The willingness to pay for cause related products: Empirical evidence from a conjoint analysis in Mexico

Abstract

Marketing campaigns aligned with Corporate Social Responsibility (CSR) practices are increasing as a strategy to reach brand differentiation and consumer preference. However, the challenge for many firms is to understand the impact of social and environmental campaigns in consumer’s perception and how these campaigns create economic and social value. Knowing that consumers make decisions based on several attributes, we use a conjoint analysis to determine the influence of CSR campaigns, brand, and price over purchase decisions. Data was collected online from a sample of Mexican consumers and was analyzed using panel data. From this sample we evaluate the direct and indirect effects of CSR campaigns in consumer preference, developing a method to map the preference increase in monetary terms. Our results show that consumers are willing to pay a premium price around 22% for leading brands if their products are associated with social campaigns and 10% for regular suppliers. This effect is not present in environmental campaigns. We prove that social campaigns create economic benefits for the firm, whereas society benefits from consumers’ participation in social campaigns.