Takeaway: Brands perceived by consumers to be ethical benefit from increased brand loyalty, customer retention, and purchase intent, and foster recommendation.
Suggested Audience: Marketing and communication executives and corporate citizenship managers building a business case for ethical behavior
In this study researchers examined the relationship between consumers’ perceived ethicality of a corporation and their trust, loyalty, and emotional response at the product level. Based on recent literature on ethical perceptions of consumers, the researchers conceptualize consumer perceived ethicality at the corporate brand level as the perception of the brand as being honest, responsible, and accountable toward various stakeholders.
The researchers surveyed 4,027 Spanish consumers who were responsible for buying groceries for their households. Each subject was asked to pick their top two habitual brands from an extensive list of brands in several fast-moving consumer goods categories. They then answered several questions regarding these brands and their attitudes toward them.
The survey examined the consumers’ levels of:
- Brand trust– The perception of fair, responsible, and accountable behavior of the brand toward a larger audience. This is a cognitive element that develops over time.
- Brand affect– A brand’s potential to elicit a positive emotional response in the average consumer as a result of its use. This is an emotional response that is more instantaneous.
- Brand loyalty– A deeply held commitment to re-purchase and re-patronize a preferred product/service consistently in the future, causing repetitive same brand set purchasing, despite situational influences and marketing efforts.
Researchers found a direct relationship between consumer perceptions of a corporate brand and the perception of the product brands under a corporate umbrella. Their findings include:
- Brands perceived to be ethical benefited from both increased both product brand trust and product brand affect.
- Consumers’ perceived ethicality of a corporate brand has an indirect impact on product loyalty.
- Product brand trust and product brand affect both have a positive and significant relationship with product brand loyalty.
- Product brand affect is significantly and positively related to product brand trust.
If citing, please refer to the original article: “Does Having an Ethical Brand Matter? The Influence of Consumer Percieved Ethicality on Trust, Affect and Loyalty", Journal of Business Ethics, 2012, Jatinder J. Singh, Oriol Iglesias, and Joan Manel Batista-Foguet