Social Responsibility: It Does Good for Society and Your Brand’s Equity
Consumers today also like the notion of thinking that they are contributing something good to the world, directly or through the brands they support. Hence, we see growth of brands like Tom’s Shoes, the Body Shop, and Fair Trade, to name a few. These brands believe in a social mission that forms the foundation of their business strategy. But can a social mission or corporate social responsibility actually lead to stronger brand equity?
According to our research at BAV, being perceived as socially responsible can help a brand build both Energized Differentiation and Esteem, a construct we call Admired Differences. Brands with strong Admired Difference scores stand out as different and earn the respect of consumers, helping to build brand love and brand equity. Below, we examine data from over 2,000 diversified brands, mapping the overall correlation of Admired Differences (Energized Differentiation x Esteem) to Socially Responsible amongst these brands over time.
What we learn is that over the last five years, there has been a steady and strong correlation between Admired Differences and Social Responsibility across a universe of brands. Moreover, if the brands are parsed further by industry, we find that Social Responsibility is more important to building Admired Differences (Energized Differentiation x Esteem) in some industries than in others.
A snapshot of brands that demonstrate the highest ranking in both Social Responsibility and Admired Differences supports the idea that these brands are often leadership brands. According to our model, these brands occupy the upper right quadrant of the BAV Power Grid.
Some of these brands, such as Nike, are leadership brands for many other reasons and have used their leadership position to advocate social causes, including environmental sustainability. Other brands, like the Mayo Clinic, build their foundation upon Research and Education- social missions in and of themselves.
Overall, the data point to the fact that being socially responsible is correlated with drivers of brand equity. Many brands understand this and advocate social causes in their brand messages, ad campaigns, or through visible brand partnerships. For instance, financial institutions supporting non-profits or other social causes has been a popular avenue to regain some of the Esteem these companies lost at the start of the recession.
Whether brands choose to leverage universal good through identifying optimal partnerships or by advocating a socially focused brand message, showing a brand cares proves to be a win /win situation.