20 Jul 2012
Why do we buy what we buy and how can companies use it to their advantage, particularly when a good cause is involved? That’s what AUT University Business School senior lecturer Dr Jae-Eun Kim has been looking at recently: the emotional motivations behind our purchases.
As part of some ongoing research, Dr Kim has just completed a study on cause-related marketing (CRM). The term was first coined – and trademarked – by American Express in the 1980s, when it joined a non-profit group raising funds to restore the Statue of Liberty, and promoted its involvement in a nationwide advertising campaign.
CRM is essentially an arrangement between a company and a non-profit organisation or charity to raise money for a particular cause. The charity enjoys a raised profile and receives more funds, while the company involved is not only seen in a positive light for aligning itself with a cause its consumers value, it also sells more products in the process.
“Cause-related marketing is saying ‘I make money but I’m going to give a percentage of it to this cause’,” says Dr Kim.
“It’s a very important marketing strategy in motivating people to purchase your product. Companies can benefit by enhancing their image and building good relationships with their customers.
“It’s important that the charity align itself with a good product so as not to devalue its cause. And the company needs to choose
a cause that fits with its image or strategy,” she says, indicating an attractive pink water bottle adorned with the Breast Cancer Foundation pink ribbon logo – a product and cause that would appeal to women.
While the motivations behind many of our purchases might seem pretty obvious – ‘I need some laundry powder’ or ‘I want a new handbag’ – Dr Kim says why we choose a specific item over another equivalent one is much more tied into ethical emotions such as guilt and pride.
“This is certainly what marketers target. Consumers’ engagement in moral/ethical consumption is an important area in marketing, but there’s not much extensive research into the ethical aspects of purchasing. My interest is in how our moral emotions – anger, pride, guilt, empathy and elevation – influence our purchasing behaviour and make us more likely to purchase social-cause products.
“Everyone experiences them and these moral emotions do influence the purchasing of social-cause products, but in some cultures and individuals certain feelings are stronger.”
Dr Kim has been comparing the role moral emotions plays among those purchasing cause-related marketing products in Korea and the United States. It seems that in more individualist cultures, such as the US (and New Zealand), the feeling of pride is more important than in a collectivity-based culture, such as Korea.
The second layer to Dr Kim’s research is the perceptions individuals have about their own thoughts, feelings and actions in relation to others (self-construal). Those with an independent self-construal give more weight to personal goals than they do to group goals, while an interdependent self-construal means you define yourself more in terms of relationships to others.
Dr Kim found that when interdependent individuals purchase a cause-related product, feelings of guilt are a strong motivating factor.
Oddly, cause-related marketing hasn’t gained much traction in New Zealand, she says. While many New Zealand companies say they support the community because they think it’s an important part of business, they’re not actively promoting their efforts and reinforcing the idea in customers’ minds.
“Customers are very interested in buying those kinds of products and supporting those sorts of causes, but marketers here aren’t actively advertising it. A company’s goal is to associate its product and the cause very closely so there’s that emotional aspect. The guilt/pride marketing strategy it adopts really depends on the type of products it sells and its target customers. This requires significant investment in advertising and promotion.”
And the message is much more effective when customers know exactly how a company supports a cause – for example with 5 percent of its profits.
CRM has, however, been used extensively overseas. Among the numerous high-profile examples is Product Red, launched in 2006. In one of the largest cause-related marketing campaigns to date, companies such as Apple, Gap, Motorola and Giorgio Armani have joined forces behind the Product Red brand to support The Global Fund to Fight AIDS, Tuberculosis and Malaria in Africa.
Much of our consumption is associated with morality and ethics, and Dr Kim is now expanding her research into the motivations behind unethical consumption.
This includes activities such as shoplifting, buying an item with the specific intent of wearing it and then returning it when it’s no longer needed (retail borrowing), and the purchasing of counterfeit products.
“It’s interesting to look at why consumers engage in unethical consumption,” she says. “How do our moral emotions play a role in the purchasing of a counterfeit handbag? For independent people, pride can be an important source – the pride that comes from, not simply owning the item, but from considering themselves a smart shopper for having just bought a ‘designer’ bag for $50.”
Words by Deirdre Coleman, issue 39 Idealog magazine.
Photo by Jessie Casson.