Non-profits Are Seen as Warm and For-Profits as Competent: Firm Stereotypes Matter
AbstractConsumers use warmth and competence, two fundamental dimensions that govern social judgments of people, to form perceptions of firms. Three experiments showed that consumers perceive non-profits as being warmer than for-profits, but as less competent. Further, consumers are less willing to buy a product made by a non-profit than a for-profit because of their perceptions that the firm lacks competence. Consequently, when perceived competence of a non-profit is boosted through subtle cues that connote credibility, discrepancies in willingness to buy disappear. In fact, when consumers perceive high levels of competence and warmth, they feel admiration for the firm--which translates to consumers' increased desire to buy. This work highlights the importance of consumer stereotypes about non-profit and for-profit companies that, at baseline, come with opposing advantages and disadvantages but that can be altered.
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Bibliographic InfoPaper provided by Stanford University, Graduate School of Business in its series Research Papers with number 2047.
Date of creation: Jan 2010
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-06-04 (All new papers)
- NEP-BEC-2010-06-04 (Business Economics)
- NEP-MIC-2010-06-04 (Microeconomics)
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- Berger, Jonah & Draganska, Michaela & Simonson, Itamar, 2006.
"The Influence of Product Variety on Brand Perception and Choice,"
1938, Stanford University, Graduate School of Business.
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