Dissertation on the Use of Cause Marketing

THE USE OF CAUSE MARKETING & THE
MEDIATING EFFECT OF PUBLICITY ON
CUSTOMER RETENTION

By
EHIAGHE RITA OMOVBUDE
PAU/SMC/PT3/110030

A dissertation submitted to the School of Media and Communication, Pan-Atlantic
University in partial fulfillment of the requirements for the award of the degree of
Master of Science of Pan-Atlantic University

July 2013.

ABSTRACT
The
overall
goal
of
this
research
is
to
find
out
how
Cause-‐Related
Marketing

influences
Customer
Retention
of
a
highly
publicised
brand.
This
was
answered
both

conceptually
and
empirically.
Based
on
the
circuit
of
power
theory,
the
model
of
the

relationship
between
Cause
Marketing
and
Customer
Retention
was
developed

thereby
generating
seven
hypotheses.
A
semi-‐inductive
approach
in
the
form
of

mixed
method
was
used
to
conduct
the
research.
Interviews
were
conducted

between
seven
Public
Relations
Managers
of
over
four
years
of
practice,
this
was

audio
recorded
and
analysed
manually.
Findings
from
the
interviews
therefore,

informed
the
design
of
the
questionnaire
for
quantitative
analysis
and
hypotheses

testing.
Out
of
one
hundred
and
twenty
questionnaires
distributed
between

Marketing
and
Marketing
Communications
Practitioners,
ninety-‐two
responded
and

using
Chi-‐square
to
test
each
of
the
seven
hypotheses
against
responses
from
the

questionnaire,
significant
levels
of
relationships
were
derived,
therefore
making
the

hypotheses
acceptable.
The
study
therefore,
resolved
that
the
use
of
Cause

Marketing
influences
customer
retention
of
a
highly
publicised
brand.
Findings
of

this
research
adds
to
the
body
of
knowledge
on
Cause
Marketing
and
is
beneficial
to

Marketing
and
Marketing
Communications
practitioners
across
various
industries,

as
well
as
Not-‐for
Profit
organisations
who
seek
to
pitch
companies.

2

ACKNOWLEDGMENT

I would like to say a big thank you to GOD for every single day I was able to make it for
classes despite my crazy work schedule and for supplying the funds necessary to
complete my MSc programme. To my mother I say a big thank you for your earnest
prayers, love and support. My sisters Omoye, Gladys and Margaret, my brothers Irabor
and Eromosele and of course my little nephew Osareme whose unconditional love have
kept me going.

I also say a big thank to the SMC faculty most especially my supervisor Dr. Otubanjo for
guiding me through the process of putting my dissertation together. Obianuju and Ndidi,
thank you for effectively mediating between the students and faculty.
Dr. Tam George, for making theories of communication easy to grasp therefore making
application to this study seamless.

I appreciate my best friend Obinali Okoli for encouraging and supporting my quest for
knowledge. To Bridget and Eduvie I say a big thank you for your support in times of
need. I love you all.

I also acknowledge my past and present employers as well as my senior colleagues, Mr.
Udeme Ufot, Funke Nwankwo, Kunle Shittu, Kaliko Olowole, Nnenna Onyeawuchi and
Temitayo Adereti for supporting me in achieving my goal.

3

DEDICATION

I dedicate this study to my Late Father, Barrister David Osuan Omovbude, who
throughout his lifetime etched in the walls of my heart the importance of education.

4

CERTIFICATION

I certify that this work was carried out by EHIAGHE RITA OMOVBUDE in the School
of Media and Communication, Pan-Atlantic University, under my supervision

Supervisor
Dr. Tayo Otubanjo (Senior Lecturer, Marketing)
School of Media and Communication
Pan-Atlantic University
Lagos, Nigeria.

5

DECLARATION

I hereby declare that all the work in this dissertation is entirely my own, unless referenced
in the text as a specific source and included in the bibliography.

Name:

Ehiaghe Rita Omovbude

Matric

No: PAU/SMC/PT3/110030

Signed:

6

Table of Contents

ABSTRACT ................................................................................................................................................2

ACKNOWLEDGMENT .............................................................................................................................3

DEDICATION ............................................................................................................................................4

CERTIFICATION ......................................................................................................................................5

CHAPTER
ONE:
INTRODUCTION........................................................................................................8

1.0
BACKGROUND..................................................................................................................................................8

1.1
STATEMENT
OF
THE
PROBLEM .....................................................................................................................13

1.2
OBJECTIVES
OF
THE
STUDY ............................................................................................................................14

1.3
SCOPE
OF
STUDY..............................................................................................................................................14

1.4
OPERATIONAL
DEFINITION
OF
TERMS .........................................................................................................15

1.5
SIGNIFICANCE
OF
THE
STUDY ........................................................................................................................16

1.6
RESEARCH
QUESTIONS ...................................................................................................................................17

CHAPTER
TWO:
LITERATURE
REVIEW........................................................................................ 18

2.0
INTRODUCTION ................................................................................................................................................18

2.1
THEORETICAL
FOUNDATION .........................................................................................................................18

2.2
STRENGTHS
AND
WEAKNESSES
INHERENT
IN
THE
USES
OF
CRM
LITERATURE ..................................24

2.3
CONCEPTUAL
FRAMEWORK ...........................................................................................................................25

CHAPTER
THREE:
METHODOLOGY ............................................................................................... 31

3.0
INTRODUCTION ................................................................................................................................................31

3.1
RESEARCH
DESIGN ..........................................................................................................................................31

3.2

TYPES
OF
SAMPLING .................................................................................................................................32

3.2.1
POPULATION
AND
SAMPLE
PROCEDURE ..................................................................................................34

3.2.2
DATA
ANALYSIS
PROCEDURE .....................................................................................................................34

CHAPTER
4:
PRESENTATION
OF
FINDINGS
AND
ANALYSIS .................................................. 36

4.1
QUALITATIVE
FINDINGS .............................................................................................................................36

4.2
QUANTITATIVE
FINDINGS ..........................................................................................................................41

4.2.1
HYPOTHESES
TESTING ............................................................................................................................58

CHAPTER
5:
CONCLUSION
AND
RECOMMENDATION .............................................................. 63

5.0
INTRODUCTION ................................................................................................................................................63

5.1
FINDINGS ..........................................................................................................................................................63

5.2
IMPLICATIONS ..................................................................................................................................................64

5.2.1
IMPLICATIONS
TO
THEORY .........................................................................................................................64

5.2.2
IMPLICATIONS
TO
PRACTITIONERS ..........................................................................................................65

5.3
RECOMMENDATIONS ......................................................................................................................................66

REFERENCES ......................................................................................................................................... 67

APPENDIX .............................................................................................................................................. 81

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CHAPTER ONE: INTRODUCTION
1.0 Background

Cause-related marketing (CRM) is a type of marketing strategy that lends support to a
charity through sales with the intent to portray a favourable brand image(Barone M. N.,
2007)). Jerry Welsh of the American Express conceived CRM as a way of increasing
awareness of the company card by linking it to a local arts programme in San Francisco.
The results encouraged American Express to apply it on a national level, i.e. the
restoration of the Statue of Liberty (Davidson, 1997) in which a 2% donation was made
everytime a card was used and when new members were added. American Express,
through the initiative, increased their sales by 28% (Demetriou M., 2009) (Demetriou,
2009)Demetriou, Papasolomou & Vrontis, 2009, p. 267).

CRM has become more popular and is now considered as one of the fastest growing
forms of marketing (Berglind & Nakata, 2005 p. 445). Researchers like Skory, Repka &
McInst (2004) have referred to CRM as “marketing with a worthy cause” (p.2). Carringer
(1994) defined it as:

8

“...the joining together of a not-for-profit charity and a commercial
company in an effort to raise funds and awareness for the cause while
building the sales and awareness of the for-profit partner” (p.16)

But the most comprehensive definition of CRM was given by Varadarajan & Menon
(1988) 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 revenueproviding exchanges that satisfy organizational and individual objectives”
(p.60)

CSR, which means Corporate Social Responsibility, is a management concept that
integrates social and environmental concerns into business operations. Mehegan (1995, p.
32) pointed out several factors that differentiate CRM from other CSR initiatives like
philanthropy. . For instance, philanthropy would come from the company’s income and
the company would expect nothing in return while CRM comes from the advertising or
promotion budget and the company would expect its sales to improve. Whereas
sponsorship is given before the purchase, in CRM the donation amount is sales-driven
(Svensson & Wood, 2006). This, stated Chaney and Dolli (2001), is the most important
part of the definition (p.157).

9

Daw (2006) pointed out four characteristics in differentiating CRM from other kinds of
interactions between profit and non-profit organisations: it is mutually beneficial to both
parties, it creates awareness of the CRM program, it creates value for other stakeholders
besides both parties and it involves the participation of employees and consumers in the
process (p.21).

Smith (1994) has referred to CRM as ‘strategic philanthropy’ (p.111) as it helps
companies maintain competitiveness in the long run (Simon 1995). But Andreason
(1996) concluded that if the public believes the positives of a non-profit are being used
by a company to cover an inferior product then the CRM initiative is sabotaged (p. 59).
Furthermore, Ross et al. (1991) stated that CRM may lose its effectiveness as more and
more companies use it.

Several factors like the favourable response to CRM have led to its rapid growth (Gupta
& Pirsch, 2006; Lafferty & Goldsmith, 2005; Ross et al., 1992).

Husted & Whitehouse (2002) pointed out that CRM started out with a short-term
cooperation between profit and non-profit organizations, and then evolved as products
were linked to non-profit causes, and is now regarded as a long-term cooperation between
profit and non-profit organizations and implemented in profit organizations’ corporate
strategy (p.6). On the other hand, Thorne McAlister & Ferell (2002) challenge this view
and point out that long-term cooperation is an exception (p.693).

10

Several CRM’s structural elements such as product type (Strahilevitz & Myers, 1998),
cause-type (Cui et al. 2003;Ellen, Mohr, & Webb, 2000) cause-proximity (Grau & Folse,
2007) and fit between sponsoring company and the cause supported (Hou, Du & Li,
2008) have been postulated in the literature to influence consumers’ response to CRM.
Past study (Ross et al., 1992) suggests that females show more favourable response
towards CRM than males.

There was also the issue of cause-proximity. Varadarajan and Menon (1988) suggested
that cause-proximity refers to the distance between the donation activity and the potential
consumers that would make the donation. Ross et al. (1992) showed that consumers hold
a more favourable attitude towards a firm that supports a local cause than a firm that
supports a national cause. It isn’t clear the influence of gender on the impact of causeproximity and how it affects consumers’ response to CRM. Ross et al. (1992) also found
that women hold a more positive attitude towards the firm than men do towards CRM but
the attitude is influenced by cause-proximity and so if companies want to target female
consumers they should design a campaign that supports local cause.

Overall, male have more favourable response towards CRM than female and for CRM
campaigns targeted at male consumers cause-proximity is of less concern, hence
companies may design CRM campaigns that support either local or international causes.
Male respondents have high attitudes towards both local and international causes. Hou,
Du & Li (2008) however concluded that local causes were preferred to national causes.

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Other factors that influence the purchase intention have been pointed out by further
studies to include the size of the donation, gender, the fit between the cause and the
company (Varadarajan & Menon, 1988; Ellen et al., 2000) and consumer’s connection to
the cause (Farache et al, 2008). Broderick, Jogi & Garry (2003) and Grau & Folse (2007)
also pointed out that the connectedness that the consumers feel to the cause was key in
determining their response to the CRM campaign. Faracha et al (2008, p. 210) also
supports this. If for instance there is no connection to the cause, then other elements like
the importance of the cause and the length of the campaign (Trimble & Rifon, 2006)
would help the consumers decide on purchase. Grau & Folse (2007) concluded in their
research that the proximity of the cause can affect the attitude of consumers to
products/services even if there was a personal connection to the cause.

It is imperative that there should be a ‘fit’ between the company image and that of the
cause which it is supporting (Varadarajan & Menon, 1988; Ellen et al., 2000; Speed &
Thompson, 2000). The cause should be compatible with the corporate identity and
perhaps the target market (Higgins, 1986; Shell, 1989; Larson, 1994).

Lafferty,

Goldsmith, & Hult, (2004) showed in their research, the negative impact of lack of fit on
comsumers’ attitude to the cause.

According to Grau & Folse (2007, p.19), the size of the donation to the cause also
determine the benefits of the CRM campaign and Hajjat (2003, p.97) supported them in
this in addition to the existence of personal connection to the cause. Grau, Garretson, &

12

Pirsch, 2007) stated that a small-sized donation can lead consumers to believe that the
company is just exploiting the non-profit organisation.

A research done in some universities in Pakistan indicated that the consumers’ attitudes
to products are indeed influenced by CRM. But also that awareness of brand and image
of the company is also a deciding factor on that influence. (Shabbir, Kaufmann, Ahmad,
& Qureshi, 2010). Samu & Wymer (2009) found that the fit between the cause and the
company image worked with the dominance of the advertisement and made the brand
favourable if they were high.

1.1 Statement of the problem
A considerable amount of work has gone into the study of Cause Marketing but it appears
that very limited work has been done to examine the relationship between the use of
Cause-Related Marketing and customer retention.

Due to this gap in literature, Marketing Communications practitioners are oblivious of the
effect of Cause Marketing on brand loyalty, which is the ultimate goal of every brand
custodian. Therefore, limiting its strategic use in the marketing process.

In a research conducted by Basil, Runte, & Deshpande, (2012) it was found that 70% of
non-profits sampled did not participate in CRM because they lacked the resources to do
so and didn’t feel that they were the kind of non-profits that companies would want to
partner with. This gap in literature therefore means that non-profits are not exposed and

13

armed with the necessary knowledge required to approach companies that are most likely
to partner with them, therefore reducing their chances of benefiting from Cause
Marketing.

The gap in literature also inhibits academics from expanding on the study of the ‘use of
Cause Marketing’ as a result limiting the possibilities of adding to the body of knowledge
in the use of this strategic marketing tool.

1.2 Objectives of the study
1. To find out if building a good brand image is a major rationale for the ‘use of CRM’
2. To find out if achieving set sales target is a major rationale for 'use of CRM’
3. To find out achieving brand equity is a major rationale for the 'use of CRM’
4. To find out if reinforcing a brand’s positioning is a major rationale the 'use of CRM’
5. To find out if Corporate Transformation is a major rationale for the 'use of CRM’
6. To find out how the use of Cause Marketing influences customer retention of a highly
publicized brand
7. To find out if the use of CRM contributes significantly to customer retention

1.3 Scope of Study
This thesis examines the relationship that subsists within the framework of three
dominant concepts within the field of marketing. These include Cause-Related
Marketing, Publicity and Customer Retention. Cause-Related Marketing is a type of
marketing strategy that lends support to a charity through sales with the intent to portray

14

a favourable brand image (Barone, Norman, & Miyazaki, 2007). Publicity according to
the Oxford American Dictionary is the notice or attention given to someone or something
by the media. Customer retention is the processes of keeping your customers or ensuring
that ones customers stay for the purpose of profitability and sustained revenue. This study
is essentially focused on these three variables and will not go beyond these boundaries.

1.4 Operational definition of terms
Cause-Related Marketing(CRM): A strategic marketing tool that is characterized by an
offer from a firm to contribute a specified amount to a designated cause when a customer
makes a purchase.
Customer Retention: Keeping a customer or making a customer stay
Publicity: Awareness about something or someone on any media
Marketing Communications: Strategies, tactics and activities involved in getting desired
marketing message to its intended target market.
Corporate Transformation: Behavioural changes that occur within an organization to
improve its performance.
Branding: Branding is the process of making a product or service easily recognizable by
customers through its intrinsic and extrinsic values.
Brand Equity: The value premium a company realizes from having a recognizable brand
image
Brand Positioning: The process of creating a brand offer in such a manner that it
occupies a distinctive place and value in the target customers mind

15

1.5 Significance of the study
A number of studies on Cause Marketing have focused on the effect of donations on
consumer purchase and Olsen, Pracejus, and Brown (2003) also pursued this research
with a conclusion that people report higher attitudes toward a company and express
stronger purchase intentions as a function of the percentage value of their donation.

Attitude is as a result of perception and perception stems from how people view things
and the fact that actions such as a company’s declaration of the value of their donation
creates an effect on consumers purchase behaviour reflects that there is something that
influences customers based on what they see the brand reflect. Thus the need to find out
if CRM can significantly influence customer retention of a highly publicized brand.

In general, CRM campaigns result in more positive consumer attitudes toward a
company and greater purchase likelihood for its products.(Brown and Dacin 1997;
Pracejus, Olsen, and Brown 2003; Strahilevitz and Meyers 1998). However, there is a
dearth in literature on the relationship between Cause-Related Marketing and customer
retention.

This study is therefore significant because it is original and findings from this study will
not only add to existing literature but also assist Brand Managers, Business Category
Managers, Marketing Communications Practitioners and Marketing Directors in making
informed decisions as regards the ‘use of CRM’ for customer retention. In addition, this
will be a valuable resource material for non-profits seeking to pitch a partnership with
for-profit organizations.

16

1.6 Research questions
This study aims at interrogating one overall question firmly supported by seven
interrelated sub questions.
Overall question
How does the use of cause related Marketing influence customer retention of a highly
publicized brand?
Sub questions
1. Is building a good brand image a major rationale for the ‘use of CRM’?
2. Is achieving set sales target a major rationale for 'use of CRM’?
3. Is achieving brand equity a major rationale for the 'use of CRM’?
4. Is reinforcing a brand’s positioning a major rationale the 'use of CRM’?
5. Is Corporate Transformation a major rationale for the 'use of CRM’?
6. How does the use of Cause Marketing influence customer retention of a highly
publicized brand?
7. Does the use of CRM contribute significantly to customer retention?

17

CHAPTER TWO: LITERATURE REVIEW
2.0 Introduction

This chapter seeks to examine existing literature on the use of Cause-Related Marketing
and it will identify the gaps in literature on the relationship between Cause Marketing and
Customer Retention. In addition, a research question is developed and answered using a
conceptual model of the relationship between CRM and Customer Retention backed by
the Circuits of Power Theory postulated by Stewart Clegg (1989) and the hypotheses
generated from this model is discussed.

2.1 Theoretical foundation

The review of literature indicates that CRM is used to take advantage of a variety of
strategic marketing and business benefits. These are discussed in the paragraphs below;

CRM for image building: Business in the Community, defines CRM as “a commercial
activity by which businesses and charities or causes form a partnership with each other to
market an image, product, or service for mutual benefit.” The business enhances its
public image by being associated with a "worthy cause" and increases its sales in the
process (Caesar, 1986). In recent years, CRM has helped re-image companies hurt by
corporate scandals, ad clutter, globalization, and new technologies (Adler, 2006). Today,
most of the companies are using Cause Related Marketing as a strategic tool (Till and
Nowak, 2000) to build a positive corporate image in the minds of consumers

18

(Chattananon et al., 2008) which results in enhancing the sales of a company’s products
(Varadarajan and Menon, 1988) and profits as well (Adkins, 2004). In 1983, American
Express Company began a campaign entitled, "When Did You First Fall in Love With
Her?" which became one of the most heralded CRM campaigns to date (Caesar 1986;
Higgins 1986; Kinsley 1985; Mescon and Tifson 1987; Schiller 1988; Smith and Alcorn
1991; Varadarajan and Menon 1988; Wiegner 1985). The campaign "made people feel
good about American Express" and left the impression of a responsible, public-minded,
even patriotic corporation (Mescon and Tilson 1987). To be more specific, the long-term
gain from a CRM program is in terms of enhanced corporate identity and image. In
contrast, CRM program is normally conceptualized as a promotional tool that has
stronger effects on short-term sales, and that can also favourably impact on image and
attitudes (File and Prince, 1998; Stipp and Schiavone, 1996). Even though studies
indicate that consumers believe it is important for marketers to seek out ways for their
firms to become good corporate citizens (R&S Worldwide, 1996), that cause related
marketing is "a good way to solve social problems" (Ptacek & Salazar, 1997), and that
consumers have a more positive image of a company if it is doing something to make the
world a better place. Another reason for CRM’s growth is that public opinion research
has shown that effective cause programs can enhance a company’s reputation and brand
image and increase the credibility of its marketing effort while giving customers a
convenient way to contribute to nonprofit organizations through their purchasing
decisions. One result is that cause-related marketing in many companies has moved from
being a short-term, one-time campaign to build sales, to a longer-term strategic effort to
build brand and reputation. (Rains 2003) In the first case CEOs that authorize CRM earn

19

social recognition, prestige and popularity and enjoy warm-glow, magnified by the large
scale of corporate donations (Polishchuk, Firsov 2007)

CRM for brand equity: Cause marketing uses the equity of a charity brand to create a
link between a company and consumers (Kylander. 2006). CRM is a "dramatic way to
build brand equity. It creates the most added value and most directly enhances financial
performance" (Mullen, 1997). If price and quality are equal, customers are likely to
switch to a brand with cause related marketing benefit (R&S Worldwide, 1993; 1996).
CRM for sales: CRM, in contrast, has a very strong link with sales, since the level of
``giving’’ is tied directly to sales outcomes. To undertake CRM successfully a firm is
therefore required to identify the expected sales level without the program and how the
program will increase sales, since this will form the basis for the payment to the recipient
combining CRM and sponsorship has the advantage of introducing a more direct
evaluation framework, which is based on identifying incremental sales (Polonsky, Speed
2000). CRM campaign is designed for changing the consumers’ opinion, or for
eventually altering the consumers’ behaviour in a way that generates income for both the
company and the cause (Pracejus & Olsen, 2004). Although companies and causes may
view CRM as a tool to achieve economic and social objectives, consumers may view
CRM as a combination of a purchase decision and some form of altruistic or donor
behaviour. If so, a number of streams of research converge to facilitate the
conceptualization and prediction of CRM consumer behaviour. (Varadarajan, Menon
1988).
Company-cause fit does influence the customer’s attitude toward the fit, which in turn

20

influences the customer’s intent to purchase the cause-related marketing product. The
framework in this study makes several theoretical contributions by enhancing knowledge
about the nature and structure of cause-related marketing. It confirms the results of
(Lafferty et al. 2004) suggesting that the customer’s overall attitude toward the
sponsoring company plays an important role in influencing purchase intent of the
sponsored product.

In the context of CRM, the same logic can also be applied; CRM campaign that supports
a local cause is more likely to be evaluated more favorably by the consumers than CRM
that supports an international cause. Signaling theory (Spence, 1974) suggested that cues
provide employers with tangible information that are often necessary to evaluate
unobservable factor. Several factors such as price, warranties and advertising
expenditures have been used by consumers as signals or cues that assist them in
evaluating a company’s product and help them in their decision making.. CRM
campaigns that support a local cause might signal greater or better offer for the
consumers compared to support of national and international cause. (Anuar, Mohamad
2011)

One theory that explains this is Social exchange theory, which looks at human interaction
in terms of a dynamic social process in which parties exchange commodities, resources or
skills in an attempt to maximize their rewards and minimize their costs (Burnett and
Wood, 1988;Foa&Foa, 1980)

21

Another is Equity theory, which is similar to exchange theory in that individuals are
assumed to attempt to maximize their resources. However, equity theory postulates that
cognitive dissonance will occur when one party in the exchange receives either too much
or too little in the exchange. (Burnett and wood, 1988;Bar-Tal1976) An individual might
engage in a CRM purchase if; (1) in the past they have perceived the purchase and to be
inequitable and the donation by the firm themselves and the recipient of the donation, or
(2) both perceptions may occur.

Cause Related Marketing appears to be a good way to raise funds for charity
organizations. Women are significantly more likely than men to try a new brand as a
result of a CRM promotion if they regularly used the product category (K.Ross,
Stutts,Patterson) Commodity fetishism is useful in understanding how CRM campaigns
like Product RED can reconcile the tensions between capitalism and social activism, two
historically separate, if not oppositional, spheres (Banet-Weiser and Lapsansky 2008).
While it would be probable for a CRM campaign to donate money to a particular cause
without tuning the beneficiaries of that cause into a commodity itself.

Product RED situates Africa directly into the symbolic order of consumption. RED
remains consistent with the social politics of individualization (Bauman 2001) and a
neoliberal approach to welfare that celebrates privatization, personal responsibility, and
consumer choice. (kuehn 2009). However, there are several variations on this theme and
not all CRM campaigns channel money to nonprofits; some engage principally in
educational or awareness-building activities. (Rains 2003)

22

CRM for brand positioning: “The key in positioning your brand,” said Lipsky, “is
tapping into the right frame.” It’s therefore not so much about the content of the
communication, but the frame you are evoking (Kylander. 2006). In all the CRM
campaigns the emphasis is placed on positioning the brand at the heart of the partnership
and not on straightforward philanthropy (Papasolomou, Demetriou). Cause related
marketing, when implemented correctly, can provide a means to differentiate a particular
brand or an entire corporation from its respective competition because of its socially
responsible overtones and positive effect on the corporate image. CRM can help
companies distinguish themselves from their peers by offering the consumer the
opportunity to contribute to something more. A firm that introduces CRM on a
competitive market can increase its market share than the company’s bottom line (Anuar,
Mohamad 2011). Market differentiation and market segmentation is easier to accomplish
when a company uses CRM (Rucker & Petty, 2006; Zuckerman & Chaiken, 1998). The
continued emergence of this area of marketing will most certainly be facilitated by the
attention given to the strategic value of focusing on the long-term benefits of enhancing
corporate image as a means of gaining competitive advantage.

The argument in this concept is that CRM efforts can be traced to the fact that they have
been initiated without considering their overall relationship to the company’s vision and
mission. Mission marketing, on the other hand, has more believability than cause related
marketing because it is a long-term and strategic organizational objective. It is bound to
the mission of the organization and according to Duncan, the first thing a company needs

23

to do is to determine a realistic, applicable mission that reflects a corporate social
responsibility and then be willing to ‘walk the talk’. The notion of “espoused theory” –
what one says – and “theory in use” – what one actually does – is well known in
cognitive psychology. It is relevant in explaining human behavior as a function of wellestablished mental models and behavioral routines that are culturally downloaded and
reinforced through everyday interactions. The ideas of espoused and in-use theories have
clear parallels with situations that organizations frequently struggle with (Broon, 2001)
…as more and more companies begin promoting their products with CRM the practice
may become commonplace and may no longer become unique or effective. Causes that
have a local or regional identification may result in greater success for both the firm and
the cause than national or international causes (Ross, Stutts, Patterson, 1991)

2.2 Strengths and weaknesses inherent in the uses of CRM literature

The literature on CRM so far has successfully given insight to its different uses from
Sales, Image building, strategic positioning, influencing consumer purchase decision and
brand equity. However, there’s room to expand the literature on the use of CRM for
brand equity. CRM has also constantly been defined as a strategic promotional tool that is
mutually beneficial to both profit organizations and not-for-profit organizations thereby
skewing studies on the relationship between CRM and sales or donation size but (Rains
2003) states that there are several variations on this theme and not all CRM campaigns
channel money to nonprofits; some engage principally in educational or awarenessbuilding activities. This variation has not been studied adequately as such confirming

24

Papasolomou and Demetriou’s statement that the current literature on CRM is limited as
to what CRM is or how it is implemented. In addition, a lot of research has focused on
the positive influence of CRM on sales and donations but there is a dearth in literature on
how the use of CRM is used to boost brand loyalty. Pracejus & Olsen (2004) highlighted
amongst the benefits of CRM, customer loyalty. However does not state how. Not many
researchers have focused on how important brand personality is to brand loyalty
(Plummer, 1985). It is on this premise that this question is asked; how does the use of
Cause Marketing influence customer retention of a highly publicized brand? This
question will be answered conceptually in the next paragraph.

2.3 Conceptual framework

The social science theory that best explains this framework is the Circuit of Power
Theory as postulated by Stewart Clegg (1989). He sees power as a circular process that
flows in three channels which he calls circuits of power. Each of these three circuits of
power has a dynamic form of its own.

1. Overt Circuit of Power: In simple terms this states that A activates resources and
means, and influences B in a way in which B would not have acted were it not for his
relations with A. ‘A’ being the use of CRM and ‘B’ being customer retention. This
means that the ‘use of CRM’ influences customer retention but that this is only
possible because of the way and manner CRM is used. As such depending on how
CRM is used, it can have a negative or positive influence on customer retention.

25

2. The Social Circuit of Power: This is also called the circuit of social integration or
dispositional circuit. This circuit creates a movement from obscurity to mainstream of
society. This is actualized when a brand that uses CRM through techniques of
production, publicize a brand in a way that customers have a sense of meaning and
belonging. This is the movement from ‘A’ to ‘C’. ‘A’ being CRM and ‘C’ being
publicity.

3. The systemic-economic circuit of power: This states that both material and nonmaterial resources are created. It is also called the facilitative circuit of power, which
in the context of the subject matter refers to the movement from publicity to customer
retention. The movement from publicity creates a belief system or presents physical
rewards that customers can relate with and causes them to be loyal to the brand being
publicized. In addition, this circuit could be negative or positive as it relates with
customer retention.

This entire movement is called an obligatory passage point that mediates all interactions.
In this case what facilitates the passage points is Publicity, which is the mediating
variable between CRM, which is the antecedent variable, and Customer Retention, which
is the consequential variable.

26

Figure 2. 1: Model of the relationship between CRM and customer retention

H1: Building a good brand image is a major rationale for the 'use of CRM'
H2: Achieving set sales target is a major rationale for the 'use of CRM'
H3: The desire to achieve brand equity is a major rationale for the 'use of CRM'
H4: The desire to reinforce a brand’s positioning is a major rationale for the 'use of CRM'
H5: Corporate Transformation is a major rationale for the ‘use of CRM’
H6: The use of CRM contributes significantly to customer retention at a time publicity is
used to make a brand visible
H7: The use of CRM contributes significantly to customer retention

27

H1- Building a good brand image is a major rationale for the 'use of CRM'.
Corporate identity deals with the impressions, image, and personality that an organization
presents to its stakeholders (Schmitt & Pan, 1994). Pracejus & Olsen (2004) highlighted
amongst the benefits of CRM, customer loyalty and improved brand image, which can
improve sales as well (Ross, Patterson & Stutts, 1992; Kropp, Holden & Lavack, 1999)
A research done in some universities in Pakistan indicated that the consumers’ attitude to
products is indeed influenced by CRM. But also that awareness of brand and image of the
company is also a deciding factor on that influence (Shabbir, Kaufmann, Ahmad, &
Qureshi, 2010). Bergami and Bagozzi 2000 state that an individual’s ability to identify
with an organization has both an emotional (attitude toward the company) and a cognitive
(company-customer fit) component (Gupta, Pirsch 2006). This therefore informs the
quest to find out if building a good brand image is a major factor for the ‘use of CRM’ by
corporate organizations? Considering the fact that an improved brand image can boost
sales.

The need to examine if the desire to meet or exceed a sales target is a major reason for
when CRM is used and how it is used informs this hypothesis. (Polonsky, Speed 2000)
states that CRM, in contrast, has a very strong link with sales, since the level of ``giving’’
is tied directly to sales outcomes. To undertake CRM successfully a firm is therefore
required to identify the expected sales level without the program and how the program
will increase sales, since this will form the basis for the payment to the recipient.
However before a company embarks on CRM, is sale the number one reason for using
CRM or the eventual outcome of a different objective entirely?

28

CRM is a "dramatic way to build brand equity . . . as it creates the most added value and
most directly enhances financial performance" (Mullen, 1997). Achieving the
Brand equity can be thought of as the "added value" endowed to a product in the
thoughts, words, and actions of consumers. Thus investigations will be carried out to find
out if Brand equity is the major reason for the use of CRM.

H4: The desire to reinforce a brand’s positioning is a major rationale for the 'use of
CRM'
Several CRM’s structural elements such as product type (Strahilevitz & Myers, 1998),
cause-type (Cui et al. 2003;Ellen, Mohr, & Webb, 2000) cause-proximity (Grau & Folse,
2007) and fit between sponsoring company and the cause supported (Hou, Du & Li,
2008) have been postulated in the literature to influence consumers’ response to CRM.
As such is a brand’s positioning influenced by different factors of CRM or the need to
reinforce a brand’s position the major reason for CRM?

H5: Corporate Transformation is a major rationale for the ‘use of CRM’: A new
contribution to literature by author
Existing literature consistently refers to CRM as a strategic promotional tool, as such ongoing research has been about the impact of CRM on sales and the relationship between
donation size and cause fit in consumer purchase decisions. However, this construct
states that CRM is used for Corporate Transformation and as such brings about change to

29

a brand’s image, personality, market share, value share and emotional connections with
the consumer based on the cause fit. This concept allows for CRM analysis of both profit
making and not-for profit-making organizations. In recent years, CRM has helped reimage companies hurt by corporate scandals, ad clutter, globalization, and new
technologies (Adler, 2006) and at a time when countries, companies and small businesses
are faced with a down turn and growing social issues, it is imperative to find out if the
need for Corporate Transformation is a major reason for the use of CRM.

H6: The use of CRM contributes significantly to customer retention at a time
publicity is used to make a brand visible
This seeks to investigate if publicity has a moderating effect in the relationship between
CRM and customer retention. It also investigates if the use of CRM contributes
significantly to customer loyalty considering the moderating effect of the publicity of a
brand. It’s therefore not so much about the content of the communication, but the frame
you are evoking. (Kylander, 2006) As such, it is imperative to understand the extent the
moderating effect of publicity would influence the contribution of CRM to customer
retention.

Not many researchers have focused on how important brand personality is to brand
loyalty (Plummer, 1985). As such this will seek to find out the relationship between CRM
and brand personality and how this translates to retention of customers.

30

CHAPTER THREE: METHODOLOGY

3.0 Introduction
The previous chapter attempted to answer the research question; how does the use
of Cause-Related Marketing influence customer retention of a highly publicized
brand? This question was answered conceptually using the circuits of power theory,
out of which seven hypotheses were derived.

This chapter however, seeks to build on the findings of chapter 2 and serves as the
beginning of the process of answering the research question empirically. The
objectives will therefore be to:

1. Identify a methodological framework that can be used to answer the question
2. Identify the most suitable research design
3.1 Research design
Research design has been defined as: “the logic that links the data to be collected (and the
conclusions to be drawn) to the initial questions of study” (Yin, 2003, p.19). Research
design is the basic framework of the various activities required in the study to provide
answers to the research questions. It addresses the purpose of the study, the unit being
studied, the time cross-section of the study, the data collection methods to be used, data
analysis procedures and presentation to be used. It is important to note that the more
complex the research design, the greater the amount of resources that will be required in
doing the research.

31

The purpose of this study is to find out how the use of Cause Marketing influences
customer retention of a highly publicized brand as it will provide guidance to
practitioners on the strategic and effective ‘use of CRM’. This study has been designed to
answer these questions;(1) Is building a good brand image a major rationale for the ‘use
of CRM’? (2) Is achieving set sales target a major rationale for the 'use of CRM’? (3) Is
achieving brand equity a major rationale for the 'use of CRM’? (4) Is reinforcing a
brand’s positioning a major rationale for the 'use of CRM’? (5) Is Corporate
Transformation a major rationale for the 'use of CRM’? (6) Does the use of Cause
Marketing influence customer retention of a highly publicized brand? (7) Does the use of
CRM contribute significantly to customer retention?

3.2

Types of sampling

A simple random sample: - A simple random sample is obtained by choosing elementary
units in such a way that each unit in the population has an equal chance of being selected.
A simple random sample is free from sampling bias. However, using a random number
table to choose the elementary units can be cumbersome. If the sample is to be collected
by a person untrained in statistics, then instructions may be misinterpreted and selections
may be made improperly.

A stratified sample: A stratified sample is obtained by independently selecting a simple
random sample from each population stratum. A population can be divided into different
groups and may be based on some characteristics. E.g education, age, gender etc.

32

A cluster sample: A cluster sample is obtained by selecting clusters from the population
on the basis of simple random sampling. The sample comprises a census of each random
cluster selected. For example, a cluster can be made up of a village or a school or a state.

Non-Probability Sampling Methods
Convenience sampling: Here the researcher questions anyone who is available. This
method is quick and cheap. However we do not know how representative the sample is
and how reliable the result would be.
Quota Sampling: Using this method the sample audience is made up of potential
purchasers of your product. For example if the typical customers will be male between
18-23, female between 26-30, then some of the respondents interviewed is expected to be
made up of this group.

The judgment sample: A judgment sample is obtained according to the discretion of
someone who is familiar with the relevant characteristics of the population. The sampling
method suitable for this study is the Judgment sample because the researcher is familiar
with the population in the marketing communications industry in Nigeria, especially as
most of the cluster in the industry is centred in Lagos. In addition, this method is the most
suitable given the time required to complete this study.

33

3.2.1 Population and sample procedure
Managers of twelve public relations firms in Nigeria will be interviewed. There are 40
registered PR firms in Nigeria; as such interacting with 12 managers in the different firms
will generate objective judgment or inference. Judgmental sampling will be used to make
the selection of firms and managers to be interviewed. Managers interviewed must have
over 3years experience in a Public Relations Firm and worked on at least two brands.
Managers of PR firms have been selected because they are exposed to many brands, as
such the possibility for exposure to Cause-related Marketing projects across various
industries is higher. Thus, share more depth of knowledge on the subject matter than a
brand manager working for a corporate organization. After the interview is conducted
and analyzed, inferences would be made and used as a parameter for preparing and
administering the questionnaires to Marketing and Marketing Communications
Practitioners. Judgmental sampling will also be used to make the selection. Practitioners
must at least have three years experience in managing brands and a total of 100
questionnaires will be distributed.

3.2.2 Data analysis procedure
The deductive method: deductive method begins with a theory from which hypotheses
are derived (Wallace, 1971), then the variables are defined and the methods for
measuring them are then established. Using these variables, the hypotheses are then
tested. The hypotheses will be acceptable if it matches with the observation. This method
starts from generalisation to specifics and is used in applying a theory to a particular
scenario.

34

The inductive method: This method is more like the opposite of the deductive method in
that we start with observations and develop general principles that explain relationships
between variables under observation. The construction of these general principles or
theories was referred to by Glaser and Strauss (1967) as “Grounded Theory” because
they are grounded in data derived from observation.

Semi-inductive method: Semi-inductive analysis (Golden-Biddle & Locke, 2006) is
similar to the inductive method in trying to derive the variables which are connected to a
particular scenario but differs in the fact that whereas the researcher has no idea of the
variables in inductive method, semi-inductive method states that the researcher possesses
some idea about the phenomenon and other concepts could emerge during the course of
the study. In reality, there is no ending to scientific research, as more study will reveal
more variables, which help develop new theories; this would therefore involve alternating
between the deductive and inductive methods. Thus this study would use the deductive
method for data analysis. Through interviews conducted, it derives variables, which are
relevant to the study and after this is done, the hypotheses are tested and results deducted
from data collated and analysed. Chi-Square will therefore be used to test the hypotheses
because it helps to identify significant variable.

35

CHAPTER 4: PRESENTATION OF FINDINGS AND ANALYSIS

4.0

Background

An extensive breakdown of the methodology employed in this research has been
treated in the previous chapter. Using the mixed methodology required that
interviews were conducted amongst experienced Public Relations Practitioners and
based on qualitative analysis, a questionnaire was designed to find quantitative
answers to the seven hypothetical questions and concepts identified during the
interviews.

4.1

Qualitative findings

Figure 2.2 Lists of Respondents
NO

RESPONDENTS

PROFILE

1

Mr. Cornel Onwoha

Chief Operating Officer Redgekko
Communications

2

Mr. Ayodeji Ayopo

Managing Director Shortlist PR

3

Mrs. Chizendu Achikwu

Head of Client Relations JSP Consult

4

Mr. Ayo Adegbesan

PR Manager JSP Consult

5

Mrs. Amaka Olukoya

Experienced PR Manager

6

Mr. Tobi Oluseye

PR Manager Reputation Raise Limited

7

Mr. Abiona Babarinde

PR Manager Soulcomms Publicis

36

-TWO-PRONGED STRATEGY: Cause Marketing was referred to as both a CSR and
Marketing tool. One of the respondents stated
“It is a two edged sword it is a form of CSR and a marketing tool”
“Cause marketing has two dimensions”

- TEETHING STAGE: Two of the respondents stated categorically that CRM is in
its developmental stage in Nigeria as such still trying to find a foot into its uses
and benefits. Ayo a PR Manager in JSP consulting stated
“Cause Marketing is still in its teething stage.”
and Amaka a PR Manager of over four years experience also reiterated saying
“We haven’t really gotten to the point of Cause Marketing so to speak. It’s more of CSR.
We are still trying to find our footing with the CSR thing and from there, I think we can
actually evolve to cause marketing but I think we are going to get there in a couple of
years time”

- CSR VERSUS CRM: When respondents were asked if they would proffer CRM to
their client one phenomenon was made clear that in Nigeria, there is no clear cut
distinction between CSR and CRM as such would rather proffer CSR. Comment
captured below.
“I’ll go for CSR as opposed to Cause Marketing. In the society today there’s no clear-cut
distinction and everyone is looking for what’s in it for them. It is going to be hard to
convince a client to give out a part of their profit to orphans and I think Cause Marketing
is not a one off thing it should be a yearly, quarterly thing and I don’t see them doing it,

37

they’ll rather push it back to their business, marketing, advertising, empower their own
people for better productivity. “

- PERCEPTION:

A good perception was highlighted, as one of the reasons why

building a good brand image would be a major reason for the use of CRM. Mr. Cornel
Nwoha the Chief Operating Officer of Redgekko had this to say
“Yes. Because when you talk about social responsibility it creates an impression that
there is a concern for the immediate environment and the issues in the environment “
Mr. Ayodeji Ayopo the Managing Director of Shortlist PR also stated
“That is what PR is all about, the client must be positively perceived”
Even as regards the use of Cause Marketing for Corporate Transformation one of the
respondents also mentioned the importance to perception.
“When you have a bad image you will want to align yourself with things that are of
public interest so that you can be viewed or change public perception. “
Also when respondents were asked about the influence of CRM on customer retention of
a highly publicized brand one of the respondents stated
“Everything comes down to perception”

- LONG-TERM SALES RESULT
There were varying views on the use of CRM for sales. Some of the respondents stated
that sales is a function of a lot of things and CRM is just a minor part of the mix and
would only impact significantly on sales in the long term.

38

“If your sales target be that in the next five years you want to achieve this and for that
reason you are doing this, it might not add up like that at the end of the day. But give it a
longer period and you may be able to surpass your target but if you tie it to a target you
have for a period of one or two years you may not achieve that.“

- PRODUCT QUALITY
On the subject of the use of CRM for Brand Image Chizendu, the Head of Client Service
at JSP consulting stated
“First your brand has to be top notch”
and this was further reiterated in the subject of the use of CRM for Brand Equity by Tobi
a PR manager of Reputation raise
“I won’t say 100% other things are involved like the quality of your product and service.
CRM is just an addition but not a sole reason”
As regards the influence of CRM on customer retention, a respondent also made mention
of product quality stating
“The use of Cause Marketing could or would induce a higher level of trial purchase. It
can turn people to your brand because you’re aligning yourself to a particular cause and
be more interested in a brand because of what they are doing but if the brand is not up to
standard it can’t”

39

“For it to work. The organization must have a good product to sell. You cannot attach a
bad product to a cause. Take time to select the cause and the selection of the cause must
be about the people. “
The point stated here is that for CRM to be effective the product or brand in question has
to be of top quality.

EMOTIONAL CONNECTION
One of the reasons for the use of CRM for brand positioning stated by one of the
respondents is to create emotional connections.
“Yes. Because there are other brands so you have to reinforce brand positioning so that
the consumers know what I stand for and ultimately have an emotional connection with
my brand and they know what you support despite the fact a bit of profit will come in.”
The COO of Redgekko also stated when asked if CRM influences brand retention
significantly
“Yes. The how is driven by emotion and sentiment.

40

4.2

Quantitative Findings

Questionnaires were distributed among Marketing and Marketing Communications
practitioners who provide solutions for customer engagement and retention. Out of 120
questionnaires distributed, 92 responded. The analyses of the questionnaire have been
done and findings presented using pie chart and bar chart. Chi-square has also been used
to test the hypotheses.

Age Distribution
It is important that the respondents are people of experience in the area of Marketing and
Marketing Communications. As a result, finding out the age distribution would ensure a
clear understanding of the demographics of the respondents.

41

Gender Distribution
Gender is another important aspect of this study thus the need to understand the
distribution of both male and female respondents of this research.

Industry Distribution
The population of this survey is majorly Marketing or Marketing Communication
practitioners working in different sectors of the economy, hence the need to understand
the distribution.

Sourced from Survey Monkey 2013.

42

Industry Experience Distribution
This study requires that respondents are experienced in the Marketing Field. It is for this
reason that this question was asked.


43

CRM is good for brand image


44

CRM is good for achieving set sales target


45

CRM is good for achieving brand equity


46

CRM is good for reinforcing a brand’s positioning


47

CRM is good for achieving Corporate Transformation


48

There is a clear-cut difference between CRM and CSR


49

Cause Marketing is in its teething stage in Nigeria


50

Publicity of a brand that supports a cause is very important


51

Publicity of a brand that supports a cause is not necessary


52

Publicity of a brand that supports a cause is neither important nor necessary


53

I will stick to a brand that supports a cause


54

I will stick to a brand that supports a cause I am emotionally connected to


55

I will stick to a brand that supports a cause only if the brand of good quality


56

I will only stick to a brand that I perceive to be good or stand for something good


57

4.2.1

Hypotheses Testing

H1: Building a good brand image is a major rationale for the 'use of CRM'
This hypothesis seeks to find out if building a good brand image is a major reason for the
use of Cause-Related Marketing. Chi-square test was run using responses from Cause
Marketing is good for building brand image, I will only stick to a brand I perceive to be
good or stand for something against the question publicity of a brand that supports a
cause is very important. See the result below
Table 1: Hypothesis test
Customer Retention
Df
P(α=0.025) Comment
CRM for Brand 12
0.109
Significant
Image

Publicity
Df
P(α=0.025) Comment
12
0.006
Significant

The result of the variables tested is significant. Therefore, the hypothesis Building a good
brand image is a major rationale for the ‘use of CRM’ is accepted.
This hypothesis seeks to find out if achieving a set sales target is a major reason for the
use of Cause-Related Marketing. Chi-square test was run using responses from -Cause
Marketing is good for achieving set sales target, I will stick to a brand that supports a
cause only if the brand is of good quality against the question publicity of a brand that
supports a cause is not necessary. See the result below

58

Customer Retention
Publicity
Df
P(α=0.025) Comment Df
P(α=0.025) Comment
CRM for Sales
12
0.106
Significant 12
0.107
Significant
The result of the variables tested is significant. Therefore, the hypothesis Achieving set
sales target is a major rationale for the ‘use of CRM’ is accepted.

This hypothesis seeks to find out if achieving brand equity is a major reason for the use
Cause-Related Marketing. Chi-square was run using responses from Cause Marketing is
good for achieving brand equity, I will stick to a brand that supports a cause I am
emotionally connected to against responses for publicity of a brand that supports a cause
is neither important nor necessary. See the result below
Customer Retention
Df
P(α=0.025) Comment
CRM for Brand 9
0.269
Significant
Equity

Publicity
Df
P(α=0.025) Comment
9
0.050
Significant

The result of the variables tested is significant. Therefore, the hypothesis Brand equity is
a major rationale for the ‘use of CRM’ is accepted.
H4: The desire to reinforce a brand’s positioning is a major rationale for the 'use of
CRM'
This hypothesis seeks to find out if achieving a brand’s positioning is a major reason for
the use Cause-Related Marketing. Chi-square was run using responses from Cause
Marketing is good for reinforcing a brand’s positioning, I will stick to a brand that

59

supports a cause against responses from publicity of a brand that supports a cause is very
important. See the result below
Customer Retention
Df
P(α=0.025) Comment
CRM for Brand 12
0.092
Significant
Positioning

Df
12

Publicity
P(α=0.025) Comment
0.604
Significant

The result of the variables tested is significant. Therefore, the hypothesis Reinforcing a
brand’s Positioning is a major rationale for the ‘use of CRM’ is accepted.

H5: Corporate Transformation is a major rationale for the ‘use of CRM’: A new
contribution to literature by author
This hypothesis, which is a new contribution to literature, seeks to find out if Corporate
Transformation is a major reason for the use of Cause-Related Marketing. Chi-square
was run using responses from Cause Marketing is good for Corporate Transformation, I
will stick to a brand that supports a cause against responses from publicity of a brand that
supports a good cause is very important. See result below


CRMfor
Corporate
Transformation

Customer Retention
Df
P(α=0.025) Comment
12
0.005
Significant

60

Publicity
Df
P(α=0.025) Comment
12
0.050
Significant

The result of the variables tested is significant. Therefore, the hypothesis Corporate
Transformation is a major rationale for the ‘use of CRM’ is accepted.
-

H6: The use of CRM contributes significantly to customer retention at a time
publicity is used to make a brand visible
This hypothesis seeks to find out if the use of Cause Marketing significantly contributes
to customer retention at a time when publicity is used for brand awareness of visibility.
Chi-square was run using responses from Cause Marketing is good for brand image,
Cause Marketing is good for achieving set sales target, Cause Marketing is good for
achieving brand equity, Cause Marketing is good for reinforcing a brand’s positioning,
Cause Marketing is good for Corporate Transformation against responses from Publicity
of a brand that supports a cause is very important and I will stick to a brand that supports
a cause. See the results below
Customer Retention
Df
P(α=0.025) Comment
CRM for Brand 12
0.000
Significant
Image
CRM
Sales 12
0.000
Significant
Target
CRM for Brand 9
0.002
Significant
Equity
CRM for Brand 12
0.092
Significant
Positioning
CRM
12
0.005
Significant
Corporate
Transformation

Df
12

Publicity
P(α=0.025) Comment
0.006
Significant

12

0.030

Significant

9

0.012

Significant

12

0.604

Significant

12

0.050

Significant

The result of the variables tested is significant. Therefore, the hypothesis is accepted.

61

Cause Related Marketing contributes significantly to customer retention at a time
publicity is used to make a brand visible.
This hypothesis seeks to find out if the use of Cause Marketing significantly contributes
to customer retention. Chi-square was run using responses from Cause Marketing is good
for brand image, Cause Marketing is good for achieving set sales target, Cause Marketing
is good for achieving brand equity, Cause Marketing is good for reinforcing a brand’s
positioning, Cause Marketing is good for Corporate Transformation against responses
from I will stick to a brand that supports a cause. See the results below

Customer Retention
Df
P(α=0.025)
CRM for Brand 12
0.000
Image
CRM
Sales 12
0.000
Target
CRM for Brand 9
0.002
Equity
CRM for Brand 12
0.092
Positioning
CRM
12
0.005
Corporate
Transformation

Comment
Significant
Significant
Significant
Significant
Significant

The result of the variables tested is significant. Therefore, the hypothesis Cause
Marketing significantly influences customer retention is accepted.

62

CHAPTER 5: CONCLUSION AND RECOMMENDATION

5.0 Introduction
The objective this research is to find out if building a good brand image is a major
rationale for the ‘use of CRM”, if achieving set sales target is a major rationale for the
'use of CRM’, if achieving brand equity is a major rationale for the 'use of CRM’, if
reinforcing a brand’s positioning is a major rationale the 'use of CRM’, if Corporate
Transformation which is a new addition to literature by the author is a major rationale for
the 'use of CRM’, how the use of Cause Marketing influences customer retention of a
highly publicized brand and if the use of CRM contributes significantly to customer
retention. After an extensive presentation of findings in the previous chapter, it is only
sacrosanct that this chapter analyzes the implications of these findings to theory and to
practice.

5.1 Findings
It was proposed that findings from this study will not only add to existing literature but
also assist Brand Managers, Business Category Managers, Marketing Communications
Practitioners and Marketing Directors in making informed decisions as regards the ‘use
of CRM’ for customer retention. In addition, this will be a valuable resource material for
non-profits seeking to pitch a partnership with for-profit organizations.

Findings from this study therefore is very relevant to Marketing Communications
Practitioners and Marketing Directors saddled with the responsibility of developing

63

solutions to recruit and retain customers. It confirms findings from previous literature
which are CRM for building brand image, CRM for sales, CRM for brand equity, CRM
for brand positioning and contributes a new literature to knowledge which is CRM for
Corporate Transformation.

The answers sort out for the seven hypotheses generated were found and conclusions
drawn from the findings and results. From the results, all seven hypotheses were accepted
therefore adding to existing literature on Cause-Related Marketing.

5.2 Implications

This section seeks to specifically analyze the consequence of findings of this study to
theory and practice.

5.2.1 Implications to theory

The research question this study sort to answer is how the use of CRM influences
customer retention of a highly publicised brand. Based on findings from this research, it
is clear that Cause-Related marketing is a powerful tool for influencing consumer’s
decisions to stick to a brand. The influence of Cause Marketing on Customer retention is
high and the influence of Cause Marketing on a brand that enjoys publicity is positively
significant too. We therefore cannot over emphasize the power of Cause Marketing as an
effective strategic marketing tool. There are however customers who will stick to a brand

64

with a cause that they are emotionally connected to and customers who will stick to a
brand that is of good quality and supports a cause at the same time.
5.2.2 Implications to Practitioners

Marketing and Marketing Communications practitioners are constantly saddled
with the responsibility of developing ideas that will not only recruit new customers
but retain as well. This study shows therefore that there are various uses of Cause
Marketing, thus if you seek to build image, hit sales target, reinforce a brand’s
positioning, achieve brand equity or bring about corporate transformation that Cause
Marketing can my used as a strategic tool to achieve customer loyalty or retention.
However, there are two things to put into consideration, ensure that the cause is one that
connects emotionally to target consumers and that the brand in question is of good
quality. In addition, for brands that require long-term solutions, CRM is a powerful tool.
Coordinators of Not-for-profit organisations are also constantly saddled with the
responsibility of raising funds for charity causes and faced with opportunities to pitch
their cause to corporate organisations without a truly mutually beneficial offer to the
organization or brand in question. It is therefore clear that Cause Marketing is a powerful
tool and is used to a large extent in developed countries, however based on findings in
this research, Cause Marketing is in its teething stage in Nigeria. Therefore Not-for-profit
organisations can use these findings for the mutual benefit of both their charity cause and
the goal of the brand at hand.

65

5.3 Recommendations
Further research that can evolve from this dissertation is the effect of the conceptual
model of the relationship between CRM and Customer Retention on specific
industries. In addition, the model of the relationship between CRM and Customer
Retention could be studied and further developed.

66

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80

APPENDIX

INTERVIEW SCHEDULE
Opening
My name is Rita Omovbude, I’m conducting a research on ‘how the use of Cause
Marketing influences customer retention of a highly publicized brand’ and since you
interact constantly with clients of companies who require CSR interventions like Cause
Marketing, I’d like to know what clients you work for, your opinion about Cause
Marketing in Nigeria and its significance to customer retention. I hope to use the
information to understand CRM in Nigeria better. This interview will only take
15minutes.
1. What PR Company do you work for and what clients do you manage?
2. What do you consider to be Cause Marketing?
3. Can you tell me about a Cause Related Marketing Campaign or Activity you’ve
been involved in, experienced or observed?
4. Would you proffer ‘the use of CRM’ to you clients?
a) If yes or no why?
5. Is building a good brand image a major reason you would ‘use of CRM’? If yes
how, if no why?
6. Is achieving set sales target a major reason you would use CRM? If yes how, if no
why?
7. Is achieving brand equity a major reason you would 'use of CRM’? If yes how, if
no why?

81

8. Is reinforcing a brand’s positioning a major reason you would 'use of CRM’? If
yes or no why is this so?
9. Is Corporate Transformation a major reason you would 'use of CRM’? If yes or
no please explain the reason.
10. Does the use of CRM contribute significantly to customer retention? If yes or no
please state why this is the case?
11. In what way does the use of CRM especially during company publicity activities,
contribute or influence customer retention?

Conclusion
12. Is there anything else you would like to add?
i) Summary of the points made
ii) Thank you for your time.

82

A QUESTIONNAIRE SEEKING TO UNDERSTAND HOW THE USE OF CAUSE
MARKETING INFLUENCES CUSTOMER RETENTION OF A HIGHLY
PUBLICISED BRAND.
Thank you for choosing to take part in this survey. This research is a partial fulfillment of
academic work at the School of Media and Communication, Pan Atlantic University. The
aim of this project is to find out if Cause marketing, which is a strategic marketing tool
influences customer retention of a highly publicised brand.
Your sincere opinion will help various stakeholders in more effective communication,
thereby affecting society positively.
Section A: Background Information
1. AGE 18-24
2. GENDER:
3

25-34
Male

35-44

Telecommunications

Food/Beverages

3. How many years have you been in this industry?
2-3
3-4
4-5
5 and over

55-64

Female

INDUSTRY: Advertising & Marketing

Financial Sector

45-54

83

others

Section B:
This rating should guide your responses. Please tick appropriately. 5=Strongly
agree 4=Agree 3=I don’t know 2= I disagree 1=I strongly disagree
S/N

Question

1

Cause Marketing is good for building brand image

2

Cause Marketing is good for achieving set sales target

3

Cause Marketing is good for achieving brand equity

4

Cause Marketing is good for reinforcing a brand’s positioning

5

7

Cause Marketing is good for achieving corporate
transformation
There is a clear cut difference between Cause Marketing and
Corporate Social Responsibility
Cause Marketing is in its teething stage in Nigeria

8

Publicity of a brand that supports a cause is very important

9

Publicity of a brand that supports a cause is not necessary

10

Publicity of a brand that supports a cause is neither important
nor necessary
I will stick to a brand that supports a cause

6

11

5

12

I will stick to a brand that supports a cause I am emotionally
connected to

13

I will stick to a brand that supports a cause only if the brand is
of good quality
I will only stick to a brand I perceive to be good or stand for
something good

14

84

4

3

2

1

Dissertation on the Use of Cause Marketing

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