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How the frequency and amount of corporate donations affect consumer perception and behavioral responses

  • Original Empirical Research
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Abstract

This article proposes two new donation strategies that focus on either the amount or the frequency of corporate donations, and verifies that consumers have very different perceptions of and behavioral responses to firms that adopt these different donation strategies. Through three lab experiments and two field studies with adult consumers, the authors show that an amount-focused donation strategy leads consumers to generate more resource- and capability-related associations about the firm’s endeavor in helping charities, whereas a frequency-focused donation strategy leads consumers to generate more commitment- and persistence-related associations about a firm’s endeavor in helping charities. Furthermore, consumers tend to perceive a donation as more instrumental in helping charities and are more likely to purchase from the donor firm, pay a higher price for the donor firm’s products, and make referrals when the firm adopts a frequency-focused (vs. amount-focused) donation strategy to support an approach-oriented (vs. avoidance-oriented) charitable goal. The findings hold important implications for corporate donation strategies regarding how firms should allocate their philanthropic budgets and strategically communicate their donation efforts.

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Notes

  1. With a total cash contribution of $446.7 million in 2015

    (http://fortune.com/2016/06/22/fortune-500-most-charitable-companies/).

  2. For example, the goal of Wal-Mart China is to help impoverished women create ventures and to promote the industrialization and sustainability of local agriculture.

  3. For example, the goal of Gilead Sciences is to help reduce the occurrence of undesirable outcomes such as HIV/AIDS and liver disease.

  4. In this research, we focus our investigation on the straight cash donation behavior that aligns with Dean’s (2003) conceptualization of unconditional donation.

  5. Another analysis showed that when the donation strategy was frequency-focused, the first thoughts generated by participants were more likely to be commitment-related (51.7%) than capability-related (13.1%) or neither of the two (35.0%). When the strategy was amount-focused, the first thoughts generated were more likely to be capability-related (54.2%) followed by commitment-related (11.9%) and neither (33.9%), χ2 (2, n = 119) = 29.58, p < .001.

  6. In business practice, the positioning and mission of charities can represent different types of charitable goals. For instance, Conservation International (www.conservation.org) emphasizes their charitable goal in an avoidance-oriented manner by stating on its homepage that for “30 years Conservation International has worked to protect nature for the benefits it provides to all of us: food, fresh water, livelihoods and a stable climate.” As an example of an approach-oriented charitable goal, La Leche League (www.llli.org) defines its mission as “to help mothers worldwide to breastfeed through mother-to-mother support, encouragement, information, and education, and to promote a better understanding of breastfeeding as an important element in the healthy development of the baby and mother.”

  7. For the sake of brevity, we omit the detailed elaborations of these interaction effects but summarize the statistics in Table 2.

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Acknowledgements

This research is supported in part by National Natural Science Foundation of China (Grant No. 71772045, 71432001) and Social Science Foundation of Shanghai, China (Grant No. 2016BGL009). The two authors contributed equally.

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  1. Department of Marketing, School of Management, Fudan University, Shanghai, China

    Liyin Jin & Yanqun He

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  1. Liyin Jin
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Jin, L., He, Y. How the frequency and amount of corporate donations affect consumer perception and behavioral responses. J. of the Acad. Mark. Sci. 46, 1072–1088 (2018). https://doi.org/10.1007/s11747-018-0584-7

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