 2012, p. 17). Another term often used in regard to entrepreneurial responsibil-
ity is “corporate citizenship” (see Oloko, 2011, pp. 50-52; Roos, 2012, p. 16). Within
the purpose of this thesis both terms are synonymously referred to as CSR, and ac-
tivities undertaken by a company to fulfill commitments to CSR are called corporate
social initiatives.
CrM is part of the overall CSR concept and serves its implementation (see Van den
Brink et al., 2006, p. 15; Bronn and Vrioni, 2001, p. 214; Chang and Liu, 2012,
p. 635). It is distinct from other corporate social initiatives such as, for example,
cause promotion, corporate social marketing, corporate philanthropy, community
volunteering or socially responsible business practices, as the corporate contribution
is depending on customer actions and there is a link to product sales (see Kotler and
Lee, 2005, p. 82). Furthermore, the necessary agreements are usually more formal
than in other CSR campaigns and the coordination with the NPO is an essential issue
(see Kotler and Lee, 2005, p. 82). CrM also involves more promotion, often in form
of paid advertising, since there are economic benefits targeted (see Kotler and Lee,2.1 Conceptual framework 9 2005, p. 82; Wymer and Samu, 2013, p. 13). Corporate philanthropy, often referred to as corporate or charitable giving, is very similar to CrM, so the question arises if CrM is an independent tool of CSR (see Oloko, 2011, p. 51; Roos, 2012, p. 19). Corporate philanthropy is defined as “direct contribution to a charity or cause” made by a corporation usually in form of dona- tions, cash grants or non-cash contributions (see Kotler and Lee, 2005, pp. 23 et seq.). However, it does not involve a compensation for the giving corporation as CrM gen- erally does, for example, in terms of license agreements (see Oloko, 2011, p. 51). Consequently, corporate giving can implicate tax benefits. It is not linked to product sales, so the purchase does not influence the donation (see Oloko, 2011, p. 52). The main thing is that CrM campaigns are usually funded and managed by the marketing department of a company whereas charitable giving is coming from a budget for so- cial matters (see Andreasen, 1996, p. 48; Kotler and Lee, 2005, p. 82; Oloko, 2011, p. 52). As mentioned above, CrM campaigns involve many different communication instruments while corporate giving is not communicated at all or just via public re- lations (see Oloko, 2011, p. 52). Thus, CrM can be qualified as an independent CSR tool. Besides the classification of CrM in the CSR context, it is also attributed to the marketing mix (see File and Prince, 1998, p. 1530; Meffert and Holzberg, 2009, p. 49; Oloko, 2011, pp. 46-49; Roos, 2012, pp. 18 et seq.). Within the instruments of communication policy, CrM is very similar to sales promotion and could be seen as a special form of it (see Adkins, 1999, pp. 116 et seq.; Oloko, 2011, pp. 46- 48). However, VARADARAJAN and M ENON describe CrM as a separate marketing instrument (see Varadarajan and Menon, 1988). The typical sales promotion offers a financial advantage to the customer, mostly in the form of price discounts, but the CrM campaign can offer an additional moral benefit (see Oloko, 2011, p. 46; Strahilevitz and Myers, 1998, p. 445) (see Chapter 2.4 for details). Therefore, CrM has to be distinguished from the classic sales promotion. Another instrument of communication policy related to CrM is sponsoring (see Oloko, 2011, p. 47; Roos, 2012, pp. 19-21). Both CrM and sponsoring are activities by which a firm wants to benefit from a positive image transfer through the conjunc- tion with another organization (see Westberg and Pope, 2012, p. 3). In addition, both
2.1 Conceptual framework 10 instruments include a service in return for the company’s efforts and the beneficiaries are often social or ecological institutions (see Oloko, 2011, p. 47). With sponsoring as well as CrM a company pursues communicative objectives, because it generally assumes social responsibility (see Polonsky and Speed, 2001, p. 1365). The main dif- ference is the determination of the contribution level. The donated amount of a CrM campaign depends on product sales (although sometimes a minimum or maximum is defined), whereas the donated amount of a sponsorship is determined beforehand and based on various factors (see Oloko, 2011, p. 47; Polonsky and Speed, 2001, pp. 1365 et seq.; Svensson and Wood, 2006, p. 21; Westberg and Pope, 2012, p. 3). Hence, in a sponsorship a corporation donates money expecting that sales will be generated and in CrM, sales are driven by the customer in the belief that the com- pany will donate money (see Svensson and Wood, 2006, p. 21). Cause related marketing can also be seen in the context of product policy, espe- cially in brand management (see Oloko, 2011, p. 48; Roos, 2012, p. 18). It can promote the image of a company and give a brand an emotional aspect (see Oloko, 2011, p. 48). Also, it gives a product or service an additional benefit for the customer next to the physiological characteristics (see Roos, 2012, p. 18; Wymer and Samu, 2009, p. 5) that ideally results in a positive brand evaluation (see Oloko, 2011, p. 48). Therefore, CrM can be attributed to product policy (see Chapter 2.3 for more benefits of CrM). ROOS argues that CrM can even be ascribed to pricing policy within the marketing mix, because it is directly tied to sales (see Roos, 2012, p. 18). Corporations could increase prices during a CrM campaign in order to absorb the maximum willingness to pay (see Roos, 2012, p. 18). Besides, to achieve the desired impact with a CrM campaign as an instrument of CSR, the items of the marketing mix have to be aligned (see Roos, 2012, p. 19).
2.2 History of cause related marketing 11 2.2 History of cause related marketing Cause related marketing has a long tradition in Anglo-Saxon countries: in the United States of America, Great Britain and Australia (see Huber et al., 2008, p. 6; Roos, 2012, p. 23). The first local CrM campaign was run in the USA during the 1981 San Francisco Arts Festival. The financial services company American Express donated 5 cents per credit card use and 2 dollars per new customer in a three-month period for different charities (see Mescon et al., 1995, p. 60; Oloko, 2011, p. 38). The total amount do- nated was $100,000 (see Mescon et al., 1995, p. 60; Oloko, 2011, p. 38) and Amer- ican Express could see a considerable increase in credit card use and an increased acceptance of their credit cards by local merchants (see Andreasen, 1996, p. 48). However, the campaign of American Express during the fourth quarter of 1983 was the first nationwide CrM campaign worldwide and is often mentioned as the beginning of cause related marketing altogether (see Kotler and Lee, 2005, p. 82; Oloko, 2011, p. 39). Every time when cardholders in the USA used their credit cards American Express donated one cent to a fund to restore the Statue of Liberty and for each new credit card issued in the USA they donated one dollar to the same fund (see Oloko, 2011, p. 39; Roos, 2012, p. 23). American Express saw a 28% increase in card usage and a 45% increase in the number of new cards issued over the same period in 1982 (see Oloko, 2011, p. 39; Roos, 2012, p. 23; Varadarajan and Menon, 1988, p. 59). The company invested about $4 million in communication (see Oloko, 2011, p. 39) and in total donated $1.7 million to the Statue of Liberty - Ellis Island Foundation (see Huber et al., 2008, p. 8; Roos, 2012, pp. 23 et seq.; Varadarajan and Menon, 1988, p. 59). The term “cause related marketing” originates from this campaign of American Express (see Berglind and Nakata, 2005, p. 445; Huber et al., 2008, p. 7; Oloko, 2011, p. 39). Since this campaign, the use of CrM in the USA has rapidly increased, as did expenditures. When US corporations only spent a total of $120 million on cause related marketing in 1990, they dedicated as many as $1,51 billion to CrM in 2009 (see Oloko, 2011, pp. 39 et seq.). In this context it has to be mentioned that also customer awareness and CrM acceptance increased in this period of time. In 1993,
2.2 History of cause related marketing 12 66% of the US consumers approved of CrM campaigns, compared to 85% in 2008 (see Oloko, 2011, p. 41). According to a study of W EBB and M OHR in 1998, 79% of the US customers could remember at least one CrM campaign exactly and had an extensive knowledge of CrM (see Webb and Mohr, 1998, p. 230). Given the long tradition of CrM in the USA, the marketing tool developed from be- ing used as a tactical and sales boosting instrument to a special instrument of brand- ing and CSR strategy (see Oloko, 2011, pp. 40 et seq.). DAW is distinguishing be- tween four phases which can be assigned to specified periods of time. The first phase is the sales phase (from 1983 until the beginning of the nineties) where the objectives were short term and the focus was on sales promotion and fund-raising (see Daw, 2006, pp. 41-55; Meffert and Holzberg, 2009, p. 48; Oloko, 2011, p. 41). The second phase is the customer loyalty phase (from the beginning until the mid-nineties) which focused on customer loyalty and was medium to long term oriented (see Daw, 2006, pp. 41-55; Meffert and Holzberg, 2009, p. 48; Oloko, 2011, p. 41). The third phase, called branding phase (from the mid-nineties until 2001), implemented CrM as a long term strategy for company image and brand identity (see Daw, 2006, pp. 41-55; Meffert and Holzberg, 2009, p. 48; Oloko, 2011, p. 41). The last phase defined by DAW is the CSR phase (from 2001 until now) which has a strong long term focus on social responsibility (see Daw, 2006, pp. 41-55; Meffert and Holzberg, 2009, p. 48; Oloko, 2011, p. 41). In Great Britain, the first cause related marketing campaign called “Computers for Schools” was started by Tesco in 1992 and is still successful today (see Adkins, 1999, p. 139; Roos, 2012, p. 24). Customers spending £10 in the supermarket or on gasoline get coupons which they can give to a school of their choice. The school can then exchange the coupons for computers at Tesco (see Adkins, 1999, p. 139; Roos, 2012, p. 24). Tesco runs this campaign for a ten week period every year and supports it with large scale communications such as national advertising via television, radio and printed media (see Adkins, 1999, p. 140). By 2003, the campaign had generated £77 million worth of computers in schools (see Lewis, 2003, p. 26). The supermarket chain was able to increase sales with the “Computers for Schools” campaign so far and was also able to record an image boost as a social responsible corporation (see Roos, 2012, p. 24).
2.2 History of cause related marketing 13 The first national CrM campaign in Germany was run by betapharm in 1998, sup- porting the after-treatment initiative “Der bunte Kreis” which is committed to the care of critically ill children (see Oloko, 2011, p. 41; Pehl and Podeswik, 2010, pp. 209 et seq.). The company donated 5 pfennigs for each drug sold to “Der bunte Kreis” for the in home care of children suffering from cancer (see Oloko, 2011, p. 41). However, the first CrM campaign in Germany to receive greater media coverage was conducted by the German brewery Krombacher in 2002 which was mainly com- municated via television (see Meffert and Holzberg, 2009, p. 48; Oloko, 2011, p. 42; Roos, 2012, p. 25). The “Krombacher Regenwaldprojekt” (Krombacher rainforest project) was a cooperation with the WWF. Krombacher promised to protect 1 m2 of rainforest for each crate of beer sold of the brands Krombacher Pils, Alkoholfrei and Radler (see Oloko, 2011, p. 42). Moreover, Krombacher assured to save 2 m2 for each barrel of 30 liters and 5 m2 for each barrel of 50 liters sold in gastronomy (see Oloko, 2011, p. 42). The specific rainforest supported by this campaign was the Dzanga Sangha rainforest in Central Africa (see Krombacher, 2013). The campaign which lasted three months resulted in an increase in sales of 8.1% for Krombacher compared to the previous year (see Oloko, 2011, p. 42; Roos, 2012, p. 25) and was the most successful sales promotion campaign for the company until then (see Broder, 2003). However, those 8.1% are not only attributable to the CrM campaign, but also to other influencing factors like advertising campaigns and perhaps the soccer world championship (see Oloko, 2011, p. 42; Roos, 2012, p. 24). The budget Krombacher spent on communication during the CrM campaign amounted to 9 million e (see Broder, 2003). At the end of the campaign, 1 million e were handed over to the WWF to protect about 15.1 million m2 of rainforest (see Oloko, 2011, p. 42; Roos, 2012, p. 25). But, due to lacking transparency the campaign had legal consequences (Landgericht Siegen AZ. 7 O 72/02, 7 O 80/02), because it was considered unfair competition (see Roos, 2012, p. 25). Until 2002, CrM was illegal in some points ac- cording to the German Act Against Unfair Competition (UWG). However, after the revision of the UWG in 2004, the legal situation concerning CrM was regulated, so the principles of freedom of contract do apply (see Glöckner, 2006-07; Oloko, 2011, p. 43; Roos, 2012, pp. 25-27). Krombacher successfully repeated the campaign in
2.3 Managerial objectives and restrictions of cause related marketing 14
2003, 2004, 2006 and 2008 (see Krombacher, 2013; Roos, 2012, p. 25).
Since Krombacher effectively used CrM in their marketing strategy, the number
of CrM campaigns in Germany slowly increased. About 150 companies or brands
ran CrM campaigns until 2009 (see Oloko, 2011, p. 43) with a strong industry focus
on the food sector (see Oloko, 2011, pp. 361-368). Although the concept of CrM is
familiar to many companies, only 36% of German corporations knew the term cause
related marketing in 2006 (see Viehöver et al., 2006, p. 11). At the same time, the
consumers’ acceptance of the concept was relatively high with 72% (see Blumberg
and Conrad, 2006). According to a study of O LOKO in 2008, about 62% of the
companies using CrM were satisfied with their latest campaign (see Oloko, 2008,
p. 46). Further, O LOKO states that CrM in Germany is currently in the sales phase
(based on the classification of DAW) since it is mainly used as a sales promotion (see
Oloko, 2011, p. 44).
Besides the aforementioned appearance, CrM is also widespread in other countries
such as Australia, Canada, India, Korea, Spain and Taiwan (see Lavack and Kropp,
2003, p. 4; Oloko, 2011, p. 45).
2.3 Managerial objectives and restrictions of cause related
marketing
Generally speaking, CSR enhances reputation, and a favorable reputation results in
the company being able to charge higher prices, enhance their access to capital mar-
kets and also attract better job candidates and investors (see Bronn and Vrioni, 2001,
p. 209; Fombrun and Shanley, 1990, p. 233). But why do companies engage in CSR
via cause related marketing? Frequently, CrM is incorporated in a firm’s business
and marketing strategies pursuing many different objectives (see Huber et al., 2008,
p. 9; Varadarajan and Menon, 1988, p. 60). Reasons for a corporation to use CrM
campaigns range between the two opposing poles of self-interest and altruism (see
Langen et al., 2013b, p. 244; Langen et al., 2013a, p. 308; Wymer and Samu, 2013,
p. 13). If the company simply believed in the value of the cause and wanted to sup-
port it, this would be called altruism. If the company only wanted to support the
cause to increase profits, it would be considered to be self-interest (see Cadbury,2.3 Managerial objectives and restrictions of cause related marketing 15 1999, pp. vii et seq.; Langen et al., 2013b, pp. 244 et seq.). Usually, both reasons are relevant to a company (see Huber et al., 2008, p. 9; Langen et al., 2013a, p. 308; Varadarajan and Menon, 1988, p. 59). However, some authors argue that companies only use CrM in their own interest (Svensson and Wood, 2011, p. 204). This chap- ter is looking at the managerial objectives and does not consider the pure altruistic reasons of using CrM. The main objective of CrM is to increase sales (see Barone et al., 2000, p. 248; Huber et al., 2008, p. 10; Murphy, 1997, p. 16; Roos, 2012, p. 28; Strahilevitz, 1999, pp. 215 et seq.; Webb and Mohr, 1998, p. 231). This means that companies expect a rise in initial and repeat purchases during the CrM campaign, e.g. due to impulse buying at the point of sale (see Keller et al., 2008, p. 473 et seq.; Roos, 2012, p. 28). A precondition for selling products is to gain the customers attention, especially in saturated markets and in times of information overload (see Cadbury, 1999, p. viii; Langen et al., 2013a, p. 308). CrM campaigns can usually draw attention to a prod- uct, a brand or a company, because they are presented in the media and often provide an opportunity for positive publicity (see Drumwright, 1996, p. 79; Huber et al., 2008, p. 10; Roos, 2012, p. 28). This can also increase awareness and recognition of a product, company or brand (see Roos, 2012, p. 28). With increasing sales, the company can also enlarge its market share (see Huber et al., 2008, p. 10). Another important managerial objective of CrM is the demonstration of social commitment and social responsibility (see Langen et al., 2013a, p. 308). This assists a corporation in differentiating their brand or product from those of the competitors (see Huber et al., 2008, p. 10; Langen et al., 2013a, p. 308; Webb and Mohr, 1998, p. 227). In this way, they can also attract new customers (see Andreasen, 1996, p. 56; Varadarajan and Menon, 1988, p. 60). Further, the demonstration of social commit- ment via CrM adds value to the brand (see Polonsky and Wood, 2001, pp. 12 et seq.; Wymer and Samu, 2009, p. 4) and it enables both customers as well as other stake- holders to identify with a company and its brands (see Langen et al., 2013a, p. 309). Moreover, when engaging in CrM companies aim at the enhancement of their corporate image or a brand’s image (see Lafferty, 2009, p. 360; Roos, 2012, p. 29; Strahilevitz, 2003, p. 80; Varadarajan and Menon, 1988, p. 60). Therefore, they try to establish an honest and reliable brand identity that is enriched with ethical values
2.3 Managerial objectives and restrictions of cause related marketing 16 and emotions (see Meffert and Holzberg, 2009, p. 48; Roos, 2012, p. 29). This can help to counter negative publicity (see Huber et al., 2008, p. 10). A credible, trustful and likable image can also establish relations between customers and brands or corporations which then lead to higher customer loyalty (see Huber et al., 2008, p. 10; Roos, 2012, p. 29). Consumers are less likely to switch brands the higher their brand loyalty and it can also result in a higher willingness to pay and to engage in positive word of mouth (see Van den Brink et al., 2006, p. 16; Koschate-Fischer et al., 2012, p. 923; Oloko, 2011, pp. 55-62; Roos, 2012, p. 29). Next to the benefits stated above, CrM can have a positive effect on employees’ motivation and performance (see Drumwright, 1996, p. 82; Huber et al., 2008, p. 10; Kienzle and Rennhak, 2011, p. 13; Roos, 2012, p. 30). Employees often feel proud to work for a company that shows social responsibility and develop a stronger bond to their employer as well as a feeling of belonging, especially when the corporation’s management demonstrates a high commitment (see Kienzle and Rennhak, 2011, p. 13; Roos, 2012, p. 30). Furthermore, the majority of applicants wants to work for a company that cares about social and environmental aspects (see Cone Inc. and AMP Insights, 2006, p. 4). Thus, CrM as a part of CSR can influence the decision of potential employees (see Roos, 2012, p. 30). In spite of the various opportunities CrM campaigns can offer, the use of CrM also entails risks that should be thoroughly considered by corporations because they can restrict the success of their campaigns (see Roos, 2012, p. 30; Svensson and Wood, 2006, p. 27). First and foremost, it is the consumers’ perception of a CrM campaign that plays a decisive role. Often, the use of CrM is considered to be selfish, so that the campaign loses its credibility (see Oloko, 2011, pp. 69 et seq.; Roos, 2012, p. 31). This leads to a negative attitude on the customer side and could even result in a boycott of the product in question (see Bronn and Vrioni, 2001, p. 208; Oloko, 2011, pp. 69 et seq.; Wymer and Samu, 2013, p. 13). The lack of transparency can support the implau- sibility of a CrM campaign. All too often, customers do not know how much is donated or whether something is donated at all (see Andreasen, 1996, p. 59; Oloko, 2011, p. 72), and companies do not publish the results of their campaigns (see Kotler and Lee, 2005, p. 101).
2.4 Cause related marketing and consumer behavior 17 Another critical factor is the proportion between revenues and expenditures in re- spect of the CrM donation, the product price and the communication expenses (see Oloko, 2011, p. 70). Consumers consider these factors disproportional in many cases, especially if the communication budget is a great deal higher than the donation or the portion of the product price donated is extremely small (see Oloko, 2011, p. 70; Roos, 2012, p. 31; Varadarajan and Menon, 1988, p. 69). A corporation’s image can also be at risk if an NPO creates negative headlines due to inappropriate behavior, e.g. the misappropriation of money from donations (see Kienzle and Rennhak, 2011, p. 14; Kotler and Lee, 2005, p. 101). In such cases the image transfer can be harmful for the company or at least reduce the expected positive outcome. The firms engaging in CrM take a financial risk too, because a company and an NPO often agree on a minimal donation amount in their contracts (see Daw, 2006, p. 66; Oloko, 2011, p. 73). In case the campaign is not successfully increasing their sales, the company will take the risk of an inefficient allocation of its marketing budget (see Oloko, 2011, p. 73). Last but not least, there is a limitation on the differentiating effect of CrM. If con- sumers face too many similar CrM campaigns, because more and more companies adopt such a strategy, the effects of the campaigns might be reduced (see Hoeffler and Keller, 2002, p. 84; Roos, 2012, p. 31). This can above all affect the USA where CrM has a long history. In Germany, however, CrM is a comparatively new instru- ment and therefore the risk of a diminishing marginal utility is rather low (see Oloko, 2011, p. 74). 2.4 Cause related marketing and consumer behavior As mentioned in the preceding chapter, CrM campaigns are created by companies trying to influence the consumer’s behavior and perception of a company or a brand. Chapter 2.4 is describing some aspects of consumer behavior that help firms to achieve their objectives in that matter without revealing the full range of consumer behavior research. Moreover, a number of relevant findings of research studies will be explained in the following.
2.4 Cause related marketing and consumer behavior 18
A CrM campaign can be successful if the association of a product, brand or com-
pany with a social cause has a positive effect on consumer behavior (see Huber et al.,
2008, p. 13). The social consciousness of consumers is the underlying reason for that
effect and this consciousness is, for example, shown by the increasing demand for
CSR (see Huber et al., 2008, p. 13). According to W EBSTER, a socially conscious
consumer is defined as
“a consumer who takes into account the public consequences of his or
her private consumption or who attempts to use his or her purchasing
power to bring about social change” (Webster Jr., 1975, p. 188).
Resulting from this social consciousness is the pro-social behavior which is the theo-
retical basis for CrM (see Huber et al., 2008, p. 13; Oloko, 2011, pp. 120 et seq.;
Roos, 2012, pp. 56 et seq.). Pro-social behavior is defined by E ISENBERG and
M USSEN as “voluntary actions that are intended to help or benefit another indi-
vidual or group of individuals” (Eisenberg and Mussen, 1989, p. 3).
The additional moral benefit of a CrM donation constitutes a special form of pro-
social behavior. It arises out of the transaction based donation that has pro-social
consequences for the customer (see Oloko, 2011, p. 122). Hence, the purchase of
a product that is linked to a cause via CrM has a double reward for the customer,
namely the product and the additional moral benefit in form of a positive feeling
about having done something good (see Huber et al., 2008, p. 14; Oloko, 2011,
p. 122).
Moreover, the increasing demand of CSR can be attributed to the varying needs
of people at different points of time with differing priority. M ASLOW ’ S hierarchy of
needs can be seen as theoretical background here. Today, consumers are striving for
self-actualization and care about morality and therefore pay attention to emotional
values of brands and products before they evaluate functional features (see Adkins,
1999, p. 30). Thus, CrM is supposed to engage people on higher levels in the hierar-
chy, as self-actualization, esteem and belonging, and to reinforce consumers’ identity
(see Adkins, 1999, p. 73).
There are several studies that show the influence of CrM campaigns on various as-
pects of consumer behavior regarding the purchase and evaluation of a product, brand2.4 Cause related marketing and consumer behavior 19 or company. S TRAHILEVITZ and M YERS analyzed how the nature of the product influences the effectiveness of charity donations as purchase incentives (CrM). They drew the conclusion that charity incentives are more effective with pleasure-oriented, hedonic, frivolous products than with functional, goal-oriented, practical products (see Strahilevitz and Myers, 1998, p. 443). This is due to the fact that consumers of- ten have a guilty feeling when buying a luxury product. This feeling can be reduced by the positive feeling of the donation (see Strahilevitz and Myers, 1998, p. 436). In addition, VAN DEN B RINK et al. investigated the effect CrM has on consumers’ brand loyalty. In general, they discovered that only long-lasting CrM campaigns enhance customers’ brand loyalty (see Van den Brink et al., 2006, p. 21). They also found out that CrM campaigns have no impact on consumers’ brand loyalty if the campaign is linked to a high involvement product (see Van den Brink et al., 2006, p. 22). However, long-lasting campaigns affect the loyalty for low involvement products. They explain this result with the strong relationship between the customer and a high involvement product that according to their study is not interfered with by CrM (see Van den Brink et al., 2006, p. 22). A study of C HANG shows what influence product characteristics and the donation framing can have on consumer purchase behavior. His general findings include that customers are more likely to favor, buy or recommend (combined in “behavioral in- tention”) cause related products where the donation is framed in an absolute amount of money compared to a framing in a percentage of the price (see Chang, 2008, pp. 1102 et seq.). Also, C HANG found that the behavioral intention is higher when the product price is low, so CrM is less effective with high price products (see Chang, 2008, p. 1104). Although the absolute amount framing is better with low price prod- ucts, the situation is reversed with an increasing price, so the behavioral intention is even lower for high price products with the donations stated in a percentage of the price (see Chang, 2008, p. 1104). Lastly, H UBER et al. examined the success of CrM campaigns in dependency of gender. They found out that women have a higher social orientation than men which is why they recommend the use of CrM for products that have a broad female target group (see Huber et al., 2008, p. 89).
3 Empirical study concerning cause related marketing
in the automotive industry
This chapter is focusing on the empirical study of CrM campaigns in the automotive
industry. First, the methodology of the study is briefly outlined in Chapter 3.1. Sec-
ond, the findings are described in more detail and analyzed in Chapter 3.2, before the
results are summarized in Chapter 3.3.
3.1 Methodology
A comprehensive desk research was conducted in order to find examples of CrM
campaigns in the automotive industry. In detail, the US and German websites of auto-
motive companies and the internet in general were searched for CrM campaigns, CSR
campaigns and nonprofit alliances (see Appendix B). The findings of this desk re-
search were then searched for the characteristics of CrM and it was decided whether
or not a campaign can be considered CrM. Some of the search terms used for this
qualitative analysis were “cause related marketing”, “corporate social responsibil-
ity”, “charity”, “donations”, “sponsoring”, “sustainability” and each of those terms
plus the respective company name. On the companies’ websites, the focus was on
CSR reports and tabs concerning society, commitment, events, philanthropic activ-
ities, community, and many other fields. The specific conditions that were checked
for compliance to classify a campaign as CrM are the following (see Chapter 2.1.1
for detailed explanation):
(a) Firm is offering to contribute a specific amount of money or a portion or per-
centage of sales/profits
(b) Contribution is for a designated cause (e.g. an NPO or a (community) project)
(c) Contribution is made when customers engage in revenue-providing exchanges
(customer triggers transaction based donation)
203.1 Methodology 21
(d) Organizational as well as individual objectives are satisfied
In order to decide which automotive companies to research, two statistics were
consulted. The studies show the world’s biggest car manufacturers in terms of turnover
in the years 2011 and 2012. The Toyota Motor Corporation, henceforth called Toy-
ota, is the company that generated the highest turnover in 2012 (see Figure 3.1). It
is followed by the Volkswagen Aktiengesellschaft, from now on referred to as VW,
in second place, General Motors Company, Inc., abbreviated GM, in third place, and
Daimler AG, here referred to as Daimler, taking fourth place. The list is proceeded
by Ford (Ford Motor Company), Honda (Honda Motor Company, Limited), Nissan
(Nissan Motor Co., Ltd.) and BMW (Bayerische Motoren Werke AG), in descend-
ing order. Although the ranking of 2012 differs slightly from the ranking in 2011,
those eight companies made it to the list of the top eight car manufacturers in matters
of turnover in both years, which makes them a good sample for this research (see
Statista, 2013a; Statista, 2013b).
The research was conducted for campaigns in Germany and the USA, because
the author expected differences in the number of CrM campaigns. This assumption
follows from the history of CrM as it developed much earlier in the USA and is fairly
new in Germany (see Chapter 2.2). Thus, it is assumed that the frequency of the use
of CrM in the USA is much higher than in Germany. Moreover, as mentioned before,
250
2012
2011
206.9
200 192.7
Turnover in billion €
158.9 159.3
150
115.5 114.3
108 106.5 101.8
100 97.9
89.9 89.2
81.8 76.9
70.1 68.8
50
0
Toyota VW GM Daimler Ford Honda Nissan BMW
Figure 3.1: Turnover of the eight largest car manufacturers in 2012 and 2011
(adapted from Statista, 2013a; Statista, 2013b)3.2 Results of the empricial study in the automotive industry 22
the automotive industry is a highly competitive and saturated market in Germany
and in the USA (see Möhlen, 2007, p. 3; Sturgeon et al., 2008, p. 7). Therefore, car
manufacturers need to differentiate their products from competitors’ products. Based
on those facts, the first hypothesis to be tested is:
H1 : CrM is a widely used instrument in the US automotive market.
In accordance with this assumption, the second and third hypotheses are advanced:
H2 : CrM is not commonly used in the automotive industry in Germany.
H3 : CrM is used more frequently in the US automotive market than in
the German automotive market.
The list of campaigns in Appendix B does not include scholarships to individuals,
but only contains projects which beneficiaries are at least a small group of people or
an NPO.
3.2 Results of the empricial study in the automotive industry
Toyota
Toyota is the first company scrutinized in this research. In the USA, the Japanese
company is undertaking many different projects that are related to social responsi-
bility (see Appendix B.1.1). However, most of those campaigns and projects cannot
be considered as CrM. Of the 22 projects found, only two campaigns require a more
detailed investigation.
The first one is the campaign of the Utah Toyota Service and Parts Center in 2004
(see Appendix B.1.1). They offered a $2 donation to the Weber State University
training program for every lube, oil and filter service done at their center during the
month of October. Furthermore, the offer stated that the Weber State University trains
the Toyota technicians, so the company donated money to the university that trains
their technicians (see Jones, 2007). This means that with this offer the company was
not only interested in increasing sales, but also wanted to tie the donation to their
work. But then, customers might not be very interested in a donation that mostly
benefits the company itself. Nevertheless, the campaign can be assigned to CrM,3.2 Results of the empricial study in the automotive industry 23 because the firm offers to donate a specified amount of money per service to the indicated cause if the consumer engages in a revenue-providing service. Therefore, the customer is triggering the donation and it is transaction based. The second campaign is called “Meals per hour” and was carried out after hurri- cane Sandy hit New York. The branch of the New York Food Bank serving the people of the Rockaway peninsula was facing food distribution problems. Toyota provided two employees to teach volunteers how to improve their system to be more efficient. Afterwards, they uploaded a video about this cooperation and Toyota promised to contribute one meal to the New York Food Bank for each view of the video on one special day. They supported the campaign with paid media advertising to increase awareness (see Jones, 2013). Although in this case the donation is triggered by cus- tomers watching the video, this campaign cannot be considered a CrM campaign, because it does not involve a transaction. This means, the customer does not en- gage in revenue-providing exchange. However, Toyota managed to generate about one million views and therefore contributed about one million meals, so there was a benefit for the company, the NPO and the customer who had a good feeling after watching the video (see Jones, 2013). In Germany, Toyota supports various projects and campaigns. However, none of those projects can be classified as CrM (see Appendix B.1.2). Volkswagen The German car manufacturer VW shows social responsibility both in the USA as well as in Germany. Of the campaigns and projects conducted in the USA, none can be assigned to CrM. However, there are various campaigns of the corporation in Germany to take a closer look at (see Appendix B.2). In 2004, the Volkswagen Autohaus Röchlin (dealership) donated 1 e of each first- aid box sold to the “Johanniter Unfall-Hilfe” in Duisburg to support a children’s hospital (see Die Johanniter, 2013). The campaign was conducted to make people check their first-aid boxes for the expiration date. Unambiguously, this is a CrM campaign, since all the conditions are fulfilled. The donation as a specified amount per product sold is offered by a firm to support a designated cause and is triggered
3.2 Results of the empricial study in the automotive industry 24 by the consumer, again with benefits for all three parties. Another campaign of VW is “FleetCompetence eCO2”. The company often works together with the German Nature and Biodiversity Conservation Union (NABU) and so it does in this campaign. To promote the leasing of green cars to fleet opera- tors, VW donates a specified amount of money (based on emissions) to the NABU for every kilometer driven with the fleet vehicle if the customer leases a particu- larly energy-efficient and climate-friendly model (see Volkswagen AG, 2013b). The models of the group’s brands are determined each year based on emissions and the contribution is made by the VW group and the respective brand (see Volkswagen AG, 2013f). In this case, it is a little more difficult to define whether or not it is CrM. First of all, the firm offers a contribution to a good cause, here an NPO. Secondly, the do- nation is triggered by the customer when engaging in a revenue-providing exchange. In this instance, the revenue-providing exchange is the leasing of a specific car model for the fleet. However, the donation is not directly based on a transaction, but based on the kilometers driven with that vehicle. But if the customer does not lease one of the specified models, there will be no donation. Therefore, this campaign is classified as CrM. VW and the NABU have another project that is researched in this study. The project aiming at the recultivation and restoration of water levels in a 2720-hectare moorland region is called “Großes Moor” (meaning large moor). For each CO2 - optimized fleet car Volkswagen Leasing leases out since 2011, they make a donation to the NABU project for the protection of this moor (see Volkswagen AG, 2013c). Here, VW again offers a specific contribution to a specified cause when a customer engages in a revenue-providing activity. This satisfies both organizational as well as individual objectives. Thus, the campaign is considered to be CrM. General Motors The American company GM is engaging in several CSR projects in the USA and only in one in Germany (see Appendix B.3). But just one campaign that was conducted in the USA is interesting for this study (see Appendix B.3.1). It was carried out on October 6, 2012, where the group’s brand Chevrolet donated $10 for each person who
You can also read
