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Corporate social responsibility in luxury contexts: potential pitfalls and how to overcome them

Author

Listed:
  • Jenni Sipilä

    (LUT University)

  • Sascha Alavi

    (Ruhr-University of Bochum)

  • Laura Marie Edinger-Schons

    (University of Mannheim)

  • Sabrina Dörfer

    (Ruhr-University of Bochum)

  • Christian Schmitz

    (Ruhr-University of Bochum)

Abstract

Recent marketing research has identified mixed effects of luxury companies’ corporate social responsibility (CSR) engagement on customer-level outcomes. To gain a better understanding of these effects, we develop a conceptual framework in which we propose that, unless carefully implemented, CSR engagement leads to lower financial performance, decreased customer loyalty, and elevated extrinsic CSR attributions for luxury companies. These effects are exacerbated if consumers actively deliberate on the company’s CSR efforts. However, luxury companies can mitigate these pitfalls and reap the potential rewards of CSR engagement by (1) engaging in company-internal, especially employee-focused CSR instead of company-external, philanthropic CSR or (2) framing their brands as sustainable instead of exclusive. We find consistent support for our theorizing in five empirical studies. The results contribute to existing knowledge on stakeholder reactions to luxury brands’ CSR and can help managers successfully navigate the implementation of CSR in luxury contexts.

Suggested Citation

  • Jenni Sipilä & Sascha Alavi & Laura Marie Edinger-Schons & Sabrina Dörfer & Christian Schmitz, 2021. "Corporate social responsibility in luxury contexts: potential pitfalls and how to overcome them," Journal of the Academy of Marketing Science, Springer, vol. 49(2), pages 280-303, March.
    • Handle: RePEc:spr:joamsc:v:49:y:2021:i:2:d:10.1007_s11747-020-00755-x
    DOI: 10.1007/s11747-020-00755-x
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    Cited by:

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    2. Luming Zhao & Jiaxi Peng & Shubin Yu, 2023. "Sustainable Luxury and Consumer Purchase Intention: A Systematic Literature Review," SAGE Open, , vol. 13(4), pages 21582440231, December.
    3. Pangarkar, Aniruddha & Patel, Jayesh & Kumar, Sampath K., 2023. "Drivers of eWOM engagement on social media for luxury consumers: Analysis, implications, and future research directions," Journal of Retailing and Consumer Services, Elsevier, vol. 74(C).
    4. Laura Broccardo & Francesca Culasso & Amandeep Dhir & Elisa Truant, 2023. "Corporate social responsibility: Does it really matter in the luxury context?," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(1), pages 105-118, January.
    5. Li Yan & Hean Tat Keh & Kyle B. Murray, 2024. "Feeling the values: How pride and awe differentially enhance consumers’ sustainable behavioral intentions," Journal of the Academy of Marketing Science, Springer, vol. 52(1), pages 75-96, January.

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