CAUSE-RELATED MARKETING PARTNERSHIPS: AN APPLICATION OF ASSOCIATIVE LEARNING THEORY PRINCIPLES FOR BOTH SHORT AND LONG-TERM SUCCESS FOR

THE BRAND

by Michael L. Thomas B.B.A. St. Norbert College, 1986 M.B.A. Southern Illinois University, 1990

A Dissertation Submitted in Partial Fulfillment of the Requirements for the Doctor of Philosophy

Department of Marketing in the Graduate School Southern Illinois University Carbondale December, 2007

UMI Number: 3291648

Copyright 2008 by Thomas, Michael L. All rights reserved.

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Copyright by Michael L. Thomas All Rights Reserved

DISSERTATION APPROVAL Cause-Related Marketing Partnerships: An Application of Associative Learning Theory Principles for Both Short and Long-Term Success for the Brand

By Michael L. Thomas

A Dissertation Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy in the field of Marketing

Approved by: Dr. John Fraedrich, Chair Dr. Terry Clark Dr. Lynn Knowles Dr. Thomas Calhoun Dr. Dennis Sherkat Graduate School Southern Illinois University Carbondale June 29, 2007

AN ABSTRACT OF THE DISSERTATION OF MICHAEL L. THOMAS, for the Doctor of Philosophy degree in Marketing, presented on June 29, 2007, at Southern Illinois University Carbondale. TITLE: CAUSE-RELATED MARKETING PARTNERSHIPS: AN APPLICATION OF ASSOCIATIVE LEARNING THEORY PRINCIPLES FOR BOTH SHORTAND LONG-TERM SUCCESS FOR THE BRAND MAJOR PROFESSOR: Dr. John Fraedrich Corporate social responsibility has received considerable attention within both the academic and business communities. Cause-Related Marketing (CRM) has evolved as an area of social responsibility that allows firms to link their philanthropic activities with the strategic marketing goals of the firm. Specifically, CRM occurs when a firm makes an offer to contribute a portion of the proceeds of a consumer purchase of the firms products or services to a charitable cause. Academic research into CRM has covered a broad landscape. Studies include: potential benefits to the brand; consumer behavior surrounding CRM offers; brand/cause alliances, and; potential benefits to the cause. Additionally, numerous theories have been used to explain various CRM activities. However, each theory that has been presented has been aimed towards explaining specific phenomena, and an all-encompassing theory to explain the antecedents and consequences of successful CRM partnerships has been elusive. The purpose of this dissertation is to use associative learning theory as a framework for understanding the antecedents and consequences of successful CRM partnerships for both brand and firm. Associative learning theory develops principles such as, belongingness and reputation that set the foundation for incorporating partnership fit and long-term brand/cause relationships as

antecedents that should link the relationship to benefits for both brand and firm. These benefits, increased word-of-mouth, improved image for the firm, consumer attitudes towards the brand, and greater purchase likelihood, thus form the desired consequences completing the framework. The significance of this research is that it introduces one theory to explain what attributes of a CRM partnership lead to the best outcomes. Additionally, this study introduces word-of-mouth promotion as a desired outcome of CRM. Wordof-mouth will be shown to not only be a desired short-term CRM benefit, but also a catalyst for continued long-term success. This study was conducted by asking respondents to read one of 4 scenarios (2x2 factorial design) and then answer a series of questions. A series of scales, previously published in the marketing literature, was used to measure the impact of the antecedents on the various preferred consequences of CRM. Data were collected by an online firm to ensure greater generalizability, and were subjected to AMOS 6 for analysis. Hypotheses were then tested using the Kruskal-Wallis non-parametric test. The results indicate that the overall model of antecedents and consequences of CRM relationships has excellent fit, and both antecedents, relationship fit and longevity of relationship, are indicators of the strength of the brand/cause relationship. Additionally, increased positive Word-of-mouth and improved brand image are fully supported as consequences of a strong brand/cause relationship. Finally, improved firm image and increased purchase likelihood are partially supported as consequences.

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The study concludes with a discussion of the results and contributions to the field. Also, limitations of the study and suggestions for future research are outlined.

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DEDICATION This dissertation is dedicated to my angel in heaven, my son, Griffin Michael Thomas. I kept my promise baby. This is for you.

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ACKNOWLEDGMENTS I would like to thank my committee chairman, Dr. John Fraedrich for his continued support, and encouragement through out this process. His constant prodding kept me on track and was critical in giving me the incentive to finish. I very much appreciate the support of the marketing department at SIUC for their heartfelt support during a very difficult time in my life. Particularly, Dr. Terry Clark, Dr. Maryon King, Dr. Lynn Knowles, and Marge Smith showed concern for my well being which was above and beyond the call of duty. I also wish to thank my entire committee for their help during this process. I would especially like to thank Dr. Thomas Calhoun, and Dr. Darren Sherkat who were so gracious to join my committee. Dr. Sherkat saved the day by agreeing to be my statistics advisor at a very late date. Thank you. Finally, I would like to thank my parents, friends and colleagues for their continued support. A special thanks goes out to Dr. Linda Mullen for guiding me through the process.

TABLE OF CONTENTS CHAPTER PAGE

ABSTRACT ....................................................................................................... i DEDICATION .................................................................................................. iv ACKNOWLEDGMENTS ................................................................................... v LIST OF TABLES ............................................................................................vii LIST OF FIGURES .........................................................................................viii CHAPTERS CHAPTER 1 Introduction .................................................................... 1 CHAPTER 2 Literature Review ........................................................... 6 CHAPTER 3 Model, Hypotheses and Research Propositions .......... 41 CHAPTER 4 Methodology ................................................................ 49 CHAPTER 5 Results......................................................................... 68 CHAPTER 6 Discussion and Conclusion85 REFERENCES ............................................................................................... 95 APPENDICIES Appendix I Questionnaire................................................................ 108 VITA ........................................................................................................... 113

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LIST OF TABLES
TABLE PAGE

Table 2.1:

Literature Review.......................................................................... 6

Table 4.11: Pre-Test for Brands .................................................................... 51 Table 4.12: Pre-Test for Time-Frames .......................................................... 52 Table 4.3: Table 4.6: Table 5.4: Table 5.5: Table 5.6: Table 5.7: Demographics ............................................................................ 55 Structural Equations ................................................................... 62 Comparison of Model Fit Indices ................................................ 71 Unidimensionality, Reliability and Convergent Validity ............... 73 Discriminant Validity Matrix ........................................................ 74 Parameter Estimates for Structural Model.................................. 75

Table 5.8.1: Results of Kruskal-Wallis Tests of Significance: Fit .................... 77 Table 5.8.2: Results of Kruskal-Wallis Tests of Significance: Longevity......... 78 Table 5.8.3: Results of Kruskal-Wallis Tests of Significance: WOM ............... 79 Table 5.8.4: Results of Kruskal-Wallis Tests of Significance: Firm Image ...... 80 Table 5.8.5: Results of Kruskal-Wallis Tests of Significance: Brand Image.... 81 Table 5.8.6: Results of Kruskal-Wallis Tests of Significance: Purchase Intentions.................................................................... 82 Table 5.9: Results of Hypothesis Testing .................................................... 84

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LIST OF FIGURES
FIGURE PAGE

Figure 1 .......................................................................................................... 46 Figure 2 .......................................................................................................... 48 Figure 5.1 ....................................................................................................... 69 Figure 5.2 ....................................................................................................... 71

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CHAPTER 1: INTRODUCTION

Corporations continually strive to increase sales and strengthen attitudes towards their brands. Additionally, firms endeavor in their marketing efforts to establish a positive image for the organization as a whole. This task has become increasingly difficult as consumer confidence in big business has diminished. A 2001 Gallup poll showed that only 28% of respondents had quite a lot or a great deal of confidence in big business. (Ellen, Mohr and Webb, 2003). Adding to this dilemma is the ever increasing difficulty firms have in differentiating their brands. Intense competition has pushed organizations to continually seek new ways to make their brands stand out (Roy and Graeff, 2003). Further, consumer skepticism regarding traditional marketing has led firms to search for new marketing approaches that may be more favorably received (Szykman, 2004). As consumer skepticism increases, firms have begun to realize that consumers also expect greater corporate social responsibility (CSR) (Caudron, 1994; Smith, 1994; Scott, 1995; Benezera, 1996). In response some organizations embraced social responsibility as a part of their overall marketing efforts (Drumwright, 1996), and as a means of improving consumer attitudes towards brand and firm (Kay, 1993; Brown and Dacin, 1997; Bronn and Vrionni, 2001). As companies take a more strategic approach in their philanthropic activities, they have examined ways in which they can align such activities with brand and corporate goals (Varadarajan and Menon, 1988; Fellman, 1999). Cause-Related Marketing (CRM) has emerged as a framework to help strategically align both corporate and philanthropic goals. CRM refers to CSR

activities that include offers to consumers to contribute a portion of the price of the product or service to a charitable organization. The key feature of CRM is that the charitable contribution is contingent upon the consumer engaging in a revenue producing transaction with the firm (Varadarajan and Menon, 1988). CRM activities have grown dramatically over the past two decades, and are estimated to be over $1.08 billion (Kalligeros, 2005). This growth has led to numerous studies on the subject (e.g. Rosenthal, 1985; Stroup and Neubert, 1987; Varadarajan, and Menon, 1988; Enderle and Tavis, 1998; Bronn and Vrionni, 2001). While, CRM has been studied, it has generally been from special perspectives (Lafferty, Goldsmith and Hult, 2004; Lafferty and Goldsmith, 2005). The few studies that have been more all-encompassing (e.g. Pracejus and Olsen, 2004; Lafferty and Goldsmith, 2005) have not included both antecedents of successful partnerships and successful outcomes of CRM for the firm and brand. Additionally, past studies have relied upon multiple theories to apply to various facets of CRM causing the overall framework to be disjointed.

1.1: Purpose of Study:

The purpose of this study is multi-faceted. First, this study advances the literature on the factors necessary for successful CRM partnerships from the forprofit firms perspective. Second, associative learning theory will be used to explain a framework of the antecedents and consequences of successful CRM partnerships that will be developed and empirically tested. Third, word-of-mouth promotion will be included as a new consequence of a successful CRM partnership. Additionally, word-of-mouth promotion is theorized to have a positive effect upon long-term success of CRM promotions. These four dimensions lead to the following research questions: 2

1. Do the antecedents, fit and longevity (commitment), result in more positive consumer evaluations of a CRM partnership? 2. Do more positive consumer evaluations of a CRM partnership result in greater word-of-mouth promotion of the brand? 3. Do more positive consumer evaluations of a CRM partnership result in more positive evaluations of firm image? 4. Do more positive consumer evaluations of a CRM partnership result in more positive consumer evaluations of the brand? 5. Do more positive consumer evaluations of a CRM partnership result in greater purchase likelihood of the brand? 6. Does word-of-mouth positively effect the outcomes of research questions 2-5?

1.2: Significance of Research:

While CRM has been studied extensively, a comprehensive framework of the antecedents and consequences of successful partnerships for the brand and firm has neither been developed nor empirically tested. This study extends previous research dealing with successful CRM outcomes (Varadarajan and Menon, 1988; Stewart, 1998; Yechiam, Barron, Erev and Erez, 2002), and antecedents of a successful CRM partnership (Pracejus and Olsen, 2004; Lafferty and Goldsmith, 2005). Moreover, the study develops a framework combining both antecedents and consequences into a model amenable to empirical testing.

Finally, this dissertation introduces word-of-mouth promotion as a desirable, and obtainable outcome of CRM. Word-of-mouth promotion has received considerable attention in the marketing literature. However, it has not been specifically mentioned as a preferred outcome of CRM (Duhan, Johnson, Wilcox and Harrell, 1997; Dye, 2000; Rosen 2000, 2002). Word-of-mouth promotion will also help show how CRM can be a successful long-term strategic outcome of CRM.

1.3: Scope of Study:

This study is designed to test how the antecedents of a tightly linked CRM partnership lead to a better partnership from the brand and sponsoring firms perspective. Applying associative learning theory to CRM can help understand how best to partner a brand with a cause for maximum success in both the short- and long-term. Additionally, the study includes word-of-mouth promotion as a desirable outcome of CRM. Also, a properly linked CRM partnership between firm and cause should create synergies that should logically lead to increased word-of-mouth which in turn should result in long-term benefits to the brand. Thus, word-of-mouth is expected to positively impact the long-term benefits of an appropriately engineered CRM partnership. However, it is beyond the scope of this study to empirically test this long-term effect. It is presented as a theoretical research proposition.

1.4: Organization of Dissertation:

The remainder of this dissertation will be organized as follows: 4

First, a review of the literature on CRM, and theories used in support of previous work will be examined. Second, the model, supporting hypotheses and research propositions will be presented. Third, the methodology used in the study will be outlined. Finally, the results of the statistical analysis will be presented followed by a discussion of the implications of the study.

CHAPTER 2: LITERATURE REVIEW

It is generally agreed that CRM began in 1983 when American Express started its campaign to restore the Statue of Liberty (Higgins, 2002; Kalligeros, 2005). The campaign raised $1.7 million for the Statue of Liberty-Ellis Island Foundation. American Express transaction activity increased 28% over the same period (Wall, 1984; Varadarajan and Menon, 1988; Higgins, 2002). Following this success, CRM activities began to flourish, exceeding $1.08 billion in 2005 (Rosenthal, 1985; Stroup and Neubert, 1987; Varadarajan, and Menon, 1988; Enderle and Tavis, 1998; Bronn and Vrionni, 2001; Kalligeros, 2005). CRM has been a logical outgrowth of corporate social responsibility. As CRM is a type of corporate social responsibility, we begin with a brief overview of (CSR). (Please see Table 2.1 for a synopsis of the literature).

Table 2.1: Literature Review: Overview of Key Articles

Section Key Topic(s)

2.1: From Corporate Social Responsibility to Cause-Related Marketing Varadarajan and Menon, 1988 Stroup and Neubert, 1987 Morris and Biederman, 1985 Fombrun and Shanley, 1998 Roy and Graef, 2003 Broad overview of subject/corporate success Stages of corporate social responsibility Corporate social responsibility history Corporate social responsibility and firm reputation Aligning corporate social responsibility and marketing goals

Table 2.1: Continued

2.2: Cause-Related Marketing Defined Varadarajan and Menon, 1988 Mullen, 1997 Roy and Graef, 2003 Pringle and Thompson, 1999 2.3: Perviously Used Theories for CRM Lafferty and Goldsmith, 2003 Till and Nowak, 2000 Yechian et al., 2003 Dean, 2004 Berger et al., 1999 Ross et al., 1992 Webb and Mohr, 1998 2.4: Underlying Theory Lafferty and Goldsmith, 2003 Till and Nowak, 2000 Shimp, 1991 Stuart et al., 1987 Shimp et al., 1991 Martindale, 1991 McSweeney and Bierley, 1984 2.5: Corporate Involvement in CRM Varadarajan and Menon, 1988 Bloom et al., 1995 Broad overview of subject/corporate success Strength of link between firm and cause Associative Learning Theory/CRM Associative Learning Theory/CRM Associative Learning Theory Associative Learning Theory/Positive brand attitude transfer Associative Learning Theory/Positive brand attitude transfer Associative Learning Theory/Overshadowing Associative Learning Theory/Belongingness Associative Learning Theory Associative Learning Theory Signal and Utility Theory Contrast Effect and Attribution Theory Pro-Social Behavior and Information Processing Theory Attribution Theory Attribution Theory Definition Definition Definition Definition

Table 2.1: Continued

Drumwright, 1996 File and Prince, 1998 Fellman, 1999 Dupree, 2000 2.6: Consumer Behavior Surrounding CRM Ross et al., 1992 Dean, 2004 CRM and gender effects on brand attitudes Consumer skepticism differences between CRM and one-time charitable donations Forehand and Grier, 2003 Ellen, et al., 2002 Olsen et al., 2003 Pracejus et al., 2004 Swaen and Vanhamme, 2004 CRM and consumer skepticism CRM and consumer skepticism/firm motives Consumer confusion surrounding CRM offer wording Consumer confusion surrounding CRM advertising copy formats Differences in consumer attitudes for responsible and irresponsible firms using CRM Consumer attitudes toward firms involved in CRM with regard to firm motives Webb and Mohr, 1998 Yechian et al., 2003 Berger et al., 1999 Drumwright and Murphy, 2001 Strahilevitz and Meyers, 1998 Strahilevitz, 1999 Typology of CRM consumers CRM and product choice CRM and consumer persuasion CRM and consumer skepticism CRM tradeoffs (price reductions vs. charitable contributions) CRM size of donation impacts (frivolous vs. practical products) Consumer tradeoffs between price and quality surrounding CRM offer CRM objectives CRM objectives Linking firm objectives with a cause Linking firm objectives with a cause

Szykman, 2004

Barone et al., 2000 2.7: Word-of-Mouth Rosen, 2002

Increasing WOM via "stealth" techniques

Table 2.1: Continued

Thomas, 2004 Rosen, 2000 Verlegh et al., 2004 Pruden and Vavra, 2004 Mohr and Chiagouris, 2005 2.8: CRM Partnerships Till and Nowak, 2000 Pracejus and Olsen, 2004 Lafferty and Goldsmith, 2005 Brown and Dacin, 1997 2.9: Effects of CRM on Charitable Causes Basil and Herr, 2003 Andreason, 1996 Brand/cause fit (impact on charity) Non-profit CRM strategies Brand/cause fit Brand/cause fit Brand/cause fit Brand/cause fit Tools to enhance WOM Effective WOM WOM strength in face of diminshing reputation Creating WOM Monitoring WOM

2.1: From Corporate Social Responsibility to Cause-Related Marketing: Corporate social responsibility (CSR) refers to the philanthropic or charitable activities of for-profit corporations (Varadarajan, and Menon, 1988). More formally, CSR encompasses corporate activities that enhance and support society at large, and go beyond corporate legal obligations (Enderle and Tavis, 1998). Sethi, (1977) states that corporate philanthropy dates back at least to the late 1800s. The literature has identified at least three major CSR stages: Voluntary involvement; mandated involvement; and social responsibility as an investment (Stroup and Neubert, 1987).

Early corporate philanthropy (1900-1954) was characterized by voluntary social responsiveness by corporations. Because these philanthropic undertakings generally reduced profits (Stroup and Neubert, 1987), corporations involved were those that could afford it (Bronn and Vrionni, 2001). However, as Varadarajan and Menon (1988) point out, although these activities were voluntary they were not always purely altruistic (due to a 1954 New Jersey Supreme Court ruling requiring corporate philanthropy to directly benefit shareholders). Therefore, the first 50 years of CSR were characterized by corporations strategically aligning their shareholder interests with their philanthropic activities (Morris and Biederman, 1985). The next phase, mandated corporate social responsibility (1970s) developed as corporations realized they were only permitted to operate at societys discretion (Varadarajan and Menon, 1988). Increased regulatory and stakeholder pressures pushed corporations to undertake social activities that were not necessarily in their shareholders best interest. Thus, corporations began to stay away from supporting causes that might be seen as supporting their direct corporate interests (Morris and Biederman, 1985). The next phase in the evolution of CSR, performance related philanthropy (1980s to present), resulted from a corporate realization that a variety of benefits accrue from philanthropic activities. Varadarajan and Menon (1988) note that this stage bridges the gap between voluntary and mandated giving. Corporations now realize that wider philanthropic giving not only benefits society, but also has the potential to benefit corporate stakeholders directly. One way in which CSR benefits stakeholders is through increased reputation. For example, a favorable reputation garnered through social responsibility might allow a corporation to charge premium prices, have better access to capital markets and investors, and attract better employees (Fombrun and Shanley, 1990). Seen through this 10

perspective, reputation advantages gained through CSR are a long-term investment in the performance of the firm. Reputation is also closely aligned with brand awareness, and can lead to successful brand differentiation resulting in a competitive advantage (Kay 1993). Thus, corporations aim for CSR activities that will be well received by society in order to eventually gain a competitive advantage. This is not to say that corporations enter into these activities simply out of self-interest, but rather that they try to align their altruistic activities with their long-term advantage. Firms with good reputations outperform those with poorer reputations (Fombrun and Shanley, 1998). Additionally, empirical studies reveal that consumers favor companies that are socially responsible (Cone and Roper, 1994; Roper Starch Worldwide, 1996; Bronn and Vrionni, 2001). Social responsibility ranks third (behind price and quality) among the most important factors driving consumer purchases, and if price and quality are equal, social responsibility will drive purchase behavior (Fombrun and Shanley, 1998). Finally, the literature leads to two distinctly different corporate perspectives on CSR. One strategic perspective is that CSR objectives are aligned with corporate marketing objectives (Roy and Graeff, 2003). The other is that CSR objectives are not aligned with corporate marketing objectives (Grahn, Hannaford and Laverty, 1987). Along this same vein, a study of corporate involvement in telethon activities revealed that corporate marketing objectives were often aligned with the telethon activities (Rosenthal, 1985). This is just one example of how the former perspective has become dominant, and: CRM is an excellent example of linking charitable activities with marketing goals.

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2.2: Cause-Related Marketing Defined:

CRM is defined as ...the process of formulating and implementing marketing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause when customers engage in revenueproducing exchanges that satisfy organizational and individual objectives. (Varadarajan and Menon, 1988, pg. 60). Mullen (1997) offers a similar definition, but the key ingredient in both is the contribution to a charitable cause is dependant upon the customer engaging in revenue-producing exchanges with the firm. CRM therefore differs from other forms of corporate philanthropy in that it is not a one time gift to a charity, or a continuing commitment to support a charity, but rather the charitable contribution is contingent upon consumers purchasing from the firm. As Varadarajan and Menon (1988) point out; there is considerable confusion surrounding CRM. Many authors have viewed non-CRM activities as CRM activities (for examples see Varadarajan, 1986; Grahn, Hannaford, and Laverty, 1987; Williams, 1986; and Rapp and Collins, 1987). For example, when the Chubb Corporation has a continuing commitment to support Masterpiece Theater on PBS this is not CRM because it does not involve any purchase from a consumer. Additionally, CRM involves 3 actors instead of two : the corporation (actor 1) which makes the offer to donate to a charity (actor 2) if the consumer (actor 3) agrees to purchase some product or service from the corporation (Dean, 2004). However, three actors are a necessary, yet not sufficient condition for CRM. For example, when McDonalds offers to make matching contributions to the Ronald McDonald House three actors are involved, but this is not CRM because although customers may make contributions they are not required to purchase anything from the firm. Therefore, in summary, the necessary and 12

sufficient condition for CRM is that the offer from the firm to make a contribution to a charitable cause must be contingent upon the consumer engaging in a revenue-providing exchange with the corporation. Some authors have expanded the CRM definition into a strategy linking a firms products with charitable causes that appeal to their target market (Roy and Graeff, 2003; Pringle and Thompson, 1999). While it is true that successful CRM may depend on a strategy that links a firms products with charitable causes that appeal to their target market, this definition is too broad as it allows for the inclusion of non-CRM activities. For example, a companys continued involvement in supporting a charity, even though no product sales are required, would meet this definition however this type of activity is not CRM. The Varadarajan and Menon (1988) definition is the appropriate one as it is the only one that distinguishes CRM from other forms of corporate philanthropy, consequently, this definition will be used in this dissertation. Although, it is important to note that this definition just outlines the borders for CRM. It is not intended to limit what strategies may best be used to increase the success rate of a CRM campaign.

2.3: Previously Used Theories for CRM:

CRM has been studied using various underlying theoretical foundations. Information integration, attitude accessibility, and anchoring and adjustment theory were used to support Lafferty and Goldsmiths (2005) study of cause/brand alliances. Till and Nowak (2000) analyzed the effective use of cause-related marketing alliances using associative learning and classical conditioning theory. Another study of the robustness and direction of the effect of CRM (Yechiam Barron, Erev and Erez, 2002) was based on signal and utility 13

theory. Dean (2004) relied on contrast effect and attribution theory to compare consumer perceptions of corporate donations (CRM vs. one-time corporate philanthropy). Finally, Berger, Cunningham and Kozinets (1999) studied consumer persuasion via CRM using pro-social behavior and information processing theories. The use of each of these theories within CRM will be further examined below. Information integration theory has been used in consumer behavior research to explain how consumers attitudes shift based on new information. The theory posits that individuals form attitudes, and then as they receive new information these attitudes are evaluated and modified. These modified attitudes are then integrated with prior attitudes (Anderson, 1981; Lafferty and Goldsmith, 2005). The critical component of this model is the effect the prior attitude has in predicting the polarization that occurs when information of equal value is cumulated. Information integration theory predicts that the attitude will become more extreme as recipients are exposed to more messages (Lafferty and Goldsmith, 2005, pp. 424). Lafferty and Goldsmith (2005) use this theory as their framework for understanding how brand/cause alliances within CRM lead to more extreme attitudes towards both the brand and cause. One key to this theory is that new information is evaluated, attitudes are modified, and new attitudes are integrated with prior attitudes. If attitudes are favorable, and the new information is favorable, cumulative attitudes become more favorable. However, the opposite is also true. If prior attitudes are negative, and new information is also negative then cumulative attitudes will become more negative. Additionally, positive/negative attitudes can be reduced/improved by new information that is negative/positive. Applying integration theory to CRM, it is clear that brands with

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positive attitudes aligned with causes associated with positive attitudes should improve attitudes towards both brand and cause. Additionally, neither brands nor causes should align themselves with a cause or brand that may be associated with negative attitudes, as this may offset attitudes towards brand and/or cause. Attitude accessibility theory has also been used in consumer research as a framework for understanding how consumers form attitudes towards brands. Specifically, the theory states that the stronger the attitude the more easily it can be accessed from memory. Stronger attitudes are also associated with individuals being more familiar with the subject, or object of interest (Fazio, Powell, and Williams, 1989; Lafferty and Goldsmith, 2005). Additionally, (and with particular interest for CRM) attitudes that are formed by direct experience are stronger than those that are formed by indirect experience (Alba and Hutchison, 1987; Bendapudi, Singh and Bendapudi, 1996; Bettman and Sujan, 1987; Fazio and Zanna, 1981; and Lafferty and Goldsmith, 2005). Therefore, attitudes formed by direct experience (as with familiar brands) will be stronger than those formed by indirect experience (as with unfamiliar causes) (Lafferty and Goldsmith, 2005). Lafferty and Goldsmith (2005) used anchoring and adjustment theory to tie attitude accessibility theory to brand/cause alliances more efficiently. According to anchoring and adjustment theory, when subjects form an attitude with a familiar object and with an unfamiliar object, they tend to anchor on the more familiar information and then adjust for the less familiar information (Tversky and Kahneman, 1973). Essentially, the less familiar object receives a transfer of attitudes from the more familiar object. Building on this, Lafferty and Goldsmith then postulate that familiar causes will receive less positive attitude transfer from a familiar brand than will unfamiliar causes.

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In addition to Lafferty and Goldsmith (2005), Till and Nowak (2000) also studied CRM alliances. However, they used associative learning and classical conditioning theory as a framework for their investigation. Associative learning has been described as the way that consumers learn about the relationships among events in the environment (Shimp, Stuart and Engle, 1991) that is brought about through the linkage or fusion of two concepts (Murdock, 1985; Till and Nowak, 2000, pp.473-474). In this context, associative learning theory is well suited to the study of brand/cause relationships within CRM, and how these relationships effect consumer perceptions. The brand can gain stronger equity through positive associations with other entities (Aaker, 1991), and therefore a brand can strengthen its equity by having positive associations with a cause via a CRM relationship. However Aaker (1991) also warned that negative associations could damage a brands equity. An underlying principle of associative learning theory is classical conditioning theory. Classical conditioning theory was developed by Pavlov in his famous dog salivation test. Marketing studies have shown that conditioning theory can be useful in understanding how one stimulus effects another (McSweeney and Bierley, 1984; Shimp, 1991), and in creating positive associative links for a brand within consumers belief set (Till and Nowak, 2000). The basis for associative learning and conditioning theory within marketing is the belief that brands should be associated with a positive attribute that will cause consumers to associate the brand with that positive attribute. For example, Harley-Davidson links its motorcycles with the attribute of freedom, rebellion, and patriotism. As a result, their motorcycles have gone far past their component parts.

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Closely related to associative learning and classical conditioning theory is signalling theory. Signalling theory transfers the concepts from associative learning and classical conditioning theory to the business community. The theory states that the quality of a product can be ascertained via other external signals. For example, a high price can signal consumers that a product is of high quality (Erevelles, Roy and Yip, 2001). Similarly, a superior warranty can signal that the firm is committed to the product, and thus the product is of high quality (Rao and Monroe, 1989). Yechiam et al. (2002) used signaling theory to show how firms involved in CRM signal customers regarding their commitment to social responsibility, thus gaining legitimacy and improved reputation. Additionally, the authors postulate when firms give to causes not apparently linked to the firms financial gain, consumers see them as more interested in quality than short-term gains. The problem with this extension is that CRM philanthropy activities are specifically tied to financial gains, and therefore the quality extension is nebulous. This extension is probably better suited to direct gifts to charitable causes. However, Yechiam et al. also employ utility theory to strengthen their argument. Utility theory states that consumers judge product quality based on the subjective utility the product provides. Brands associated with a cause, as in CRM, give consumers something extra (donation to the cause) than brands not associated with a cause. Therefore, the CRM brand will have increased utility over non-CRM brands, and will be perceived as higher quality. This increased utility can be based on altruistic motivations (Schwartz, 1977), but also can be based on self-fulfilling expectations (Eden, 1993). Basically, if the consumer believes that by purchasing a product they are helping a cause they are likely to purchase the product over a competing product because they believe they are fulfilling their expectation. 17

Yechiam et al. (2002) focused specifically on CRM however; some of their underlying theory may have been better suited to direct corporate philanthropy. Dean (2004) specifically explored different consumer perceptions of CRM versus one-time corporate donations. He used attribution and contrast effect theories to support his study. Attribution theory states that consumers make attributions (positive/negative) towards a product based on their perceptions of the industry, company and brand. This theory has been used previously in the study of CRM with mixed results. Ross, Patterson, and Stutts (1992) found that consumers found only positive attributions towards Proctor and Gamble for engaging in a CRM campaign supporting the Special Olympics. Respondents found the campaign to be acting socially responsible and not exploitive. However, Webb and Mohr (1998) found that 50% of subjects found CRM activities to be selfish in nature. Perhaps the difference in these studies is that Webb and Mohr did not deal with specific CRM campaigns, whereas Ross et al. dealt with a specific campaign. Perhaps respondents are likely to be more skeptical when dealing with a broad subject rather than a specific cause such as the Special Olympics. Dean (2004) extended these studies by postulating that CRM activities will have more negative attributions associated with them than will one-time corporate charitable contributions. Additionally, Dean used contrast effect theory to compare CRM with onetime donations. This theory states that an individuals initial attitude will serve as a reference point for future information. When new information differs from ones initial attitude a contrast effect occurs. Also, individuals go through a series of steps to make sense of new information that contrasts with their initial view. Many times this leads to over correction and a biased viewpoint. Dean used this theory to test how responsible and irresponsible firms involved in CRM and one18

time charitable activities are perceived. According to contrast effect theory (due to over-correction) irresponsible firms should gain more from corporate philanthropy than responsible firms. Finally, in a study of consumer persuasion through CRM advertising, Berger et al. (1999) relied on various theoretical frameworks. First, they accessed pro-social behavior theory to analyze gender effects within CRM. Prosocial behavior is defined as helping, sharing, and other seemingly intentional and voluntary positive behavior for which the motive is unspecified, unknown, or not altruistic (Burnett and Wood, (1988) pp. 14; Berger et al., pp. 491). Charitable donations are viewed as a pro-social act (Burnett and Wood, 1988), and CRM, although tied to a commercial exchange, is connected to pro-social behavior. Additionally, past research has pointed towards females being more pro-socially oriented in their charitable activities than males. Females tend to engage in helping behavior that is more caring, while males tend to engage in helping behavior that is more heroic in nature (Eagly, 1987). Berger et al. thus postulate that females will be more positively affected by CRM advertising than will men. One problem with this hypothesis is that it is based on a definition and theory that does not adequately support it. Per the definition, pro-social behavior is ...behavior for which the motive is unspecified, unknown, or not altruistic. However, the authors state that womens motives for helping are more nurturing and caring, and mens motives are more heroic. Therefore, both females and males have motives that are known and specific, and females motives are also altruistic, as altruistic behavior is unselfish, caring behavior. Next, they used information processing theory to support two more hypotheses. Specifically, they compare the explanatory power of three information processing models, the elaboration likelihood model (ELM) (Petty, 19

Cacioppo and Schumann, 1983), the heuristic systematic model (HSM) (Chaiken, 1980), and the motivation, opportunity and ability model (MOA) (MacInnis, Moorman and Jaworski, 1991). The ELM model postulates two distinct routes to attitude change. The central-or systematic-route occurs when a viewer, who is highly involved with the product, diligently processes the product attribute information in the ad, and ignores other ad elements and peripheral cues. Peripheral processing, by contrast, occurs when the viewer exhibits low inolvement with the product and experiences an attitude change, not from processing the product information in the ad, but as a result of associating the product with positive cues (Berger et al., 1999, pp. 491). The HSM model states that these associations may also be based on heuristics, or learned procedures such as decision rules or schematics (Eagly, 1987; Eagly and Chaiken, 1993). Both models point toward CRM cause connections acting as a cue or heuristic that would only be processed in situations of low product involvement. The MOA model, in contrast to both the ELM and the HSM models, states that peripheral cues effect both peripheral and central processing of both high and low involved consumers (Berger et al., 1999, pp.492). MacInnis and Park (1991) found the ELM and HSM models overly simplistic, and indicated that level of involvement in processing advertising information may be dynamic rather than static. Therefore, there may be measurement problems associated with the study of involvement and advertising processing. Berger et al. (1999) used this framework to develop hypotheses suggesting that CRM causes act as peripheral or heuristic cues when subjects are under conditions of low product involvement, and that causes act as executional cues that may increase a subjects involvement in an ad, which then increases their information processing. The first of these hypotheses is based on 20

the ELM and HSM models, but ignores the MOA model, and the second hypothesis is based on the MOA model, but ignores the measurement problems inherent in this model. The literature reveals a rich patchwork of theories used to analyze and understand various aspects of CRM. Utility, signal, attribution, information integration, and attitude accessibility theories all are useful in understanding niche areas of CRM study. Some also provide a foundation for broad study of the subject. For example, utility theory helps explain why combining an additional benefit (charitable donation) to a product purchase increases the likelihood of purchase (due to increased utility gained by the consumer). Likewise, signal theory helps explain how consumers can come to view firms involved in CRM more positively because they perceive the tie to the cause as a signal that the firm is socially responsible, and possibly more financially capable of providing higher quality products. While all of these theories have been useful in CRM research, this study relies on associative learning theory, further developed in the next section. Associative learning theory explains the benefits of cohesive, logically linked CRM relationships better because associations are easier to develop when the linked objects are a natural fit (Till and Nowak, 2000). The theory explains why a long-term commitment between firm and charity is beneficial to the CRM relationship because consumers develop associative links between brand and cause more easily when the message is repeated.

2.4: Underlying Theory:

Associative learning theory has at its core the principle that long-term memory consists of processing units (nodes) that are connected by associative 21

links (Martindale, 1991). Nodes are an expression of the complete set of knowledge, and information on a subject, and thus represent the complete set of knowledge and information we have about companies, brands, and causes (Till and Nowak, 2000). Associative links are how we learn about relationships among ideas, events, and objects (e.g. nodes) in our environment (Murdock, 1985). CRM partnerships build an associative link between brand and cause, and consumers make inferences about the brand/cause based on this link (Till and Nowak, 2000). Associative learning principles can guide firms in their quest to build the most effective link between their brand and a cause. Classical conditioning is one such principle that has been studied from multiple perspectives to understand how a stimulus can benefit from being associated with another (McSweeney and Bierley, 1984; Shimp, 1991). Empirical studies have described the importance of conditioning consumers for effective transfer of positive attitudes to a brand (e.g. Stuart, Shimp and Engle, 1987; Shimp, Stuart and Engle, 1991) and in changing consumer beliefs about a brand (e.g. Kim, Allen and Kardes, 1996; Kim, Lim and Bhargava, 1998). Conditioning effects are particularly important because the effects have been found to persist over time (Grossman and Till, 1998). Recent research has separated conditioning effects into two parts: affect transfer and inferential belief formation. Affect transfer is the concept that a stimulus (brand) can be positively affected by associating it with another positive stimulus (cause) in the environment. Early marketing research on conditioning effects focused on affect transfer. The studies were interested solely in examining if pairing a brand with a pleasant image resulted in positive attitudes toward the brand (e.g. Gorn, 1982; Stuart et al. 1987; Shimp et al. 1991). While affect transfer is interested in attitude shifts, inferential belief formation is interested in an individuals brand knowledge (beliefs) shift as a 22

result of association with another stimulus. For example, subjects beliefs that a pizza delivery service was fast were increased when the firm was associated with a race car. The CRM implication is that careful consideration of cause partners can extend the associative link beyond simple affect transfer, and transform consumer beliefs about the brand (Till and Nowak, 2000). Unlike affect transfer, inferential belief formation illustrates that associative links can be improved beyond simply associating a brand with any cause. While firms strive to increase both affect transfer and inferential belief formation, two concepts hinder this process. The first, overshadowing, refers to the multitude of competing elements in the marketing environment, and their impact on associative links. Marketing managers may intend to link their brand to a cause; however, consumers may link the cause with some competing element (Martindale, 1991). The second hindering concept, blocking, refers to the vast amount of nodes in an individuals mind that are linked to other nodes. For example, a brand is linked to its firm, jingle, trademark, advertising messages etc... Consumers may have trouble linking a brand to another node (cause) if he/she already links the brand to many other nodes. Repetition and belongingness are other associative learning principles that may help to overcome the problems with overshadowing and blocking. Both repetition and belongingness further the idea that proactively managing a CRM relationship can lead to stronger associative links. Links between stimuli can be developed after just one pairing (Stuart et al., 1987), however repeated pairings reinforces the link by providing a signal to an individual that when one stimuli is present the linked stimuli is expected (Rescorla, 1988). CRM relationships should therefore be more effective when the partnership message is repeated over time.

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Sporadic or one-time tie-ins are likely to be less effective than brand/cause partnerships that are nurtured over the long run (Till and Nowak, 2000, p. 476). Belongingness refers to the increased likelihood of an associative link being formed when the paired stimuli are perceived to be similar (McSweeney and Bierley, 1984). Since the environment consists of many competing stimuli, those that are more alike have better chances of being associated together (Einhorn and Hogarth, 1986). The belongingness principle suggests that cause and brand pairings that will be most easily formed will be those in which there is a perceived natural or plausible fit between the brand and the cause. This principle also suggests that in cases when a brand wants to pair with a specific cause because of the high emotional appeal of the cause, that such a pairing may not be effective for the brand if consumers do not perceive an appropriate match between the brand and cause (Till and Nowak, 2000, p. 477).

In summary, many theories have been used to illustrate various niche elements of CRM, and some theories give additional clarification on broad spectrum CRM issues. However, associative learning theory principles provide insights into what elements lead to a more effective partnership for the brand. Till and Nowak (2000) outlined the benefits for CRM partnerships from applying these principles. However, they did not tie them to specific outcomes for the brand and firm, nor did they empirically test them.

2.5: Corporate Involvement in CRM:

Much of the literature on CRM has surrounded corporate involvement in CRM (Varadarajan and Menon, 1988; Bloom, Hussein and Szykman, 1995; Drumwright, 1996; File and Prince, 1998; Fellman, 1999; Dupree, 2000, Nowak

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and Clarke, 2003). Varadarajan and Menon (1988) found six general objectives for a firm entering into a CRM relationship: 1. Increasing sales; 2. Enhancing Corporate stature; 3. Thwarting negative publicity; 4. Customer pacification; 5. Facilitating market entry; and 6. Increasing the level of trade merchandising activities for the brand(s) promoted. The first, to increase sales as a basic objective of CRM, can be found when, for example, Kimberly-Clark entered into a CRM relationship with the American Heart Association to increase incremental sales through trial, repeat, and multiple unit purchases (NCH Reporter, 1983; Varadarajan and Menon, 1988). Second, firms enter into CRM relationships to enhance their image. For example, one study found that CRM stimulated positive attitudes towards the sponsoring firm, and these results were stronger for women than for men (Ross, Patterson and Stutts, 1992). Third, companies experiencing unfavorable publicity can use CRM to reverse the negativity and pacify these feelings. For example, tobacco firms use of CRM might help improve their public image (Szykman, 2004). Fourth, CRM ads, while perceived more favorably than brand ads when released prior to a scandal, were found to lose their advantage when released after negative news (Deshpande and Hitchon, 2002). In fact, CRM ads were found to be the most vulnerable to negative news. Fifth, a firm entering a new market can appeal to local consumers by partnering with a local charitable cause. Finally, CRM can increase the level of activity for a brand. Many examples of companies specifically linking a brand to a cause are available. For example, Heinz baby food partnering with a local hospital is just one example (Varadarajan and Menon, 1988). Drumwright (1996) simplified the Varadarajan and Menon objectives and classified them as being economic, non-economic, or mixed. Economic 25

objectives were those targeted at meeting marketing objectives (increasing sales, increasing brand awareness). Non-economic objectives were those geared towards a social agenda (enhancing corporate stature, thwarting negative publicity, or customer pacification). Mixed objectives were those that helped achieve both marketing and social objectives of the firm (market entry). Drumwright also found that the longer the time commitment a firm made to a cause the more successful the CRM campaign in terms of product sales, and consumer attitudes toward the brand and firm. This was due to the fact that a longer commitment reduced consumer skepticism as to firm motives. Additionally, research has identified other factors key to successful CRM campaigns. For example, Dupree (2000) pointed out that a successful CRM campaign linked firm objectives with the cause. However Bloom, Hussein and Szykman (1995) suggest that while linking firm and cause may be desirable, it was the strength of the link to product sales that made the CRM program most successful (Roy and Graeff, 2003). Further, File and Prince (1998) split CRM objectives into corporate or product related. Corporate objectives were those that improved overall organizational image, trade relations, or created positive publicity, while product objectives included persuading consumers and broadening target markets. CRM has grown considerably over the past twenty years, and is expected to continue to expand. It has been suggested that the reason for this growth is attributable to the growing awareness by consumers of social issues (Dupree, 2000). Another possible reason for CRMs expected continued expansion is that firms are becoming more strategic in their philanthropic efforts, and are therefore searching for charitable giving that better links with their strategic marketing objectives (Fellman, 1999).

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Both perspectives are probably contributing to the expansion of CRM. Additionally, various studies have shown how firms can be most successful (increased reputation and financial success) at implementing CRM campaigns. Finally, future studies of CRM success for corporations will rely upon information garnered via consumer behavior studies surrounding CRM.

2.6: Consumer Behavior Surrounding CRM:

The study of consumer perceptions, involvement, attitudes, persuasion, skepticism, and trade-offs surrounding CRM has been extensive (Ross, Patterson, and Stutts, 1992; Dean, 2004; Forehand and Grier, 2003; Roy and Graeff, 2003; Barone, Myazaki, and Taylor, 2000; Swaen and Vanhamme, 2004; Szykman, 2004). For example, an early study of consumer attitudes towards CRM used an analysis of a real-life CRM campaign in which Proctor and Gamble offered to donate to the Special Olympics every time a coupon was redeemed for a multitude of Proctor and Gamble products. Respondents found that the offer did not exploit the cause, and that Proctor and Gamble was acting socially responsible (Ross, Patterson and Stutts, 1992). Other studies found that CRM has positive effects upon consumer attitudes towards firm products (see: Brown and Dacin, 1997; Osterhus, 1997; Two exceptions are: Smith and Stodghill, 1994; Webb and Mohr, 1998). Furthering perception, awareness, and involvement research, Webb and Mohr (1998) developed a typology of consumers participating in CRM: 1. Balancers; 2. Attribution-Oriented; 3. Socially Concerned; 4. and Skeptics. Balancers were characterized as those who attempted to balance their traditional use of buying criteria with their desire to help a cause. They were positive towards firms who were involved in CRM. 27

Attribution-oriented consumers were the most concerned with firm motives regarding CRM. They were more involved than either the balancers or skeptics, but were similar to the skeptics in that they realized the advertising nature of CRM. The socially concerned consumers were primarily driven to be involved in CRM because they had a strong desire to help the cause. These individuals were highly involved, much like the attribution-oriented consumers, but in the end they were very positive towards firms involved in CRM, as they saw the ends justifying the means. Finally, skeptics were driven by the understanding that CRM is simply advertising. They distrusted the offers and negatively viewed the firms involved. Yechian, et al. (2002) examined consumer responses towards CRM by looking into the effect CRM has on product choice. They used two experiments to test how CRM affects product choice. Specifically, the authors show that CRM effects are robust to experience, even when the products promoted are low quality. They also show that increasing the clarity of differences in utility between products may decrease, but not eliminate, these effects. Additionally, the study found that CRM benefits inferior products more, however, negative effects were only found for products whose market share was larger than the proportion of consumers with positive attitudes towards the charitable cause. Finally, the positive effects of CRM were greatest when an inferior product was being promoted in an ambiguous situation. Extending this research into consumer persuasion, Berger, Cunningham, and Kozinets, (1999) using information processing theory, examined the underlying processes influencing consumer attitudes and purchase intentions visa-vis CRM. Their results suggested that including a charitable cause in brand advertisements had a significant influence on consumer attitudes and purchase intentions, and varied across different levels of subject involvement. Moreover, 28

the charitable cause inclusion had a mediating effect that influenced perceptions and involvement of product advertisement quality. Following this research, studies were undertaken that used attribution theory to better understand consumer perceptions of CRM. Drumwright and Murphy (2001) extended Drumwrights 1996 study, by suggesting that the study of consumer attributions of firm intentions was applicable to the study of consumer skepticism towards CRM. Building on this work, Forehand and Grier (2003) studied the effect a firms stated intent has on consumer skepticism with the premise that while CRM (They use the term corporate social marketing, however their study extends to CRM) benefits both firm and society, corporations represent these offers to consumers only in terms of benefits to society. Their results showed that firms are better off honestly representing their motives honestly to consumers. Consumer skepticism was reduced when corporations represented offers honestly as being beneficial to both the firm and society. Ellen, Mohr and Webb (2000, 2002) used this research to show that firms dont necessarily need to be perceived as acting in a purely altruistic manner. Consumer skepticism was less when a firms profit motives were more obvious, and a long-term commitment by a firm caused increased CRM success. Dean (2004) compared use of CRM with more traditional one-time corporate charitable donations, and their effects on consumer perceptions of firm intentions He found that unscrupulous firms image were improved by using either CRM or more traditional philanthropic pursuits. However, scrupulous firms were better served using traditional methods, as CRM was received with more consumer skepticism as to the firms intentions. These results were supported by Swaen and Vanhamme (2004) who found that consumers viewed firms that promote themselves as being socially responsible to be more credible and to 29

have more integrity. However, when a company was found to have acted socially irresponsible, these effects disappear. Irresponsible firms using CRM were trusted less than irresponsible firms not using CRM. It would seem that CRM is not a panacea for all firms. Care should be taken to examine what the best fit might be for an organization and its marketing and philanthropic goals. Szykman (2004) tested the effects of consumer perceptions, or skepticism towards firms involved in CRM, and what effect it has on firm image, and how this effect differs across industries. The study measured both consumer attitudes toward the CRM relationship and to the firms motives. The results suggest that the harmful effects of a firms products or processes may impact how consumers view the firms CRM efforts. Overall, subjects perceived all CRM activities across industries positively. However, the nature of motives varied. Interestingly, sin industries, such as tobacco, had more positive results with their CRM campaigns geared at sustaining their business than when they undertook campaigns that may possibly reduce sales (such as stop smoking campaigns). Presumably, consumers view the latter type of campaign more skeptically. Their results support those of Dean (2004) and Ellen, Mohr and Webb (2002). Roy and Graeff (2003) expanded perception research by examining consumers attitudes toward professional athletes and teams that enter CRM relationships. The article focused on a case study of one NFL team and its players involvement in a CRM relationship. The results indicated that consumers expect businesses, athletes, and NFL teams to support local charities and communities. While 92.5% of respondents expected NFL teams to provide charitable support, approximately 59% indicated that they would be more likely to purchase a ticket for a team game if they knew the team was involved in charitable activities. These results extend to other businesses being involved in sports-related charity events. For example, FedEx annually supports the St. Jude 30

Classic professional golf tournament. Since 1986, when FedEx became involved, the tournament has raised over $10 million for St. Jude Childrens hospital (Irwin, Lachowetz, Cornwell and Clark, 2003). A case study of this partnership (Lachowetz and Irwin, 2002) found FedEx gained accolades from consumers for their involvement in the event. While both of these studies used a broader definition of CRM than is used in this study, the results provide some interesting insights for CRM research. For example, as CRM falls under the broader umbrella of CSR, professional sports teams may also benefit from CRM activities (as defined in this dissertation). For example, ticket prices that include a percentage gift to a designated charity may be as well perceived as other CSR activities. Other studies have evaluated consumer involvement and awareness of CRM (Broderick, Jogi and Garry, 2003); and consumer confusion about CRM (Olsen, Pracejus and Brown, 2003; Pracejus, Olsen and Brown, 2004). Broderick, Jogi and Garry (2003) furthered research into consumer involvement surrounding the potential for involvement to account for differences in consumers degree of effort devoted to consumption activities (Laaksonen, 1994), and research into consumers varying degrees of involvement surrounding charitable giving (Bennett, and Gabriel, 2000). They investigated the

underlying motivations and involvement (with the designated charity) of consumers who supported CRM programs, and found that respondents with a high emotional level of individual involvement were more likely to perceive, be aware of, and to respond to CRM offers. Additionally, consumers viewed organizations that enter into appropriate CRM relationships more positively than organizations that partnered more inappropriately. Olsen, Pracejus and Brown (2003) examined consumer confusion surrounding percentage of profit donated wording used in various CRM offers. 31

Results indicate that when a CRM offer to donate is expressed as a percentage of profit, considerable consumer confusion, and overestimation of the amount expected to be donated ensues, resulting in skepticism towards the organization. This bias is not attenuated even when the consumer involved has extensive accounting training. The authors also tested for experimental effects and could not account for the effects. Additionally, consumers report more positive attitudes and stronger purchase intentions as a function of the percentage value of the donation. However, these results do not work as a function of whether the offer is expressed as a percentage of profit, or a percentage of price. They conclude that the upward bias associated with percentage of profit donations can be somewhat mitigated by using affirmative disclosures. However, the greatest mitigation is achieved by expressing the donation as a percentage of price rather than profit. In a follow-up analysis the authors examined how consumers can potentially become confused when viewing CRM advertisements (Pracejus, Olsen and Brown, 2004). In a series of three studies they discovered that 69.9% of copy formats are abstract, because they are expressed in terms of portion of proceeds to be donated. Additionally, only 25.6% of ads are estimatable as they are expressed as percentage of profit to be donated, and only 4.5% are calculable because they are expressed as percentage of price to be donated. The paper finds that even slight variations in abstract wording can lead to considerable confusion among consumers as to the amount being donated. The amount of the donation estimate for each copy format varies significantly across individuals, moreover the donation amount can effect choice. In conclusion, a large amount of abstract ad copy is used within CRM circles, leading to considerable confusion among consumers as to donation amount, which in turn can impact consumer choice. 32

Others explored the trade-offs that consumers consider when examining CRM offers (Pracejus et al., 2004). Strahilevitz and Meyers (1998) examined consumer perceptions of the trade-off between potential price reductions and charitable incentives. Their findings show that CRM works better with frivolous products than with functional products. They postulate that this result is because the altruistic utility offered by charity incentives may be more complimentary with the feelings generated from frivolous products than with the more functional motivations associated with practical products (p. 444). However, it is acknowledged that the findings may be due to consumers supporting CRM activities where there is more congruence between the firm and charity. The latter is probably more likely as later studies will illustrate. Strahilevitz (1999) then examined how the size of the donation impacted the effectiveness of CRM. The results indicated that when consumers were faced with a choice between a discount or a donation, and the amount of the discount or donation was large (25% to 50% of purchase price) then they overwhelmingly chose the discount. This was particularly true for practical, as opposed to frivolous products. When the discount or donation was small (1% to 5% of purchase price) consumers tended to select the donation more often, and there was no difference between practical and frivolous products. Finally, Barone, Miyazaki and Taylor (2000) look at consumer trade-offs between price and quality within CRM. The methodology asked subjects to select price or quality under varying levels of either altruistic or self motivation between two different brands using CRM. The results indicated that CRM impacted brand choice, but only if price and quality remain constant.

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2.7: CRM Partnerships:

While the vast majority of research into CRM has focused on corporate involvement and consumer behavior, considerable recent research has investigated the effects of the quality of the CRM partnership (Till and Nowak, 2000; Pracejus and Olsen, 2002; Kalligeros, 2005; Lafferty, Goldsmith and Hult, 2004; Lafferty and Goldsmith, 2005). The research suggests that firms with high levels of congruence between their core businesses and social activities are viewed more favorably than firms who have lower levels of congruence (Brown and Dacin, 1997; Sen and Bhattacharya, 2001). Kalligeros (2005, p. 18) states, CRM is both art and science. The art is in the relationship, while the science is the research that focuses your choices on the right issue and nonprofits in alignment with your needs. She continues by listing criteria every relationship should be measured by. For example, will the relationship lead to significant social change? Will it be attractive to the firms target market? Will the results be measurable, so that consumers can easily see that participation helps? And, what causes are competitors involved with? Firms and causes should come to an agreement early on regarding mutual goals, responsibilities, and how success will be measured. In conclusion, continuous communication between parties is essential to make sure the relationship stays on track. Kalligeros brings up some interesting points that align well with other research; however one might argue that both the relationship and the research into aligning needs entail some level of art and science. Building on the work of Strahilevitz and Meyers (1998), which hints at the possibility that congruence between firm and charitable cause may impact the success of CRM activities, Pracejus and Olsen (2004) investigate the fit between firm/brand/cause. Additionally, the authors extend other research into elements 34

of fit, such as, fit between brand extensions and core brands (Aaker and Keller, 1990, 1993), and composite brand alliances (Park, Jun and Shocker, 1996). When fit between core brand and extension is strong, the extensions have been found to enhance evaluation of the core brand (Aaker, and Keller, 1990, 1993). Similarly, studies of composite branding alliances found that greater fit leads to greater success (Park, Jun, and Shocker, 1996). These studies and others (e.g. Kamins, and Gupta, 1994) show that consumer attitudes towards brands is increased when fit is high. Pracejus, and Olsen (2004) note that CRM is similar to these and other brand alliances because CRM links a brand to another object, a charitable cause. Therefore, CRM partnerships that have strong fit should have improved performance, such as increased consumer attitudes toward the brand and firm, and thus greater likelihood of purchase. Using choice-based conjoint analysis, Pracejus, and Olsen (2004) not only examine whether the fit between firm/brand and charitable cause impacts CRM success, they also measure the magnitude of effects. The results indicate that CRM impacts consumer choice, and that firm/brand and charitable cause fit increases this effect. Specifically, study 1 showed that CRM campaigns that had a high degree of fit between brand and charity had nearly five times more impact on choice, in terms of price trade-off than did campaigns with a low degree of fit. Study 2 revealed an even larger effect with high-fit campaigns having ten times the impact on choice as low-fit campaigns. Using associative learning principles, Till and Nowak (2000) developed a framework to help firms understand how building strong relationships with a charitable cause can facilitate the marketing success of CRM activities. They conclude with thirteen managerial implications that should lead to more effective CRM relationships. Some examples are:

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1. 2. 3.

Cause-related marketing alliances can affect consumers overall attitude toward the sponsoring brand. Cause-related marketing alliances will be more effective when used consistently over time. The perceived fit, similarity, or belongingness should be an important consideration for a brands selection of a cause alliance partner with which to pair. (Till and Nowak, p.480-481, 2000)

Finally, Lafferty and Goldsmith (2005) continue the investigation of the brand/cause relationship by examining whether the brand helps the cause or the cause helps the brand. The authors note that it is generally assumed that CRM benefits both the brand and the cause; however the majority of research has been focused on benefits accrued by the for-profit firm and brand. This study investigates not only benefits to the brand, but also potential benefits to the charitable cause. The results show that CRM benefits unfamiliar causes, but has less impact upon familiar causes. The brand accrues positive attitudes regardless of the familiarity of the cause. The findings of this study suggest that managers of unfamiliar charities should look to incorporate CRM into their marketing arsenal more than those of familiar causes, and brand managers can benefit from alliances with either familiar or unfamiliar causes.

2.8: Effects of CRM on Charitable Causes:

Lafferty and Goldsmith (2005) analyzed potential benefits to non-profit and for-profit organizations entering into CRM. Others have specifically examined CRM effects on non-profit causes. For example, Basil and Herr (2003) analyzed how fit impacts attitudes towards charitable organizations involved in CRM. Their results suggest the effect of fit is very strong, and can compensate for problems 36

with poor attitudes toward a corporate partner being transferred to the charity. Specifically, subjects compensated for poor attitudes toward a firm if they thought the firm and cause were logically linked. Additionally, with the proliferation of charitable causes, charities must work very hard to gain the publics attention (Warneke, 2005). An alliance with a for-profit corporation can give a charity another angle to gain access to more donors. As early as 1996, Andreason studied how non-profits benefit from partnering with a for-profit organization, and he urges non-profits to become proactive strategists seeking out corporate partners that have brands that match well with their cause. Additionally, he suggests that most corporations look to partner with a cause in hopes that the causes positive image will transfer to the brand or firm. However, non-profits have more to offer than just image. Corporations also benefit from publicity garnered from the relationship and access to the charitable donor base. Further, Andreason warns non-profits about potential pitfalls for nonprofits entering into CRM partnerships. Non-profits with limited resources need to be careful not to waste resources on CRM relationships that have high potential to fail. Additionally, they need to be aware of potential cannibalism of existing donations. CRM will increase donations, but if current donors cut back because of perceptions that overall donations will increase due to CRM, the potential exists for total donations to actually decline. Other issues of note are the loss of non-profit organizational flexibility that may result from ties with non-profits; problems associated with being partnered with an unethical corporation; and over-reliance on corporate funding.

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2.9: Word-of-Mouth:

Word-of-Mouth (WOM), (or viral or buzz marketing) promotion has received considerable attention within the marketing literature (Duhan, Johnson, Wilcox and Harrell, 1997; Dye, 2000; Rosen 2000; Higgins, 2002; Pruden and Vavra, 2004; Mohr and Chiagouris, 2005). Described as the oldest form of media, WOM is promotion of a firms products or services outside the controllable marketing mix (Pruden and Vavra, 2004). As early as 1971, marketing research discussed that WOM was nine times more effective than traditional advertising at changing unfavorable or neutral attitudes into positive ones (Day, 1971). Pruden and Vavra (2004) found consumers viewed 90% of advertising to not be credible, but 90% of WOM was credible. The growing criticism of the advertising industry, increased difficulty in targeting markets due to fragmented audiences, and technological threats to television advertising, such as Tivo and the internet, firms are looking for new ways to create a buzz for their brands (Kaikati and Kaikati, 2004). Therefore, marketing academics and executives have been very interested in trying to increase WOM. However, when corporations have tried to manipulate WOM directly they have found an unwanted backlash effect (Pruden and Vavra, 2004). This has led to numerous studies (e.g. Silverman, 2001; Rosen, 2002; Thomas, Jr., 2004; Pruden and Vavra, 2004; and Mohr and Chiagouris, 2005) that have investigated how organizations can increase WOM using stealth techniques that do not result in an unwanted backlash. Thomas (2004) suggests that firms have numerous tools, such as testimonials, observable usage, endorsements, hosted chat rooms, and referral programs that can lead to increased WOM. Pruden and Vavra (2004) suggest that firms implement WOM monitoring programs so that firms can take advantage of advocates and pacify 38

complaintants. Mohr and Chiagouris (2005) continue the monitoring idea by suggesting that the internet presents new ways in which this process can be enhanced. Verlegh, Verkerk, Tuk and Smidts (2004) also studied WOM effects. Their results show that when ulterior motives of the firm/brand are diminished WOM is unaffected. Finally, WOM has some unique aspects when compared to other forms of promotion. First, WOM is the source of information most relied upon by consumers, (Pruden and Vavra, 2004). Thus, WOM more easily spreads ideas than other marketing messages. Second, WOM communications are generally represented in a story (Delgadillo, and Escalas, 2004). Third, a satisfied customer usually tells 3-5 people about their positive experience. This leads to a multiplier effect, in which the idea spreads exponentially (Pruden, and Vavra, 2004).

2.10: Summary and Conclusions:

Considerable research has been conducted on CRM. While various definitions have been developed, and the domain expanded, the strict definition developed by Varadarajan and Menon, (1988) is the best and is used in this dissertation. Additionally, various theories have been used to illuminate CRM (for example, information integration, attitude accessibility, associative learning and attribution theory). However, these theories have each been selected to explain certain CRM niches, but do not provide an overriding framework of CRM success. Previous research efforts are to be applauded for increasing our knowledge of CRM. The purpose of this dissertation is to build on this work by using associative learning theory to explain how proper brand/cause relationship 39

antecedents may lead to more successful CRM partnerships for the brand. This study also introduces WOM, as both outcome and moderating effect for longterm success. The next chapter will demonstrate how these antecedents explain both short-term CRM success, and theoretical long-term CRM success via increased WOM transfer. Theories developed to study CRM have resulted in a rich body of literature. However, these various theories have aimed at illuminating subsets of CRM. For example, Varadarajan and Menon (1988) designed their article specifically toward helping firms better use CRM as a marketing tool. Likewise, Yechiam et al. (2002) is aimed at understanding CRM affects on product choice. In the same way, Berger et al. (1999) are interested only in consumer persuasion in CRM contexts. Additionally, Webb and Mohr (1998) focused solely on developing a typology of consumer responses to CRM. Associative learning theory has been used within marketing to describe brand extensions, alliances, and most recently CRM. However, within CRM the theory has only been used to outline partnership antecedents, and was never empirically tested (e.g. Till and Nowak, 2000). Also, a framework for linking these antecedents with specific consequences has yet to be developed. The broad scope of principles available from associative learning theory is well suited to understanding how a brand can partner with a cause for maximum benefit. Finally, the previous articles on CRM did not include WOM as a desired outcome of CRM. Given the extensive body of work on WOM, it only makes sense that WOM would be a desirable outcome of CRM. Particularly, since strengthened firm image is a desirable outcome of CRM, and positive WOM can help improve firm image (Pruden and Vavra, 2004).

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CHAPTER 3:

MODEL, HYPOTHESES AND RESEARCH PROPOSITIONS

3.1: Hypotheses Development:

The marketing literature has devoted much space to the subject of fit. The fit between core brands and subsequent extensions has been found to enhance consumer perceptions of the extension when the core brand was well liked (Aaker and Keller, 1990, 1993). Composite branding alliances were also found to be beneficial when the brands in the alliance had greater attribute complimentary fit (Park et al., 1996). Also, product/spokesperson fit was found to impact product attitudes (Kamins and Gupta, 1994). Finally, Morgan and Hunt (1994) discovered that shared values among partners were an important determinant of relationship trust and commitment. The CRM literature builds on this research by positing that firms that align their marketing goals with charitable organizations that match well with their goals will be more successful (Till and Nowak, 2000; Lafferty and Goldsmith, 2005). Associative learning theory provides a foundation for this prediction. Particularly, the belongingness principle directly states that since most environments have many competing stimuli, those that are most similar to one another have the best chance of forming an associative link. Belongingness of the two stimuli also helps overcome the problems of overshadowing and blocking by forging a stronger link between the two. When applied to CRM, associative learning theory predicts that a brand/cause partnership that is a natural fit should stand a better chance of forming an associative link in the minds of consumers

41

(i.e. be perceived as belonging together). This in turn should lead to greater chances of affect transfer and inferential belief formation. Therefore:

H1:

A CRM brand/cause relationship in which the brand and the cause are logically linked (i.e. they serve somewhat similar groups, or have common objectives) will be perceived by consumers to be a better fit between the two.

The antecedent, longevity, has also been frequently mentioned in the CRM literature as a means to more successful CRM relationships. Drumwright (1996) found that the longer a CRM campaign ran, the higher the perceived commitment of the firm, and the more successful the campaign. Additionally, she found that greater time commitment led to greater perceived balance between other-interested and self-interested motives. Associative learning theory provides theoretical support for the prediction that greater time commitment will lead to a stronger CRM partnership. The theory states that repetition of paired objects will strengthen the associative link between the two. The repetition of the pairing acts as a signal to individuals that when one stimulus is present they should expect the other. CRM partnerships that are consistently managed over the long-term should be more effective than one-time or short-term relationships. Therefore:

H2:

A CRM brand/cause relationship that has a long history (longevity/commitment) will be perceived by consumers to have more brand/firm commitment.

42

These two antecedents form the framework for studying successful CRM relationships for both the brand and firm. With the antecedents in place, successful consequences from the CRM literature can be linked to the partnership using underlying principles from theory. In order to accomplish this, a latent (unobserved) variable is introduced into the model. Associative learning theory illustrates how both fit and longevity (commitment) work synergistically to produce a better associative link between brand and cause in the consumers mind. This synergistic link is represented in the model by introducing a non-measured latent variable, CRM Relationship Strength. This study is interested in the combined effect (interaction) of the two on CRM outcomes. The latent variable represents these two dimensions. It becomes the linking mechanism between the antecedents and consequences of a successful CRM partnership. Previous studies have theorized that CRM relationships can produce multiple benefits for the brand and firm. Varadarajan and Menon (1988) postulated that a broad range of objectives can be achieved, including enhancing brand and corporate image, and increasing sales. Numerous other articles have reinforced this initial view. Brand benefits from CRM have received considerable attention (Shimp, 1991; Berger et al. 1996; Brown and Dacin, 1997; Sen and Battacharya, 2001). Likewise, firm benefits from CRM have also been analyzed (Ross et al., 1992; Berger et al. 1996). Finally, CRM impact on purchase decisions has been studied (Smith and Alcorn, 1991; Creyer and Ross, 1996; Barone et al., 2000). While the literature reveals numerous theoretical and empirical studies supporting CRM as a means of improving firm and brand image, and increasing purchase intentions, none have combined all three benefits in an empirical study.

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Additionally, no previous article, to my knowledge, has investigated how a stronger CRM relationship can produce better results than a weaker relationship. The literature has stated that any association between brand and cause should create positive affect among consumers (Bagozzi and Moore, 1994; Brown and Dacin, 1997; Sen and Bhattacharya, 2001). However, associative learning theory points out that an association is not guaranteed, but a relationship that has good fit between brand and cause, and lasts over a long time should improve the odds of an association being made in the consumers mind. Once the associative link is made affect transfer and inferential belief formation should occur. Once these occur, the theory states that positive attributes of the cause should transfer to the brand and firm. Therefore:

H3:

Stronger CRM relationships will have more positive consumer attitudes toward firm image.

H4:

Stronger CRM relationships will have more positive consumer attitudes toward the brand.

The literature has also demonstrated that CRM partnerships can lead to increased purchase intentions for the brand (Berger et al., 1999), and these effects are robust to experience (Yechian et al., 2002). Associative learning theory hints at this connection via inferential belief formation. Once the consumer transforms their cognitive structures for the brand in a positive way product choice should be improved. However, as stated previously, the associative link must be made before this effect can take place. Therefore:

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H5:

Stronger CRM relationships will have higher consumer purchase intentions for the brand.

Finally, associative learning theory helps explain the last hypothesis. WOM is the transfer of information on a brand or a company among individuals not using traditional media. The CRM literature does not specifically discuss WOM as a potential outcome of CRM. However, logic dictates that WOM should be a desired outcome of CRM. WOM has less skepticism associated with it than traditional media, and customers generally tell 3-5 people about a positive experience. This makes WOM communication easily replicated throughout society. Once inferential belief formation occurs consumers not only have positive attitude transfer from the cause to the brand, but also have improved cognitive structures. Stronger positive product knowledge should improve positive WOM. Thus, when a brand successfully combines with a cause (with both fit and for a long-term relationship) to strengthen the relationship it follows that positive WOM should be increased for the brand. Therefore:

H6:

Stronger CRM relationships will have more positive WOM.

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WOM
H3

Fit

H1

H2

Brand/Cause Relationship Strength

H4 H5

Firm Image

Brand Image
H6

Longevity Purchase Intentions

Figure 1: Model to be Tested

These hypotheses represent the antecedents and consequences of a strongly linked CRM relationship. These hypotheses are graphically displayed in the proposed model for this study (Figure 1). The previous section described why WOM is a consequence of an appropriately linked CRM relationship. However, WOM is also a long-term antecedent due to the exponential effect of WOM. This occurs because as WOM increases more consumers are exposed to the offer, which should lead to increased brand awareness, firm image, and purchase intentions. Additionally, WOM should continue to expand as well. The theoretical model shows R1-R3, which represents the following three research propositions:

R1:

WOM will lead to more positive long-term consumer attitudes toward firm image.

46

R2:

WOM will lead to more positive long-term consumer attitudes toward the brand.

R3:

WOM will lead to greater long-term likelihood of consumer purchases.

These three research propositions are presented because it is theorized that increased WOM will lead to further dissemination of brand information beyond the subjects participating in the CRM offer, and will therefore lead to future goodwill and sales for the firm and brand (see Figure 2 for a graphical representation of the full theoretical model). However, testing this theory is beyond the scope of this dissertation. The next chapter will show the methodology that will be employed to test the six hypotheses.

47

WOM
R1 H3

Fit
H1 H4

R2

Firm Image T2

Firm Image
H5 R3

H2

Brand/Cause Relationship Strength

Brand Image
H6

Brand Image T2

Longevity Purchase Intentions Purchase Intentions T2

Figure 2: Theoretical Model

These six hypotheses and three research propositions are designed to answer the six research questions outlined on page three. First, the impact the antecedents, fit and longevity, have on consumer evaluations of CRM partnerships (RQ1) is answered via H1 and H2. Second, these positive consumer evaluations should result in certain consequences of the CRM partnership (i.e. increased WOM, brand and firm evaluations, and greater purchase intentions) (RQ2-5) are answered via H3-H6. Finally, the theorized long-term impact of WOM on the overall model (RQ6) is answered by the three research propositions.

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CHAPTER 4:

METHODOLOGY

4.1: Pilot study:

All four scenarios were pre-tested to ensure each scenario appropriately represents each category. Manipulation checks were conducted for fit and longevity. Twelve fictional brands were tested to find which items rate highest and lowest for fit with the charity. Next, two time frames were selected for the actual study (short-term relationship/long-term relationship). The pre-test rated three time frames (new; 1 year; 5 years) to discover which two accurately represent each category. Finally, t-tests confirmed that fit and longevity differences between selected variables were statistically significantly different at the .05 level. Additionally, the scenarios were pre-tested to ensure readability. Pretesting was conducted among a group of respondents similar in profile to the final sample. Professors, undergraduate, and graduate students at a southeastern university comprised the pre-testing sample. Respondents were asked to complete the questionnaire and to provide comments. The questionnaire was adjusted based on this feedback. To prevent bias based on prior knowledge of a brand, fictional brands were chosen for pre-testing (examples include ABC toys, and ABC childrens clothing). Pre-testing was conducted on a dozen fictional brands in various product categories to ensure one rated low on fit and one high on fit (the brand performing lowest on fit, and the one performing highest will be chosen for the respective treatment groups). Give Kids the World was selected as the 49

charity because it is not widely advertised, and thus probably not widely known (however, pre-testing confirmed this). Since the focus of this study is the effect of CRM on the brand/firm not the charity, an actual charity was chosen to provide realism to the experiment. Additionally, the researcher is interested in providing results to this particular charity. 42 professors, graduate and undergraduate students from a southeastern university were chosen for the study. The first stage, readability of results, revealed that subjects had no problems with the readability of the scenarios, and understood the correct meaning of each. However, several subjects had problems with the directions for the pre-test questionnaire. It was determined that the pre-test analysis differed somewhat from the final analysis because the underlying purpose was different. This was confirmed when those subjects who had difficulty with the pre-test directions were shown the main study and were able to follow the directions easily. The only real problem that arose in this stage was that approximately half of the subjects expressed concern about the dislike question, (brand image indicator). Specifically, they did not think the question made sense. It was determined to leave the question in for the main study for two reasons. First, the question has been tested in past studies and has shown good reliability, and second, the question was retained to see if the main study showed any peculiarities. The second stage tested for differences in perceived fit between the various brands and the charity. Table 4.11 shows descriptive statistics for each of the twelve fictional brands used in the pilot study. An analysis of means shows that kids wear was perceived by subjects to have the closest fit with the charity. Whereas, subjects found sparkplugs to have the least fit (condoms displayed slightly lower fit, but it was determined that this category could be offensive to some and was therefore removed). A t-test of kids wear and sparkplugs 50

showed a statistically significant difference at the .05 level. Therefore, these two brands were retained for the main study.

Table 4.11: Pre-Test Results for Brands

Descriptive Statistics toycar menswear diapers condoms babyfood kidswear sparkplugs sunglasses coffee schoolsupp carseats toiletpaper Valid N (listwise) N 42 42 42 42 42 42 42 42 42 42 42 42 42 Minimum 1 1 1 1 1 1 1 1 1 1 1 1 Maximum 7 7 7 7 5 6 7 7 7 6 6 7 Mean 1.71 5.52 2.00 6.38 1.71 1.45 6.36 5.60 5.60 2.17 1.93 4.95 Std. Dev. 1.29 1.67 1.55 1.43 1.09 1.15 1.41 1.67 1.67 1.46 1.55 1.95

Paired Samples Test Paired Differences Mean kidswear sparkplugs

Std. Dev.

df

Sig.

Pair 1

-4.90

2.14

-14.86

41

0.000

Finally, Table 4.12 shows descriptive statistics for each of the three time frames. An analysis of the means shows consistent expected differences between the three time-frames. A t-test for new and 5 year relationships was statistically significantly different at the .05 level, as was the t-test for 1 year and 5 year relationships. However, it was determined that to allow for consistent wording in the scenarios a six month time frame should be used to represent the

51

short longevity treatment scenario in the main study. The t-test for new and one year time-frames showed no significant statistical differences between the two, and thus supported this decision. Also, discussions with subjects confirmed that no differences in commitment on behalf of the brand would be perceived between a new and a six month relationship.

Table 4.12: Pre-Test Results for Time-Frames

Descriptive Statistics new oneyear fiveyear Valid N (listwise) N 40 40 40 40 Minimum 1 1 1 Maximum 7 6 7 Mean 3.15 2.73 2.03 Std. Deviation 1.85 1.24 1.93

Paired Samples Test Paired Differences Mean new - oneyear oneyear - fiveyear new - fiveyear 0.43 0.70 1.13 Std. Deviation 1.84 1.68 3.11 t 1.46 2.63 2.28 df 39 39 39 Sig. (2tailed) 0.15 0.01 0.03

4.2: Data Collection:

The data was collected via a questionnaire (see appendix I) consisting of a scenario describing a CRM relationship followed by a series of questions to test each of the hypotheses. Greenfield Online, an online data collection firm, distributed the survey to members of their online data collection database with a goal of collecting at least 500 usable surveys. The respondents represented the

52

consumer population, and were more than sufficient to reach the minimum threshold of 20 respondents per construct. The research design for the scenarios was a 2 (fit: high/low) X 2 (longevity: high/low) factorial design. Each respondent saw only one scenario, (Group A saw the high fit/high longevity scenario; Group B saw the high fit/low longevity scenario; Group C saw the low fit/high longevity scenario; and Group D saw the low fit/low longevity scenario). The scenarios followed the format used by Lafferty and Goldsmith (2005).

4.3: Sample Characteristics:

Data was collected from consumers throughout the United States. An online data collection firm was employed to help collect the data. The Greenfield Online firm provided demographic data on the respondents. Four versions of the survey, each representing one of the treatment groups, were available for completion on the Greenfield, Inc. website. 1241 surveys were completed, but since treatment one had the fewest responses (197) a random sample of 197 was taken from each of the remaining 3 groups resulting in 772 usable surveys (197 for each treatment group). A comparison between completed surveys and Greenfields data base indicated no significant differences between the two with regards to gender, income, education, and race. Therefore, no response bias was indicated. The demographic distribution of subjects is shown in Table 4.3. The distribution consisted of more females (63%) than males (37%). The youngest subjects (18 to 24) accounted for 15.1%, while the 25 to 34 age group was the largest, accounting for 29.1% of all respondents. Overall, the dispersion by age was very good with 21%, 20.2%, and 14.4% representing the 35 to 44, 45 to 54, 53

and 55 to 65 age groups, respectively. As expected, the majority of subjects were white (77.6%), however, the remaining 22.4% were fairly well spread out among blacks (6.7%), Asians (6.2%), and Hispanics (4%). The majority of subjects had at least some college (68.5%), while 39.5% had graduated from college with at least a bachelors degree. The results show a good dispersion by income with the $50,000 to $75,000 category being the largest accounting for 22.8%. An analysis of zip codes from respondents reveals over 500 different zip codes from through out the United States. No more than seven respondents came from any one zip code illustrating a broad geographic distribution. Finally, the results confirm that the chosen charity, as expected, is not well known. Only 16.8% of respondents acknowledged having heard of Give Kids the World prior to the study.

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Table 4.3: Demographics

N Gender Male Female Age 18-24 25-34 35-44 45-54 55-65 772 285 487 772 118 225 162 156 111 Frequency (%) 100 36.9 63.1 100 15.3 29.1 21 20.2 14.4

Race White Black Asian Hispaniic Other Rather not say Education High School Some College College Degree Some Grad. School Graduate Degree Income Less than $20,000 $20,000 - $34,999 $35,000 - $49,999 $50,000 - $74,999 $75,000 - $100,000 Over $100,000

772 599 52 48 31 29 13 772 243 224 182 37 86 759 131 135 152 173 75 93

100 77.6 6.7 6.2 4 3.8 1.7 100 31.5 29 23.6 4.8 11.1 100 17.3 17.8 20 22.8 9.9 12.3

Give Kids The World Awareness 743 Yes 125 No 618

100 16.8 83.2

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4.4: Operationalization of Constructs:

The study uses six constructs that are operationalized as follows:

4.41: H1: Fit:

Ellen, Mohr, and Webb (2000) previously studied the fit between a brand and a cause in a CRM relationship. They developed a scale to measure this relationship that will be used in this study. The authors use three, seven-point semantic differentials that evaluate the extent to which there is a strong relationship between a brand and a cause. The original scale was intended for retailers involved in cause marketing, but can easily be adapted to consumer brands (Bruner, Hensel, and James, 2005). The authors reported an alpha of .87 for the scale. The scale items (as adapted for consumer brands) are as follows (Ellen, 2003): What do you think about brand contributing a portion of sales to cause? 1. does not make sense given their business / makes sense given their business. 2. is not consistent with their business / is consistent with their business. 3. is not related to what they sell / is related to what they sell.

4.42: H2: Longevity (Commitment):

Several studies have shown longevity of CRM relationships to be the most important aspect of perceived firm commitment to the cause, thus leading to 56

greater success for the brand (Dahl, and Lavick, 1995; Drumwright, 1996; Ellen, Mohr, and Webb, 2000, 2002). Ellen, Mohr, and Webb (2000) developed a scale consisting of four, seven-point semantic differential items to measure a potential donors attitude towards a firms commitment to a CRM cause. Though the scale was designed for donor opinions it can easily be adapted for other CRM activities, such as consumer perceptions (Bruner, Hensel, and James, 2005). The authors reported an alpha of .91. The scale items as adapted for this study are as follows (Ellen, 2003): Do you think the business depicted in the above scenario... 1. 2. 3. 4. is not committed to the charity / is committed to the charity has little invested in the charity / has a lot invested in the charity is not interested in the charity / is interested in the charity is giving a little to the charity / is giving a lot to the charity

4.43: H3: Firm Image:

The CRM literature has consistently stated that one of the potential benefits of CRM is improved image of the sponsoring firm. To measure this hypothesis a scale developed by Speed and Thompson (2000) will be used. The scale consists of three, seven-point Likert statements which measure an individuals attitude surrounding the effect a companys support for an event has on that individuals attitude toward that firm (Bruner, Hensel, and James, 2005). The authors report an alpha of .95 for the scale. The scale items are as follows: 1. This sponsorship makes me feel more favorable toward the sponsor. 2. 3. This sponsorship would improve my perception of the sponsor. This sponsorship would make me like the sponsor more. 57

4.44: H4: Attitude Toward the Brand:

The CRM literature also posits that increased consumer attitudes about a brand is a potential benefit to be gained from a strong brand/cause partnership. A scale developed by Lee, and Mason (1999) was used to measure this hypothesis. The scale consists of four, seven-point Likert statements that measure an individuals attitude toward a brand featured in an ad that the individual was exposed to (Bruner, Hensel, and James, 2005). Although the scale was designed for an individual brand ad, the measurement of brand attitudes for a brand within a CRM ad is consistent with this approach (the word scenario is substituted for the word ad). The authors report an alpha of .92 for the scale. The scale items are as follows: 1. The brand in the scenario is likely to possess the stated scenario claims. 2. 3. 4. I react favorably to the brand. I feel positively towards the brand. I dislike the brand. (reverse)

4.45: H5: Purchase Likelihood:

Finally, the CRM literature states that a primary goal of CRM promotions is to increase the likelihood of purchase. This hypothesis was measured using a scale developed by Speed, and Thompson, (2000). The scale consists of three; seven-point Likert statements that measure the increased likelihood a consumer would buy the product of a sponsor of a particular event (Bruner, Hensel, and James, 2005). The authors report an alpha of .94 for the scale. The scale items used are as follows: 58

1.

This sponsorship would make me more likely to use the sponsors product.

2.

This sponsorship would make me more likely to consider this companys products the next time I buy.

3.

I would be more likely to buy from the sponsor as a result of this sponsorship.

4.46: H6: Word-of-Mouth:

A review of the literature on WOM revealed that it is a highly desirable form of promotion that firms actively seek. To measure this concept, a scale developed by Price and Arnould (1999) was used. The scale evaluates the extent to which an individual would be willing to recommend the CRM offer to others. This will show the short-term WOM benefits of a properly engineered relationship. However, since WOM has exponential effects it is theorized that long-term benefits will be gained as well (see Figure 2). The scale consists of three, seven-point statements; the authors report an alpha of .95 for the scale. The original scale was developed for a service provider, however, there is no logical reason a CRM promotion offer could not be substituted. The scale items as adapted for this study are as follows (the only change is substituting the CRM offer for the name of the service provider): 1. I would recommend this promotion to someone who seeks my advice. 2. 3. I would say positive things about this promotion to other people. I would recommend this promotion to others.

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4.5: Non-Response Bias:

The online firm assigned IDs to all subjects so that respondents can be separated from non-respondents (respondents are defined as those who complete the questionnaire and non-respondents are those who do not complete it). As all surveys will be sent to subjects who are members of the online firms database, the IDs allowed for this proposed separation. Demographic information was gathered from respondents via their questionnaire answers, whereas non-respondent information was gathered from the online firms database. Due to the nature of the data, a non-parametric independent sample Mann-Whitney U test was employed to test the demographic differences between respondents and non-respondents. This procedure has been suggested by numerous previous articles to test non-response bias (Armstrong and Overton, 1977; McClave and Sincich, 2000; Smith, Olah, Hansen, and Cumbo, 2003. Thakur, 2005).

4.6: Statistical Analysis:

In order to test the CRM model the data gathered from the questionnaire will be subjected to Structural Equation Modeling (SEM). SEM consists of both a structural and a measurement model that can be estimated simultaneously (Kenny, 1979; James, Muliak, and Brett, 1982; Williams and Hazer, 1986; Anderson and Gerbing, 1988; Novak, Hoffman, and Young, 2000; Thakur, 2005). The measurement model illustrates which variables indicate each construct, while the structural model specifies causal relationships among constructs (Thakur, 2005). 60

4.61: Variables:

The independent variables are fit, and longevity (commitment). The dependent variables are strength of partnership (latent), firm image, brand attitude, purchase likelihood, and WOM. WOM is theorized to have a long-term impact on all four dependent variables, however, as was stated earlier, testing this theory is beyond the scope of this study.

4.62: Model Specification:

The Model in Figure 1 represents the path diagram of causal relationships among constructs. The exogenous constructs are the two independent variables mentioned above, while the endogenous constructs are the five dependent variables. The preexisting scales used provide multiple indicators of each endogenous construct (except for the latent construct). The hypotheses are represented by the exogenous/endogenous relationships. The exogenous construct, fit, is measured by 3 indicators, while the other exogenous construct, longevity (commitment) has 4 indicators. Likewise, the WOM, purchase intentions, and firm image endogenous constructs each have three indicators, while brand attitudes has four. For each of these hypothesized effects a structural coefficient is estimated. Additionally, an error term representing specification and random measurement error is included. The structural equations derived from this path diagram are displayed in table 4.6.

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Table 4.6: Structural Equations

Structural Equations Y1 = b1x1 +b2x2 +E1 Y2 = b3Y1 + E2 Y3 = b4Y1 + E3 Y4 = b5Y1 + E4 Y5 = b6Y1 + E5 Exogenous Constructs X1 = Fit X2 = Longevity Endogenous Constructs Y1 = CRM Partnership Strength Y2 = Firm Image Y3 = Brand Image Y4 = Purchase Intentions Y5 = WOM

b = Structural Coefficient E = Error

4.63: Model Estimation:

A two-step procedure of SEM using confirmatory factor analysis was used to analyze the model. The first step estimated the measurement model, and the second step measured the structural model while the measurement model was fixed. CFA also allowed for the estimation of reliability, validity, and unidimensionality of the measured variables (indicators) (Anderson and Gerbing, 1988; James, Muliak, and Brett, 1982; Novak et al., 2000; Schumacker and Lomax, 2004; Thakur, 2005). After estimating the measurement model, the model was purified by eliminating variables that did not fit well in the initial model. The next step was to evaluate the structural model by testing the hypotheses statistically.

62

However, prior to evaluating the structural model the measurement model was tested to ensure reliability and validity of the constructs. First, indicator reliability, which confirms construct reliability was estimated. Construct reliability tests how well items loading on a construct measure the common latent construct. Alpha levels above .8 are considered good (Fornell and Larcker, 1981). With construct reliability confirmed, the choice of input matrix will follow. Two options exist, variance-covariance, or correlation matrices. Since the purpose of this study is a true test of theory it is appropriate to use the variancecovariance matrix because this matrix satisfies the assumptions of SEM (independent observations, random sampling, normality, and linearity of all relationships), and is the correct data form for validating causal relationships. Additionally, to reduce departures from normality, a large sample size (over 500) was used. Generally, it is recommended that a sample of over 15 subjects per estimated parameter helps to minimize the impact of sampling error (Hair et al., 1998).

4.64: Structural Model Identification:

Structural model identification problems are a leading cause of meaningless or illogical results. An identification problem, in simple terms, is the inability of the proposed model to generate unique estimates, (Hair, et al.,1998, p. 608). Two main types of identification problems exist; rank condition and order condition. The rank condition is not a concern in this study because one identification heuristic states that any construct with three or more indicators will be identified. Since all constructs in this study have three or more indicators the rank condition will be satisfied. 63

The order condition states that the degrees of freedom must exceed zero. Basically, the model is trying to estimate more parameters than there is available information (Hair et al., 1998). AMOS 6 provides empirical tests to identify identification problems. While none are anticipated, given the model structure, if an identification problem occurs, the only solution is to reduce the estimated coefficients. This must be accomplished by researcher analysis, and is based on the specific identification problem. A process recommended by Hayduk (1987) was followed in case any identification problems occurred.

4.65: Model Fit:

After the model was estimated and identified the next step was to inspect for offending estimates. Offending estimates are coefficients in either the structural or measurement models that are outside acceptable levels. Common examples are negative error variances for any construct, standardized coefficients exceeding or close to 1.0, or very large standard errors for any coefficient (Hair et al., 1998). If offending estimates exist, they can be resolved using similar techniques for correcting identification problems. Once any offending estimates have been resolved, then overall model fit may be assessed. Common methods for estimating overall model fit are the chi-square and maximum likelihood methods. However, both of these methods are too sensitive to large sample sizes (Beardon, Sharma, and Teel, 1982; Bagozzi and Yi, 1988; Byrne, 1994). Additionally, maximum likelihood is sensitive to violations of normality (Bentler, 1990; Hammond, and Leinert, 1995; Bentler and Yuan, 1999). However, alternative methods exist that are not sensitive to these issues. Therefore, root mean square error of approximation (RMSEA), normed fit index (NFI), comparative fit index (CFI), and incremental fit index (IFI), were used to 64

estimate model fit. A higher value for each indicates better model fit (the exception is RMSEA which should have a value below .08). Multiple indices were used because no consensus exists on a single measure (Bentler, 1990). Also, multiple indices are necessary to represent two types of model fit, absolute, and incremental. Absolute fit measures (chi-square, RMSEA) determine the degree to which the overall model predicts the covariance matrix. Incremental fit measures (NFI, CFI, IFI) compare the proposed model to a baseline, or null model (Hair et al., 1998). After overall model fit has been estimated, measurement model fit must be analyzed in a two-step process. The first step is to test the unidimensionality of the measures. Unidimensionality exists when indicators load above 0.5 on their latent factor, however, the higher the factor loading the better (Bollen, 1989). Thus, factor loadings on each construct were analyzed to confirm unidimensionality of the measures. The second step is to test for construct validity. Specifically, convergent and discriminant validity are assessed. Convergent validity is the degree to which theoretically linked concepts are actually related. Discriminant validity is the degree to which concepts that should not be related are not (Hair et al., 1998). Convergent validity was tested via average variance extracted. Estimates above 0.5 will indicate convergent validity (Hair et al., 1998). Discriminant validity was tested by analyzing the shared variance among constructs. Specifically, the shared variance should be less than the average variance extracted for each indicator measuring the construct (Fornell, and Larcker, 1981). If items load below 0.5 then consideration must be taken to removing the offending indicator. Finally, structural model fit was examined. As suggested by Schumacker and Lomax (2004) the Robust Maximum Likelihood estimation was used to evaluate structural model fit. This analysis allowed for testing of the proposed 65

hypotheses. First, an examination of the estimated coefficients was conducted. AMOS 6 provided tests for statistical significance (t-tests) and standard errors for each coefficient. A significance level of .05 will be used for each equation, thus allowing for tests of statistical significance for each path (parameter). If problems are found with the data then corrective action, such as deletion of a construct, or reformulation of causal relationships should be considered. However, any reformulations must have theoretical justification. As regards hypothesis testing, departures from normality can create problems with the accuracy of the t-test statistics for path analysis. If normality is a concern, then other options such as the Kruskal-Wallis test, which is not constrained by departures from normality, can be used for hypothesis testing. The KruskalWallis test gives a statistic that is a very close approximation of the chi-square statistic with k-1 degrees of freedom. The test has been used extensively in the medical sciences where non-normal distributions are common, and has been used to test hypotheses in marketing where factor analysis was conducted (Hui, and Wan, 2005).

4.66: Model Respecification:

Once the overall model, measurement and structural models are found to have acceptable levels of fit then we proceeded to examining the residuals to see if the model could be respecified to provide better results. Once again though, any respecifications must have theoretical support before being conducted (Hair et al., 1998). Any residuals exceeding +/- 2.58 are considered troublesome. The goal is to have less than 5% of residuals exceeding this value. Additionally, trends in offending residuals must be analyzed (for example, a variable being connected to multiple offending residuals). Corrective action would be to remove 66

variables that are connected to multiple problem residuals. However, improvements in model fit (by removing a variable) must make theoretical sense, and must provide for improved model fit across multiple fit indices (Hair et al., 1998).

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CHAPTER 5: RESULTS 5.1: Analysis and Results

5.11: Model Estimation and Purification:

A two-step process was used for analysis. First, the measurement model was estimated via confirmatory factor analysis in AMOS 6. Second, the model was purified by eliminating variables that did not fit well in the initial model. Third, the structural model parameters were tested for significance, and finally, the structural model was analyzed by statistically testing each hypothesis. Additionally, tests for reliability, unidimensionality, and validity of the measured variables were conducted. The initial model (please see figure 5.1 for graphical representation) and corresponding data file were submitted to AMOS 6 for initial measurement model estimation. A problem immediately arose when the covariance matrix was not positive definite. Analysis showed that two brand attitude indicator variables had identical means, as did two purchase intention indicator variables. Therefore one of the indicators for each needed to be removed from the analysis. Once this was completed the covariance matrix became positive definite as desired. The Maximum Likelihood (ML) method was used for estimation. The result shows that the multivariate kurtosis was 300.56 which exceeds the cutoff point of 3 (Bentler, 1990). Therefore, multivariate normality is a problem. Given this result, the ML method will give distorted conclusions about the model. In this situation it is recommended that Robust ML estimation be used to provide more

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accurate results (Bentler, 1990; Hammond and Lienert, 1995; Bentler and Yuan, 1995).

WOM 1 WOM 2 WOM 3

1

Fit 1 Fit 2 Fit 3 Longevity 1 Longevity 2 Longevity 3 Longevity 4

WOM
1

Fit Brand/Cause Relationship Strength Longevity Purchase Intentions

1

Firm Image

Firm 1 Firm 2 Firm 3 Brand 1 Brand 2 Brand 3 Purchase 1 Purchase 2 Purchase 3

Brand Image

Figure 5.1: Final Model

Robust ML estimation provides robust statistics such as root mean square error approximation (RMSEA), normed fit index (NFI), incremental fit index (IFI), and comparative fit index (CFI), that are not as influenced by relaxing the assumption of multivariate normality. Results indicated acceptable fit on all but one index. The NFI of .955, IFI of .962, and CFI of .962 are all above the cutoff point of .91 indicating reasonable fit. However, the RMSEA of .083 is slightly above the cutoff point of .08 (acceptable fit is considered being below .08). The

69

initial chi-square value was significant at the .05 level with a value of 806.3. Overall, the initial model shows acceptable fit. Additionally, no offending estimates were discovered as a negative, or error variances exceeding one were discovered. The initial model was then purified by analyzing the modification indices provided by the AMOS 6 software. The indices showed that by correlating the error variances of the latent variables fit and longevity a significant improvement in chi-square could be achieved. The result was a chi-square of 492.78. Additional improvements could be achieved by correlating two of the longevity indicator error terms (e5 and e7), and two of the firm image indicator error terms (e11 and e13). These changes resulted in a chi-square of 424.5. Improvements in all of the fit indices also resulted from these correlations. It is important to note that all of these correlations of error terms made theoretical sense and were therefore implemented. Additional improvements to the model were suggested by the modification indices but were not implemented because of a lack of theoretical support. Finally, one indicator variable, reverse dislike, did not show an acceptable factor loading on its latent construct (loading of .449 is below cutoff of .05), and was therefore eliminated from the analysis. This resulted in a final purified model with a chi-square of 344.3. Fit indices showed considerable improvement over the initial model. Final results as compared to the initial model are shown in Table 5.4. The final fit indices of NFI (.981), IFI (.987), CFI (.987), and RMSEA (.053) all indicate excellent fit of the model to the data (please see figure 5.2 for a graphical representation).

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Table 5.4: Comparison of Model Fit Indices: Proposed Model vs. Final Revised Model
Model Proposed/Base Model Final Revised Model NFI IFI CFI RMSEA

0.955 0.981

0.962 0.987

0.962 0.987

0.083 0.053

error1
1 1 1 1 1

error2

WOM Fit error5 1 Firm Image error 6

1 1

e1 e2 e3 e4 e5

Fit 1 Fit 2 Fit 3

WOM 1 WOM 2 WOM 3 Firm 1 Firm 2 Firm 3

1 1

e8 e9 1 e10
1

Longevity 1 Longevity 2

Brand/Cause Relationship Strength 1 1 Longevity

1

e11 e12 1 e13

1 1

Brand 1 Brand 3

e14 e16

e6 Longevity 3 e7 Longevity 4
1

Brand Image

Purchase Intentions
1

Purchase 1

1 1

e18 e19

Purchase 2

error3
Figure 5.2: Final Revised Model

error7

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5.12: Unidimensionality, and Internal Consistency Reliability:

An analysis of the factor loadings of the measured variables on their respective latent constructs was used to demonstrate unidimensionality. When measured variables have factor loadings above .05 then unidimensionality is indicated (Bollen, 1989). Table 5.5 shows the factor loadings and t-test values for each of the measured variables on their respective latent constructs. All of the loadings are well above .05, with the lowest loading being .792. Therefore, unidimensionality is confirmed. Internal consistency reliability shows how well measured variables measure the common latent construct. Generally, a value above .8 is considered good (Fornell and Larker, 1981). Table 5.5 shows the results for internal consistency reliability. All values are well above .8 indicating strong internal consistency reliability.

5.13: Convergent and Discriminant Validity:

Since reliability does not ensure validity, further tests were conducted to confirm that validity of the constructs exists. Convergent validity is confirmed when concepts that should theoretically be related are in fact related. Discriminant validity is confirmed when concepts that should not be theoretically related are in fact not related (Hair et al., 1998).

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Table 5.5: Unidimensionality, Reliability and Convergent Validity

Construct Indicator Factor Loadings (Standardized) Internal Consistency Reliability Average Variance Extracted

Fit

Fit 1 Fit 2 Fit 3

0.90 0.96 0.79

0.91

0.79

Longevity

Longevity 1 Longevity 2 Longevity 3 Longevity 4

0.90 0.91 0.85 0.87

0.94

0.78

Firm Image

Firm 1 Firm 2 Firm 3

0.97 0.97 0.96

0.97

0.92

Brand Image

Brand 1 Brand 2

0.88 0.95

0.91

0.93

Purchase Intentions

Purchase 1 Purchase 2

0.96 0.97

0.97

0.84

WOM

WOM 1 WOM 2 WOM 3

0.94 0.96 0.97

0.97

0.93

Fornel and Larcker (1981) suggest using average variance extracted (AVE) to test the degree of convergent validity. An AVE above .5 indicates convergent validity. Table 5.5 shows the average variance extracted for each measured variable. The results indicate convergent validity as all are well above the .5 cutoff.

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Discriminant validity is confirmed when cross-construct correlations are low. To test this the researcher examines the shared variance between two constructs. The results should be lower than the AVE of the items actually measuring the construct. The diagonal elements (AVE) should be higher than the off diagonal elements. The items above the diagonal are the correlations between constructs, while the items below the diagonal are the squared correlations between constructs. The results in table 5.6 show that discriminant validity is confirmed.

Table 5.6: Discriminant Validity Matrix

Construct Fit Longevity WOM Firm Image Brand Image Purchase Intentions Fit 0.79 0.34 0.03 0.04 0.02 0.03 Longevity 0.58 0.78 0.04 0.05 0.03 0.03 WOM 0.18 0.2 0.92 0.34 0.23 0.32 Firm Image 0.19 0.21 0.58 0.93 0.27 0.31 Brand Image 0.16 0.18 0.48 0.52 0.84 0.21 Purchase Intentions 0.17 0.19 0.56 0.56 0.46 0.93

Diagonal items represent the average variance extracted for each construct. Items above the diagonal are the correlations between constructs, and the items below are the shared variance among constructs.

5.14: Structural Model Parameter Estimates and Model Respecification:

In order to test the hypotheses, the causal relationships between the six latent constructs must first be examined. Since this is a two level second order factor analysis the relationship between the two latent antecedent constructs and the second order latent construct, as well as the relationship between the second 74

order latent construct and the four consequence latent constructs are analyzed. This leaves six hypothesized paths to be tested. The main concern is that the hypothesized paths are in the correct direction and are statistically significant. Table 5.7 shows the results of the analysis. All six paths are positive indicating proper directionality. Additionally all were statistically significant at the .05 level.

Table 5.7: Parameter Estimates for Structural Model

Parameter Link --> Fit Link --> Longevity Link --> WOM Link --> Firm Image Link --> Brand Image Link --> Purchase Intentions Path Coefficient 0.447 0.491 0.938 0.965 0.969 0.919 Critical Ratio 12.463 13.803 33.911 41.367 33.911 36.022 P *** *** *** *** *** ***

***p<.001 Note: Link is short for Brand/Cause Relationship Strength

The final step prior to hypothesis testing is to check for possible model respecifications. As stated previously, this is accomplished by analyzing the residuals. Any that are +/- 2.58 are considered offending and should be carefully analyzed to see if removal makes theoretical sense. An analysis of the residuals clearly pointed out that no offending estimates existed, therefore, no model respecification was recommended.

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5.15: Hypotheses Testing:

In order to test the hypotheses it is necessary to analyze the performance of each treatment group. Specifically, it is expected that the groups will be significantly different from each other with regards to each hypothesized path. In order to accomplish this the mean of each indicator variable for each latent construct is analyzed to ensure magnitude differences are in the hypothesized direction. Since the data violate the assumption of normality it was decided to use a test of significance that was not subject to the assumption. Therefore, the non-parametric Kruskal-Wallis test was conducted to ensure statistically significant differences between the four groups (please see tables 5.8.1-5.8.6 for the results of these tests). To test H1, each fit indicator mean is analyzed for magnitude, and then the Kruskal-Wallis test is conducted. The results indicate that treatment groups (version) one and two have higher magnitude means than versions three and four. This is expected since versions one and two are the high fit groups. Additionally, the Kruskal-Wallis test is significant for all three indicator variables, which confirms a statistically significant difference between the four treatment groups at the .05 level. Therefore, H1 is supported. A similar process was followed to test H2. Versions one and three were the high commitment groups, so it is expected that their means will have the highest magnitude. Version one has the highest mean, however version two is once again higher than version three. Upon further analysis the gap is much closer between version two and three than was found in the fit category. Perhaps this indicates that while commitment is important, fit is even more desired. The correlated error variances between the fit and longevity constructs also alludes to

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these two being correlated. Finally, all four indicators are statistically significant at the .05 level. Therefore, H2 is supported.

Table 5.8.1: Results of Kruskal-Wallis Tests of Significance: Fit

Ranks Fit 1 Version 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total N 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 Mean Rank 466.77 446.11 320.96 312.16 462.30 446.70 323.74 313.25 475.24 473.80 298.95 298.01

Fit 2

Fit 3

Test Statistics(a,b) Chi-Square df Asymp. Sig.

Fit 1 81.40 3.00 0.00 Kruskal Wallis Test Grouping Variable: Version

Fit 2 76.35 3.00 0.00

Fit 3 125.49 3.00 0.00

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Table 5.8.2: Results of Kruskal-Wallis Tests of Significance

Ranks Long 1 Version 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total N 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 Mean Rank 415.51 398.65 374.55 357.29 427.99 416.84 378.78 322.38 416.76 404.50 381.63 343.11 424.91 412.74 376.96 331.39

Long 2

Long 3

Long 4

Test Statistics(a,b) Chi-Square df Asymp. Sig.

Long 1 8.20 3.00 0.04 Kruskal Wallis Test Grouping Variable: Version

Long 2 27.73 3.00 0.00

Long 3 13.03 3.00 0.00

Long 4 21.57 3.00 0.00

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Table 5.8.3: Results of Kruskal-Wallis Tests of Significance: WOM

Ranks WOM 1 Version 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total N 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 Mean Rank 414.96 402.82 371.37 356.85 413.83 409.58 363.60 358.98 419.75 407.40 358.16 360.70

WOM 2

WOM 3

Test Statistics(a,b) Chi-Square df Asymp. Sig.

WOM 1 8.91 3.00 0.03 Kruskal Wallis Test Grouping Variable: Version

WOM 2 10.44 3.00 0.02

WOM 3 12.26 3.00 0.01

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Table 5.8.4: Results of Kruskal-Wallis Tests of Significance: Firm Image

Ranks Firm 1 Version 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total N 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 Mean Rank 411.90 396.43 365.75 371.91 411.76 400.55 363.20 370.49 415.87 400.70 364.25 365.18

Firm 2

Firm 3

Test Statistics(a,b) Chi-Square df Asymp. Sig.

Firm 1 5.64 3.00 0.13 Kruskal Wallis Test Grouping Variable: Version

Firm 2 6.64 3.00 0.08

Firm 3 8.19 3.00 0.04

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Table 5.8.5: Results of Kruskal-Wallis Tests of Significance: Brand Image

Ranks Brand 1 Version 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total N 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 Mean Rank 422.62 414.29 356.25 352.84 419.44 413.69 362.06 350.81

Brand 1

Test Statistics(a,b) Chi-Square df Asymp. Sig. a

Brand 1 16.93 3.00 0.00 Kruskal Wallis Test Grouping Variable: Version

Brand 1 15.09 3.00 0.00

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Table 5.8.6: Results of Kruskal-Wallis Tests of Significance: Purchase Intentions

Ranks Purchase 1 Version 1.00 2.00 3.00 4.00 Total 1.00 2.00 3.00 4.00 Total N 193.00 193.00 193.00 193.00 772.00 193.00 193.00 193.00 193.00 772.00 Mean Rank 411.28 404.20 360.28 370.24 417.84 401.74 356.29 370.13

Purchase 2

Test Statistics(a,b) Chi-Square df Asymp. Sig. a

Purchase 1 7.66 3.00 0.054 Kruskal Wallis Test Grouping Variable: Version

Purchase 2 9.74 3.00 0.02

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H3, as with all the remaining hypotheses, is a consequence of a strong brand/cause link. Therefore, it is expected that version 1 will have the highest mean, and version 4 will have the lowest. Version 2 and 3 should be somewhere in the middle; however, if version 2 is consistently higher on all indicators that alludes to fit being more important than longevity in the brand/cause link. Likewise, if version 3 is higher then possibly longevity is more important in the brand/cause link. The indicators for this hypothesis have means that are consistently higher for version 1, however, version 4 is consistently higher than version 3. Additionally, only one of the three indicators is significant at the .05 level. Therefore, H3 is only partially supported. Similarly for H4, version 1 is has the highest mean for both indicators and version 4 has the lowest for both. Additionally, both indicators are significant at the .05 level. Therefore, H4 is supported. The results for the tests of H5 are similar to those for H3. Version 1 has the highest mean for both indicators; however, version 3 has the lowest mean for both indicators. Finally, only one of the indicators is significant at the .05 level (however, the other indicator would be significant at the .054 level). Therefore, H5 is only partially supported. Finally, for H6 version 1 is has the highest mean for all three indicators and version 4 have the lowest for all three. Additionally, all indicators are significant at the .05 level. Therefore, H6 is supported. Table 5.9 summarizes the results for all six hypotheses.

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Table 5.9: Results of Hypothesis Testing

Hypothesis H1: A CRM brand/cause relationship in which the brand and the cause are logically linked will be perceived by consumers to be a better fit between the two. H2: A CRM brand/cause relationship that has a long history will be perceived by consumers to be more commited to by the brand/firm. Results Supported

Supported

H3: Stronger CRM relationships will have more positive consumer attitudes toward firm image. H4: Stronger CRM relationships will have more positive consumer attitudes toward the brand. H5: Stronger CRM relationships will have higher consumer purchase intentions for the brand. H6: Stronger CRM relationships will have more positive WOM.

Partially Supported

Supported

Partially Supported

Supported

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CHAPTER 6:

Discussion and Conclusion

The purpose of this study was multi-faceted. First, the study focused on advancing the literature on the factors necessary for successful CRM partnerships from the for-profit firms perspective. Second, associative learning theory was introduced to explain a framework of the antecedents and consequences of successful CRM partnerships that was developed and empirically tested. Third, word-of-mouth promotion was included as a new consequence of a successful CRM partnership. Additionally, word-of-mouth promotion was theorized to have a moderating effect upon long-term success of CRM promotions. Each of these goals can now be discussed in the context of the study results.

6.1: Literature Advancement:

The literature surrounding CRM has been both broad and deep. Suggestions for successful CRM promotions from both the brand and charities perspective have been developed. Also, CRM has been discussed in the context of corporate involvement and consumer behavior research. This study furthered past research by developing a thorough overview of past research and then extending that research by combining both antecedents and consequences of successful CRM partnering into an empirically testable model. Additionally, WOM was added as a desired consequence of CRM partnering.

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6.2: Model Results:

The overall model was found to have excellent fit. The few modifications made to the model were theoretically justified. First, two indicators were deleted because they had the same mean as another indicator for the same latent construct, and this was necessary to identify the model. Second, one indicator was deleted because it did not have an acceptable factor loading, and was troublesome in pre-testing. Third, the error terms for fit and longevity were correlated which makes theoretical sense as the two constructs are hypothesized to interact in creation of a strong brand/cause link. Finally, the error terms for two indicators of longevity were correlated, as were two for firm image. This made theoretical sense because the indicators were for the same construct. Overall, the excellent model fit of the revised model indicates that the model fits the data, and that the representation of antecedents and consequences of proper CRM partnering is empirically sound. The next several sections detail the tests of significance for the structural model and hypotheses.

6.21: Brand/Charity Fit:

The results indicate that perceived fit between the brand and charity has a significant impact on desired outcomes of CRM. All of the indicators for the latent variable, fit, were statistically significant, and the path parameter for brand/cause link to fit for the structural model was significant. The significance of the indicators reveals that significant differences exist between the four treatment groups, and the magnitude of the means for the groups indicates appropriate ranking. The significance of the path parameter indicates support of the structural model. Additionally, the two treatment groups that had high fit had the highest 86

means for every indicator included in the model. This suggests that subjects not only perceived fit as important to link the brand to the cause, but that it resulted in better attitudes toward the brand, firm, purchase intentions, and WOM promotion.

6.22: Longevity/Commitment:

The length of time that a brand is involved with a charity was used as a measure of commitment by the brand to the charity. Results show that all of the indicators of longevity were statistically significant, and that the path parameter, longevity to brand/cause link, was also significant. This indicates statistical support for H2. However, it is evident from analysis of the means for the two high longevity treatments (1 and 3), that longevity has more of a moderating role on overall attitudes towards the firm, brand, purchase intentions and word of mouth. Longevity definitely impacts attitudes positively, as treatment one (high fit/high longevity) consistently had higher means than treatment two (high fit/low longevity). If fit was the only driving factor, one would expect treatment one and two to be approximately equal. However, treatment four (low fit/low longevity) had higher means than treatment three (low fit/high longevity) for all of the indicators for firm image and purchase intentions. This may indicate that longevity does not play much of a role in influencing behavior for these two consequences, but rather has more of an impact on brand image and WOM. However, even these two variables showed very close means for treatments three and four. Therefore, one concludes that longevity has an impact on consequences, but probably only as a moderating variable in the presence of a good fit between the brand and the charity.

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6.23: Firm Image:

The four consequences of successful brand/cause partnerships, firm image, brand image, purchase intentions, and WOM, compose hypotheses three through six. The results for the first, firm image were mixed. The path parameter, firm image to brand/cause link, was significant, supporting the structural model. However, only one of the three indicators for firm image was significant at the .05 level. Also, while treatment one (high fit/high longevity) had the highest magnitude means for all three indicators, and treatment two (high fit/low longevity) was second highest, treatment four (low fit/low longevity) was higher than treatment 3 (low fit/high longevity) on all three indicators. This alludes to the fact that any differences between the treatment groups for firm image are based on fit not longevity. Therefore, H3 can only be partially supported.

6.24: Brand Image:

The path parameter, brand image to brand/cause link, was significant supporting the structural model, and both indicators were significant indicating significant differences between the treatment groups. Additionally, the magnitudes of the means for the groups were in the hypothesized order. However, the fact that the two high fit groups were substantially higher than the two low fit groups along with the fact that both high fit groups had similar means, and both low fit groups had similar means indicates that fit, rather than longevity is driving this result. However, the order of the treatment group mean magnitudes also indicates that longevity has some impact.

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6.25: Purchase Intentions:

The path parameter, purchase intentions to brand/cause link, was significant which supports the structural model. However, only one of the two indicators was significant at the .05 level (the other indicator would be significant at the .054 level) lending only partial support for significant differences between the treatment groups. The high fit groups had much higher magnitude means than did the low fit groups, and the high fit/high longevity group had higher magnitude means than the high fit/low longevity group, which would lend support to fit and longevity as both driving any significant results. However, once again, the low fit/low longevity group had slightly higher magnitude means than the low fit/high longevity group, which tends to imply that while longevity has an impact, fit is driving the significant differences between groups. The results only partially support H5.

6.26: WOM:

The path parameter, WOM to brand/cause link, was significant supporting the structural model. Also, all three of the indicators of WOM were significant. This supports H6. The mean magnitudes of the treatment groups were all in the predicted order for the first two indicators, however, for the third indicator, the low fit/low longevity treatment was slightly higher than the low fit/ high longevity treatment. This may indicate a slight preference to fit over longevity as the driving antecedent, however, the means of the two groups are too close to make that judgment. Therefore, H6 is supported.

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6.3: Academic Implications:

The CRM literature is rich with information. The Varadarajan and Menon (1988) article provided a theoretical blueprint for future study that has been consistently built upon. Numerous theoretical and empirical articles have been developed which have furthered the topic. Various theories have been presented, as have antecedents and consequences of successful CRM. However, none of these articles have developed, and empirically tested a model of both the antecedents and consequences of successful CRM partnering. This study furthers past research by presenting a model, and then empirically testing it. This provides a foundation for understanding the elements of the phenomena, and allows for more in depth research into other extraneous variables that may impact the model. Additionally, the model allows a framework which can be expanded to potentially include other antecedents and/or consequences just as WOM was added in this study as a desirable consequence of CRM. The inclusion of WOM in the model has various implications for future academic study. WOM has received considerable attention in the literature as a highly desirable form of brand promotion. However, it has not been included in the CRM discussion. This study demonstrates that positive WOM can be achieved via a proper CRM partnership. Unlike the other consequences presented here, WOM provides the potential for exponential future success for the CRM relationship and thus, the brand. WOMs effect on future WOM, brand and firm image, and future purchases makes it a very important and valuable element in the model that deserves considerable future attention. Finally, the grounding of this model in a single theory, associative learning theory, has important implications. Having one theory provide a foundation 90

simplifies future research by limiting the number of assumptions that must be met. Additionally, a single theory strengthens the argument because one is not reaching for multiple theories to shoehorn an argument together.

6.4: Managerial Implications:

Similar to academic research, practitioners can gain from the insights of this study. By understanding the implications of proper CRM partnering managers can better select a charitable partner for CRM activities. Choosing a partner with similar goals, customers/beneficiaries, and purpose an organization can reduce consumer skepticism over firm motives and gain the desired outcomes of improved brand image, WOM, and potentially firm image and future purchases. Likewise, by maintaining a relationship over time should further increase these benefits. Additionally, managers have long desired insights into increasing WOM. However, deliberate attempts to manipulate WOM that can be ascertained by consumers has been shown to be ineffective. This study shows that proper CRM partnering can increase WOM which then can have long-term benefits for the brand. Managers may find that this benefit may potentially be applicable in other marketing practices such as other charitable giving or event support. Finally, organizations should be able to better streamline their marketing expenditures by focusing their charitable social activities into areas that are most effective at achieving brand and corporate goals. Instead of using a shotgun approach which may be not only expensive and ineffective, but also may be detrimental, firms can follow the guidelines set forth within this study to maximize marketing effectiveness.

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6.5: Limitations and Suggestions for Future Research:

This study has several limitations that offer opportunities for future research. First, this study developed a model of antecedents and consequences of successful CRM which combined past research and added an additional consequence, WOM. Additional investigations of possible other antecedents and consequences that could be added to the model should be investigated. Second, while this study used a large generalizable sample, it is not without its limitations. Future research with a more balanced sample based on gender that investigated gender effects on the model would be appropriate. Also, investigations into racial, income, and education effects would provide useful insights. Third, this study was only conducted using U.S. residents. Replications of this study in other countries would increase the generalizability and validity of these findings. Fourth, it was beyond the scope of this study to analyze multiple types of brands or charities. Future research should investigate if these findings can be replicated with different brands and charities. Also, replication with nonfictional brands would enrich these findings. Finally, the WOM research propositions should be formally studied in a time-series study to uncover the long-term impact of this variable.

6.6 Conclusions:

CRM has received considerable attention in the literature as it has been ever more embraced by practitioners. The numerous studies have enriched our understanding of the subject as well as contributed to practitioner success. This study builds on past research by using associative learning theory as a foundation for combining previously discussed antecedents and consequences 92

for successful CRM partnering into an overarching model to explain the phenomena. Additionally, the model allows for significance testing of each construct in order to ferret out the true driving forces of the model. The knowledge that fit is a leading concern for successful CRM partnerships, and that the longer the relationship the more the partnership is enhanced should provide guidance for future research and current practitioners. Also, consequences have been tested together in a way that can guide researchers and practitioners expectations of what can be achieved via CRM. Specifically, that increased WOM and brand image should be expected, and that firm image and increased purchases are also possible. The addition of WOM as a desired outcome of CRM is new to the literature. This study is the first to add this important construct to the discussion. The results point out that increased WOM should be expected when a firm appropriately links their brand to a charity and continues this relationship over time. Additionally, as the research propositions below postulate, increased WOM should result in long-term exponential benefits.

R1:

WOM will lead to more positive long-term consumer attitudes toward firm image.

R2:

WOM will lead to more positive long-term consumer attitudes toward the brand.

R3:

WOM will lead to greater long-term likelihood of consumer purchases.

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Partnering with a charity can be very beneficial for a brand and firm. The question has always been how does a brand best accomplish this task? Will any charity do? Past research has provided valuable insights into these questions. The results of this study extend past studies and combine causes and effects into an empirically tested model with high generalizability that future researchers can build on and practitioners can use. The theoretically based model also incorporates a previously unmentioned consequence, WOM, and verifies that this outcome can be achieved through proper alignment of brand and charity. Firms should devote more time to partnering with charities that have similar goals or who have beneficiaries that are similar to the firms customer base. Additionally, long-term relationships are beneficial in driving consumer perceptions of firm commitment to the cause. Attention to these details can results in great rewards for the brand and firm, while supporting a worthwhile cause that benefits society.

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APPENDICES

APPENDIX I Questionnaire:

Please read the following scenario, and answer the questions that follow:

Give Kids the World is a non-profit organizations that provides a once-in-alifetime experience for children with life-threatening illnesses. Located in Orlando Florida, the organization provides residential living for sick children and their families while visiting the Orlando theme parks. In conjunction with the Make-A-Wish Foundation the children and their families receive airfare, local transportation, and tickets to the theme parks in the Orlando area (Disney World, Epcot, Animal Kingdom, MGM, and Universal Studios). While at Give Kids the World, the children and families stay at a theme park of their own, with visits from Disney and Warner Brothers characters. The resort also has a twenty four hour ice cream parlor, mini-train rides throughout the facility, swimming pools, magic garden and many other facilities. Every day the children receive presents delivered directly to their villas, and can be tucked-in nightly by the resident mayor (the resorts rabbit character). At (brand), we know how critical it is to support children with life-threatening illnesses and their families. That is why we are partnering with Give Kids the World. To help others in their time of need, (brand) will make a donation to Give Kids the World each time you make a purchase of (brand). It is a big commitment that we are serious about as we have been working with Give Kids the World for the last (time frame) Help us to help others with your next purchase. (Brand) and Give Kids the World, partners making a difference.

Have you ever heard of Give Kids the World before? Yes____

No_____ .

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Please answer the following two questions based on the above scenario. First read the question then answer on the subsequent scales. Each scale is bounded by responses that are opposite in meaning. Please put an X on the scale which represents how strongly you feel. 1. What do you think about brand contributing a portion of sales to Give Kids The World? makes sense given ----:----:----:----:----:----:-------:----:----:----:----:----:---their business is consistent with their business is related to what they sell

does not make sense given their business. is not consistent with their business is not related to what they sell

----:----:----:----:----:----:----

2.

Do you think the business depicted in the above scenario... is committed to the charity has a lot invested in the charity is interested in the charity is giving a lot to the charity

is not committed to the charity has little invested in the charity is not interested in the charity is giving a little to the charity

----:----:----:----:----:----:-------:----:----:----:----:----:-------:----:----:----:----:----:-------:----:----:----:----:----:----

Please answer the remaining questions based on the information from the scenario. Please state how strongly you feel by placing an X on the corresponding line:

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3. I would recommend this promotion to someone who seeks my advice. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

4. I would say positive things about this promotion to other people. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

5. I would recommend this promotion to others. Strongly Moderately Slightly Neither Slightly Disagree Disagree Disagree Agree _______ ________ ________ ______

Moderately Agree

Strongly Agree

______ _________ _______

6. This sponsorship makes me feel more favororable toward the sponsor. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

7. This sponsorship would improve my perception of the sponsor. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

8. This sponsorship would make me like the sponsor more. Strongly Moderately Slightly Neither Slightly Moderately Disagree Disagree Disagree Agree Agree _______ ________ ________ ______

Strongly Agree

______ _________ _______

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9. The brand in the scenario is likely to possess the stated scenario claims. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

10. I react favorably to the brand. Strongly Moderately Slightly Neither Disagree Disagree Disagree _______ ________ ________ ______

Slightly Agree

Moderately Agree

Strongly Agree

______ _________ _______

11. I feel positively towards the brand. Strongly Moderately Slightly Neither Disagree Disagree Disagree _______ ________ ________ ______

Slightly Agree

Moderately Agree

Strongly Agree

______ _________ _______

12. I dislike the brand. (reverse) Strongly Moderately Slightly Neither Disagree Disagree Disagree _______ ________ 13. ________ ______

Slightly Agree

Moderately Agree

Strongly Agree

______ _________ _______

This sponsorship would make me more likely to use the sponsors product. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

This sponsorship would make me more likely to consider this companys products the next time I buy. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

14.

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I would be more likely to buy from the sponsor as a result of this sponsorship. Strongly Moderately Slightly Neither Slightly Moderately Strongly Disagree Disagree Disagree Agree Agree Agree _______ ________ ________ ______ ______ _________ _______

15.

Please answer the following as each pertains to you:

Sex: Male___ Female___ Race: White___ Other___ Age: ____ Income: Under $20,000___ $20,000-$35,000___ $35,001-$50,000___ $50,001-$75,000___ $75,001-$100,000___ Over $100,000___ Zip Code: ______ African-American___ Asian___ American Indian___

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VITA Graduate School Southern Illinois University Michael L. Thomas Date of Birth: August 17, 1964

905 Cannon Donaldson, 2, Statesboro, Georgia 30458 St. Norbert College Bachelor of Business Administration, May 1986 Southern Illinois University Carbondale Masters of Business Administration, May 1990 Special Honors and Awards: 2005 Sheth Foundation AMA Marketing Fellow Dissertation Title: Cause-Related Marketing Partnerships: An Application of Associative Learning Theory Principles for Both Short and Long-Term Success for the Brand Major Professor: John Fraedrich

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