Study: 'Value instantiation' key to luxury brands' and social responsibility

January 13, 2020

CHAMPAIGN, Ill. -- Luxury brands and corporate social responsibility initiatives make for unlikely bedfellows - the former with their self-enhancement values, the latter with its ethos of self-transcendence.

Although the values of haute couture designer handbags and clean drinking water campaigns would seem to clash, "value instantiation," which promotes the integration of disparate values, can help luxury brands thread the needle and counteract the adverse effects of value incompatibility, said Carlos Torelli, a professor of business administration and the James F. Towey Faculty Fellow at Illinois.

One of the most notable trends in marketing has been a pivot toward values-based marketing, which channels consumers' desires to make communities and society a better place to live. Notably, 85% of the top 50 global luxury brands - Prada, Tiffany and Rolex, for example - are involved in socially responsible activities such as philanthropy, environmental sustainability and ethical business practices.

But when luxury brands promote their corporate social responsibility agendas, they are, paradoxically, blending opposing values into their marketing strategies, which can result in negative responses from consumers, Torelli said.

"The two are fundamentally inconsistent with each other. If you want to pursue power, status and self-enhancement, it's hard to do that concurrently with focusing on others," he said. "Promoting two values simultaneously can lead consumers to experience a sense of unease or disfluency, resulting in unfavorable responses to the brand's marketing and product or service offerings. It's a mishmash of values."

But when consumers are exposed to an example of engaging in philanthropic activities while also striving for self-enhancement - say, when luxury brand managers promote the charity work of successful Hollywood celebrities such as Matt Damon, Angelina Jolie and Brad Pitt - they are more likely to consider that the two seemingly incompatible values can be pursued simultaneously, and envision themselves engaging in philanthropic activities while also purchasing luxury brands, the researchers say.

"Values are somewhat abstract; we need to make them concrete sometimes by giving an example of someone who embodies them," said Torelli, also the executive director of Executive and Professional Education at the Gies College of Business.

Across two studies, Torelli and his co-authors employed different approaches for value instantiation. In the first study, they exposed participants to the philanthropic activities of self-enhancement-driven celebrities. In the second, the researchers encouraged participants to visualize themselves engaging in philanthropic activities while pursuing self-enhancement values.

The results of both studies point to value instantiation as an effective tool in offsetting the harmful effects of integrating social responsibility appeals while selling luxury goods.

"It's a way for luxury brands to cope with trying to be more pro-social but not backfiring because of the incompatibility that the two things bring about," Torelli said.

The effect was particularly evident among the core consumer segment of luxury brands, who strongly pursue self-enhancement values, and thus would normally respond most negatively to social responsibility appeals, according to the researchers.

"It may seem disingenuous for a luxury brand to tout its altruism through its corporate social responsibility activities, but in marketing and branding, the trend for social responsibility has been growing dramatically over the last 20 years," Torelli said. "It used to be that a corporation was a profit-maximizing entity that didn't worry about anything else. But eventually, that's not optimal because firms have a responsibility and an interest in not behaving badly - in not contributing to pollution or damaging the environment, and not exploiting labor."

The research ultimately provides strategic guidance for luxury brands that wish to incorporate corporate social responsibility initiatives into their brand platform, Torelli said.

"For just about any business, there's more pressure now to be a partner in their communities - whether it's on a local scale or a global scale," Torelli said. "Some companies are doing it, and some feel left behind. Some do it right and some do it wrong. Ultimately, we provide a new conceptual framework for understanding how brands can overcome value incompatibility. Value incompatibility is at the heart of many struggles for 'old' brands to reposition themselves and make them more relevant for new consumers and the younger generation."

Torelli's co-authors are Deborah Roedder John, of the University of Minnesota; Alokparna (Sonia) Basu Monga, of Rutgers University; and Ji Kyung Park, of the University of Delaware.

The paper was published in the journal Marketing Letters.
-end-
Editor's notes: To contact Carlos Torelli, call 217-300-4158; email ctorelli@illinois.edu.

The paper "Value instantiation: How to overcome the value conflict in promoting luxury brands with CSR initiatives" is available online.

DOI: https://doi.org/10.1007/s11002-019-09498-4

University of Illinois at Urbana-Champaign, News Bureau

Related Consumers Articles from Brightsurf:

When consumers trust AI recommendations--or resist them
The key factor in deciding how to incorporate AI recommenders is whether consumers are focused on the functional and practical aspects of a product (its utilitarian value) or on the experiential and sensory aspects of a product (its hedonic value).

Do consumers enjoy events more when commenting on them?
Generating content increases people's enjoyment of positive experiences.

Why consumers think pretty food is healthier
People tend to think that pretty-looking food is healthier (e.g., more nutrients, less fat) and more natural (e.g., purer, less processed) than ugly-looking versions of the same food.

How consumers responded to COVID-19
The coronavirus pandemic has been a catalyst for laying out the different threats that consumers face, and that consumers must prepare themselves for a constantly shifting landscape moving forward.

Is less more? How consumers view sustainability claims
Communicating a product's reduced negative attribute might have unintended consequences if consumers approach it with the wrong mindset.

In the sharing economy, consumers see themselves as helpers
Whether you use a taxi or a rideshare app like Uber, you're still going to get a driver who will take you to your destination.

Helping consumers in a crisis
A new study shows that the central bank tool known as quantitative easing helped consumers substantially during the last big economic downturn -- a finding with clear relevance for today's pandemic-hit economy.

'Locally grown' broccoli looks, tastes better to consumers
In tests, consumers in upstate New York were willing to pay more for broccoli grown in New York when they knew where it came from, Cornell University researchers found.

Should patients be considered consumers?
No, and doing so can undermine efforts to promote patient-centered health care, write three Hastings Center scholars in the March issue of Health Affairs.

Consumers choose smartphones mostly because of their appearance
The more attractive the image and design of the telephone, the stronger the emotional relationship that consumers are going to have with the product, which is a clear influence on their purchasing decision.

Read More: Consumers News and Consumers Current Events
Brightsurf.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.