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Using CSR to improve brand image

There was a time when Say’s Law would have us believe that you only needed to produce to sell. Then, as times changed, we realized that to sell, a promotion was necessary to the marketing mix. With the information and choice-rich consumers of today, firms are fast realizing that they cannot limit themselves to the basic functions of exchange and if they are to survive in the long run, the society must be an integral part of their stakeholder analysis. For long, most firms existed on the periphery of society, interacting only through their products. Their exchange was one driven solely by profit and giving back to the society was largely a personal decision. The ‘obligation’ to society was sporadically met as firms had still to develop a sense of social responsibility. The situation has changed considerably in the present times with both firms and the public realizing that the firm exists within the community and with their considerable wealth and resources, are in a prime position to contribute to its upliftment. With some countries even going so far as to legalize the act, there is no doubt that corporate social responsibility is a fixture in most firm’s annual expenditure. As firms strive to show their socially conscious sides, it does beg the question- how much does CSR impact brand image?

How ‘good’ is your brand?

The current generation does not want a brand that is intangible and stays aloof. They want the brands to behave ‘humanlike’ and have traits and a distinct personality. Similarly, the brand must also care about issues that plague the society and cannot be seen as being unaware or worse still, uncaring. Nike suffered a great setback in the 90s when reports surfaced that showed that their factories actually used child labor to produce shoes. It leads to negative association with the entire brand making the consumers feel like accomplices to the act. Its effect goes beyond sales as it affects how an entire generation of consumers look at your products. Through an intense round of counter-marketing, it is possible that you may be able to salvage the brand but the rework has limited damage control abilities. By influencing people at a deeper level, it can actually have ramifications on the sustainability of the brand. On the other hand, consider the campaign started by IBM for a Smarter Planet. By encouraging its employees and consumers to innovate for a better future, it firmly established itself as a brand that was committed towards technological development for the better. To put it simply, CSR or the lack of it divides brands into two clear categories- ‘good’ and ‘bad’. Good brands are seen as being socially responsible and invite a positive association and the opposite is true for bad brands.

Goodwill hunting

The only tangible asset on the balance sheet, goodwill is not only a product of met credit timelines and product quality. It is also the measure of how your brand is perceived and a large part of that perception stems from its

intent to help the community that it draws from. As global competition increases and brand loyalty decreases, CSR becomes an effective tool to attract and capture the audience. There is a rising trend amongst consumers to decide on a brand based on its set of values and what they stand for rather than just its product and services. A firm that actually acts on its prescribed values and undertakes effective CSR activities both within and outside the firm are seen in a more favorable light than others. They also become viable talking points that keep the brand relevant while earning brownie points for adding the double line to its profit calculations.

Societal concept – not just a theory

When the societal concept first gained prominence in the marketing world, most people saw it as an idealistic contribution that would not be realized. The concept holds that a firm must be aware that its interactions have an impact on the society across the length and breadth of its operations. As firms make more money than ever, the eternal question of “what we owe to each other” arises and firms are finding it nearly impossible to be mere money-making institutions with no soul. While some firms are instituting scholarships, others are undertaking pressing causes of poverty, illiteracy, and healthcare. The reason for this paradigm shift is due to the change in the mindset of the consumers who have become socially aware and conscious and want to be associated with brands that exhibit the same qualities. It is not just about brand image anymore but also about brand affinity that CSR has become a crucial element of.

Going beyond moral obligation

CSR contributes to the appeal of a brand to not only its consumers but also its other stakeholders. It contributes to sustainability and a stellar reputation that makes it very appealing to its investors. By instituting programs that help uplift the society, it also motivates the employees as they contribute towards a greater cause. Over time, a brand image is not just what is communicated to the audience but is the sum total of what the brand stands for and its core philosophies and the internal stakeholders help reinforce the image. By including CSR as an integral part of the business strategies, firms can look at creating a tangible path for the values they stand for and further the belief in the brand. Corporate social responsibility is not a smokescreen anymore with firms looking to undertake unrelated activities with little or no impact. Firms are increasingly looking at creating value through their initiatives and making a major difference as consumers are looking for brands that are more than their products. A brand image is no longer the promotional activities but includes the entire gamut of activities in which the firm interacts with the society which includes its social responsibility. It is a factor in the brand’s sustainability, its public image and also on its brand loyalty. To put it simply, consumers care about the brand that cares.


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