Effects of price premium and product type on the choice of cause‐related brands: a Singapore perspective

Abstract

This exploratory study investigates whether product type, utilitarian versus hedonic, affects consumers' likelihood of choosing a brand linked to a cause. The sample consists of 128 young Chinese Singaporeans. Unlike prior research done in Western countries, the respondents in this study were more likely to buy cause‐linked brands for practical than for hedonic products. They were also more likely to pay a price premium for cause‐linked practical products. This difference is attributed to the Confucian values that are espoused by the Chinese. Additionally, finds that specifying the amount donated to the cause increases the likelihood of purchasing cause‐linked brands that are priced at 10 to 25 percent premiums over comparable alternatives. Discusses implications for marketers and future research directions.

To donate or not to donate? Product characteristics and framing effects of cause‐related marketing on consumer purchase behavior

“…When the product price is high, a request for a donation could be seen as too demanding and may counteract the normally positive effects of the CRM. Subrahmanyan (2004) suggests that as the price premium of a CRM brand increases, the likelihood of purchasing the CRM brand decreases. A higher donation magnitude with a higher-priced product may arouse more suspicion that the cause is being abused and may result in cynicism toward the cause and the promoted product.…”

“…In the fall of 2007, Yoplait donated 10 cents per lid up to $1.5 million to the Susan G. Komen Breast Cancer Foundation. Because of the increased use of charity-linked promotions in the marketplace, recent studies have begun to examine potential factors that might affect CRM effectiveness and how consumers respond to CRM (e.g., Barone, Norman, & Miyazaki, 2007;Hamlin & Wilson, 2004;Strahilevitz, 1999;Strahilevitz & Myers, 1998;Subrahmanyan, 2004;Webb & Mohr, 1998). However, little research has been undertaken on how CRM campaigns are described in advertising copy to shape consumer purchase decisions.…”

“…This research, using a Taiwanese context, fills a gap in the current literature so as to provide additional lessons for CRM research outside of Western settings. In Asia, research in CRM is relatively sparse but has been emerging rapidly (Subrahmanyan, 2004). According to the IEG Sponsorship Report (2004) …”

The Effect on Korean Consumers' Brand Preference, Trust and Purchase Intention for Donation Amount Information of Luxury Fashion Brands

“…Considering the cultural differences, consumer perceptions about luxury CRM in Asian markets could be different from those in Western markets (Subrahmanyan, 2004). However, no research has fully explored luxury CRM in Asian markets even though Asia has become one of the biggest markets in luxury goods (Boenigk & Schuchardt, 2013).…”

Industrial Ingredient Co-branding: A Brand Relationship Approach

“…Accordingly, if the ingredient buyer obtains a higher value through a co-branding initiative, this is supposed to positively affect the ingredient supplier's brand equity (Van Durme et al, 2003). The willingness to pay a premium price for a branded product is the main evidence for the existence of brand equity (Bendixen et al, 2004;Hutton, 1997;Subrahmanyan, 2004).…”