Neural correlates of consumer behavior: bad news management effect of cause-related marketing

Abstract

Cause-related marketing (CM) is based on social interactions and reciprocity among society, nature, and profitability which are key forces of sustainable development of companies. The impact of CM on the consumers’ responses in terms of attitude to the strategy, attitude toward the brand as well as purchase intention has been a controversial issue. Having a pro-social agenda produces a powerful marketing tool that may build and shape a company`s reputational status, allow for a differentiation in the market and give a company a competitive edge. The neural basis of why pro-social behaviors occur provides an interesting prediction such as consumers’ desire for altruism through purchasing and soothing consumer`s guilt regarding indulgence. Recent studies in neuroeconomics have started to explore the neurobiological basis of the social behavioral propensity for altruistic rewarding and punishement which are of key importance for human cooperation. In order to investigate consumers’ perception regarding the notion that CM originated from corporate social responsibility (CSR) or social commitments, we are proposing the following main questions: (1) whether CM could be regarded as an insurance policy against the negative impact on corporate reputation caused by untold events; and (2) whether company’s CM could push consumers’ paying button. Furthermore, to evaluate the effectiveness of time frame for CM, we applied the novel scheme: proactive CM and reactive CM. We use both behavioral measurement and functional magnetic resonance imaging to show practical effectiveness. We aimed to prove that product-dependent or product-independent issues in CM have a differentiated moderation effect on bad news for companies according to product-harm crises or social crises. In the context of social neuroeconomics, activities in the reward-related area represent pro-social behavior. Remarkably, the dorsal striatum seems to play an important role for human cooperation and the punis...