Welcome to Francis Academic Press

Academic Journal of Business & Management, 2022, 4(1); doi: 10.25236/AJBM.2022.040117.

How Consumers’ Response on CSR Affects Brand Competitiveness in the Fast Fashion Industry——Case Study of Zara (Inditex) and H&M

Author(s)

Biying Jiang

Corresponding Author:
Biying Jiang
Affiliation(s)

Business Administration, Beijing Jiaotong University, Weihai, China

Abstract

This research is to examine how consumers’ response on CSR affects brand competitiveness. A case study of Zara and H&M is conducted to compare brand CSR practices and brand competitiveness. In addition, a qualitative questionnaire research is designed to collect consumers’ response on CSR, as well as their brand preference and purchasing behaviour, which directly indicate brand competitiveness. The research finds that Zara is more competitive although H&M has done better in CSR. Consumers’ response on CSR has a moderate effect on brand competitiveness, while the competitive factors in the fast fashion industry rank from design, price to quality, and finally CSR. Besides, consumers’ response on CSR benefits brand competitiveness by positively prompting brand equity, and negatively impacting competitors’ competitiveness through CSR’s spillover effect on non-CSR competitors. Moreover, negative CSR is found to have more serious influence on brand competitiveness than positive CSR. Gender difference is found that male customers are more social CSR oriented, while female customers are more environmental CSR oriented. Secondly, female customers are more susceptible to CSR, while male customers have less confidence on brands’ CSR initiatives.

Keywords

CSR, Brand Competitiveness, Fast Fashion Industry

Cite This Paper

Biying Jiang. How Consumers’ Response on CSR Affects Brand Competitiveness in the Fast Fashion Industry——Case Study of Zara (Inditex) and H&M. Academic Journal of Business & Management (2022) Vol. 4, Issue 1: 100-110. https://doi.org/10.25236/AJBM.2022.040117.

References

[1] AskTraders. (2020). Leading European fast fashion brands based on total revenue worldwide in 2019 (in million GBP)*. Statista. Statista Inc. Available at: https://www-statista-com.ezproxy.lancs.ac.uk/ statistics/1094176/european-fast-fashion-brands-ranked-by-revenue/ [Assessed 27 June 2020].

[2] Brønn, P. S., & Vrioni, A. B. (2001). Corporate social responsibility and cause-related marketing: an overview. International journal of Advertising, 20(2), 207-222.

[3] Butler, S. (2015). Zara owner Inditex faces fines in Brazil over poor working conditions claim. The Guardian, 12 May. Available at: https://www.theguardian.com/fashion/2015/may/12/zara-owner-inditex-fines-brazil-working-conditions-claim [Assessed 27 June 2020].

[4] Calabrese, A., Costa, R., & Rosati, F. (2016). Gender differences in customer expectations and perceptions of corporate social responsibility. Journal of Cleaner Production, 116, 135-149.

[5] Chen, Y. H., Wen, X. W., & Luo, M. Z. (2016). Corporate social responsibility spillover and competition effects on the food industry. Australian Economic Papers, 55(1), 1-13.

[6] Connelly, L. M. (2008) Pilot studies. Medsurg Nursing, 17(6), 411.

[7] Flyvbjerg, B. (2006). Five misunderstandings about case-study research. Qualitative inquiry, 12(2), 219-245.

[8] Hsu, K. T. (2012). The advertising effects of corporate social responsibility on corporate reputation and brand equity: Evidence from the life insurance industry in Taiwan. Journal of business ethics, 109(2), 189-201.

[9] Hur, W. M., Kim, H., & Woo, J. (2014). How CSR leads to corporate brand equity: Mediating mechanisms of corporate brand credibility and reputation. Journal of Business Ethics, 125(1), 75-86.

[10] Ibrahim, S., Jamali, D., & Karatas-Ozkan, M. (2012). Corporate social responsibility (CSR) in small and medium-sized enterprises: a developing country perspective'.Social and sustainable enterprise: changing the nature of business, (Contemporary issues in entrepreneurship research, volume 2) Emerald Group Publishing Limited.

[11] Kahreh, M. S., Babania, A., Tive, M., & Mirmehdi, S. M. (2014). An examination to effects of gender differences on the corporate social responsibility (CSR). Procedia-Social and Behavioral Sciences, 109(8), 664-668.

[12] Karaosman, H., Morales-Alonso, G., & Grijalvo, M. (2015). Consumers’ responses to CSR in a cross-cultural setting. Cogent Business & Management, 2(1), 1052916.

[13] Keller, K. L., & Lehmann, D. R. (2003). How do brands create value? Marketing management, 12(3), 26-26.

[14] Lassar, W., Mittal, B., & Sharma, A. (1995). Measuring customer-based brand equity. Journal of consumer marketing, 12(4), 11-19.

[15] Li, Y., Zhao, X., Shi, D., & Li, X. (2014). Governance of sustainable supply chains in the fast fashion industry. European Management Journal, 32(5), 823-836.

[16] McWilliams, A., Siegel, D. S., & Wright, P. M. (2006). Corporate social responsibility: Strategic implications. Journal of management studies, 43(1), 1-18.

[17] Mohr, L. A., Webb, D. J., & Harris, K. E. (2001). Do consumers expect companies to be socially responsible? The impact of corporate social responsibility on buying behavior. Journal of Consumer affairs, 35(1), 45-72.

[18] Myagmarsuren, O., & Chen, C. (2011). Exploring relationships between destination brand equity, satisfaction, and destination loyalty: a case study of Mongolia. Journal of Tourism, Hospitality & Culinary Arts, 3(2), 81-94.

[19] Perry, P. and Towers, N. (2013). Conceptual Framework Development for CSR Implementation in Fashion Supply Chains. International Journal of Physical Distribution & Logistics Management, 43(5/6), pp.478-500.

[20] Plewa, C., Conduit, J., Quester, P. G., & Johnson, C. (2015). The impact of corporate volunteering on CSR image: A consumer perspective. Journal of Business Ethics, 127(3), 643-659.

[21] Porter, M. E., & Kramer, M. R. (2006). The link between competitive advantage and corporate social responsibility. Harvard business review, 84(12), 78-92.

[22] Raggio, R. D., & Leone, R. P. (2007). The theoretical separation of brand equity and brand value: Managerial implications for strategic planning. Journal of Brand Management, 14(5), 380-395.

[23] Saleh, M. H., Ebeid, A. Y., & Abdelhameed, T. A. (2015). Customers' Perception of Corporate Social Responsibility (CSR): Its Impact on Word-ofMouthand Retention. Innovative Marketing, 11(2), 49-55.

[24] Seawright, J., & Gerring, J. (2008) Case selection techniques in case study research: A menu of qualitative and quantitative options. Political research quarterly, 61(2), 294-308.

[25] Sitaro, T. D. (2020). Fast Fashion and Sustainability-The Case of Inditex-Zara.

[26] Torres, A., Bijmolt, T. H., Tribó, J. A., & Verhoef, P. (2012). Generating global brand equity through corporate social responsibility to key stakeholders. International Journal of Research in Marketing, 29(1), 13-24.

[27] Torugsa, N. A., O’Donohue, W., & Hecker, R. (2013). Proactive CSR: An empirical analysis of the role of its economic, social and environmental dimensions on the association between capabilities and performance. Journal of Business Ethics, 115(2), 383-402.

[28] Valet, V., (2019) The World’s Most Reputable Companies for Corporate Responsibility 2019. Forbes, 17 Sep. Available at: https://www.forbes.com/sites/vickyvalet/2019/09/17/the-worlds-most-reputable-companies-for-corporate-responsibility-2019/#56af9ae0679b [Accessed 21 June 2020].

[29] Vilanova, M., Lozano, J. M., & Arenas, D. (2009). Exploring the nature of the relationship between CSR and competitiveness. Journal of business Ethics, 87(1), 57-69.

[30] Wicker, A. (2020) The flawed ways brands talk about sustainability. Vouge Business, 16 Apr. Available at: https://www.voguebusiness.com/sustainability/the-flawed-ways-brands-talk-about-sustainability-coronavirus [Accessed 21 June 2020].

[31] Winzar, H., Baumann, C., & Chu, W. (2018). Brand competitiveness: introducing the customer-based brand value (CBBV)–competitiveness chain. International Journal of Contemporary Hospitality Management, 30(1), 637-660.