The influence of sustainable development goals (SDGs) on customer-based store equity (CBSE)

Abstract

The sustainable development goals (SDGs) commenced globally in 2015. The execution of the SDGs is described as "Localizing the SDGs" to emphasize the role of local establishments and local players. The concern of SDG-related issues and concepts appears to be rising and is in line with the appreciation of its considerable potential. During the last decade, the concept of brand equity has been considerably utilized (or localized) in the context of the store, which is termed customer-based store equity (CBSE). We contribute to this localizing viewpoint by studying how the inclusion of the SDGs, particularly corporate social responsibility (CSR), influences local store equity. We propose eight major means by which the SDGs play a key role in creating CBSE, including 1) building store awareness; 2) developing consumer-self imagery; 3) engaging with store personality; 4) enhancing perceived store credibility; 5) enriching store reputation; 6) evoking store feeling; 7) cultivating store trust and loyalty; and 8) improving store perceived quality. We discuss the implications of our research propositions and provide directions for future research. Corresponding author: Boonyawat Soonsiripanichkul Email addresses for the corresponding author: b_soonsiri@hotmail.com First submission received: 28th February 2019 Revised submission received: 10th April 2019 Accepted: 20th April 2019 Introduction There is a growing interest for implementing social actions related the sustainable development goals (SDGs) (Drumwright 1996; File and Prince, 1998; Varadarajan and Menon, 1988). Research indicates that the SDG-related activities can be used to satisfy multiple objectives; and thus several outcomes could be expected from successful implementation of the SDGs, including differentiating firms from the competition (e.g., Burt and Sparks, 2002; Pivato, Misani, and Tencati, 2008); building an emotional, even spiritual bond with consumers (Lichtenstein, Drumwright, and Braig, 2004; Meyer, 1999); improving employee morale (Lee et al., 2012); and increasing sales revenue (Hoeffler and Keller, 2002). Moreover, SDG-related initiatives could lead to the construction of a positive corporate/brand image/equity (Godfrey, 2005; Hsu, 2012; Melo and Galen, 2010), and they may provide a reservoir of goodwill that would protect negative publicity and criticism from an unexpected event or tragedy (Dawar and Piliutla, 2000). By engaging in SDG-related activities, it can be seen that the SDGs are not only the “right thing to do but also the smart thing to do” (Smith, 2003, p. 52). Many studies have linked firms’ sustainable actions (e.g., social responsibilities and environmental concerns) with consumer behaviors at the product level (e.g., brand preferences and willingness to pay a price premium) (Creyer and Ross, 1997). However, the discussion on how such actions may contribute to customer-based store equity is varied and limited. The aim of this paper is to study how the inclusion of the Sustainable Development Goals (SDGs), particularly related to Corporate Social Responsibility (CSR), influences Customer-Based Store Equity (CBSE). Journal of Business and Retail Management Research (JBRMR), Volume 13, Special Issue May 2019 www.jbrmr.com A Journal of the Academy of Business and Retail Management (ABRM) 49 Discussion Sustainable Development Goals (SDGs) The 2030 Plan for Sustainable Development, agreed by all United Nations Member States in 2015, delivers a blueprint for peace and prosperity for humankind and planet earth, now and into the future (UNSDGs, 2019a). They hold that terminating poverty and other deprivations should be dealt with handin-hand with approaches that enrich health and education, decrease inequality, and stimulate economic development – all while tackling climate change and progressing to safeguard our oceans and forests (UNSDGs, 2019a). It has been well-defined from the beginning that the SDGs cannot be achieved without major corporate engagements (IISD, 2019). IISD (2019) illustrates that two SDG features are imperative in describing corporate engagement: their actionability and the ethical obligations that they convey. On actionability, certain SDGs could be progressive within an establishment’s (value chain) operations, while others demand that all social sectors collaborate (UNSDGs, 2019b). On ethical obligations, regarding ethical duties, there are SDG targets that seek to pre-empt negative impacts on society, which we call “avoiding harm” targets, while other targets actively seek to “do good” by intending to make additional contributions to the well-being of people and the planet (IISD, 2019). In this paper, we particularly study the influence of the SDGs that are CSR related on the concept of CBSE. CSR denotes ‘‘policies and practices of corporations that reflect business responsibility for some of the wider societal good’’ (Matten and Moon, 2008, p. 405). Enderle and Tavis (1998, p.1130) view corporate social responsibility as “the policy and practice of a corporation's social involvement over and beyond its legal obligations for the benefit of the society at large”. According to the definition by Angelidis and Ibrahim (1993, p.8), corporate social responsibility is “corporate social actions whose purpose is to satisfy social needs”. Lerner and Fryxell (1988) propose that CSR expresses the extent to which firms’ results are coherent with social principles and expectations. The devotion to CSR initiatives is also recognized to be a foundation of competitive edge and an approach to improve company performance (Hsu, 2012; Porter and Kramer, 2006). Bhattacharya and Sen (2004) have illustrated that the outcome of CSR initiatives on customer awareness or attitudes, which are ‘‘internal’’ effects, is significantly superior to the outcome that are ‘‘external’’ to the consumers, such as purchase action. Socially responsible firms are differentiated from their competitors and thus socially responsible activities positively affect consumer attitudes towards the firm and heighten customer satisfaction (Pivato, Misani, and Tencati, 2008). Luo and Bhattachary (2006) described the direct impact of CSR on customer satisfaction, in which a socially responsible firm fulfills customer demands via above average levels of company-consumer identification. This can strengthen the tendency of consumers to support the establishment (Dutton, Dukerich, and Harquail, 1994). Bhattacharya and Sen (2003) proposed that consumers who enthusiastically identify themselves with a firm tend to trust and forgive the firm’s misconducts. Therefore, the more a firm is recognized to be socially responsible, the more consumers will identify with and support the firm (Lichtenstein, Drumwright and Braig, 2004). The functions of CSR and SDGs CSR as green marketing Green marketing encompasses a wide range of activities, including new product development, manufacturing method, packaging modification, and advertising. Yet explaining green marketing is not an easy task (Polonsky, 1994). The very first description—which defined green marketing as the study of the positive and negative features of marketing activities on pollution, energy depletion, and non-energy resource depletion (Henion and Kinnear, 1976)—has three key elements, 1) it is part of the complete marketing body; 2) it involves both positive and negative activities; and 3) it examines a restricted series of environmental concerns. While this conceptualization is a meaningful opening point, it needs to be more broadly defined. Polonsky (1994, p.2) suggests a broader definition of green marketing: “Green or Environmental Marketing consists of all activities designed to generate and facilitate any exchanges intended to satisfy human needs or wants, such that the satisfaction of these needs and wants occurs, with minimal detrimental impact on the natural environment”. This definition integrates the established elements of the marketing definition, which are activities created to establish and enable any exchanges Journal of Business and Retail Management Research (JBRMR), Volume 13, Special Issue May 2019 www.jbrmr.com A Journal of the Academy of Business and Retail Management (ABRM) 50 aimed to fulfill human needs or wants (Stanton and Futrell, 1987). Therefore, this ensures that the benefits of the establishment and its customers are covered, as voluntary exchange would not exist except when both the buyer and seller mutually gain (Polonsky, 1994). This description also embodies the safeguarding of the natural environment, by exerting effort to reduce the detrimental effect such exchange has on the environment. Therefore, green marketing should be perceived as "less environmentally harmful" rather than "environmentally friendly”. CSR as societal marketing The early formal description of social marketing was proposed by Kotler and Zaltman (1971, p. 5): “Social marketing is the design, implementation, and control of programs calculated to influence the acceptability of social ideas and involving considerations of product planning, pricing, communication, distribution, and marketing research”. Andreason (1994) argued that such a definition is confounding in some ways, such as whether its practice was restricted to social and nonprofit marketers, and it limits its intention to impacting "the acceptability of social ideas". He later suggested that social marketing is the adjustment of commercial marketing technologies to procedures designed to encourage the voluntary conduct of target audiences to develop their own welfare and that of the societies in which they live. CSR as cause-related marketing The general definition of cause-related marketing (CRM) is the process of creating and executing marketing activities that are illustrated by donating a certain amount to a selected nonprofit organization that, in turn, influences consumers to participate in revenue-generating exchanges (Mullen, 1997). It could crea