Students:
Alev Selbes & Samira Mohamed
Master of Science in Marketing
Advisor:
Karen Brunsø, Professor PhD
30.08.2010
Århus School of Business
Department of Marketing and
Statistics
-Master Thesis-
Consumer Behaviour Analysis in Relation
to CSR Activities of Cosmetics Brands
Abstract
Corporate Social Responsibility (CSR) has become an important topic in recent years,
especially within the cosmetics industry. The consumers are becoming more involved with
CSR and the demand for socially responsible brands is increasing. On the other hand,
cosmetics brands are implementing more and more CSR activities. This paper focuses on the
CSR activities of the cosmetics brands and how they affect consumer purchase behaviour. A
qualitative research has been conducted, which consisted of in-depth interviews with
cosmetics consumers and an interview with Estee Lauder Companies. Consumers find CSR
an important topic in the cosmetics industry and would to like to see more socially responsible
cosmetics brands. They would like to be informed more about what the cosmetics brands are
actually doing in terms of social responsibility. However, they would like to be persuaded in a
way that the CSR activities of the cosmetics brands are really meant to improve the society
and the environment, not just used as a marketing tool. When it comes to buying cosmetics
brands; quality, price and ingredients are considered to be the main purchase factors by
consumers. However, it can be stated that even though CSR is not considered to be a purchase
factor, it does have a significant impact on the purchase decisions. When it comes to
purchasing cosmetics products, the majority of the consumers are searching for products that
are fragrance free and allergy tested, and that do not contain unhealthy chemical additives (in
relation to the purchase factors “ingredient” and “quality”). These issues are part of the
environmental responsible activities that are provided by several green cosmetics brands, such
Clinique and Aveda.
The cosmetics brands consider CSR as a way to differentiate themselves from their
competitors in order to gain competitive advantage and to raise brand awareness. However,
the activities need to be in alignment with the identity and the image of the brand. In this way,
CSR activities contribute to the brand image while increasing the credibility of these activities
in the consumers‟ mind. Moreover, it is necessary for the cosmetic brands to communicate
their CSR activities to the consumers, in order to inform them continuously and make them
aware about the CSR commitment of the brands. In addition, the cosmetics brands can
cooperate together through certain CSR initiatives in order to increase the credibility of the
importance of CSR in the cosmetic industry. The industry initiatives raise CSR awareness and
support the overall image of the cosmetics industry as well as the image of the cosmetics
brands.
Acknowledgements
This thesis has been written as part of our Master of Science in Marketing study at the Aarhus
School of Business, Aarhus University.
It was a challenge to pursuit and to determine the specific problems of the subject we have
chosen for our thesis in the context of its complexity. Furthermore, searching and receiving
the relevant information turned out be a great challenge as well. However, working on our
thesis has been a great learning experience. We were able to explore and gain more
knowledge about Corporate Social Responsibility in the cosmetics industry.
We would like to thank Aarhus School of Business and our supervisor Karen Brunsø for their
time and support during our thesis period. Karen spent time and effort giving us useful
feedback and support in our research. We would also like to thank Estee Lauder Companies
for their contribution to our thesis. Especially our interview with Isabel Martin was very
valuable for us in order to understand the importance of CSR from commercial point of view.
We are grateful for her time and assistance.
Finally, we would like to thank our families for their support and all the consumers who
participated in the in-depth interviews. Without them, this thesis would not have been
completed.
Alev Selbes & Samira Mohamed
Brussels, 26th
of August, 2010
Table of Contents
1. INTRODUCTION ......................................................................................................................................... 1 1.1 BACKGROUND ........................................................................................................................................................... 1 1.2 PROBLEM IDENTIFICATION .................................................................................................................................... 2 1.3 PROBLEM STATEMENT............................................................................................................................................ 3 1.4 STRUCTURE ................................................................................................................................................................ 4 1.5 DELIMITATIONS ........................................................................................................................................................ 5
2. LITERATURE REVIEW ............................................................................................................................ 6 2.1 DEFINING CSR .......................................................................................................................................................... 6
2.1.1 Definition of CSR .................................................................................................................................................... 6 2.1.2 The Evolution of CSR ............................................................................................................................................ 6 2.1.3 Reasons to Implement CSR ................................................................................................................................. 7
2.2 ACTIVITIES OF CSR .............................................................................................................................................. 13 2.2.1 Internal and External CSR Activities ........................................................................................................... 13 2.2.2 The 3C-SR Model .................................................................................................................................................. 16
2.3 CSR AND INNOVATION ........................................................................................................................................ 17 2.3.1 CSR-driven Innovation ....................................................................................................................................... 17 2.3.2 The Cosmetics Industry ...................................................................................................................................... 18
2.4 DEVELOPMENT OF CSR ....................................................................................................................................... 19 2.4.1 Current Developments of CSR and Consumer Behaviour ................................................................... 19
2.5 CSR AND CONSUMER BEHAVIOUR .................................................................................................................. 21 2.5.1 Need Recognition .................................................................................................................................................. 21 2.5.2 Information Search .............................................................................................................................................. 22 2.5.3 Evaluation of Alternatives ................................................................................................................................. 23
2.6 THEORETICAL FRAMEWORK .............................................................................................................................. 24
3. METHODOLOGY ..................................................................................................................................... 25 3.1 RESEARCH PURPOSE ............................................................................................................................................. 25 3.2 RESEARCH APPROACH ......................................................................................................................................... 25
3.2.1 In-depth Interviews .............................................................................................................................................. 26 3.3 RESEARCH DESIGN ............................................................................................................................................... 26
3.3.1 Company Interview .............................................................................................................................................. 28 3.4 ANALYTICAL APPROACH .................................................................................................................................... 30
4. COMPANY ANALYSIS ........................................................................................................................... 34 4.1 COMPANY BACKGROUND AND HISTORY ....................................................................................................... 34
4.1.1 Isabel Martin’s Background ............................................................................................................................ 35 4.2 CSR AS A COMPANY CULTURE......................................................................................................................... 36 4.3 INTERNAL CSR ACTIVITIES ................................................................................................................................ 36 4.4 EXTERNAL CSR ACTIVITIES .............................................................................................................................. 37
4.4.1 Animal testing and product safety ................................................................................................................. 37 4.4.2 Environmental Activities .................................................................................................................................... 38 4.4.3 Breast Cancer Awareness Campaign ........................................................................................................... 39 4.4.4 MAC AIDS Fund ................................................................................................................................................... 40
4.4.5 Social Activities of Aveda, Clinique and La Mer..................................................................................... 40 4.5 CONSUMER INVOLVEMENT ................................................................................................................................ 41 4.6 COMPETITORS‟ CSR ACTIVITIES ...................................................................................................................... 43 4.7 CSR AND INNOVATION ........................................................................................................................................ 43 4.8 FUTURE CSR OPPORTUNITIES ........................................................................................................................... 45 4.9 ESTEE LAUDER COMPANIES & 3C-SR MODEL ............................................................................................ 46
4.9.1 CSR Commitment of Estee Lauder Companies ........................................................................................ 46 4.9.2 CSR Communication of Estee Lauder Companies.................................................................................. 49 4.9.3 CSR Consistency of Estee Lauder Companies ......................................................................................... 53
4.10 CONCLUSION ....................................................................................................................................... 55
5. CONSUMER ANALYSIS ........................................................................................................................ 57 5.1 DEMOGRAPHIC ANALYSIS .................................................................................................................................. 57 5.2 ANALYSIS OF COSMETICS BRANDS ................................................................................................................. 57 5.3 COSMETICS BRANDS AND CORPORATE SOCIAL RESPONSIBILITY ......................................................... 59
5.3.1 CSR and The Body Shop .................................................................................................................................... 60 5.3.2 CSR and MAC ........................................................................................................................................................ 62 5.3.3 CSR and Estee Lauder ........................................................................................................................................ 63 5.3.4 CSR and Clinique ................................................................................................................................................. 63 5.3.5 Limited CSR Awareness ..................................................................................................................................... 63
5.4 CSR ADVERTISING AND PERSUASION ............................................................................................................ 64 5.4.1 Persuasion and CSR Driven Cosmetics Brands ...................................................................................... 66 5.4.2 Consumers’ CSR Perceptions.......................................................................................................................... 70
5.5 CSR AWARENESS .................................................................................................................................................. 71 5.5.1 CSR Perceptions towards Information Sources ....................................................................................... 76 5.5.2 Consumers’ Value of CSR ................................................................................................................................. 78 5.5.3 CSR Related Cosmetics Consumptions ........................................................................................................ 79
5.6 LOYALTY ASPECTS OF THE COSMETICS PRODUCTS .................................................................................. 81 5.6.1 Recommendation and Discouragement of Cosmetics Brands ........................................................... 84 5.6.2 Loyalty and CSR .................................................................................................................................................... 86
5.7 BRANDING AND COSMETICS PRODUCTS ........................................................................................................ 87 5.8 CONCLUSION ........................................................................................................................................................... 89
6. CONCLUSION ........................................................................................................................................... 92 6.1 OVERALL CONCLUSION....................................................................................................................................... 92 6.2 LIMITATIONS ........................................................................................................................................................... 93 6.3 FURTHER RESEARCH ............................................................................................................................................ 94
REFERENCES ................................................................................................................................................ 96
1
1. Introduction
The first chapter provides background information regarding the importance of Corporate
Social Responsibility in today‟s world, especially within the cosmetics industry. Furthermore,
the purpose of this thesis is described through the problem identification and the problem
statement. Lastly, an overview of the thesis structure is shown and the scope the thesis is
explained in the delimitation part of the introduction section.
1.1 Background
"A good company delivers excellent products and services, and a great company does all that
and strives to make the world a better place." William Ford Jr., Chairman, Ford Motor Co.
Nowadays, Corporate Social Responsibility (CSR) is playing an important role in the rapidly
changing global world. In terms of the word “change”, it can be said that consumers,
companies and their strategies as well as the interaction between these two parties are
evolving based on the characteristics of the globalization. Consumers are more selective and
conscious about the products that they are purchasing and companies are also becoming more
responsible about the products that they are producing, supplying and selling. The reasons
behind these responsible activities are based on consumer demand, legal requirements that are
developing rapidly in the last decade and, the competitive needs of the firms. Hence, CSR is
at the intersection area of the debates about globalization, competitiveness and sustainability
(COM, 2006).
Although it is hard to give a clear definition of CSR, the European Commission defines CSR
as a concept where companies integrate social and environmental concerns in their business
operations and interactions with their stakeholders voluntarily (COM, 2006). The “voluntary”
word itself carries great importance since it renders companies to differentiate themselves
from the ones, which cannot go beyond obeying the law. Another definition of CSR also
overlaps this point of view by defining CSR as actions which appear to further social good,
beyond the interests of the firm and the requirements of the law (McWilliams et al., 2001).
The first models of CSR were introduced in the 1960s. These models linked the social aspect
of CSR directly with responsibilities above and beyond economic and legal obligations
(Meehan et al., 2006). Going beyond law can be exemplified as applying progressive human
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resources management programs, developing non-animal testing procedures, recycling,
supporting local businesses, abating pollution and embodying products with social attributes
or characteristics (McWilliams et al., 2001). Over the past 50 years, these models have been
revised and new models emerged to explain the importance and value of CSR for a
company‟s image as well as long-term growth. Also, as mentioned by William Ford, to be a
great a company includes striving to make the world a better place. Having a successful CSR
strategy is in alignment with striving to reach that goal.
Moreover, in the cosmetics industry it is very important that each and every product of a
brand are produced and sold based on the law and the specific health requirements. But
besides using the right ingredients and obeying the law, applying CSR is more than that. It is
related with caring consumers‟ demand, and the demand of other stakeholders such as
employees, investors and the community (McWilliams et al., 2001).
1.2 Problem Identification
Cosmetics companies do not only implement CSR policies to make the world a better place,
but also see it as way to achieve more growth and long term profit. In order to be successful in
the cosmetics industry, which is growing very fast, it is important to differentiate from the
competitors. CSR can be seen as a way of creating competitive advantage and as an
innovative way in order to be unique in the market.
Moreover, in the cosmetics industry the CSR agenda is consumer driven whereas in other
industries CSR activities are primarily based on compliance and reporting records. Because of
this consumer driven aspect, the cosmetics industry is more aware of being socially
responsible while launching new products. Consumers are becoming environmental friendly
since they are more selective and socially responsible in their choices. They care about where,
how and by whom the products are produced. Moreover, it is important for consumers to
know what ingredients are used and if they add value to environmental institutions or NGOs
by buying the specific product. For example the past couple of years have shown a cosmetics
trend of natural and environment friendly products. Consumers have shown an increased
interest in botanical extracts, minerals, oils and other natural ingredients. Furthermore,
another debated issue is that consumers are also sensitive and responsive to animal testing in
the cosmetics industry. If the specific product or brand has a negative reputation in terms of
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animal testing, ingredient quality or environmental unfriendly production processes;
consumers are not willing to choose those products.
Also, internal CSR activities are just as important as external activities. For this reason CSR is
closely related to employee satisfaction, which is a way of implementing internal CSR
activities. Examples of these internal activities are how employees are attached to the brand,
how they are trained, how they are treated and the benefits that the company can provide for
them such as maternity leave, flexible hours for the working families, promotional
opportunities, etc.
It can be said that creating and strengthening a strong brand image are very necessary in the
globalized context. Therefore, CSR is a good way to enhance the brand value. Avoiding from
irresponsible production processes and employee dissatisfaction will lead a company to a
stronger brand image while protecting the brand name from bad reputation. Therefore, it can
be concluded that not having the right and sufficient CSR activities/policies within the
company may lead to competitive disadvantage. Moreover, competitive disadvantage will
harm the brand image and the company will come up with lower profits. In addition, it can be
said that since CSR is one of the important sources of innovation, in the long run lacking CSR
activities and strategies will lead to company failures.
1.3 Problem Statement
Overall, the reasons mentioned above lead us to research how important CSR can be in
consumers‟ buying behaviour in the cosmetics industry. That it is the reason why, we have
stated not having the right and sufficient CSR activities as the problem statement of this
paper. The report is written from cosmetics companies‟ point of view and how important it is
for them to implement CSR activities and use these activities as a possible competitive
advantage. Based on this, the central is formulated which is: “How do Corporate Social
Responsibility activities affect consumers’ buying behaviour in the cosmetics industry?”
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The research questions are stated with their sub questions below:
RQ1) How do cosmetics brands define CSR?
- Can CSR be used as a way to differentiate in the cosmetics industry?
- Does CSR-related innovation have an influence on changing consumer behaviour?
- How important is the consumer demand for cosmetics brands in terms of CSR activities?
RQ2) How do consumers interpret CSR in the cosmetics industry?
- Is CSR an important purchase decision factor for cosmetics consumers?
- How influential are the CSR activities in order to create brand awareness?
- How influential is the peripheral route of persuasion to raise CSR awareness for the
cosmetics brands?
1.4 Structure
The structure of the thesis is shown below in Figure 1:
Figure 1: Thesis Structure
The core of this paper consists of five sections, which are illustrated, in Figure 1. In the
literature review, secondary data concerning CSR, consumer behaviour and the cosmetics
industry are analysed. Furthermore, the methodology provides an overview of the chosen
research approach and the research design. In addition, the company and consumer analyses
Ch. 1 Introduction
Ch. 2 Literature Review
Ch. 3 Methodology
Ch. 6 Conclusion &
Recommendation
Ch. 4 Company Analysis
Ch. 5 Consumer Analysis
5
are provided in order to understand how companies define CSR and how consumers interpret
CSR. After the company analysis and the consumer analysis parts, which means after
answering the research questions, an answer is given to the central question “How do
Corporate Social Responsibility activities affect consumers‟ buying behaviour in the
cosmetics industry?” The answer of the central question is based on the results of the
interviews and the analyses. Finally, recommendations are given on how companies can raise
CSR awareness and how CSR can be more influential on consumers‟ buying behaviour.
1.5 Delimitations
This thesis focused on the central question and the research questions that are formulated
above and did not take other factors of consumer behaviour in consideration due to lack of
time and resources. Furthermore, based on the researchers‟ accessibility, the research was
conducted in Brussels while the results were analysed from a company‟s perspective. The
limitations of this thesis are discussed in the 6th
chapter of this thesis.
6
2. Literature Review
2.1 Defining CSR
This paragraph focuses on the definition of CSR, how it evolved over the past 50 years and
the reasons as to why companies implement CSR activities. Also, a short overview is given
about the role CSR plays in the cosmetics industry.
2.1.1 Definition of CSR
Over the years the CSR concept has been defined, redefined and extended. Since the first
modern concepts in the 1950s, it can be concluded that there is no single definition of CSR.
Many different definitions can be found in existing literature regarding CSR, which come
from economists, researchers, organisations, governmental bodies and other institutions
concerning the society. The definition that is used throughout this report comes from the
European Commission that defines CSR as a concept where companies integrate social and
environmental concerns in their business operations and interactions with their stakeholders
voluntarily (COM, 2006).
2.1.2 The Evolution of CSR
In this paragraph information is given about the several definitions of CSR and how it has
evolved throughout the last 50 years. A lot of literature has been written about CSR and every
decade has its own ideas and themes related to this concept.
Howard R. Bowen wrote one of the most significant literatures concerning CSR in 1953. In
his work he questioned what social responsibilities companies may be expected to assume.
Through this question he came up with the following definition of CSR: “it refers to the
obligation of businessmen to pursue those policies, to make those decisions, or to follow those
lines of action which are desirable in terms of the objective and values of our society”
(Carroll, 1999). Archie B. Carroll argued that this definition marks as the beginning of the
modern period of literature on CSR and describes Bowen as the Father of Corporate Social
Responsibility (Carroll, 1999).
7
Furthermore, Carroll claims that 1960s marked “a significant growth in attempts to formalize,
or more accurately, state what CSR means” (Carroll, 1999). One of the prominent writers of
that time was Keith Davis who defined CSR as decisions and actions taken for reasons that
are partially beyond the company‟s direct economic or technical interest. Davis argued that
there is a significant relationship between social responsibilities and the power that companies
have over the society.
In the 1970s, more attention was given to stating exactly what the responsibilities of a
company were. An example is the emphasis on anticipating and promoting desirable changes
in the business-society relationships, which became associated with the term social
responsiveness (Meehan et al., 2006). Sethi (1975) formulated a corporate social performance
model distinguishing different corporate behaviours. His model consisted of three behavioural
approaches that reflect different attitudes towards conducting social responsible activities.
These three approaches are social obligation, social responsibility and social responsiveness.
The social responsiveness approach is a corporate behaviour in which both societal and
economic objectives are achieved while having the obligation to anticipate upcoming social
problems and to work actively to prevent them from happening.
Carroll believed that the 1980s and 1990s stood for fewer definitions, but for more research
and alternative themes such as the stakeholder theory, which was made most famous by R.
Edward Freeman. He defined a stakeholder as “any group or individual who can affect or is
affected by the achievement of the activities of an organization” (Carroll, 1999). Freeman
argued that different stakeholders are relevant to a company‟s operations.
Additionally, Carroll expects that in the 2000s more research will be done on how to measure
CSR. More empirical research will be conducted and researchers will focus on how to
implement CSR successfully (Carroll, 1999; Meehan et al., 2006).
2.1.3 Reasons to Implement CSR
Keith Davis (2008) created a model consisting of 5 propositions that describe how and why
companies should take action to protect and improve the welfare of society as well as that of
their businesses. These 5 propositions are the following:
8
1. Social responsibility arises from social power.
Companies have power over and influence on the society, since they are able to make
decisions that will have impact on external factors such as the environment, employment
(more jobs or less jobs) and local development (stores, buildings etc.). Due to this influence
and power, Davis argues that companies can and should be hold responsible for sustaining
and improving the society.
2. Business shall operate as a two-way open system, with open receipt of inputs from
society and open disclosure of its operations to the public.
To improve the welfare of the society, Davis proposes an ongoing and open communications
between the companies and the society representatives. This means that the companies need
to listen to what should be done to maintain and improve social welfare. On the other hand,
the society needs to listen to the companies and what they have done so far in terms of social
responsibility.
3. The social costs and benefits of an activity, product or service, shall be thoroughly
calculated and considered in deciding whether to proceed with.
The technical feasibility and economic profitability as well as the short term and long term
impact of all business activities on society need to be taken into consideration before
undertaking them.
4. The social costs related to each activity, product or service shall be passed on to
the customer.
Financing activities to improve the welfare of the society might be profitable for companies.
Therefore, it can be expected that companies should pass the extra costs made by having
social activities to consumer. This can be done through higher price for socially responsible
products and services.
5. Business institutions, as citizens, have the responsibility to become involved in
certain social problems that are outside their normal areas of operation.
If a company has the expertise and the know-how to solve or prevent a social problem, it
needs to be held responsible for solving that problem. It should not matter whether or not a
9
company is directly associated to a societal problem. In the end, all citizens and companies
will benefit from a generally improved society.
Also, the importance of CSR is not only related to improving social welfare but also to a
company‟s motivation to take CSR actions. According to Lynes and Andrachuk (2008) the
possible motivations for a company to be committed to CSR are: long-term financial strategy
(e.g. investing in efficient and low-emission technologies), eco-efficiencies (e.g. reduction in
expenses as a result of savings achieved through waste reduction), competitive advantage,
good corporate citizenship, image enhancement, stakeholder pressures and a desire to avoid or
delay regulatory actions. Especially the pressures from stakeholders form an important
motivation for a company‟s CSR involvement.
2.1.3.1 Stakeholders
Nowadays, companies are facing the globalisation of markets, increasing intensity of
competition, rapid technological changes, demographic changes, environmental challenges,
changing value systems and changing consumer preferences (Karna, et al., 2001). These
changes in the society influence companies to consider various interest groups in its decision-
making. The interest groups can be referred to as stakeholders. As mentioned before,
stakeholders are identified as “any group or individual that can affect, or is affected by, the
performance of the organisation” (Freeman, 1999). Examples of stakeholders are employees,
shareholders, customers, governments, communities, suppliers and unions. Companies often
face demands from the different stakeholder groups to invest in CSR policies. Also,
recognizing the importance of stakeholders and their demands has benefits for the companies
as well. Building relationships with customers, suppliers and other stakeholders can create a
competitive advantage. Furthermore, it can result to a new proactive corporate strategy that
anticipates societal issues instead of only reacting to them. Based on this, the importance of
CSR is becoming a more significant tool for companies (Karna, et al., 2001).
This report focuses primarily on the stakeholder group “consumers” and how the CSR
activities of cosmetics companies affect their purchase behaviour. Consumers have several
preferences and views to influence a company‟s CSR activities. As mentioned by McWilliams
and Siegel (2001), there is strong evidence that many consumers value CSR attributes.
10
Examples of consumer demands are non-animal tested ingredients, recycling and reducing
pollution.
To meet the consumer demands and to benefit economically, a company can implement CSR
as a differentiation strategy. Examples of differentiation via CSR are recycled products or
organic products. In this way a company can create new demand or can even charge a
premium price for the socially responsible products. It might be necessary to invest in R&D in
order to achieve differentiation. However, these R&D investments can lead to process and
product innovations. There are some consumers who want the products that they purchase to
have certain socially responsible attributes (product innovation), while other consumers also
value knowing that the goods they purchase are produced in a socially responsible manner
(process innovation) (McWilliams et al., 2001).
The CSR differentiation strategy can only be successful if customers know about a company‟s
CSR policy. Advertising is therefore an important tool to create and enhance awareness.
According to Nelson‟s (1970) description of experience goods and search goods, it can be
said that cosmetics products belong to the experience goods category. Consumers can only
understand the true value of cosmetics products after they purchase and use it. Advertising for
experience goods entails more information in which the product is often linked with a
recognized brand name. This association provides the consumer with information about the
product by connecting it with the reputation of the brand. By implementing and creating
consumer awareness concerning CSR, a company is able to create a reputation of reliability
and honesty. More often than not, consumers assume that the products of a reliable and honest
company will be of high quality. Therefore, advertising that provides information about CSR
attributes can be used to build and sustain a reputation for quality, reliability, or honesty
(McWilliams et al., 2001).
Other possible factors of consumer demand are tastes and preferences and the price of
substitute products. The taste and preferences of consumers are influenced by mass media.
Over the years, CSR has become a popular topic in the media where free publicity is given to
a company‟s commitment or lack of commitment to CSR. Also, mass media is able to provide
consumers with new information regarding social attributes and methods of production. It
11
enhances consumer awareness and therefore influences demand for CSR (McWilliams et al.,
2001).
It has to be said that not all consumers value CSR attributes, which means that the price of
competing products will still affect the demand for socially responsible products. On the other
hand, those consumers who do value CSR are willing to pay a higher price for a product with
additional social characteristics than for an identical product without these characteristics. A
consumer survey conducted on behalf of the European Commission showed that 70% of
consumers find it important that a company is committed to social responsibility, while 44%
are willing to pay a higher price for products that are socially and environmentally responsible
(CSR Europe, 2000).
Figure 2 gives a short overview of several stakeholders and their demands as well as a
company‟s reward when implementing CSR activities based on the stakeholders‟ views.
Stakeholders Demands Rewards
Consumers Products with socially responsible
attributes and products produced in a
socially responsible manner.
Increased consumption (through
differentiation and innovation), brand or
company reputation of being reliable,
honest and of high quality.
Employees &
unions
Equality and diversity; working
conditions (e.g. safety); financial
security; work place facilities.
Increased employee loyalty, morale and
productivity.
Government Proactive environmental practices,
certain level of CSR investments.
Increasing consumption of the company‟s
products. Either their own consumption or
that of the consumers they influence.
Community Support for local social services Increasing consumption of the company‟s
products. Either their own consumption or
that of the consumers they influence.
Figure 2: Overview of stakeholders‟ demands and companies‟ rewards
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2.1.3.2 The Cosmetics Industry
CSR has a significant role in the cosmetics industry. Since the consumers use cosmetics
products on themselves (face and/or rest of the body), it creates a personal interaction with the
industry. The consumers are more willing to be informed about the CSR activities of the
cosmetics companies. These activities, in a consumer‟s mind, shows whether a cosmetics
brand is reliable, honest and/or of high quality. The cosmetics industry is known for
pioneering in CSR committed activities and policies. Examples are small-medium enterprises
such as The Body Shop and Aveda, which are considered as pioneers in green marketing that
introduced and reported on their CSR activities. The ambition of these companies was to
change consumers‟ purchase behaviour. They were able to gain consumers‟ trust and market
shares and as a result they were able to compete with large cosmetics companies. The SMEs
(Small Medium Enterprises) have set the standards for CSR and multinational cosmetic
companies are now following suit (OECD 2007).
The main CSR focus for cosmetics companies are:
- Environmental protection such as the control of environmental impact on production sites
and shipping centres, use of bio substances in product formulas and use of recycled
materials.
- Ecological issues such as the preserving the ecosystem. Since cosmetics companies often
use many and different plants in their product formula, it has become an important focus
issue to maintain a positive CSR image.
- Social standards, which can be internal such as empowering employees (to increase
employee satisfaction) and non-discrimination of employees (by sex, age, race, and/or
culture). Social standards can be external as well, for example protecting cultures abroad
by funding local agricultural projects and local agricultural economies.
The majority of the CSR topics in the cosmetics industry are linked with the ingredients used
in the products. Consumers find it important to know what ingredients are used, if they are
healthy ingredients and whether or not they are tested on animals. Furthermore, consumers
like to know where the ingredients come from and if a company is a participant of fair-
trading. The buying decision of cosmetics products is often linked with habit, loyalty or social
status. Therefore, by focusing on consumer demand and raising awareness on other social
responsible issues not only increases consumer loyalty and brand image, but gives a company
13
a competitive advantage through differentiation (OECD, 2007).
As mentioned before, advertising is important to create consumer awareness and gain
competitive advantage. Even though the advertising budget is often limited, a part of the
budget is used to communicate the social and environmental view and the activities of the
company. Advertising is done through mass media as well as through guerrilla marketing (i.e.
direct promotion and product placement in movies and television shows). Another example of
guerrilla marketing is advertisement through the cosmetics stores. Consumers can find
information regarding a company‟s CSR activities in the stores via leaflets, posters or
cosmetics consultants who stress the CSR advantages of the brand. In addition, by using mass
media the companies are able to communicate their CSR messages and use their logo to
increase their positive image. The companies receive free publicity from printed media as
well as through research and reports, consumer guides and CSR-related awards (OECD,
2007).
In addition, cosmetics companies inform their customers through their CSR reports. The Body
Shop was the first company to publish a stakeholder report in 1995. The issues that are
highlighted in the reports are ethical trade, animal testing, supply chain, ecology, human
rights, protection of the planet, packaging, partnership with NGOs, employee treatment and
involvement, ingredients and internal CSR (OECD, 2007).
2.2 Activities of CSR
CSR is becoming a more important concept for companies instead of considering it as a trend
concept. The CSR activities of companies are divided into two parts, which are internal and
external CSR activities, in order to explain how it works into more detail.
2.2.1 Internal and External CSR Activities
Although CSR is usually perceived, recognized and related with end results such as creating a
responsible company, product and/or brand image and focused on the effect on consumers,
internal CSR activities help to create the part under the iceberg for companies. To be more
specific, in the cosmetics industry consumers are becoming environmental friendly since they
are more selective and socially responsible in their choices. They care about where, how and
by whom the products are produced. Easy access to Internet, television and other media
14
enables consumers to gain knowledge about the roots of the products as well as the production
processes and this situation leads consumers to responsible buying. Moreover, it is important
for consumers to know what ingredients are used and if they add value to environmental
institutions or NGOs by buying the specific products. Furthermore, another debated issue is
that consumers are also sensitive and responsive to animal testing in the cosmetics industry. If
the specific product or brand has a negative reputation in terms of animal testing, ingredient
quality or environmental unfriendly production processes, consumers are not willing to
choose those products. In addition, it can be said that all safety, energy consumption and
pollution control related activities can be grouped under external CSR activities.
Lately, organizational commitment is considered as one of the most important success
indicators for companies. In that case, internal CSR activities play an extremely important
role to attract the very best employees and to sustain them for the good of the companies in
the long term. Matthews says: “As the media draws attention to environmental and
sustainability issues, consumers are questioning the ethics of companies that may mislead in
their “green” or “fair trade” positioning. As consumers become more knowledgeable and
critical about these issues, they are increasingly sensitive to issues or claims that can be
considered “green washing,” a term used to describe unfounded or irrelevant environmental
claims” (Matthews, 2008). Therefore, internal CSR activities can be stated as a proof for
companies to show that what they are doing is not a green washing but the real self-interest of
the companies towards responsible behaviour. Even though there are companies that do not
truly believe in importance of internal CSR, it creates the basis for implementation of
successful external CSR activities.
Therefore, Meehans and Richards (2006) stress the importance of developing international
management processes for effecting social responsiveness in order to make the organization
more flexible and to have greater responds to external change in the social environment.
Sookram (Guardian, 2009) explains what internal CSR is by saying: “Internal CR refers to all
the practices that are implemented within a company, such as employee development
programmes, health and safety policies, governance practices, creating a motivating and
productive work environment within the organization, and reducing the impact of a
company‟s operation on the environment and product responsibility.” Moreover he adds that
too many companies were placing emphasis on external CSR and were ignoring the
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opportunities and benefits that can be easily derived and quantified from internal CR. Since
many companies are more focused on financial benefits of the outcomes of corporate socially
responsible behaviour, they pay more attention on external CSR activities. On the other side,
it shouldn‟t be forgotten that creating the strong image of being a socially responsible
company comes from applying internal CSR activities which in the end persuades consumers
that all the CSR activities of the company is just not a green washing. Internal CSR activities
are also a very important investment for the companies in the long run which will lead to high
financial benefits through strong organizational commitment. “Early models of CSR emerged
in the 1960s and typically held the “social” aspect of CSR as referring directly to those
responsibilities above and beyond economic and legal obligations. Thus for many, CSR was
and still is synonymous with voluntary and philanthropic acts by business organizations
designed to alleviate social ills or benefit a disadvantaged group chosen by the corporation‟s
managers” (Meehan et al. 2006). On the other side, real life business cases show that this
belief cannot go further than creating a green washing image in consumers‟ mind. When
companies consider CSR as strength and the social resources are considered as an asset
through successful competitive strategy, the real meaning of CSR is understood and
companies will come up with cost benefits, which are their primary focus.
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2.2.2 The 3C-SR Model
Moreover in order to have a better understanding of CSR, its effect on consumer behaviour
and mutual advantages for the stakeholders Meehans and Richards 3C-SR model is going to
be examined. The three components of this model are: ethical and social commitments,
connections with partners in the value network and consistency of behaviour over time to
build trust (Meehan et al., 2006). The model suggests that in order to be a “good corporate
citizen” it is impossible to separate these three elements of the 3C-SR model. Figure 3 shows
an overview of the 3C-SR model.
Figure 3: The 3C-SR Model
The model suggests that ethical and social commitments stand for the social resources, which
are ethical standards, social objectives of the organizations such as its mission, strategic
objectives, strategy programmes, organizational policies and corporate culture. Furthermore,
connections with partners in the value network can only be sustained by having it as complex
constellations but not in sequential chains. The right fit between customers and the
competencies of the companies has to be achieved and improved. And lastly, consistency of
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behaviour has been mentioned as the behavioural element of social resources over time and
observed in all facets of organizational operations.
2.3 CSR and Innovation
This paragraph describes whether CSR can be used as an innovative tool and how CSR-driven
innovation can play a role in the cosmetics industry.
2.3.1 CSR-driven Innovation
CSR-driven innovation builds on the ideas of user-driven innovation (input from consumers)
and company-driven innovation (internal ideas and development). It results from a company‟s
ambition to improve social or environmental conditions. Also, an innovation can be further
encouraged by introductions of new technologies, the development of engineering skills and
consumer demand as well as the local, national and global concern for CSR-related issues and
stakeholders‟ wishes.
To create socially responsible innovations depend on a company‟s level of CSR involvement.
There are different levels of CSR involvement. The importance of CSR depends on how far
companies implement the concept into their business structures. For example (Clarkson,
1995):
- Companies with reactive CSR strategies do not take social responsibility and do less than
what their stakeholders require.
- Companies with defensive CSR strategies acknowledge social responsibility but conduct
the minimal obligations.
- Companies with accommodative CSR strategies accept social responsibility by conducting
all that is required.
- Proactive companies anticipate social responsibility and do more than is required.
In addition to the examples above, Porter and Kramer have defined another type of CSR,
namely strategic CSR (Porter and Kramer, 2006). Companies that use a strategic CSR not
only accept and anticipate social responsibility (and therefore proactive) but also integrate it
into their core business strategies. This means that CSR is integrated into the company‟s
innovation process as well.
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Four types of CSR-driven innovations can be indentified based on today‟s literature:
- Corporate social innovation (CSI), as discussed by Kanter (1999), refers to the fact that
companies can use social issues as an opportunity to learn and develop their business
supported by R&D. In this way, innovation can arise from social knowledge. A company
is able to create new products, new solutions and new market opportunities, while meeting
societal needs.
- The bottom of the pyramid (BOP) refers to disruptive innovations targeting the poorest
consumer group, who live on less than 2$ per day (Prahalad, 1994). In this way,
companies are able to generate growth and satisfy societal and stakeholders‟ needs by
creating profitable and future growth markets as well as focusing on the poor and their
urgent needs. This is done by directing technology and product-development resources on
the needs of the poor and building long-term relationships with local communities and
companies as well as NGOs.
- Ecological innovation focuses on environmental issues (Hockerts, 1999). Companies are
able to profit from ecological innovation by not only following current consumer demand,
but also by anticipating future environmental developments.
- Social entrepreneurship aims at indentifying socially responsible opportunities to create
public goods. Social entrepreneurs are often associated with voluntary and non-profit
sectors (Hockerts, 1999).
2.3.2 The Cosmetics Industry
The cosmetics industry is a saturated industry in which competition is quite high. A
significant part of the growth is achieved through innovation. Innovation is necessary to
maintain competitiveness, to improve product performance, to increasing safety issues and to
reduce the environmental impact of the products (OECD, 2007). Beertil Heerink of the
European cosmetics association Colipa confirms this notion by stating that “the cosmetics
industry thrives on the capacity to innovate” (Nichol, 2010). Examples of drivers of
innovation are the diverse population and the changing consumer needs. Examples of
innovation are new formulations of products and new testing methods.
As it has been mentioned before, consumers want to be informed about the ingredients used in
the cosmetics products. These ingredients need to be traceable. That is why it is necessary to
know who is doing what in the supply chain. To create consumers‟ awareness and consumers‟
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trust regarding natural or biological ingredients, cosmetics companies need to be able to make
clear where those ingredients come from, who is producing them and how they are processed
into the final products. The supply chains are quite short for small-medium sized companies.
This also counts for the companies that specialise in natural ingredients in which the
distributor can be the producer. The supply chain can be quite long and complicated for larger
enterprises. The ingredients might come from abroad or from a wholesaler, processed in
another company. In some cases, the final packaged product is bought from the distributing
brand (OECD, 2007).
Also, the supply chain can play an innovative part in socially responsible packaging. The
cosmetics industry is looking for new techniques to reduce packaging waste. Examples of the
new ways of packaging are making use of biodegradable plastics and recycled materials.
Other packaging techniques are upcycling (reusing an object in a new way) and
lightweighting (use of less material) (Organic Monitor, 2010).
2.4 Development of CSR
Development is an important term for Corporate Social Responsibility. Therefore, it is seen
that sustainable development is mostly linked with it. The world has limited resources and
increasing population. Due to the increasing competition companies cannot create value for
consumers and for the society without responsible behaviour. Moreover, changing the
ongoing attitude and developing CSR activities create differentiation and a win-win situation
for all stakeholders. Therefore, Meehans and Richards (2006) agree with this idea by saying:
“An organization that commits to widely recognized standards of social performance and
seeks to promulgate them across its entire value network will, if the effort is perceived to be
genuine (i.e. consistently maintained over the long term), benefit from enhanced competitive
resources deriving directly from its social orientation. In effect, CR orientation becomes a
meaningful basis for marketplace differentiation”.
2.4.1 Current Developments of CSR and Consumer Behaviour
International Institute for Sustainable Development has set 6 drivers for the development need
of CSR which are: The shrinking role of government, demands for greater disclosure,
increased customer interest, growing investor pressure, competitive labour markets and
supplier relations (BSDglobal, 2010). Moreover, the 3C-SR model‟s three components related
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to ethical and social commitments, connections with partners in the value network and
especially consistency of behaviour element are crucially important in terms of developments
in CSR. “Development of social resources requires organizations to take a holistic or strategic
view of their values and the management policies they underpin. This in turn implies
consistent adherence to externally recognized and accredited standards” (Meehan et al.,
2006). Therefore, it can be said that having loyal customers is no more related about
providing the expected products with the best quality and the best price. Credibility of the
product, the production process‟s effects on nature, the credibility of the suppliers, strategic
CSR views of the company and its reactions towards the developments carry an important
role.
Furthermore, being a proactive firm in terms of developments in CSR is very important.
Companies may choose to be adaptive, interactive or proactive. And managers of the socially
responsive companies are proactive (leaders) while dealing with social issues (Goodwin,
2007). For example, Shiseido as one of the biggest cosmetics companies claims that they
apply both reactive and proactive CSR activities but emphasizes that proactive CSR activities
are the ones, which makes Shiseido unique (Kataoka, 2009). Moreover, some of the proactive
CSR implications of Shiseido can be listed as: providing make up and massage seminars for
elderly and disabled people, having social contributions for funds by Shiseido employees,
donating environmental associations, supporting tree planting programs and so on.
Furthermore, it can be said that being a proactive company reflects the intention of the
company‟s interest towards developments in the CSR area, which makes it unique and
competitively successful as well. Meehans and Richards (2006) say: “Strategically astute
organizations are today aware of significant changes in consumer attitudes to organizations
themselves and the brands they seek to develop.” And they continue by saying: “Where
negative perceptions of organizations prevail, brand boycotts often follow as consumers,
particularly in wealthy industrialized countries, seek to punish parent organizations. But
herein lies an opportunity for a new approach to competitive strategy based around social
resources.” Therefore, CSR implications and developments should be taken as opportunities
for companies in order to increase their competitiveness as well as creating value for
customers, society and the environment.
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Moreover, the article gives examples of how consumer behaviour is affected by the social
performance of the companies. “Many consumers place primary emphasis on company social
performance in deciding whom to favour with their spending. Environics International‟s
Corporate Social Responsibility Monitor 2001 (a survey of 26,000 people across 20 countries)
found that CSR-related factors accounted for 49 per cent of a company‟s image while brands
and financial management accounted for only 35 and 10 per cent, respectively” (Meehans et
al., 2006). This example shows how brand awareness in terms of social responsibility changes
consumers‟ decisions as well as cost benefits and images of the companies.
2.5 CSR and Consumer Behaviour
Understanding consumer behaviour is vital in every industry. An important area of consumer
behaviour is how consumers choose and make decisions and steps that lead to the purchase of
a particular product or service. These steps consist of need recognition, information search,
evaluation of alternatives, and purchase.
2.5.1 Need Recognition
When it comes to social responsibility, a consumer need can be a product that satisfies
individual needs as well as improves social welfare. It has to be said that not every consumer
experiences this need. The recognition of this need depends on personal moral views, also
called as ethical obligation, and whether or not this obligation forms an essential part to one‟s
self-identity (Valor, 2008).
Another obstacle regarding need recognition is “bounded responsibility”, which refers to the
fact that not all consumers are equally aware of or involved with all social issues. For
example, one consumer might be more involved with the preservation of the environment
while the other cares more for human rights. It shows that consumers have different views of
corporate social responsibility.
Also, the perceived efficacy of consumer action is important. Consumers are willing to
purchase a socially responsible product if they believe that it will contribute to solving a
social issue. There is a greater chance of purchase if it makes a difference.
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2.5.2 Information Search
The sources of information influence a consumer perception of efficacy. For example, mass
media often focuses on the drama regarding a social issue (e.g. the harm inflicted) than on the
solutions (reasons why it happened and possible strategies to solve it). It reduces the
consumer‟s believe of change. On the other hand, information coming from formal sources
(e.g. university classes), informal sources (NGOs, seminars, campaigns, magazines etc) can
be more educational and empowering for consumers and might increase the perceived self-
efficacy (Valor, 2008).
In addition, consumers might buy responsibly if they are able to find out about a company‟s
impact on social welfare. However, studies have shown consumers face difficulties in finding
this information. Also, this is due to that fact that ethical/social attributes of a product are
often credence attributes, which cannot be judged before, during or after product use due to
lack know-how and expertise and the level of difficulty.
There are consumers that would like to buy responsibly but do not make the effort to inform
themselves for all product categories. For example, they may be willing to find information
about one product category, but care less about finding information regarding another socially
responsible product category. Even though they might be aware that the information is
available, they see it as a huge investment in time and effort to retrieve and process it. Those
consumers who feel the ethical obligation are more willing to search for information. On the
other hand, too much information can lead to overload and to difficulty in combining
information about companies. Moreover, consumers are more sensitive to negative
information than to positive information. Examples of negative information are a company‟s
lack of CSR involvement or a company‟s violations and opposition to a social issue.
How consumers process information can depend on their involvement with a product or a
brand. If a consumer has a strong commitment to a brand, he/she is able to show more
resistance to negative information and might have difficulty remembering ethical attributes of
a product.
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2.5.3 Evaluation of Alternatives
Consumers will only buy responsibly if these products can perform at least as good as the
irresponsible products. Another factor influencing the purchase decision is the price of a
socially responsible product. The additional costs resulting from responsible producing
processes are often passed on to the consumer by charging a premium price (Valor, 2008). As
mentioned before, reports have shown that consumers are willing to pay a higher price for a
socially responsible product. However, this counts as long as they have a budget for it. If their
income cannot support responsible purchasing, consumers will buy competing products with a
lower price.
Other factors that have an influence on a consumer‟s purchase behaviour are travelling a
distance to buy the product and spending too much time locating the product in the store.
After seeking information and considering the alternatives, consumers make the decision to
choose a socially responsible product. As mentioned before, it is hard to judge the ethical
attributes of a product. That is why it is important for companies to raise awareness and
provide information about their CSR developments and their impact of improving social
welfare.
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2.6 Theoretical Framework
Figure 4 shows a summary of the theoretical outline that is used throughout the thesis. The figure shows the literature used to answer the research
questions, which are vital for answering the central questions.
Figure 4: Theoretical Framework
CQ: “How do Corporate Social Responsibility
activities affect consumers’ buying behaviour in the
cosmetics industry”
RQ1) How do cosmetics brands define CSR?
- Can CSR be used as a way to
differentiate in the cosmetics industry?
- Does CSR-related innovation has an
influence on changing consumer
behaviour?
- How important is the consumer demand for
cosmetics brands in terms of CSR
activities?
RQ2) How do consumers interpret CSR in the cosmetics industry?
- Is CSR an important
purchase decision factor for cosmetics
consumers?
- How influential are the CSR
activities in order to create brand
awareness?
- How influential isthe peripheral
route of persuasion to raise CSR
awareness for the cosmetics brands?
3. Methodology
The theoretical framework of this thesis was presented in the previous chapter. The
methodology of this work will be explained in this section.
3.1 Research Purpose
As it has been mentioned before, the central question of this paper is: “How do corporate
social responsibility activities affect consumers‟ buying behaviour in the cosmetics industry?”
Therefore, the purpose of this research can be stated as the following: to have a better
understanding of CSR and its impact on consumer behaviour. Moreover, as the literature
review has shown, the cosmetics industry has been chosen as the area of research since CSR
activities are playing an important role for the firms as well as for the stakeholders in this
specific sector.
3.2 Research Approach
Qualitative research method is chosen in order to analyse the research aim of this study. The
reason why the qualitative approach is selected depends on its constructionist and
interpretivist character. Bryman states: “qualitative research can be construed as a research
strategy that usually emphasizes words rather than quantification in the collection and
analysis of data; has rejected the practices and norms of the natural scientific model and of
positivism in particular in preference for an emphasis on the ways in which individuals
interpret their social world; and embodies a view of social reality as a constantly shifting
emergent property of individuals‟ creation” (Bryman, 2004). Therefore, based on the purpose
of this research, consumers‟ interpretations, values, and attitudes towards responsible
consumption, environmental awareness and voluntary actions in terms of societal and
environmental issues of cosmetics companies are topics, which needed to be explored by
conducting qualitative research. Davies (2007) says: “Much qualitative research aims to do
just that: to reflect upon the feelings and experiences relative to the research question, to
explore the nature of the relationship between person and situation, and to take account of the
effect of the research analyst‟s own background and role.”
In addition, qualitative research provides the opportunity and flexibility- to the researcher- of
learning consumers‟ expectations, experiences and current elaborations within their own
words rather than just focusing on numbers gathered by quantitative surveys. Davies (2007)
supports this idea by saying: “Qualitative research feels more human than methods that can
sometimes be portrayed as reducing everything to thick boxes and tables.” In qualitative
research, the researcher wants rich and more detailed answers while quantitative research is
supposed to generate answers that can be coded and processed quickly. (Bryman, 2004)
3.2.1 In-depth Interviews
Furthermore, the chosen qualitative method is conducting in-depth interviews. In-depth
interviews can be conducted in an unstructured or semi-structured way. It is preferred to use a
semi-structured interview for this research based on the following reasons. Firstly, semi-
structured interviewing gives the opportunity to ask specific topics to be covered in the
interview guide while providing flexibility at the same time. Since this research has specific
questions to explore, semi-structured interviewing enables to cover more specific issues.
Moreover, semi-structured interviewing provides flexibility for the interviewer to come up
with new and/or follow up questions or to reformulate the questions based on the replies and
reactions of the interviewee. Secondly, since two people conducted this research, the semi-
structured aspect of the interview ensures a way of comparing interviewing styles. Thirdly,
qualitative interviewing gives the opportunity to interview the participants more than once
when it is necessary and to have a pre-test of the questions in order to be sure if the questions
are understood in the right way. (Bryman, 2004)
On the contrary, the biggest disadvantage of having in-depth interviews is that it is time
consuming. Moreover, the type of the questions may create disadvantage if they are not
prepared in the appropriate way. For example if the questions are too long and complex to
remember, the participant may not give their ideal answers. And lastly, face-to-face
interviews are vulnerable to bias since participants may be influenced by the interviewer and
vice versa. During this thesis study, the advantages of in-depth interviews are valued more
compared to the disadvantages.
3.3 Research Design
The semi-structured interviewing method has been planned for the consumers as well as for
the company interview in the following way. First of all, in terms of consumer interviews the
participants are identified as female cosmetics consumers who, in the age range of 18 to 40
years old, are living in Brussels. Having a broad age range is because of the fact that the
cosmetics industry targets all female consumers. In the cosmetics industry it is often observed
that consumers are divided into consumer segments based on their economic, geographic, or
cultural differences but not based on the age differences. On the other hand, it has to be kept
in mind that, there are some exceptional categories such as anti-aging creams and anti-aging
make-up products. However, most cosmetics product categories do not aim to segment female
consumers based on their ages.
Moreover, Brussels has been chosen as the area in which the interviews are conducted. The
reason for this is that the researchers of this study are located in Brussels. Therefore, personal
interviews were only possible to conduct in Brussels. Time restriction was also the reason that
the interviews were restricted within this specific region. On the other hand, it is assumed that
the information gathered from the interviews, meaning consumers‟ perceptions related to
CSR, can be seen as homogenous for the rest of Belgium and Europe.
In terms of the interview guide, it is prepared to follow a certain protocol of questions starting
with couple of introductory icebreaker questions to make the interviewee more comfortable
and continuing with several transition questions, which explain the purpose of the interview
and asking for permission to use a tape recorder. After being confirmed by the interviewee,
starting with some demographic questions and keeping up with thirteen main questions that
address the core subjects of the research. Moreover, the interviewees‟ answers are
summarized during the interview in order to be sure that the answers are understood in the
right way (Gubrium et al.). One other issue that has to be mentioned is about the number of
the interviews conducted. Normally, literature shows that there is no fixed number of
interviews while doing qualitative research. Moreover it is suggested that, the interviewers
should continue interviewing until they have learned all there is to be learned from the
interviews (Gubrium et al.). Therefore, 25 interviews have been conducted since this amount
led the interviewers to collect sufficient information in order to answer the research questions.
In addition, test interviews were held in order to avoid confusion and misunderstandings and
to reduce the level of bias. By doing so, the findings of the in-depth interview are expected to
be more reliable.
During the test interviews it was noticed that consumers had difficulty in understanding the
term CSR, since the majority of the interviewees were not familiar with the term. Even after
the explanation was given, and examples of the CSR activities were mentioned; the
interviewees still had hard time processing the information and giving examples of CSR
activities in the cosmetics industry. Based on this, it was decided to aid the interviewees by
showing examples of CSR advertisements of cosmetics brands. In this way, consumers were
able to recognize and fully understand the meaning of CSR activities. On the other side, it has
to be mentioned that while showing the CSR advertisements, the name and logo of the
cosmetics brands were hidden in order to prevent interviewee bias of focusing too much on
these cosmetics brands shown in the CSR advertisement. In addition, in this way the answers
of the interviewees can be considered more reliable. The advertisements shown during the
consumer interviews can be found in the Appendix 1.
After a quick glance on the advertisements (around 5 – 10 seconds), the interviewees were
able to give more examples of CSR activities and were able to recall socially responsible
cosmetics brands. Furthermore, they were able to give detailed answers to the other questions,
such as how they find out about socially responsible cosmetics brands, whether they find CSR
important and believe that it makes a difference, what type of CSR activities will lead them to
change their loyal cosmetics brands, whether they would recommend a socially responsible
cosmetics brand and if they would discourage socially irresponsible cosmetics brands to
someone else.
Moreover, the test interviews showed that the interview questions were difficult to understand
and to answer in the first instance. Some of the questions were too long or formulated in a
difficult way to understand. After the test interviews, the interviewee questions were
reformulated in order to make them easier for the interviewees to answer and to make sure
that interviewees feel comfortable in answering those questions. The consumer interview
guide can be found in the Appendix 2.
3.3.1 Company Interview
The second target group to interview were the cosmetics brands. The same kind of guide is
used, which was mentioned above for consumers, in terms of the interviewing style.
Due to lack of time and cooperation, only one company interview was conducted. The
interview was held with Estee Lauder Companies. Even though there is only one company
interview, it did have a significant importance on the thesis report. First of all, Estee Lauder
Companies is a multinational enterprise that plays an important role in the cosmetics industry,
with 27 cosmetics brands. Secondly, during the consumer interviews, the company‟s prestige
beauty brands such as Estee Lauder, MAC, Bobbi Brown, Clinique and Aveda were
mentioned as favourite cosmetics brands or as socially responsible brands by a large group of
interviewees. As a result, by interviewing Estee Lauder Companies, information was gathered
about the perception on CSR on corporate level and about the brands‟ CSR initiatives. This
means that, although Estee Lauder Companies is the only company, which the interview has
been conducted, it provided remarkable amount of information through its wide range of
brands.
The contact person of Estee Lauder Companies in relation to the CSR topic is Isabel Martin.
Martin is the Vice President Governmental Affairs-EU of the Benelux. The total number of
questions for the company interview was 14. However, the first 3 questions were basic
questions related to the background information of the interviewee. The other eleven
questions focused on the perceptions of Estee Lauder Companies on CSR. The CSR-related
topics discussed during the interview were company‟s culture, consumer involvement,
competitive advantage, innovation and future CSR developments in the cosmetics industry.
These topics were discussed in order to answer the research question and in the end the
central question.
Unfortunately, test interviews were not possible for the company interview. However, to
make sure that all information gathered and that the answers of the interviewee were valid and
reliable, the website of Estee Lauder Companies, the brands‟ websites and the Annual Report
of 2009 provided additional information to analyse and evaluate the company‟s CSR
commitment. In addition, the answers of Isabel Martin were summarized during the interview
to check whether the interviewers understood her answers and in order to avoid any
confusion. The company interview guide can be found in the Appendix 2.
3.4 Analytical Approach
The results of the interviews were analysed by using several models and theories. An
important theme in the consumer analysis is awareness consisting of recognition (aided
awareness) and recall (top-of-mind awareness). Analysing CSR awareness is necessary in
order to understand how CSR activities affect consumer purchase behaviour. Another
important theme in the consumer analysis is persuasion. Persuasion can be described as
change brought either by reason or by indirect factors that do not involve any reasoning
(Tellis, 2004). Examples of these factors are the use of cues such as endorsers and emotional
cues (fear, humour, joy, shock etc.). Persuasion is an important subject for this thesis in order
to answer the central question: “How do corporate social responsibility activities effect
consumers‟ buying behaviour in the cosmetics industry?” Moreover, during the consumer
interviews, questions were asked in relation to how consumers find out that a brand is socially
responsible and how they feel about being informed. These questions in general are related
with the routes of persuasion. Companies can use CSR as a way of differentiation to gain
competitive advantage. However, in order to do that, they need to communicate to consumers
about their CSR activities and persuade them about the legitimacy and the credibility of their
advertisement.
In terms of persuasion, the most important model used is the Elaboration Likelihood Model
(ELM). ELM is a framework that summarizes the different routes of persuasion and explains
the reasons for each routes of persuasion. The explanations are based on how much a
consumer thinks about the message of the advertisement. The routes of persuasion that are
discussed in this paper are the central route and the peripheral route. For example, when a
consumer has the motivation and the ability to evaluate a message, the likelihood that she will
think about it will be high. The consumer will look for and respond to strong arguments in
favour of the message and counter what she considers are weak reasons. This route of
persuasion is called the central route. On the other hand, if a consumer has the motivation but
lacks the ability to evaluate a message, she will more likely respond to cues associated with
the message, which is called the peripheral route of persuasion (Tellis, 2004). The routes of
persuasion can be found in figure 5.
Figure 5: Elaboration Likelihood Model of Persuasion (Petty et al., 1986)
The routes of persuasion are closely linked with the communication channels used by
cosmetics companies. These channels are discussed in the consumer analysis section as well.
There is a special focus on the point-to-point communication since this is an important
communication channel for the cosmetics industry. In addition, Vaughn presents a model
called Foot-Cone-Belding (FCB) grid, which shows how purchase decisions are made for
specific products.
Figure 6: FCB Grid
In Figure 6, four different situations are illustrated based on the high-low involvement and the
think-feel dimensions. Based on this figure, it is clear to observe that consumers reflect
different decision mindsets in terms of the sequence of “learning, feeling and doing” for
specific product categories.
Cosmetics products‟ consumption can be classified in the second quadrant. “The second
quadrant concerns product decisions of high involvement, but for which less information is
needed. In this case, the consumer first wants to be emotionally attracted by the brand image,
and then he or she collects information, and finally undertakes some action. Jewellery,
perfume, fashion and holidays may be examples that fit in this category” (De Pelsmacker et
al., 2007).
In addition, in relation to the peripheral route, the importance of repetition and the advantages
of using endorsements in the cosmetics industry and for CSR advertising are analysed as well.
The structure of the consumer analysis is done based on the results of the interview questions.
The order of the interview questions remains the same as the interview guide and subjects
such as persuasion, repetition, communication channels and loyalty are analysed while
evaluating the answers of the interviewees. At the end of the consumer analysis, an answer is
given to the research question “How do consumers interpret CSR?”
The company analysis section consists of short background information of Estee Lauder
Companies and its CSR activities. Moreover, the answers of the company interview with
Isabel Martin are analysed. In addition, the 3C-SR model is used to analyse whether Estee
Lauder Companies is a good corporate citizen. The aim of the 3C-SR model is to point out
that it is necessary for a socially responsible company to be committed, to share these
commitments with its value network and that it is consistent with its performance. These three
components of the 3C-SR Model are inter-related and it is impossible to separate the elements
and claim to be a good corporate citizen (Meehan et al, 2006). In the end, an answer is given
to the research question “How do cosmetics brands define CSR?”
4. Company Analysis
This chapter focuses on analysing the results of the interview, which was conducted with
Estee Lauder Companies.
4.1 Company Background and History
Estee Lauder Companies is one of the leading manufacturers and marketers of quality skin
care, makeup, fragrance and hair care products. Mrs. Estée Lauder founded the company in
1946. Estee Lauder Companies has been a family-owned company until 1995 when it became
a public held company. Until this day, the Lauder family is still very much involved in the
company‟s operations. The flagship cosmetic brand of the company (Estee Lauder) is named
after Mrs. Estée Lauder. Currently, the company has 27 cosmetics brands.
The cosmetics products of Estee Lauder Companies are sold over 140 countries and
territories. The net sales of 2009 were $7.3 billion. The vision of Estee Lauder Companies is
“Bringing the best to everyone we touch”. The company defines “the best” as the best
products, the best people and the best ideas and has built its success on these pillars since its
establishment.
The brands of Estee Lauder Companies are:
Estée Lauder, Aramis, Clinique, Prescriptives, Lab Series Skincare for Men, Origins, Tommy
Hilfiger, M·A·C, Kiton, La Mer, Bobbi Brown, Donna Karan, Aveda, Jo Malone, Bumble and
Bumble, Michael Kors, Darphin, American Beauty, Flirt!, GoodSkin™ Labs, Grassroots™
Research Labs, Sean John, Missoni, Daisy Fuentes, Tom Ford, Coach, Ojon and Smashbox.
It has to be said that this report focuses primarily on the high-end prestige beauty and makeup
artist brands of Estée Lauder, MAC, La Mer, Bobbi Brown and the prestige skincare brands
of Clinique and Aveda.
4.1.1 Isabel Martin’s Background
The company interview was conducted with Isabel Martin on 05/07/2010. Question 1 was
asked to learn her position at the company.
Martin‟s position is Vice President Government Affairs-EU at the Benelux Office of Estee
Lauder Companies. Her main task consists of following regular legislations with the focus on
product regulations. Product regulations refer to composition of the ingredients, packaging of
the products and safety conditions. Moreover, her tasks are closely linked with the distribution
issues for the company, online sales regulations, R&D and product development, consumer
communication and PR.
Within question 2, it is aimed to learn Martin‟s background with Estee Lauder Companies.
Martin has a lawyer background. Moreover, she has been working in the cosmetics industry
for 12 years and working for Estee Lauder Companies for 7 years. Martin mentioned that
before, she used to be the legal director for the Trade Association. After working at this
position, she started to work for Estee Lauder Companies as being the first person to hold the
title Vice President Government Affairs-EU.
Question 3 was asked to learn how long Martin has been involved with the CSR activities at
Estee Lauder Companies.
She mentioned that her position is not directly a CSR Management position. Moreover there
is not a CSR department in the Benelux Office. Martin mentioned that there is a global CSR
policy in terms of energy, waste minimization and packaging of Estee Lauder Companies. On
the other side, the individual brands of Estee Lauder Companies have their own CSR
activities. Since Martin‟s tasks are focused on regulations and legislations of the cosmetics
products she is highly involved and linked with CSR policies and activities for 7 years.
4.2 CSR as a Company Culture
Question 4 is asked to learn whether CSR is an important part of the company culture within
Estee Lauder Companies.
Estee Lauder Companies is an enterprise that has been involved with CSR activities since its
establishment. CSR is a part of the identity of the company and has strong links with the
vision and the mission of Estee Lauder Companies. Since it is a family owned company, it has
been involved with external and internal CSR activities (employee satisfaction, product
quality, product safety, environmental friendliness, etc.) for many years. As a family owned
company, the company culture of Estee Lauder Companies was not to expose its name in
order to protect its reputation for many years. For the last 20 years, there has been a huge
pressure from the NGOs in terms of implementing CSR activities. Therefore, consumers also
became aware and developed demand towards the subject. As a result, CSR became as a
competitive advantage for the cosmetics companies. So, although the strategy of Estee Lauder
Companies was not to expose its name in terms of the CSR activities, it became necessary for
the company in the end.
In addition, although there is a global policy at corporate level in terms of energy, waste
minimization and packaging at Estee Lauder Companies, having the regional structure makes
it easier to implement the CSR policies and set it as a company standard. Moreover, the
Annual Report aims to centralize information in terms of CSR and to put the information in a
systematic manner in order to have a global picture of the CSR activities.
4.3 Internal CSR activities
As mentioned before, one of the pillars of Estee Lauder Companies is employing the best
people. The company is highly involved in empowering its employees and making them feel
part of the family oriented company. “We embrace diversity and global exclusiveness and
take pride in providing a work environment in which individuals of different races, genders
and gender identities, sexual orientation, ethnicities, religions and backgrounds can excel”
(Estee Lauder Companies Annual Report, 2009). Estee Lauder Companies has several
programs to empower its employees and to make them feel committed to the company. These
programs are:
- Most Valuable People (MVP) Volunteer Program supports several institutions that
focus on health, education, literacy and institutions that give support to women. The
goal of the MVP Volunteer Program is to give the employees of Estee Lauder
Companies the opportunity to help local communities and other people in need. For
instance, employees of Estee Lauder Companies supported the literacy organization
“Reach Out and Read” by helping children to get prepared for school.
- Think Smart is a program that encourages employees to submit ideas on how Estee
Lauder Companies can operate more efficiently and more cost effectively. Since its re-
launch in 2005, the program has received thousands of ideas from employees.
- Health & Wellness Programs focus on the well being of the employees by giving
health check-up, skin cancer screenings, mammograms, fitness programs and other
onsite activities.
At the moment, Estee Lauder does not have standardized policies regarding safety issues.
However, the company‟s aim for the next 3 years is to standardize the behaviour-based safety
program and the workplace policies and procedures. In addition, the company aims to
increase safety trainings and to maximize communications through all its facilities.
Moreover, the employees are very much involved with the CSR activities organized by the
individual brands. The commitment to the external CSR activities originated from examples
set by the employees, for example the Lauder family. Estee Lauder Companies believes that
the employees are the core of doing “good” and represent the company‟s dedication of being
socially responsible.
4.4 External CSR activities
Estee Lauder Companies is as much committed to its external CSR activities as it is to the
internal activities. The external CSR activities of Estee Lauder Companies are implemented at
corporate level while the brands have their own CSR initiatives as well.
4.4.1 Animal testing and product safety
One of the most discussed topics in the cosmetics industry is the testing on animals. Estee
Lauder Companies decided to act against animal testing 20 years ago. Instead, the company
evaluates its products with the help of volunteers and aims for the complete elimination of
animal testing in the cosmetics industry. Moreover, in order to secure the safety of the
cosmetics products, the ingredients and the product formulas are continuously evaluated.
Furthermore, the chemicals used in the product formulas comply with the chemical
management plans of the European chemical program REACH (Regulation, Evaluation,
Authorization and Restriction of Chemicals).
4.4.2 Environmental Activities
Being environmental friendly is a topic that Estee Lauder Companies as well as the
consumers care greatly about. One of the ways that the company strives for an environmental
production is through the packaging process. Estee Lauder Companies is one of the founding
members of the Sustainable Packaging Coalition (SPC). The SPC is an industry-working
group that aims for a packaging system that provides economic prosperity and the use of
sustainable materials. This means that packaging material is sourced responsibly, and the
packaging is designed to be safe. Moreover, renewable energy is used during the production
processes and packaging is recycled efficiently. One of the green brands of Estee Lauder
Companies is Aveda, which is one of the first prestige cosmetics brands that developed
sustainable packaging. For example, the brand uses 96% of Post-Consumer Recycled plastic
in the packaging of new products. The Key Packaging Achievements of Estee Lauder
Companies can be found in the Appendix 3.
Furthermore, the R&D Department of the company created a program called Green
Chemistry. This program consists of 40 scientist and engineers who focus on developing
sustainable product design. In addition, the company founded an Environmental Affairs and
Safety (EAS) Committee. This Committee is concerned with making sure that the company‟s
processes and policies comply with all applicable laws and with the accredited ISO 14001
Environmental Management System. Also, the Committee cooperates with environmental
organizations and governmental institutions in order to improve the company‟s environmental
programs. Moreover, the Committee developed an environmental program that aims to reduce
energy usage, for example through installations of on-site renewable energy.
Another environmental activity is the improvement of the company‟s global water usage.
Estee Lauder Companies tracks the water usage at all locations and implements conservation
measures to reduce the water used for processes such as cleaning, sanitation and irrigation.
The company is currently developing a program to further minimize the water usage (Estee
Lauder Companies Annual Report, 2009).
4.4.3 Breast Cancer Awareness Campaign
One of largest social activities of Estee Lauder Companies is the Breast Cancer Research
Foundation (BCRF), which was founded in 1993 by Evelyn H. Lauder (Senior Corporate Vice
President of Estee Lauder Companies). The independent foundation aims to fund for
innovative clinical and translational research. The foundation supports universities and
medical centres to conduct advanced breast cancer research in order to find a cure and
prevention of breast cancer. Funding collected through the foundation goes to breast cancer
research and worldwide awareness programs. One of those programs is the Breast Cancer
Awareness (BCA) Campaign created by Estee Lauder Companies. This campaign aims to
raise awareness for the importance of breast health and early detection though several
communication channels. First of all, Pink Ribbons and informational brochures on breast
health are distributed. The Pink Ribbon has become a worldwide symbol for breast health of
which 85 million have been distributed so far. The informational brochures provide
information about breast health and give instructions on how to screen the breast cancer
individually. The information brochure can be found in the Appendix 4. Second of all, the
Global Landmark Initiative is an initiative where landmarks, famous buildings and
monuments (e.g. JFK Airport, Tower of Pisa, Niagara Falls etc.) are lit up in pink, which is
the colour associated with breast health. The pink lights can be seen as “a symbol of hope,
empowering and enlightening millions of women everywhere” (Estee Lauder Companies
Annual Report, 2009). In 2009, over 200 landmarks where lit up in pink. Lastly, the company
appoints World Pink Ribbon Ambassadors to support the BCA Campaign. One of the current
Ambassadors is actress and model Elizabeth Hurley. In addition, advertisements are placed in
magazines to promote the foundation and the BCA Campaign and more information can be
found on the company‟s website.
The campaign is implemented in more than 70 countries and is supported by 14 brands of
Estee Lauder Companies. These brands create and sell unique Pink Ribbon Products in order
to represent their own brand contributions to the Breast Cancer Research Foundation. The
Pink Ribbon products are sold every October, which is the month of breast cancer awareness.
The primary brand that supports the Breast Awareness Campaign is the Estee Lauder brand.
4.4.4 MAC AIDS Fund
Another large social activity of Estee Lauder Companies is an initiative of the brand MAC,
the MAC AIDS Fund (MAF). This foundation was established in 1995 and supports men,
women and children who are affected by HIV/AIDS. MAC raises awareness for its
foundation with Viva Glam Campaign. The brand introduced the Viva Glam Lipstick
consisting of 8 different shades, in which all the money raised through the sales will go to the
MAC AIDS Fund. In addition to this, the brand organizes a volunteer day for World AIDS
Day on the 1st of December. During this day, the MAC employees volunteer at local
organizations. Furthermore, MAC appoints ambassadors for the Viva Glam Campaign to raise
further awareness for the MAC AIDS Fund. The current ambassadors of the Viva Glam
Campaign are the artists Cyndi Lauper and Lady Gaga. In addition, both artists developed a
limited-edition lipstick for the Viva Glam Campaign in which sales are donated to the MAC
AIDS Fund.
4.4.5 Social Activities of Aveda, Clinique and La Mer
In addition to developing sustainable packaging, Aveda also has created the Aveda Program
for the collection of plastic bottle caps at different locations. These plastic bottle caps are then
recycled into new caps and containers. The program aims for recycling of plastic caps and
preventing these caps to be dumped in landfills, beaches, rivers and oceans. Aveda is the first
cosmetics brand in the world to have received a “Cradle to Cradle” (C2C) sustainability
certification.
Clinique is known for being 100% fragrance free and allergy tested. Especially testing on
allergies is very much appreciated by consumers. The consumer interviews showed that when
it comes to purchase decision factors, “ingredients” is rated very highly. In addition, with
ingredients it is also meant no unhealthy chemicals and no allergic reactions. Clinique tests
every product 12 times on 600 people. This means a total of allergy 7200 tests per product. If
one of these tests results into an allergic reaction, the product formula will be reformulated in
order to reduce allergic reactions to a minimum. In this way, Clinique is able to produce
quality and healthy cosmetics products while keeping consumers‟ wishes in mind.
The cosmetics brand La Mer is committed to ocean conservation by promoting the
regeneration of the sea kelp forest. The brand promotes this issue in collaboration with
Oceana, which is an international ocean advocacy organization. La Mer and Oceana raised
awareness together for Wold Oceana Day, which was officially recognized by the United
Nations on June 8th
2009. In addition to the World Oceana Day, La Mer participated on
Oceana‟s Habitat Protection Campaign and developed a special limited-edition crème in
which all the money raised is donated to the Oceana.
4.5 Consumer Involvement
Question 5 was asked to learn about the results of implementing CSR strategies on consumer
behaviour.
Martin mentioned that each Estee Lauder brands have unique identities and different CSR
activities, which are specific and in alignment with the image of the brands. For example
since Origins, Clinique and Aveda position themselves as environmental and natural brands,
consumers of these brands are also sensitive and involved with the CSR topic. Moreover, the
feedback gathered from consumers also shows variety in terms of CSR activities based on the
regional differences. UK and Scandinavian countries are stated as the regions where consumer
awareness in terms of CSR and environmental involvement are the highest. Martin mentioned
that: “The consumer in Europe has more ethical values. During the recruitment process, I
observed that many applicants were interested in the CSR activities of the company and I was
quite impressed by their knowledge in terms of the CSR activities of Estee Lauder
Companies.” This shows that Estee Lauder is communicating with their consumers in terms
of their CSR activities in the right way. In addition to this, the CSR impact on consumer
behaviour depends on the identity of the brands. Martin exemplified by saying: “MAC has a
young and trendy identity while positioning itself. There is a direct relation with the brand
identity and the CSR activities –such as the HIV foundation- applied by the brand.”
Therefore, it is important that the CSR activities and the brand image have links within the
consumer segment it has targeted. To sum up, the implemented CSR activities have successful
effect if only the brands communicate with their consumers based on the CSR campaigns,
which are in alignment within the brand image.
Question 6 was asked to find out the kind of feedback Estee Lauder Companies receives from
consumers about their CSR activities.
Since Martin is not working for a CSR department, she wasn‟t able to share statistics about
consumer feedback. But she shared her personal observations on consumer behaviour in the
cosmetics industry. Martin said, she observed that there is a growing number of perfumeries
dedicated to natural cosmetics products in Paris where can be an important spot for cosmetics
industry. Moreover, magazines and Internet are highly influencing cosmetics consumers in
terms of the green market. In addition she said that: “The more the markets for organic
products are increasing, the more consumers become aware and support organic production.
Furthermore, it is not about safety, it is about being socially and environmentally aware.”
Therefore, if consumers become more aware about these issues for a specific industry they
spread their knowledge and awareness for the other industries and product categories.
Additionally, Martin explained that it is harder to measure consumers‟ reaction and
involvement in terms of social awareness. But, still the new generation is considered more
reactive and sensitive towards social and environmental issues. She said: “New generation of
consumers are different. The age that they have grown up in, is continuously highlighting the
problems related to the environment and the society. Therefore, they are more aware as well
as interested in giving reactions towards these subjects.”
Question 7 was asked to understand how important consumer demand is while creating and
implementing CSR activities for Estee Lauder Companies.
Martin said that consumer demand is very much important towards CSR activities within
Estee Lauder Companies. Therefore, as it has been mentioned before, family owned structure
of the company has lead Estee Lauder Companies to keep its name behind in terms of CSR
activities. But lately, since CSR activities became a competitive advantage for cosmetics
companies, Estee Lauder also chanced its strategy regarding this issue. The company also
communicates with their consumers and make them aware of what the company is doing in
terms of CSR. In relation to this Martin said: “CSR is a competitive advantage for cosmetics
companies in general. As a cosmetics company, if you don‟t communicate with the consumers
they don‟t have the chance to know about the company‟s contribution about social an
environmental responsibility.”
Furthermore, Martin mentioned about the growing pressure of NGOs in the cosmetics
industry. NGOs set high standards and push for more regulations in terms of safety issues for
the cosmetics products. As a result, CSR topic creates attention and awareness in the media as
well as in the public. In relation to this, consumer awareness and demand is increasing for the
cosmetics products.
4.6 Competitors’ CSR Activities
Question 8 was asked to find out Martin‟s opinions about other cosmetics brands, which apply
successful CSR strategies. Moreover, question 9 was asked to learn if CSR is a way to
differentiate from competitors.
Martin stated that L‟Oreal, Unilever and PG are the companies, which apply successful CSR
strategies. The reason behind their success is that these companies are aware of the
importance of communicating with their consumers regarding their CSR activities. Moreover,
she took attention towards the financial advantages of CSR applications in the long run. These
companies are aware of the difference, which CSR activities can bring for them in the stock
exchange. Martin said: “A global company has no other choice than communicating with their
consumers regarding their CSR activities in order to gain competitive advantage.”
On the other side, she mentioned that it is very important to apply the same safety and
environmental regulations at the all regions where the company operates. Therefore, she said
that in the cosmetics industry the safety regulations are significantly varied from region to
region. Estee Lauder Companies applies the strictest regulations for all regions in order to
treat every customer in the same way. As a result, she considers Estee Lauder Companies as a
responsible company while comparing it to the competitors in an objective attitude.
4.7 CSR and Innovation
Question 10 is asked to learn if CSR is an innovative idea/strategy to change consumer
behaviour for Estee Lauder Companies.
Martin mentioned that CSR can be considered as a stimulus to innovate. Therefore she said:
“We push our suppliers to innovate, to provide more environmental friendly packaging
materials.” For example Aveda, which is a unique cosmetics brand in terms of its
organic/natural image, has been bought by Estee Lauder Companies. Aveda products consist
of natural ingredients as well as innovative recycled packaging. After the purchase of Aveda,
Estee Lauder Companies changed and adopted all packaging processes into recycled
packaging materials. However, based on the characteristics of the cosmetics production, it is
impossible to produce fully natural products for all the cosmetics industry. Martin explains
this issue by saying: “Not all cosmetics products can be pure organic because of the
unavailability of the ingredients. The production of the organic ingredients is very limited.
This is because the plants have to grow for a time period and this will limit the availability to
produce pure organic products.” Therefore, even though consumer demand for organic
products is growing, it is impossible to expect all cosmetics products to be 100% organic. As
a result, the innovative contributions for the cosmetics products are being accomplished more
based on the packaging. In relation to this, consumers who are sensitive about environmental
issues will appreciate the innovations in recycled packaging and waste minimisation as well.
Question 11 was asked to learn more about the innovative CSR activities in the cosmetics
sector and also specifically the contribution of Estee Lauder Companies towards the issue.
The most well known topics within innovation in the cosmetics industry can be listed as
innovation through the environmental packaging, supporting employees and social causes. In
addition, Estee Lauder Companies is performing innovative CSR activities through its
packaging processes, societal contributions and empowerment of internal commitment. For
example, Aveda has been running a recycled packaging policy and La Mer has been
promoting the regeneration of the sea kelp forest. Moreover Estee Lauder Companies helps
kids and adults how to read in USA. Since the headquarters of the company is located in New
York, Estee Lauder Companies donates money to protect and to clean the Central Park
voluntarily. In addition, the company gives humanitarian support such as rebuilding schools
in Haiti. One of the reasons for this aid is to support the employees of the company since
Estee Lauder Companied has many Asian employees. By doing so, the company aims to
create synergy and emotional links with the employees who in turn feel more committed to
the company. These activities are contributions for the societal causes, which have no relation
to the cosmetics industry. As a result, Estee Lauder Companies applies innovative
environmental activities in relation to its production processes as well as societal activities,
which are not related to the cosmetics industry. Therefore, the consumers appreciate these
contributions as a responsible cosmetics company.
4.8 Future CSR Opportunities
Question 12 is asked in order to learn if CSR will play a bigger role for cosmetics companies
in the future.
Martin mentioned she truly believes that CSR is and will become more important in the
cosmetics industry. She added by saying: “There is a tendency in underestimating the
importance of cosmetics products. Moreover, this is a blind judgement in the sense of
underestimating because consumers can never stop using them as well. For example,
consumers may never stop using soap even though they may underestimate the value of the
product.” In addition to this, Martin said that NGOs‟ role over the cosmetics industry is
remarkable in terms of changing the attitude of the consumers towards the industry. NGOs
are striving for more regulations that take great attention in the media, which in turn will
increase awareness and sensitivity of consumers. As consumer awareness and sensitivity
increase, CSR‟s role will increase more in the future based on the demand from the
stakeholders including customers. “Although cosmetics industry‟s role shouldn‟t be
underestimated, the word “cosmetics” reflects a superficial meaning for many people” Martin
explained. And she continued explaining, since the majority of the people who are involved in
making regulations are male, this also triggers the underestimation of the cosmetics industry.
Therefore NGOs play a crucial role in order to change this attitude. Martin also mentioned
that the Trade Association‟s involvement within cosmetics industry is quite important in the
sense of introducing industry guidelines. To sum up consumers‟, media and legal authorities‟
awareness will lead to more CSR activities in the cosmetics industry in the future.
Furthermore, within question 13 it is aimed to figure out what can be done in terms of CSR
activities in the future for the cosmetics industry.
Martin mentioned that currently, CSR implications are used as a way of creating
differentiation and gaining competitive advantage. This means that the cosmetics companies
have their own CSR policies and activities rather than being a part of the industry approach
towards social responsibility. It is very important for a cosmetics company to have initiatives
in terms of CSR at the corporate level. Having CSR initiatives at the corporate level stand for
having CSR visions, which are applied, in all the regions that the company operates in the
same way. Moreover, these initiatives of each cosmetics company should be a part of the
industry approach. By having an industry approach, the impact on the environment and the
society will be greater and more effective.
4.9 Estee Lauder Companies & 3C-SR Model
CSR has become a way to differentiate and to gain competitive advantage. As mentioned in
the Literature Review, the 3C-SR Model is a way to evaluate whether a company is a good
corporate citizen by analysing its CSR strategy and activities. The model emphasizes that
CSR can be a means for a company to be socially responsible and to achieve long-term
success and competitive advantage. The model consists of 3 components, which are ethical
and social commitments, connections with partners in the value network and consistency of
behaviour over time to build trust (Meehan et al, 2006). These three components are inter-
related with each other and are equally important in order to be a good corporate citizen.
Estee Lauder Companies has a broad range of CSR activities at corporate level as well as at
the brand level. The CSR policy of the company can be evaluated with 3C-SR Model in order
to analyse whether the company is a good corporate citizen. In relation to this, the company‟s
commitment, connections and consistency of CSR are analyzed.
4.9.1 CSR Commitment of Estee Lauder Companies
With ethical and social commitment is meant the ethical standards and social objectives of
Estee Lauder Companies. These standards and objectives can be translated into the mission,
strategic objectives, strategy programmes and policies and the company‟s culture. The
standards point out how committed a company is to being socially responsible in the long run
instead of focusing on short-term profits and benefits of CSR.
The social responsibility commitment of Estee Lauder Companies consists of two parts. The
first part is to maintain the company‟s own production processes in order to reduce negative
impacts on the environment. The second part is to continue to be an active member of
sustainability by supporting people, projects and causes outside the company. The second part
in particular, shows the voluntary aspect of the company‟s commitment towards social
responsibility.
As mentioned in the company‟s background, the mission of Estee Lauder Companies is stated
as the following: “Bringing the best to everyone we touch”. The word best is described as the
best people, the best products and the best ideas. These 3 pillars form the core of the
company‟s culture and the company‟s strategy. The CSR activities are necessary for Estee
Lauder Companies to have the best people, the best products and the best ideas. In terms of
the internal CSR activities such as the Think Smart Program and Health & Wellness Program
the company shows its commitment to its employees and is able to empower them to stay
committed to the company. Moreover, through these programs Estee Lauder Companies is
able to attract and keep the best employees. In terms of the external CSR activities such as the
product safety & no animal testing and environmental activities, the company is able to bring
the best products (quality as well as socially responsible) to the consumers. Also, the
company touches people by helping local communities as well as through their foundations
(Breast Cancer Research Foundation and MAC AIDS Fund).
In addition to the mission of the company, Estee Lauder Companies builds its vision and
reinforces its position as the leader of prestige cosmetics on three factors: “Imagine, Integrate
and Innovate”. Everything the company can imagine will be achieved. Estee Lauder
Companies further integrates and spreads its knowledge, experience and resources throughout
its brands, regions and functions to become more powerful. Finally, by innovating, the
company is able to maintain being the forefront of the latest cosmetics innovative
ideas/products/services. These three factors are also incorporated into the company‟s CSR
activities. First of all, with the Think Smart Program the employees are able to share their
ideas on how the company can operate more cost effective. Also, the brands have their own
CSR initiatives, which reflect the brands‟ identity. These are examples of the factor
“Imagine”, which show that the company is very much open to new ideas and initiatives and
these ideas can be realized as well. Secondly, a good example of integration is sustainable
packaging. Aveda is the first brand of Estee Lauder Companies that started a sustainable
packaging policy. Based on the experience and knowledge gained through Aveda, Estee
Lauder Companies decided to develop a corporate policy for sustainable packaging. Thirdly,
innovation is achieved with imagining and integrating. Estee Lauder Companies believes that
having satisfied and committed employees is necessary for the growth of the company. In the
Annual Report 2009 it is stated that hundreds of groundbreaking product and program
innovations over the years come from the collaboration efforts and commitment of the diverse
employees who bring different approaches and ideas to the company. Sustainable packaging
and the conservation measures to reduce water usage are examples of process innovation,
while Aveda‟s natural products are examples of product innovation. This shows that internal
and external CSR activities are inter-related. The link between internal and external activities
is best described by Estee Lauder Companies itself when it mentions that the goal of its
corporate citizenship is to increase both shareholder and community value by stating: “The
progress of its environmental and safety programs, coupled with its philanthropic initiatives,
helps to make certain the company will be able to continue to Bring the Best to Everyone We
Touch” (Estee Lauder Companies Annual Report, 2009).
Meehan et al mention that the societal validity of a company commitment will be greater
when they are in alignment with emerging external frameworks for ethical and social values.
Estee Lauder Companies has received several external frameworks and certificates for its
CSR activities. For example, seven products of Aveda have received the Gold Level Cradle to
Cradle (CSC) certification, which made it the first cosmetics brand to have been awarded the
Gold Level C2C certification. The C2C certification verifies that a company uses healthy
materials and/or has eco-intelligent design (MBDC, Cradle to Cradle). Aveda received the
Gold Level certification for the ingredients used in its products and the Silver Level
certification for its packaging. In addition, Estee Lauder Companies received the ISO 14001
certification for its manufacturing sites. This certification gives requirements for
environmental management systems and shows that Estee Lauder Companies desires to
operate in an environmental friendly way. These standards can be seen as endorsements and
can be used as communication tools since they are a measure of the company‟s commitment
to environmental friendly activities.
In order to ensure long-term commitment and positive corporate image, it is necessary to have
business networks that share the same commitments. The business network consists of
suppliers, business partners, allies and customers. The shared commitments with upstream
and downstream partnerships are necessary to implement a company‟s CSR activities and to
increase a company‟s credibility. Estee Lauder Companies communicates its CSR
commitment to its suppliers in terms of environmental and safety standards of raw materials.
Furthermore, commitment is closely linked to consistency. A company can have a mission
and objectives related to CSR but if these objectives are developed for short-term profits,
corporate legitimacy and credibility will decline. Consumers are able to find out through
different media channels (internet forums, articles, TV documentaries, NGOs) about the lack
of CSR commitments of companies. In terms of consistency, the company describes its CSR
commitment by stating the following: “The Estee Lauder Companies realizes that to ensure
the long-term success of our Company, our financial goals need to be integrated with the
human and ecological impacts of our business.”1 Furthermore, Martin mentioned that the
company has been socially responsible since its establishment, but was late in communicating
its CSR activities to the consumers. For example, the first CSR report of Estee Lauder
Companies was published in 2007. This means that even though the company has been
socially responsible for years, consumers were not fully aware of what the company is exactly
doing in terms of CSR for a long time.
In conclusion, it can be said that Estee Lauder Companies has a long-term CSR commitment.
The CSR strategy of the company can be defined as the activities that are managed at
corporate level (and therefore apply to all brands) and activities that are managed by the
individual brands. The internal CSR activities are all at corporate level while the social
activities are categorized at corporate and/or brand level. The commitment of the company is
further recognized through several certifications in which stakeholders are able to indentify
Estee Lauder Companies as a socially responsible company. However, in order to increase its
corporate image, the company needs to communicate more to consumers and other
stakeholders in order to make them aware of the company‟s internal and external CSR
activities.
4.9.2 CSR Communication of Estee Lauder Companies
In this section, connections within the value network as the second important element of
implementing 3C-SR model, is going to be analyzed within Estee Lauder Companies.
1 http://www.elcompanies.com/citizenship/citizenship.asp
Connections within the value network, in other words the stakeholder approach, ensure
mutuality of interests and uniform commitment to shared values across the value network
(Meehan et al, 2006). The stakeholders of Estee Lauder Companies can be defined as their
suppliers, business partners, allies, NGOs, governmental institutions, employees and
consumers. Moreover, in order to succeed in communicating to consumers in terms of the
CSR activities of the company, the relationships with the rest of the stakeholders have to be
well managed as well. Negative reputation of the allies and partners, negative progress reports
of the NGOs and governmental institutions regarding the company‟s CSR activities and the
wrong fit between the selected suppliers and the company in terms of the environmental and
social values will effect consumers‟ evaluations towards the image of the company. In
relation to this, Normann and Ramirez argue: “Value occurs not in sequential chains but in
complex constellations”. Therefore avoiding stakeholder deficit, which leans on narrow
operational focus in choosing the right suppliers and building the right connections with the
stakeholders in the value network, carry significant role.
In terms of selection of the suppliers, Estee Lauder follows EHS (Environmental Health and
Safety Supply Chain) requirements. Each supplier has to sign off that they can meet corporate
EHS specifications of Estee Lauder Companies in terms of environmental and safety issues,
transportation and waste disposal. In the CSR activities section of the Annual Report of Estee
Lauder Companies, which was published in 2009, it is explained that 99 percent of the
production and sourcing of the company‟s raw materials are outsourced. Therefore, in order to
be totally consistent with the CSR vision of the company, Estee Lauder Companies expects
from its suppliers that they comply with all applicable government regulations for the country
in which they reside. It is also expected that suppliers adhere to the provisions specified in the
“Supplier Code of Conduct” of the company. Moreover, “Supplier Code of Conduct” outlines
the company‟s expectations for suppliers‟ environmental and social performance, including
components addressing wages and compensation, human rights, child and forced labour, safe
working conditions, anti-discrimination, freedom of association and environmental
responsibility. In addition, “Raw Materials Coding Package” is being updated to help
suppliers provide the finest ingredients that meet the strict environmental and safety standards
of Estee Lauder Companies. Furthermore in order to ensure compliance, a process of auditing
for the top-line suppliers is established and the company is still developing protocols in order
to respond to audit results in an appropriate way (The Estee Lauder Companies Annual
Report, 2009). Some of the accomplishments in terms of environmental supply chain
management of the company are listed below:
- Six suppliers of Estee Lauder Companies have committed to using renewable energy
for the manufacture of their parts.
- The manufacturer of Aveda‟s folding cartons runs their plant with 100% wind
power.
- Origins has also made a commitment to purchase folding cartons only from
manufacturers using renewable energy.
- In 2007, after the announcement of the company‟s commitment to engage their
global packaging suppliers in supporting and furthering their goals, Estee Lauder
Companies has also standardized the post-consumer recycled (PCR) content of their
shippers and carriers to 80 percent and increased their supplier commitment to
renewable energy.
In terms of the connections within NGOs and governmental regulations, Estee Lauder
Companies has shown great concern as well. Based on the information gathered through the
interview, which is conducted with Estee Lauder, Isabelle Martin mentioned that different
regulations are applied in the cosmetics industry based on the legislations of each country.
The company‟s point of view is to treat every consumer in the same way. That is the reason
why, Estee Lauder Companies applies the strictest regulations of the country that it has been
operating and centralizes its CSR operations and activities. Moreover, the goals that have
been set by the NGOs are taken into serious consideration in order to serve the best to their
consumers in terms of social and environmental responsibility as well as protecting the
company‟s reputation. Therefore, the company engaged with “Look Good Feel Better”
program, which reflects the industry initiative and is run by the US Trade Association in the
US. The program consists of spreading free products at the hospitals, providing volunteer
beauticians in order to give make up sessions. Within this program, the initiative of the
industry is being combined with the company initiative. Moreover, many cosmetics
companies worked together as partners in order to support the “Look Good Feel Better”
campaign. This campaign is a great example of how rival companies can work together with
the support of Trade Association in order to help people. In addition, one of the most
remarkable points of this campaign was in terms of assuring credibility of the act. Therefore,
no company mentioned its name on the products. Since many consumers think that CSR
activities are done part of a marketing campaign, this campaign was important to support the
credibility of the CSR activities. In other words, it is done because of the specific interest of
the companies in terms of CSR.
The connections with the employees are an important part of its internal CSR activities for
Estee Lauder Companies. Executive Chairman of Estee Lauder Companies says: “Great
companies depend on great people” (The Estee Lauder Companies Annual Report, 2009).
This vision of the company in terms of its employees is based on satisfying them in terms of
their work place, work conditions and safety conditions as well as making employees
contribute to the CSR activities of the company. Estee Lauder Companies state on their
website that all employees have a role to play and a stake in the success of their
environmental and safety programs. By doing so, the company becomes overall committed to
its CSR vision and mission while employee commitment towards the company increases as
well. Through the connections with the employees -which have been explained in the internal
CSR activities section in details-, Estee Lauder Companies aims to increase employee
satisfaction and commitment by encouraging and supporting their employees in terms of their
health and well-being, providing an inspired work environment and making them to
contribute more in CSR activities of the company in order to make them more attached to the
company‟s CSR values. Therefore, the annual report highlights the Health & Wellness
Programs of the company that focuses on the programs, which are provided for their
employees such as health checkups, skin cancer screenings, mammograms, fitness programs
and other activities. Moreover, the employee program, which is called “Think Smart”, is
developed to encourage the employees to submit their ideas in terms of coming up with
efficient and smart ideas. In addition, the program benefits employees as well as the company
itself to come up with more efficient and cost-saving solutions.
Furthermore, consumers are stated as one of the most important circle in the stakeholder chain
for Estee Lauder Companies. Therefore, consumers‟ involvement through company‟s CSR
activities in terms of understanding their feedback and demands are essential. 2009 Annual
Report of the company states that: “We recognize that our customers share our commitment
to protecting and preserving the environment. Each year, thousand of consumers worldwide
contact us regarding our environmental practices. Consumer queries on our environmental
packaging principles have nearly tripled since we published our first CSR report in 2007.” As
it has been mentioned in the literature review, it is very important for the consumers that the
ingredients used for the cosmetics products are traceable. This is the reason why the chosen
suppliers for the company are an important aspect for Estee Lauder to strengthen the image
and to ensure credibility. Therefore, the connections with the stakeholders are not in
sequential chains but operate together as constellations (Meehan et al, 2006).
4.9.3 CSR Consistency of Estee Lauder Companies
In this section consistency, as the third important element of implementing the 3C-SR model,
is going to be analyzed within Estee Lauder Companies. “Consistency refers to the
behavioural element of social resources over time and across all facets of an organizations
operation” (Meehan et al, 2006). Therefore the CSR activities of Estee Lauder Companies
have to be consistent in time in order to be considered as “credible” for cosmetics consumers.
Consistency has to be obtained in terms of the company‟s mission and vision statements,
selection of business partners and suppliers, which also have to be committed to socially
responsible values. In other words, even though Estee Lauder Companies shows successful
implications of CSR, its suppliers and business partners have to share the same CSR values
and they all have to work in a consistent way to create and maintain credibility. Moreover,
since consumer awareness is increasing towards environmental supply chain, it is crucially
important that Estee Lauder Companies is faithful to this issue. To sum up, Estee Lauder
Companies espouses social commitments within its value network, which is significantly
important to provide an advanced level of consistency in terms of CSR activities.
Furthermore, besides having consistency in the selection of suppliers, consistency has to be
obtained towards employee satisfaction and employee safety in order to increase
organizational commitment. Employee wellness activities, recognition awards, community
environmental protection projects, and regular internal communications are mentioned in the
website of the company as activities accomplished in order to have healthier, motivated,
involved, and better-informed employees. Estee Lauder Companies believes that consistent
employee satisfaction is an important aim of the CSR vision of the company. Therefore, the
reason why the consumers have mentioned Estee Lauder Companies during the interviews
depends on the remarkable communication created within the stakeholders in a consistent
way.
Estee Lauder Companies established the environmental sustainability program in 2007 and
published their first CSR reporting which highlights the commitment towards its stakeholders.
Moreover, in order to develop the CSR vision and activities of the company, the second CSR
Report was published in 2009. These published CSR reports are significantly important in
order to recognize the progress achieved by the company in terms of CSR. Estee Lauder
Companies stated goals in terms of employee safety, global philanthropy, sustainable
packaging, research and development, environmental stewardship and supply chain.
Moreover, the company‟s corporate strategy is based on the commitments and continuous
improvements, which are crucially important to ensure consistency of the CSR vision of the
company. In addition, being attached to consistent CSR missions and visions lead Estee
Lauder Companies to continuous developments in terms of CSR- based on the goals
mentioned above- in other words helps the company to maintain consistency in terms of
continuous developments.
To sum up based on the 3C-SR model, it is significantly important that the companies are
committed to their missions and values in terms of CSR and are sharing the same values with
their stakeholders regarding CSR in a consistent way. The commitments, connections and
consistency aspects of the company, which have been mentioned above, make Estee Lauder
Companies a “good corporate citizen”. In addition, as it has been stated in the literature
review, companies can be categorized as being reactive, defensive, accommodative, and
proactive based on their CSR involvement. Moreover, beyond being proactive is stated as
implementing strategic CSR (Porter and Kramer, 2006). Estee Lauder brand can be
categorized as a proactive brand in terms of its CSR activities, which is anticipating social
responsibility and doing more than required. On the other side some of brands of Estee
Lauder Companies such as Clinique and Aveda are implementing strategic CSR because of
the aspect that they do not only accept and anticipate social responsibility but also integrate it
into their core businesses. Therefore the difference in implementing 3C-SR aspects creates the
difference in CSR involvement.
4.10 Conclusion
Within the analyses of Estee Lauder Companies and its brands, it is aimed to come up with
answers towards one of the research questions of this paper. The research question is: How do
cosmetics brands define CSR? To answer this question, three sub questions are formulated in
order to understand whether CSR can be used as a way of differentiation, if CSR related
innovation has an influence on changing consumer behaviour and how important consumer
demand is for cosmetics brands in relation to the CSR activities.
1. Can CSR be used as a way to differentiate in the cosmetics industry?
Due to the competitive characteristics of the cosmetics industry, continuous developments are
significantly important in order to gain higher market share. Therefore, differentiation created
based on product characteristics is not enough to succeed. Cosmetics companies search for
other ways to distinguish themselves in order to be unique. In relation to this, companies
focus on building brand image and creating emotional links with their consumers rather than
just providing quality products. Based on this idea, the cosmetics brands focus on CSR
activities to strengthen their brand image (through creating links with CSR). During this
research, it is observed that many companies establish CSR vision and missions and integrate
CSR activities into their core businesses. Since consumers are becoming more aware about
CSR based on the influence of media channels, CSR is valued more and evaluated as a
differentiation factor for consumers.
In relation to the company analysis, communicating through the CSR activities was not a
preferred attitude of Estee Lauder Companies for many years as a company strategy.
However, it is observed that it became necessary for Estee Lauder Companies to
communicate the CSR activities with the consumers due to the increased consumer
awareness, competition and the need to differentiate. As a result, differentiation can be
achieved through CSR activities in the cosmetics industry.
2. Does CSR-related innovation have an influence on changing consumer behaviour?
Continuous developments are being driven by innovative ideas in the cosmetics industry.
Moreover, product innovation is not enough to succeed. Companies search for different ways
to innovate and differentiate themselves. Therefore, cosmetics companies implement CSR
strategies and activities in order to differentiate themselves from competitors and consider it
as a resource that they can run innovative businesses. Due to the increased awareness of the
consumers, which is observed through consumer interviews (consumers want to be informed
about CSR and value it), CSR related innovation is significant in order to influence consumer
behaviour.
Moreover, Estee Lauder Companies states that consumers are aware of and value the CSR
practices of the company. Even at the recruitment processes, candidates show great concern in
CSR involvement of the company. This shows that CSR activities have an influence on
consumer attitude. In addition, the increasing number of natural cosmetics brands/shops is a
reflector of changing consumer behaviour in return of having increased demand.
3. How important is the consumer demand for cosmetics brands in terms of CSR activities?
Consumer demand is important while implementing CSR activities in order to enhance
positive brand image. Cosmetics companies improve their CSR activities based on the
consumer feedback. In addition, consumer demand is influenced by mass media, NGOs and
governmental policies as well. On the other hand, CSR activities cannot always be developed
based on the needs of the consumers since consumers may not have sufficient knowledge and
information based on the importance of the issue. In that sense, it is important to educate
consumers in order to come up with sufficient evaluations based on the consumer demand.
Due to this fact, CSR activities create consumer demand. In relation to this, it is observed that
Estee Lauder Companies educate its consumers in order to create involvement, which leads to
increased consumer demand.
Moreover, the CSR activities have to be in alignment with the brand‟s identity. Therefore, if
consumer demand for CSR activities does not comply with the brand identity, the expected
impact cannot be created and CSR activities cannot be influential on consumer behaviour. In
addition, Estee Lauder Companies apply different CSR activities for different brands in order
to meet different consumer demands. To sum up based on the conclusions of the sub
questions; the research question can be answered by saying that cosmetics companies define
CSR as an innovative way to differentiate themselves from competitors in order to create
consumer demand towards socially and environmentally responsible cosmetics brands.
5. Consumer Analysis
This chapter focuses on analysing the results of the interviews that are conducted with the
consumers.
5.1 Demographic Analysis
This section is going to provide information about the demographic aspects of the interviews,
which are related to the interview questions 1, 2 and 3. These questions are sequentially asked
to understand:
- How old they are;
- What their nationalities are and
- What their occupations are
Therefore, 25 interviews were held within the age range of 18 to 40 years old. Interviewees
were female consumers who live in Brussels. 15 of the interviewees were students and 10 of
the interviewees were working people in different fields. Since most of the interviewees were
students, the majority of the age range can be stated between 18 to 25 years old. In addition,
the interviews were conducted in Brussels and based on the multinational characteristics of
the city the interviewees were not just from Belgium but also of different nationalities. The
age, nationality and occupation distribution of the interviews can be found in the Appendix 5.
5.2 Analysis of Cosmetics Brands
After analysing the demographics, question 4 and 5 are asked to find out:
- The favourite cosmetics brands of the interviewees and;
- The factors they find important while buying cosmetics products.
In terms of the favourite cosmetics brand names of the interviewees, it is seen that Clinique
and L‟Oreal are mentioned as the most favourite cosmetics brand names. Moreover Estee
Lauder, The Body Shop and MAC are answered as the second most favourite brand names.
The figure in the next page shows the distribution of the favourite cosmetics brands
mentioned by the interviewees.
Figure 7: Favourite Cosmetics Brands
In relation to interview question 4:What are your favourite cosmetics brands?
Furthermore, most given answers as purchase factors are price and quality followed by
duration and ingredients factors. In addition, based on the answers of the interviewees it is
seen that there is a tendency in relating price with the expected quality, duration and with the
nature of the ingredients. In order to be more clear, the nature of the ingredients refer that the
products are fragrance free, not allergic and do not contain unhealthy chemical additives
based on the answers of the interviewees. Figure 8 shows the decision factors of the
consumers in term of their cosmetics product consumption.
Figure 8: Purchase Decision Factors
In relation to question 5: What factors do you find important while buying a cosmetics product?
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Although 16 people out of 25 have mentioned price as an important factor for cosmetics
consumption, 9 people considered quality more important than the price and mentioned that
price is not a significant factor for them. The reason why price is important for the majority of
the interviewees is that they were students who do not earn a lot of money. Examples of the
answers of the interviewees concerning these factors are stated below:
- “The price can be higher since luxury products last longer.”
- “I don‟t want to buy cheap cosmetics products since my skin is very sensitive.”
- “Due to the good quality of the cosmetics products, I don‟t mind paying a higher
price.”
- “Quality and price are the most important factors to me, but since I‟m a student I
really pay more attention to the price of the products.”
Moreover, another factor that influences the buying decision is the image of the cosmetics
brands. Consumers think that the better the image; the better the quality, the longer the
duration and the healthier the ingredients are for the cosmetics products. Therefore, they are
more willing to pay a higher price. In alignment to this interviewees, who considered price as
an important factor, stated that L‟Oreal, Max Factor, Nivea and Maybelline are their favourite
cosmetics brands. On the other side, consumers who do not consider price more important
than the quality stated that their favourite cosmetics brands are Estee Lauder, Dior, YSL,
Sisley, Lancôme, Clinique and MAC.
5.3 Cosmetics Brands and Corporate Social Responsibility
Lately, Corporate Social Responsibility activities are also highly used while creating and/or
strengthening the brand image. Most of the time, consumers believe that providing quality is
the main responsibility of the cosmetics brands. Therefore, CSR activities might be a way for
companies to differentiate themselves in terms of having strong and unique brand images.
In this section, it is aimed to learn within question 6 and 7:
- Whether consumers know socially responsible cosmetics brands and
- If they are aware of the CSR activities of the companies.
The figure below shows the distribution of the socially responsible cosmetics brands that
consumers are aware of.
Figure 9: CSR and Brand Awareness
In relation to question 6: Can you give examples of cosmetic brands which are socially responsible?
5.3.1 CSR and The Body Shop
It was remarkable to figure out that The Body Shop was the most given example of a socially
responsible cosmetics brand. In addition, this should be commented as a success indicator for
The Body Shop since half of the interviewees recalled The Body Shop as a socially
responsible cosmetics brand, whether it is one of their favourite brands or not -as it was asked
in question 4-.
Another important aspect about The Body Shop is that when people are asked about The
Body Shop‟s CSR activities; all the answers were related to fair trade, supporting women
rights and not doing animal testing. Figure 10 in the next page, shows examples of these
cases.
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Figure 10: The Body Shop advertisements against animal testing and supporting women‟s health.
Hence, it can be said that these activities are the ones that have social impacts that benefit the
society and create indirect links with the consumers. Unlike Clinique, which builds its CSR
activities on just ingredient quality -a direct purchase decision factor-, The Body Shop builds
its CSR activities on combining direct and indirect purchase decision factors such as
protecting animals, protecting the environment and protecting the people (consumers as well
as the employees). Sophie Gasperment, the Chief Executive of The Body Shop, states in the
2009 Values Report: “We believe that our values are at the heart of our commercial success
and they are the key to growing our business. As we go forward we will be more creative in
bringing our message to customers who are searching for brands with principles that they can
trust. In doing this we will deliver more positive benefits to everyone that we touch.”
Moreover, The Body Shop states that they‟re different regarding their values. These values act
as a practical guide to decision making at all levels of the company, helping to insure that the
profits are made with principles. And these values are stated as being against animal testing,
supporting community trade, activating self esteem, defending human rights and protecting
the planet at the global web site of the company. Therefore, it is believed the reasons that lie
behind ranking The Body Shop (top of mind awareness) as the highest in Figure 9, depends
on the values, which were mentioned by Gasperment.
5.3.2 CSR and MAC
MAC, Estee Lauder, and Clinique were stated as the most given answers in terms of socially
responsible brand names after The Body Shop. Also MAC and Estee Lauder focus on societal
issues such as establishing HIV and breast cancer foundations. The consumers within its act
towards HIV recall more specifically MAC by using famous spokespersons such as Lady
Gaga and Cyndi Lauper to create awareness. The meaning transfer theory is the most relevant
one while brands are using celebrities in their advertisements. “The central premise of the
meaning transfer theory is that a celebrity encodes a unique set of meanings, which if well
used can be transferred to the endorsed product” (Tellis, 2004). Firstly, the meanings encoded
within the image of the celebrity have to be aligned with the brand image. Secondly, the
meaning transfer between the image of the celebrity and the brand has to be delivered in a
desired way to the consumer. And lastly, customers are expected to capture the meanings
transferred with the ad after purchasing the product. (Tellis, 2004) Therefore, while using
Lady Gaga and Cyndi Lauper as endorsers, MAC applies the meaning transfer theory in a
successful way. This is because; both Lady Gaga and Cyndi Lauper are extreme characters
that MAC can align with its own brand image to attract consumers. Moreover, printed
advertisements are chosen as the communication tool in order to transfer the message of the
campaign to the consumers. Figure 11 shows the advertisement used for the HIV foundation
created by MAC.
Figure 11: MAC‟s Viva Glam Campaign advertisement.
The quote below the picture: “Every cent from the sale of MAC Viva Glam lipstick and lipglass goes toward
helping women, men and kids everywhere affected by HIV and AIDS.
In addition, MAC‟s campaign called “Back-to-Mac”, aims for making consumers to return 6
empty MAC products and receive 1 new lipstick of their choices as a reward. By these
activities, the brand‟s objective is to create environmental awareness (through recycling) and
also to strengthen its brand image in terms of being considered as a socially responsible
company.
5.3.3 CSR and Estee Lauder
Another example of a socially responsible cosmetics brand mentioned by interviewees is
Estee Lauder and its “Breast Cancer Awareness (BCA)” campaign. The brand focuses on
raising awareness for breast health every October, which is the month to fight for breast
cancer. One of the interviewees also stated that during that month make-up artists go to the
hospitals to visit patients who are suffering from breast cancer and having make-up sessions
with them as a responsible act. Moreover, during that month Estee Lauder spreads flyers,
which inform and make women aware of how to screen breast cancer by themselves.
Furthermore, during that month several products are selected and promoted differently-to take
the attention- while donating the amount gathered, to the breast cancer foundation.
5.3.4 CSR and Clinique
While consumers recall the CSR activities of The Body Shop, Estee Lauder and MAC in
terms of supporting the society and the environment, the reasons for recalling Clinique are
more related with the ingredients used in the products. When the interviewees are asked to
give more details about Clinique‟s CSR activities, it is understood that customers perceive
Clinique as a quality brand in terms of offering 100% fragrance free and allergy tested
products. Therefore, it can be said that Clinique‟s CSR activities directly focus on the
consumers and their personal experiences.
5.3.5 Limited CSR Awareness
The third most given answer for question 6 was “I don‟t know”. Moreover, “I don‟t know”
answer can be divided into two categories which consumers mean that they really don‟t know
any brand names/CSR activities or consumers who cannot remember the brand names but still
are aware of the CSR activities within the cosmetics industry.
The interviews showed that interviewees had hard time in remembering cosmetics brands
(brand recall) or relating the brand names within their CSR examples although they were
aware of the CSR activities. Although 6 women out of 25 had no brand name and an example
of a CSR activity of a cosmetics brand in their mind, it was still remarkable to collect the
examples mentioned above since CSR is still a young concept for consumers. In that case,
repetition and communication tools are significantly important to create brand awareness. It is
seen that the recalled brand names are the ones, which continuously mention their CSR
activities. For example Clinique‟s slogan is exactly what the interviewees recalled as an
example of the company‟s CSR activities, which is “Allergy tested. 100% Fragrance Free.”
The Body Shop is another successful cosmetics company in terms of building CSR
awareness. Whenever a consumer enters The Body Shop store, every time she
hears/reads/experiences a CSR related impulse so that, the consumers can create a bridge
between the brand name and the social responsiveness of the company. This is the reason why
these brand names are the most recognized and recalled ones in terms of CSR. In that case,
effective and repeated advertising carry an important role to make consumers aware and even
persuaded. Tellis (2004) says: “Some advertisers may leap to the conclusion that even if an ad
is entirely ineffective now, time and repetition will ensure its ultimate success. Another way
of stating the same premise is that advertising takes a long time to wear in with consumers.
From this reasoning arises the recommendation that even if advertising seems ineffective
initially, persistence with the campaign will ultimately bear fruit” (Tellis, 2004). For example,
The Body Shop integrates CSR related activities into its vision, mission and the overall
philosophy of the company. Moreover, The Body Shop chooses to reflect this point of view
within different ways of advertising continuously. In addition, as it has been mentioned in the
methodology section, the way The Body Shop manages with commitment, value connections
and consistency issues (based on 3C-SR Model) is the reason why consumers identify The
Body Shop as a socially and environmentally responsible company.
5.4 CSR Advertising and Persuasion
Advertising is an important route to persuasion in terms of changing consumers‟ opinion,
attitude or behaviour as a way of marketing communication. Moreover, persuasion through
advertisements can be achieved through the central route and/or the peripheral route. The
route by which an advertisement is able to persuade consumers depends on the involvement
of the consumers and how much they think about the message of the advertisement. “When
people have both the motivation and the ability to evaluate a message, their likelihood of
thinking about it will be high. They will look for and respond to strong arguments in favour of
the message and counter what they think are weak reasons. This route of potential persuasion
is called the central route.” On the other side, “If consumers have the motivation but lack the
ability to evaluate a message, they are likely to respond to cues associated it with the message.
This form of persuasion is called the peripheral route” (Tellis, 2004). The Elaboration
Likelihood Model (ELM) summarizes the routes of persuasion since understanding how
persuasion works is significant in order to analyse consumer behaviour for cosmetics products
through CSR related advertising.
The chosen route of persuasion depends on the characteristics and the industry of the product.
In other words, it is not right to comment that one way of persuasion route is superior to the
other one. Each routes of persuasion can be effective for some specific product categories. In
addition to this, there are some general assumptions for specific industries based on the
characteristics of the products and the characteristics of their consumers. Consumers‟
motivation, ability and opportunity for specific products may differ from one industry to the
other. For example, there is a clear difference in terms of persuading consumers when they
consider buying a car or cosmetics products. When consumers think of buying a car, they are
more involved in the need of having more information and also the ability to process that
information. On the other side when consumers buy cosmetics products less information is
needed, which makes it easier to process the information, in order to give the buying decision.
To sum up, since the ability of the consumers to process the information is significantly
varied, the central route or the peripheral route is chosen for specific products to communicate
with the consumers based on the characteristics of the product or the industry.
During the interviews it is observed that consumers give their purchase decisions based on the
process of “feel-learn and do” (in relation to the Foot-Cone-Belding (FCB) grid) towards
questions 13 (Have you ever bought a socially responsible cosmetics product after being
informed at a store?) and 14 (What kind of CSR activities will lead you to change cosmetics
brands that you are loyal to?). “Feel-learn and do” processes stand for what consumers feel
about the brand images, what information they have in terms of the cosmetics companies‟
CSR activities and lastly which brands to buy. Based on this process consumers decide on
their purchase decisions as well as changing their loyal brands. Especially the “learning” part
is very important when CSR is the argument for persuasion since consumers don‟t have much
information regarding this issue.
5.4.1 Persuasion and CSR Driven Cosmetics Brands
Based on the characteristics of the cosmetics industry, the peripheral route is the most chosen
way to persuade consumers through advertising. The peripheral route is used when one or
more of the MAO (motivation, ability, opportunity) factors is/are low. Cosmetics products are
quality products that are bought for their quality and for aesthetic reasons. Therefore the
motivation, ability or opportunity aspects are not the same as the products in the first, third
and the fourth quadrant of the FCB grid. (Methodology, Figure 6) The buying decision
process is influenced more by the affective elements for the cosmetics products, which
represent the feelings associated with the products. Affective elements stand for the peripheral
cues such as the image of the endorsers, background music, humour elements and the number
of arguments used (De Pelsmacker et al, 2007). Consumers‟ product decisions require high
involvement whereas less information is needed during the peripheral route processing for the
cosmetics products. Moreover the brand identity and the message of the advertisement, which
are used to communicate with the consumer through the peripheral routes, have to be aligned
in order to create or strengthen the brand image. The sum up, the reasons why the peripheral
route is preferred by the cosmetics brands through their advertisements as a way of persuasion
are stated as the following:
-Since less information is needed for the purchase decision of cosmetics products,
cosmetics brands need to focus on the affective elements of the products/brands.
-Consumers are influenced by the emotional links more than the information given
with the words and numbers in a cosmetics advertisement.
Using emotions have several advantages since the affective elements are important in order to
persuade consumers in an advertisement. Firstly the stimuli, which are created in order arouse
emotions, draw the viewers into the action and distract them from the advertiser‟s intention to
persuade. Secondly, emotions require less effort from the viewer since affective elements
mentioned in the advertisements such as pictures, music and actions require less cognitive
effort of the viewer. Thirdly, the emotion-arousing stimuli are considered more interesting by
the consumers. In addition, these affective elements are easier to recall than the factual
evidences and emotions might be remembered longer than the arguments. And lastly,
emotions may lead consumers to change their behaviour sooner than the logic would (Tellis,
2004).
De Pelsmacker (2007) also states that: “The reason why consumers start paying more
attention to peripheral cues is that in many ads peripheral cues form the only processable
information under circumstances of low motivation, limited ability or limited opportunity.
Advertisements without attractive peripheral cues, but with an easy-to-process, product-
related message might also work under low MAO, simply because the cognitive resources to
form counter-arguments are lacking.” Moreover, heuristic evaluation, which is having
inferences based on the cues in order to form cognitively based attitude, is important when
one of the MAOs is low. Therefore, heuristic cues may be used by consumers as reassurance
and credibility factors such as brand name, reputation, experts endorsing the brand and price
level. (De Pelsmacker et al, 2007) Moreover, during the interview it is observed that people
consider price level as a reflector of the quality, or the images of the endorsers as a source of
credibility for the specific brand names. As a consequence, heuristic cues have an important
impact on consumers through the advertisements during the information processing of the
peripheral route. In addition, when consumers are asked in order to learn how they find out
that a cosmetics brand is socially responsible, TV and magazine advertisements were the most
given answers. Therefore, it can be concluded that advertisements through these
communication channels are important in terms of creating/supporting brand awareness and
as well as awareness through the CSR activities of the cosmetics companies. The figure 12
shows advertisements from L‟Oreal and Lancôme using famous people in their
advertisements to attract consumers‟ attention.
Figure 12: L‟Oreal and Lancôme Advertisements
Within these advertisements, both cosmetics brands aim to make use of the images of these
famous spokespersons. Consumers have the idea in their mind that if Beyonce is using
L‟Oreal lipstick and Uma Thurman is applying Lancôme foundation these brands should
provide good quality. Especially within the quote from Beyonce saying: “With this rich,
creamy lip colour, my lips are irresistible. And we‟re worth it.” increases the credibility of the
product/brand. In addition, consumers may want to identify themselves with these famous
people as well as with the cosmetics brands. Moreover, using famous spokespersons in the
advertisements can lead to positive cognitive responses and as a consequence to change
consumers‟ attitudes towards the brands in a favourable way (De Pelsmacker et al, 2007).
In terms of CSR advertising, spokespersons can be used as a way of peripheral route of
persuasion in order to create credibility and to ensure the trustworthiness of the message.
Spokespersons can be very influential in terms of changing people‟s attitude towards
responsible cosmetics consumption and consumers may feel more attracted towards the
subject because of the emotional links created with the spokesperson. Since consumers are not
motivated or not able to process the message through CSR related advertisements, using
endorsers is a right way of persuading consumers through peripheral route.
Figure 13: Estee Lauder‟s Breast Cancer Awareness Campaign with Elizabeth Hurley.
The figure above is an example of CSR related advertisement of Estee Lauder using a famous
spokesperson. Through this ad, women are made conscious about breast cancer and made
aware about breast health. The age and the identity of the endorser, the link between the
spokesperson and the consumers and the right fit between the message of the advertisement
and the spokesperson are significantly important in terms of the success of the advertisement.
Therefore, Elizabeth Hurley is a famous, glamorous actress whose identity fits with the image
of Estee Lauder. In addition because of her age (45), she is able to connect with the women
about the risk factors of the breast cancer. Moreover, since her grandmother has died because
of breast cancer, her experiences and advices can be more influential on consumers.
Furthermore besides using celebrities as endorsers in the advertisements, experts and lay
endorsers can be used based on the characteristics and roles of the communication process
(Tellis, 2004).
CSR is a subject that can arouse consumers‟ emotions. Therefore, the peripheral route can be
used as a way to influence consumers in terms of CSR. It is aimed to create emotional links
between consumers and the cosmetics brands rather than developing cognitive attitude
formation that is making consumers carefully think about the substance of the message.
Consumers rely on how the advertisements make them feel rather than what the
advertisements tell about through the peripheral route (attitude formation) (De Pelsmacker et
al, 2007). Therefore, CSR is about considering the society, environment, about being aware
and feeling responsible. In that case, consumers can only be attracted through creating links
based on consumer awareness and sensitivity. In alignment with the “feel-learn and do”
process, consumers are firstly emotionally attracted to the CSR topic, secondly informed and
taught about the subject and lastly led to action.
Moreover when interviewees are asked if they find it important that cosmetics companies are
socially responsible, they answered as “yes” because they feel themselves happy and consider
themselves as a good person when they make a responsible purchase. Therefore, CSR
activities can be stated as a way of creating emotional links with the consumers and the
peripheral route is the right way to achieve it.
5.4.2 Consumers’ CSR Perceptions
Within question 8, it is aimed to understand:
- If consumers really appreciate CSR or consider it just as a marketing tool, in other
words just “green washing” -even though the consumers remember CSR activities of
the cosmetics brands-.
Based on the comments of several interviewees, cosmetics industry is meant to create a
difference in terms of physical appearance and physiological mood. Hence generally talking,
cosmetics industry has to reflect “uniqueness” within itself. This is the reason why the
interviewees weren‟t considering CSR activities as just green washing but as a clever concept
to be different. CSR applications are beneficial for companies as well as the consumers and
the society.
On the other hand, not all the consumers were that positive in this case. Several interviewees
were commenting that they would definitely search for information on the websites after
learning about cosmetics companies‟ social commitments such as searching what they have
done before or whether having certificates or not (in terms of including scientifically proven
healthy ingredients). Some other comments of the interviewees are as the following:
- “I don‟t know if I believe that it makes a difference but if I hear negative reports, I will
not buy the products.”
- “I don‟t believe that luxury brands will do it just for doing it, because the image is
important for them. So I do trust luxury brands if they say they are doing so.”
- “I do believe in it; the more focus is placed on these campaigns, the more brands will
participate. In the end it will benefit the whole society.”
- “Independent from the impact of these campaigns I think the primary objective is the
awareness created among the people.”
- “Of course I do. However, I assume that every company should be doing it and don‟t
necessarily needs to use it as a communication tool.”
To sum up, although there are opposing ideas in terms of the trust towards CSR activities of
the companies, consumers don‟t mean that they and the society don‟t need CSR activities.
They really want to see the impact of it. If companies can make consumers believe the
sincerity and can prove the end results of what they are doing, the consumers are very much
open to this concept. Moreover, the price levels of the products are seen as an indicator of the
product quality as well as the brand image. Hence, consumers are more willing to trust the
CSR activities of the expensive brands more than the others.
5.5 CSR Awareness
In order to understand when and how consumers become aware of the CSR concept in the
cosmetics industry, the consumers are asked to answer:
- The first time that they have heard about the social responsibility in terms of the
cosmetics products (question 9) and;
- How they find out that a cosmetics brand is socially responsible (question 10).
During the interviews conducted within 25 interviewees, quite different answers were
gathered towards the first time that they have heard about social responsibility for the
cosmetics products. The answers varied between “I don‟t know” or “I‟ve just heard about it
during this interview” and up to “15 years ago”. In addition, it has to be mentioned that the
majority (13 interviewees) of the interviewees mentioned that the first time they have heard
about the social responsibility for the cosmetics products was 4 to 7 years ago. One of the
reasons for the varied answers for question 9 is the age difference between the female
consumers. For example, when 18-year-old females were asked about the first time they have
heard about the social responsibility in the cosmetics sector they answered as “3 years”. On
the other side, 2 of the female consumers between 30 and 40 years old were asked the same
question and their answers were “15 years”. The figure below shows the distribution of the
CSR awareness through the years.
Figure 14: Years of CSR Awareness
In relation to question 9: When was the first time that you have heard about social responsibility for the
cosmetics products?
Even the answer for question 4, which was about learning the favourite cosmetics brands of
the consumers, the answers of female consumers between 30 and 40 years old were richer and
more detailed than the answers of the 18 years old consumers. Therefore, the age clearly is a
factor in terms of the accumulated knowledge that has been gathered through the years in
order to state the level of awareness. Secondly, what has been figured out is that most of the
interviewees were aware of various corporate social responsibility acts in the society such as
environmental issues and animal rights. Especially consumers have had a growing interest in
the biological/ecological food industry for many years. On the other hand, since question 9
was structured specifically to learn consumers‟ awareness for the cosmetics products, the
industry specification shortened the awareness period. In other words, although people were
aware of the CSR activities within different industries for a long time, CSR activities of the
cosmetics industry were a recent experience for them. The reason for being more aware about
the CSR activities of other sectors is that the visibility and repetition is more than in the
cosmetics industry. For example, the growing interest and awareness towards the biological
food can be the result of the frequent informing process through different channels of the
mass media. When people go for shopping at a grocery store, it is very easy to catch that a
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Years of CSR Awarenes
product is biological. Biological foods have distinctive packaging such as tags, certificates or
colours (generally green since it is related to the environment). On the other side, for the
cosmetics products consumers have to read the information booklet given inside the package.
So it is harder to get the information compared to the biological foods. For example one of the
interviewees commented by saying “Most of the brands provide CSR related information such
as -this product is not tested on animals- within small letters in the information booklet.”
Therefore, expecting huge interest and awareness towards it, might be hard to achieve within
short term.
Furthermore, within question 10 it is aimed to figure out how consumers find out that a
cosmetics brand is socially responsible. Based on the answers of the interviewees, it is seen
that the largest source of information is the mass media. 15 people out of 25 mentioned that
TV and magazines are the communication channels that consumers receive information
towards CSR activities of the cosmetics companies, which is the highest number of answers
for this question. Internet/forums/websites, store activities, articles/newspapers are the other
sources of information given sequentially based on the number of answers.
On the Internet, consumers check the web pages of the cosmetics brands and become aware of
their CSR activities. Furthermore, they read forums and learn other consumers‟ experiences
and opinions, and come across articles related to CSR in the cosmetics industry. Moreover,
people can read newspapers online and watch documentaries related to CSR issues and make
themselves aware within their own interest. Figure 15 in the next page shows the sources of
information in terms of CSR activities gathered from the interviewees.
Figure 15:Source of Information
In relation to question 10: How do you find out that a cosmetics brand is socially responsible?
In addition, store activities are also one of the highest main sources of information for
consumers. Store activities include store displays, having conversations with the sales
persons, receiving samples and goodies, receiving information booklets, having donation
boxes which people can support foundations or social acts through donating and receiving
pins for special occasions (such as receiving pink ribbons during the October which is the
month for breast cancer awareness, Estee Lauder).
Moreover, articles and newspapers were stated as sources of information in terms of social
responsibility aspects of the cosmetics companies. Consumers like to read the articles of the
newspapers and become more aware of the facts going on. Other sources of information given
by the interviewees are billboards, info booklets of the products, through friends and school,
employees of the company itself, celebrities as spokespersons of different CSR campaigns
and scientific certificates that proves the quality of the products. In terms of providing
scientific certificates, it is easier to build trust from consumers since it is a way of using
professional endorsement. “Consumers typically do not know enough about a new supplier to
have confidence in buying its product. In this case, advertising could provide information to
reduce the consumers‟ uncertainty or it could provide other signals (e.g., endorsements) to
build consumers‟ trust. For instance, Neutrogena advertises its product as dermatologist
recommended for acne-prone skin. In the skin-care category that is cluttered with many
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Source of Information
brands each spending millions on advertising, Neutrogena was able to earn the credibility of
consumers, by relying on this professional endorsement” (Tellis, 2004).
Moreover, one of the interviewees said: “I learned a lot about CSR activities during my
internship at a cosmetics company. At first, I barely knew anything but during my internship
all the employees were informed and involved within CSR activities. Also, I have shared my
own interpretations with my friends and I believe that it was a contribution for the awareness
of the society. And it made me feel a better person.” Another interviewee commented by
saying: “Although I was aware about environmental issues, the actions towards protecting
animals and many issues related to social awareness; these were at the superficial level and I
even didn‟t know the word CSR and what it stands for. Since I am a marketing student, during
my education I have had the opportunity to learn more about this subject and became more
aware and sensitive about this issue.” Therefore, based on these comments, it can be said that
if the companies can provide efficient education and trainings towards their employees they
may increase the level of awareness of the society within their own links.
In addition, obtained knowledge at the schools are also very important. Younger generations
can be educated about CSR so that they will value it even more in the future. In this way,
consumers will be more sensitive about CSR when buying a product and demanding for it. As
a result, companies will be more motivated to perform CSR activities. Therefore, social
awareness will be increased in the long term in a consistent way. Moreover, at some
universities, students are offered CSR and CSR management courses, which help them to
have an advanced level of awareness in terms of CSR and this, will lead to easier recognition
processes.
Furthermore when consumers are asked about the first time they have heard about the social
responsibility within question 9, 10 of the 25 interviewees answered while giving The Body
Shop as an example although they were not asked to give an example of a brand name. 10 of
these interviewees said that The Body Shop is the brand, which has introduced them to CSR
within the cosmetics sector. It doesn‟t mean that they knew the term and what CSR stands for
but they became aware of that a cosmetics company can support environmental and social
causes voluntarily. The reason enabled consumers to consider The Body Shop as a socially
and environmentally responsible brand, actually depends on the communication channels,
which have been created between the company itself and the consumers.
The Body Shop uses most of the communications channels as a source of information for
consumers, which have been mentioned above. The most important communication channel
for The Body Shop is the store activities, which they run the social and environmental
campaigns. Therefore, since it is a personal experience, the highest rate of awareness is being
raised. This is the reason of why the interviewees gave The Body Shop as an example while
answering question 9.
Lastly, 2 consumers answered as “I don‟t see it” when they were asked how they find out that
a cosmetics brand is socially responsible. The reason for this is that, these 2 interviewees were
the youngest participants of this research. They didn‟t have much idea about CSR activities of
the cosmetics companies as well as having troubles in remembering the brand names. So
although they were aware about social issues, they weren‟t able to match cosmetics company
names with specific CSR activities.
5.5.1 CSR Perceptions towards Information Sources
Question number 10 was aimed to learn how consumers find out that a cosmetics brand is
socially responsible. Question number 11 aims to understand:
-How consumers feel about being informed in terms of CSR activities of the cosmetics
brands.
Figure 16, in the next page, shows the reactions of consumers towards CSR information.
Figure 16: Reaction Towards CSR Information
In relation to Question 11: How do you feel about being informed about social responsibility aspects of
companies?
The most given answer is that consumers are happy to be informed about CSR activities of
the cosmetics brands. It is observed that they don‟t want to be pushed and want to receive the
information within their own initiatives. One of the interviewees said that: “I prefer reading
the information that takes my attention or listen to it on TV whenever it is interesting to me.
But I don‟t like to be stopped and informed when I‟m checking a store and during the time of
shopping. But overall, I can say that I feel happy to be informed and having ideas about the
cosmetics brands‟ responsible activities.” Moreover, another interviewee commented by
saying: “I am interested in being informed if I‟m really interested in the product and/or if I‟m
considering buying the product. Otherwise, if I‟m just checking I don‟t want to spend my time
being informed for a product that I‟m not interested in to buy.” Based on the answers of the
interviewees, the participants who said that they find being informed interesting they
expressed themselves saying as “I find it interesting but I don‟t hear it a lot” and “I find it
interesting but I need to be informed more”. Consumers are happy to be informed in the end,
whether they are interested, feel bored or neutral. Their expectation is not to face aggressive
attitude and to use their own initiative while being informed.
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5.5.2 Consumers’ Value of CSR
Within question 12, interviewees are expected to elaborate:
-Whether they find it important that the cosmetics companies are socially responsible.
The answers gathered are listed below:
-“I find it very important. Maybe 100 years ago, there were few cosmetics brands and
even being able to produce the cosmetics products was a differentiation strategy for a
company. But lately because of the competitive aspect of the cosmetics industry,
companies have to focus on new competitive ways. I believe that CSR is a beneficial
competitive advantage for companies as well as for the consumers.”
-“Cosmetics products are directly linked with our skin health, so being a responsible
company in terms of the ingredients is a must for cosmetics brands. Moreover, I want
to learn where the products come from since I‟m applying it on my skin.”
-“I find it important. The more companies do it, the better the impact will be for the
world.”
On the other side, one interviewee stated that it is crucially important for a cosmetics
company to be socially responsible, she also carries a doubt in order to fully trust the
companies if they are keeping their promises and achieving the goals that they have aimed in
terms of donations. Therefore, one of the interviewee expressed her ideas by saying: “I
appreciate it very much that, cosmetics products don‟t include harmful ingredients; carry the
responsibility towards protecting people‟s health, protecting animals or donating foundations.
However, as a consumer I have question marks in my mind about whether promises are being
held or not.” Interviewees agreed on this subject within their answers that CSR related
activities should be trustworthy. They want to be convinced that the cosmetics companies are
actually being socially responsible.
Another perspective, which was observed through the interviews is that although people find
the CSR activities important towards the environment and the society, they don‟t find it
important while buying a product. Since the brand image is a reflector of the quality for the
consumers, they don‟t question the ingredients. In the end, for this segment of the consumers,
CSR activities are just interesting to hear and to observe but not a decisive factor while
buying a cosmetics product.
5.5.3 CSR Related Cosmetics Consumptions
The 13th question was asked in order to learn:
-If consumers ever bought a socially responsible cosmetics product after being
informed at the store.
The aim of asking this question is to learn more about the point-of-purchase communications.
“Point-of-purchase or POP advertising, also called in-store, point of sales or POS advertising,
can be defined as any promotional material placed at the point of purchase, such as interior
displays, printed material at shop counters or window displays. However, it also includes in-
store broadcasts, video screen demonstrations, shopping-trolley advertising, shelf talkers,
coupon dispensers, wastepaper baskets and interactive kiosks” (De Pelsmacker et al, 2007).
Therefore, 8 people out of 25 interviewees gave the answer “yes” and 17 people gave the
answer “no” for the question whether they have made a purchase after being informed at a
cosmetics store. Moreover, as it has been mentioned before, point-of-sales communication
was defined as receiving information at the store while talking to a sales person, paying
attention to the store displays, receiving samples and information brochures by the
interviewees. 8 out of 25 consumers stated that they were informed at the cosmetics shop and
then made a purchase. Their arguments are:
-“I don‟t believe that the sales people at the cosmetics shops have the required
information so I don‟t trust what I hear from them. This is the reason why I prefer
informing myself at the store by reading the brochures and the store displays. The
Body Shop is an example for me.”
-“Yes, I remember that I bought a product of Sothys which is a French cosmetics
brand. The sales person seemed very reliable and she informed me a lot about skincare
rather than just mentioning about the product. Also, sometimes I buy the products after
trying the samples that I received from the cosmetics shops.”
Moreover, Sisley and Clinique were the other cosmetics brands that have been purchased after
being informed at the store.
On the other side, the arguments of the interviewees who answered as “no” are:
-“I don‟t think that the sales people are qualified enough to inform me and to provide
required knowledge. Therefore I am not open to be persuaded by them.”
-“The conversations that I have had with the sales people were more about learning
new product offers and about the duration of the products.”
-“In general, I don‟t like to talk with the sales people as I always feel obligated to
purchase therefore I am not aware if a product is socially responsible.”
It can be said that there is a tendency of underestimating the sales people and not carrying
trust towards them. Therefore, cosmetics companies may focus on trainings of their
employees more in order to change the customers‟ attitude towards this issue. In addition to
this, cosmetics companies can focus more on attracting consumers through other point of
purchase communications that may lead consumers to use their own initiatives without feeling
obligated to talk to the sales person.
It is also observed that people approach more positive towards communicating to the sales
person at The Body Shop stores compared to the other cosmetics brands. First reason is that
The Body Shop products are being sold at their own The Body Shop stores. Therefore,
consumers only have to focus on The Body Shop products. On the other side, since other
brands are sold at a cosmetics store which consumers can find many brands; they feel
themselves overwhelmed and bored because of receiving a lot of information for different
brand names. Also, this decreases the motivation and the attention of the consumers.
Moreover, one of the advantages for The Body Shop is that they provide specific store design
at every point of sales all around the world. So, although the person is checking the store at
another city or country, they feel themselves familiar to the brand and know what to expect
from The Body Shop stores. “POP communications are not only concerned with POP
advertising. The store image, store design, the scent and the music in the store, the way the
products are placed on the shelves and the packaging of the products form an integral part of
POP communications. In short, POP communications involve all the aspects of the store and
the store environment that can signal something to customers about the quality, price or
product assortment, whether it is initiated by the retailer or by the manufacturer” (De
Pelsmacker et al, 2007).
“Increasingly, consumers decide which product or brand to buy while shopping. Since it is
important to communicate with the consumer at the time and the place where they take a
purchase decision, in-store communication techniques are increasingly important, and are
becoming increasingly sophisticated” (De Pelsmacker et al, 2007). As it has been mentioned
in the literature review, cosmetics products are experience goods which consumers cannot
make personal decisions beforehand (without experiencing/trying the product) due to lack of
information. Because of this reason, point of sales communication is especially more
important for cosmetics industry compared to the other industries. Consumer attention can be
attracted, brand name can be reminded, consumers can be informed and persuaded and lastly
the image can be created at the store. Figure 17 explains the objectives mentioned above.
Figure 17: Point-of-purchase communication objectives (De Pelsmacker et al, 2007).
5.6 Loyalty Aspects of the Cosmetics Products
Question 14 was asked to understand:
-Whether consumers are willing to change their cosmetics brands that they are loyal to
after being influenced by CSR activities of other cosmetics brands.
17 interviewees answered as “maybe”, 6 interviewees answered as “no” while 2 interviewees
answered as “yes”. Figure 18, gives an overview of the answers in relation to question 14.
Pop
communications
Attract
attention
Persuade
Create Image
Inform
Remind
Figure 18: Changing Loyal Cosmetics Brands
In relation to question 14: What kind of CSR activities will lead you to change the cosmetics brand that you are
loyal to?
The only two interviewees, who are willing to change their loyal brands, said that ecological
awareness, support and research to cancer, poverty, and education related subjects are the
CSR activities that they are very sensitive about. Therefore, they can change their loyal
brands if they are informed and persuaded about these issues.
On the other side, the interviewees who directly rejected to change their loyal brands stated
these arguments:
-“No, I don‟t think so. The first important factor for me is the quality of the product.
So, since I am satisfied with the brands that I am loyal to, I wouldn‟t consider
changing them.”
-“The brands that I am using are already socially responsible so I don‟t feel the need to
change them.”
Moreover, the majority of the interviewees gave the answer “maybe” while reasoning it with
some circumstances. The most given condition under which consumers are willing to change
their loyal brands, is that the socially responsible brand has to assure at least the same level of
quality. Interviewees stated that they want to test the product with samples and compare it to
the brands they are loyal to in order to be sure of the quality. Moreover, the word of mouth is
an important decision factor for interviewees while switching their brands. The experiences of
their friends, family members, and the shared knowledge through forums on the Internet were
2
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Changing Loyal Brands
Yes
No
also stated as important factors. Furthermore, when interviewees are asked within question 5
about their purchase decision factors, CSR was not mentioned as one of the reasons.
Therefore, CSR activities are not stated as one of the main reasons to choose a cosmetics
brand. It is more observed as an important factor while creating and supporting the brand
image. This is the reason why, the majority of the interviewees answered as “maybe” and
“no” for question 14.
Furthermore, within question 15 it is aimed to learn:
-If the consumers are willing to pay a higher price for a socially responsible cosmetics
product.
Only two interviewees answered as “yes” and one interviewee said “no” and 22 interviewees
answered as “maybe” while basing their arguments on some conditions. Figure 19 shows the
responses of the interviewees.
Figure 19: Willingness to Pay Higher Price
In relation to question 15: Are you willing to pay a higher price for a socially responsible cosmetics product?
The interviewees, who are willing to pay a higher price for a socially responsible product,
would like to support some specific environmental and social acts. On the other side, the only
interviewee who responded she wouldn‟t pay a higher price explained that she only buys
cosmetic products just because she likes the products but not because of any socially
responsible reason. In addition, the majority of the interviewees expressed their ideas by
saying:
21
22
Willingness to Pay Higher Price
Yes
No
-“I believe that implementing socially responsible activities would make a huge cost
for the companies. Therefore it is normal to expect a higher price. Since my eyes are
very sensitive, I would consider paying a higher price for eye make-up products
because of my need of quality.”
-“I might pay a higher price but it depends on how high the price increase is compared
to the brands that I am already using.”
-“If my purchase is going to donate to a current cause/problem such as people
suffering from a flood, earthquake, hurricane, war, etc., I may pay higher amounts so
that I can contribute to a social act.”
5.6.1 Recommendation and Discouragement of Cosmetics Brands
Moreover, it is aimed to learn:
-People‟s attitude towards recommendation of socially responsible brands (question
16) and;
-Discouragement of brands, which have negative image in terms of social
responsibility (question 17).
As for question 16, the majority of the interviewees -22 people- stated that they would
recommend the socially responsible brand names to their friends and families. Moreover, it is
observed that consumers are more willing to advise and recommend to each other about the
purchase decisions during the shopping time. Some of the interviewees mentioned that they
have already recommended The Body Shop and Yves Rocher to their friends in terms of their
socially responsible behaviours and products. On the other hand, 3 people mentioned that they
would not make a recommendation in terms of the social responsibility aspects of a cosmetics
brand. The interviewees stated that they don‟t have much knowledge in terms of CSR
activities of cosmetics brands; therefore they would prefer not to make a recommendation.
Figure 20 shows consumers‟ willingness to recommend or discourage a cosmetics brand to
other people.
Figure 20: Recommendation of CSR-related Brands / Discouragement of Irresponsible Brands
In relation to question 16 and 17: Would you recommend a cosmetics brand to someone else because of its CSR
activities? / Would you advise someone else not to buy a cosmetics brand because of its negative image in terms
of social responsibility?
Question 17, was asked to learn if consumers would advise someone else not to buy a
cosmetics brand because of its negative image in terms of social responsibility. Surprisingly,
the evaluations of consumers about recommendation and discouragement of a brand was
equal when it is asked about their behaviour. 22 people stated that they would reflect their
discouragement about the brand to their friends and 3 people said that they wouldn‟t reflect
their discouragement. This is surprising because, as mentioned in the literature review, there
is a tendency of thinking that negative reinforcement is shared more often than positive brand
experiences. “For long it has been assumed, both by managers and academics, that negative as
compared with equally extreme positive information receives a higher weight in the formation
of judgements because negative information would be perceived as more useful or diagnostic
for classifying brands into evaluative categories. However, the negative effect may be
overstated. Even if consumers are motivated to process marketing communications, the same
information may lead to a completely different processing and communication result
depending on the type of consumer motivation or processing goal” (De Pelsmacker et al,
2007). As it has been mentioned in the literature review, how consumers process information
can depend on their involvement with a product or a brand. If a consumer has a strong
commitment to a brand, she is able to show more resistance to negative information and might
have difficulty remembering ethical attributes of a product.
22
3
Recommendation of CSR-related Brands
yesno
22
3
Discouragement of Irresponsible Brands
yes
no
5.6.2 Loyalty and CSR
The psychological commitment or relation between a consumer and a brand can be defined as
brand loyalty (De Pelsmacker et al, 2007). In addition, repeated purchase shouldn‟t be
confused with brand loyalty since continuous buying decisions are mostly given because of
several factors such as availability of limited choices or being the least expensive option
which have no links regarding emotional involvement to the brand. On the other side, “loyal
customers are more likely to pay attention to, understand, agree with, and respond positively
to messages of advertising for the brand to which they are loyal to” (Tellis, 2004). Therefore,
since CSR activities directly focus on and influence consumers‟ emotions, it can be assumed
as a way of creating emotional links with the brand. By doing so, it helps to retain loyal
customers. Based on the answers of the interviewees, it is observed that consumers feel
themselves better and different from other customers regarding their socially responsible
cosmetics consumption. In other words, CSR strengthens the link between the consumers and
the brand by making them feel different from others and making them feel part of a socially
responsible group of the society. As a result of this, brands can offer more than just the
product itself. They can offer an experience, which is the core of creating emotional links with
the consumers. Moreover by establishing social communities, cosmetics brands can achieve
improved customer involvement and brand loyalty. Those consumers who become a part of a
socially responsible community of a cosmetics brand will increase word-of-mouth which
leads to attracting new consumers. De Pelsmacker (2007) supports this idea by saying:
“Evidently, a strong brand implies that as many customers as possible are satisfied, committed
buyers. Not only will committed buyers repurchase the brand; they will also actively promote
your brand to others and function as real ambassadors.”
Moreover, cosmetics brands -through their CSR activities- can reflect themselves to the
responsible cosmetics consumers that they share the same values. Therefore, the socially
responsible image of the specific cosmetics company can be stated as a value that consumers
would feel proud of sharing and reflecting to the people around them. By doing so, consumers
can identify themselves with the brand and can use it as a status symbol -as being a
responsible person- within their social network. This may be another reason of how CSR can
be used as a factor of creating or retaining loyalty.
And lastly, CSR related product development activities may influence consumers in order to
stay as loyal customers or become loyal customers. For instance, when interviewees are asked
about their purchase decision factors, 17 consumers out of 25 gave quality as an answer.
Therefore offering fragrance free, non-allergic products that do not include unhealthy
chemical additives can be considered as product quality related CSR activities. In other
words, many consumers base their product loyalty decisions on CSR related quality
improvements of the cosmetics products.
5.7 Branding and Cosmetics Products
Branding provides many advantages for a company. “Strong brands help the consumer to
locate and identify products and evaluate their quality. It makes it easier for the consumer to
develop attitudes and expectations. A brand name serves as a shorthand label for a large
bundle of associations and the whole brand personality. Branding makes shopping more
efficient in that, it reduces the amount of decision-making time required and the perceived
risk of purchase, as a result of the fact that a brand promises a constant level of quality. It
gives consumers the ability to assess quickly the value and quality of new products by
association with a well-known brand name. Finally, branding increases the innovation
potential of manufacturers, thus leading to more variety and consumer choice.” (De
Pelsmacker et al, 2007). CSR activities can be used as a way of building and enhancing the
brand image for the cosmetics brands. Therefore, within CSR campaigns consumers associate
socially responsible activities with the brand name. With the help of repetition of CSR related
activities, consumer awareness can be achieved since creating brand awareness is essential in
the cosmetics industry where consumer involvement is very high. For valuable quality
products and brands such as cosmetics, design products, shoes, accessories, etc., aesthetic
reasons and quality are the main reasons of purchase because they symbolise the consumers‟
lifestyle. Therefore, the cosmetics brands should focus on creating and supporting brand
awareness (De Pelsmacker et al, 2007).
Brand awareness can be defined as creating associations with physical characteristics of a
brand such as the brand name, logo, package and style. Moreover, brand awareness can be
achieved in two ways, which are brand recall and brand recognition. Brand recall is harder to
achieve than the brand recognition. Less repetition and smaller investments are needed to
establish for brand recognition than the brand recall. As it has been mentioned before, point-
of-purchase decisions are important for cosmetics products especially for CSR related
purchase decisions. This is because the consumers at the point of purchase can easily
recognize CSR activities. Therefore packaging, displays, colours, logos and all the visual
aspects of the products are important to create brand recognition.
On the other side, in terms of CSR awareness both brand recognition and brand recall are
important. During the interviews, consumers mentioned that they prefer searching for the
cosmetics brands and becoming informed through the websites and the forums besides just
becoming informed at the cosmetics stores. This is how brand recall can be created and
strengthened through CSR related activities. “ Sometimes this dual brand awareness objective
is required, since for many product categories consumers limit their search activity based on
loyalty to a limited set of brands” (De Pelsmacker et al, 2007).
Repetition is also an important aspect for brand recall, which increases the strength and speed
of learning. The more consumers are exposed to information, the more likely they learn it.
The effect of the repetition is highly related to the importance of the information and the
reinforcement given. If the subject of the matter is very important and there is a great deal of
relevant reinforcement, less repetition of an advertising message is needed for consumers to
learn the message (Hawkins et al, 1992). On the other hand, although CSR is an important
subject, the concept is new for consumers. Therefore, high repetition is needed to make
consumers more aware and to set CSR as a standard in order to make it as a purchase decision
factor. Moreover, repetition is not only necessary to make consumers aware of CSR but also
important in order to link CSR activities with cosmetics brand names, in other words, to
achieve brand recall.
When consumers are loyal to some cosmetics brands, the only way to make the consumers to
change their loyal brands is to achieve brand recognition as well as brand recall. Making
consumers informed about CSR activities help to create emotional links between the
consumers and the brand. Therefore, CSR related activities can support brand recall and
become a part of the brand image in the long run while supporting the environment and the
society. “Every communication activity should take brand awareness into account. Even if
brand attitude or other objectives are more dominant, it will still be important to support brand
awareness. A brand can never have too much brand awareness. The effect of brand awareness
on brand choice and brand purchases is substantial. If two brands are equally valued, the
brand with the highest awareness will be purchased more often” (De Pelsmacker et al, 2007).
This point is related to the answers of question 14. Within question 14, the interviewees
mentioned many reasons under which situations they are willing to change the cosmetic
brands that they are loyal to. Interviewees expressed that only assuring the same quality and
the similar price range can be considered as reasons to switch their loyal brands. Therefore, if
a cosmetics company is valued in the same category in terms of quality and the price range,
the brand which has the highest brand awareness will be the one chosen. Besides protecting
the environment and the society, which is the prior mission for implementing CSR activities,
brand awareness can be increased through CSR as well.
To sum up; a “win-win-win” situation can be achieved:
- While increasing brand awareness and benefiting from increased purchases in terms
of the companies,
- While becoming more aware about the environmental and social issues therefore
carrying the need to be a part of the act in terms of the consumers
- And lastly increasing the well being of the environment and the society.
5.8 Conclusion
Within the consumer analysis, it is aimed to come up with answers towards the research
question: How do consumers interpret CSR in the cosmetics industry? In order to answer this
question, three sub questions are formulated to understand whether CSR is an important
purchase decision factor for cosmetics consumers, how influential the CSR activities are in
order to create brand awareness and how influential the routes of persuasion are to raise CSR
awareness for the cosmetics brands.
1. Is CSR an important purchase decision factor for cosmetics consumers?
Although consumers state that they find it important for cosmetics brands to be socially
responsible, they did not directly mention CSR as a purchase factor. The most important
purchase factors for consumers are the quality of the product, the price, the ingredients and
the duration. On the other hand, it can be said that the factor “ingredients” can be considered
as a CSR factor as well. Consumers define ingredients as fragrance free, as being not allergic
and not containing unhealthy chemical additives. These aspects are all part of environmental
and healthy CSR activities. For example, Clinique‟s main CSR activities consist of providing
fragrance free and on allergy-tested products. In addition, ingredients are very much linked to
the quality. By making the products fragrance free and without chemical additives, the quality
of the products increases as well in the mind of the consumers. Therefore, it can be said that
even though consumers do not consider CSR as a direct purchase factor, they actually do
value it and use it as complementary source in order to make their purchase decisions.
2. How influential are the CSR activities in order to create brand awareness?
Even though CSR is a not a purchase decision factor for cosmetics consumers, it does have a
significant influence on creating/supporting the brand image, which indirectly influences
consumers‟ purchase decisions. Moreover, strengthen brand awareness is closely associated
with the emotional links created between consumers and cosmetics brands. Therefore, CSR
activities of cosmetics companies, which highlight social and environmental problems/causes,
can be used as way to creating/enhancing emotional links with consumers.
Moreover, consumer interviews showed how a cosmetics company can create and increase
brand awareness through integrating CSR activities to its core business strategies. Therefore,
The Body Shop is stated as the cosmetics brand that carries the highest consumer awareness
in terms of CSR based on the answers of the consumer interviews. The consumer awareness
of the Body Shop, which is achieved through the CSR activities, can be shown as an answer
to this sub question. In the relation to the first sub question, creating brand awareness through
CSR leads consumers to consider CSR as an indirect purchase decision factor.
3. How influential is the peripheral route of persuasion to raise CSR awareness for the
cosmetics brands?
As it has been mentioned before, creating emotional links with consumers is significantly
important for cosmetics brands. Consumers give purchase decisions in order to feel
themselves happy, different and privileged. In relation to this, through consumer interviews it
is observed that CSR-focused consumption make them feel good citizens who differentiate
themselves through their socially responsible contributions. In the end, they feel themselves
as a part of a privileged group of the society in terms of their responsible consumption.
Therefore, the peripheral route of persuasion is a way to touch on those feelings while
persuading consumers. In relation to this, the peripheral route achieves this objective by using
different cues (stressing emotions) through advertisements instead of leading consumer to
cognitive information processes. During the consumer interviews, it is observed that
consumers are open to being informed about CSR activities of cosmetics brands. Moreover,
consumers want to use their own initiatives while being informed. Therefore, the peripheral
route is significantly important in order create brand awareness without putting too much
pressure on consumers. In order words, to attract consumer interest through emotional links is
the expected way of being persuaded by consumers, which can only achieved through the
peripheral route of persuasion in terms of CSR.
To sum up, based on the conclusions of the sub questions, the research question can be
answered by saying that consumers interpret CSR for the cosmetics brands not as a direct
purchase decision factor for them. Furthermore, consumers consider CSR activities as an
influential source to create their brand awareness while coming up with the purchase
decisions. Moreover, based on consumers‟ need in terms of creating emotional links with
cosmetics brands, the peripheral route of persuasion is decided as the right way to
communicate with the consumers.
6. Conclusion
The previous sections focused on the results of the company interview and the consumer
interview. Based on these results, answers were given on the two research questions. These
research questions were formulated to support of the central question, which is “How do
Corporate Social Responsibility activities affect consumers’ buying behaviour in the
cosmetics industry?” In this chapter the answer to the central question is presented. In
addition, the limitations of the research and the ideas for further research are discussed as
well.
6.1 Overall Conclusion
Based on the key findings of the consumer and company analyses, it can be stated that CSR
activities of the cosmetics brands do affect consumers‟ buying behaviour. There are several
ways in which these activities have an impact on consumers‟ purchase behaviour.
The most important purchase factors of the cosmetics consumers are the quality, the price, the
ingredients and the duration of the cosmetics products. The consumers did not mention CSR
as one of their purchase factors. However, it can be stated that even though they not directly
consider CSR as purchase factor, it does have a significant influence on their buying
decisions. The factors “ingredients” and “quality” are closely related with the CSR activities
of cosmetics companies (such as the use of biological/natural ingredients).
In addition to the purchase factors that are mentioned above, consumers choose certain
cosmetics brands based on the emotional links that they have towards these brands. These
emotional links can be further enhanced with the CSR activities of the cosmetics brands. The
cosmetics brands can use the peripheral route of persuasion to make consumers aware of their
CSR activities, in other words to create CSR awareness. By using peripheral cues in the
advertisements (for example the image of the endorsers, music and other affective elements),
consumers are able to create emotional links with the CSR activities. This will lead to
emotional links with the brands as well. As result, both CSR awareness and brand awareness
are created.
Moreover, it is observed that consumers had difficulty in understanding the meaning and the
value of CSR. Based on this, the activities of the cosmetic companies help consumers educate
about the value of CSR. As a result, consumers become more involved in the CSR activities
and they feel satisfied in buying social responsible cosmetics products since they are able to
contribute to the society and the environment. They can consider themselves as good citizens.
In this way, emotional links with the cosmetics brands are created as well.
Furthermore, consumers are informed about CSR activities (and lack of CSR activities) within
the cosmetics industry through mass media and NGOs. These information channels help
consumers to understand about the necessity of being socially responsible. After being
informed and becoming aware of CSR activities, the consumers demand increases. Therefore,
even though consumers do not directly consider CSR as a purchase decision factor, it can be
stated that consumers want to see more social responsible acts from the cosmetics brands.
They recommend socially responsible brands to their friends and families and discourage
irresponsible brands. As a result, CSR can be considered an indirect purchase decision factor.
On the other hand, it is necessary for cosmetics brands to continuously communicate their
CSR activities to their consumers. Before purchasing a socially responsible brand, consumers
want to be persuaded that the CSR activities are not just a marketing tool. For this reason, it is
important that cosmetics brands are showing their CSR commitment on a long-term basis.
6.2 Limitations
There are several limitations with regards to this thesis. A significant limitation was collecting
more consumer behaviour data through more interviews. There were some difficulties finding
participants for the consumer interviews. This is due to the fact that in-dept interviews take
longer time to conduct than quantitative surveys. The cosmetics consumers that participated in
the interviews have chosen to do so, because they were able to make time for it in a short-term
period. However, it became painfully clear that many consumers did want to take part of the
interview because they did want to make time for it. After being told about the estimated time
(maximum of 30 minutes) to conduct the interview, they were not interested enough to
participate and were not willing to schedule an appointment. For this reason, no more than 25
interviews were conducted. On the other hand, it must be said that 25 consumer interviews
were enough to collect sufficient and valuable data in order to conduct the research in terms
of consumers‟ purchase behaviour.
In addition, the number of questions was limited to thirteen main questions regarding CSR.
Since each of those questions required an elaborated answer from the interviewees, it was not
possible to ask more questions. Asking more than thirteen questions prolonged the duration of
the interview, which was not attractive for finding interviewees. This means that more
questions, in relation to CSR and consumer behaviour, were not asked.
Furthermore, it had to be said that some of the answers of the interviewees were not valid or
not taken into consideration, since they were not willing to elaborate on their answers.
Without any explanation to some questions (e.g. Q10: “Do you find CSR important? Please
elaborate”), it is hard to analyse consumers‟ perceptions on CSR and how it affects their
buying behaviour.
Also due to the location of the researchers, the interviews were conducted in Brussels. Since,
in-depth interviews require that the researchers personally meet with the interviewees; it was
hard to conduct interviews outside of Brussels because of the time restrictions. In addition,
because of the difficulty in finding participants who were willing to participate for the
consumer interviews, several of the interviewees were found through the networks of the
researchers. For this reasons, a large group of the cosmetics consumers are students.
Moreover, it was not possible to receive CSR statistics from cosmetic brands (sales
results/figures) in order to measure the actual impact of CSR on consumer companies. The
cosmetics brands were not willing to share that information due to the sensitivity of the
documents. Therefore, the analyses of this paper primarily focused on the data collected
through the consumer interviews and the company interview in order to answer the research
questions.
6.3 Further Research
As mentioned before, this paper aims to understand how CSR activities of cosmetics brands
affect consumer purchase behaviour. The majority of the participants of the consumer
interviews are in the age range of 18 to 25 years old and primarily students. Even though
cosmetics products are aimed to reach consumers within a broad age range, it can be
interesting to conduct a consumer behaviour research focusing on “working cosmetics
consumers”, in order words focusing on employees (for example, employees within the age
range of 30 to 50 years old). This group of cosmetics consumers have a higher income than
students. In addition, it is observed from the consumer interviews that employees often
purchase prestige cosmetics brands, such Estee Lauder, Dior and Chanel, than mass-market
cosmetics brands. It can be assumed that they buy the prestige brands not only because of the
quality of the products, but also because of the emotional links they have towards the brands.
Furthermore, the interviews showed that consumers between 26 and 40 years old have heard
about social responsibility with the cosmetics industry for a longer period of time compared
with younger consumers and they were able to give more examples of CSR activities within
the cosmetics industry. Therefore, further research can be done on: how CSR affect
consumers‟ buying behaviour, how cosmetics brands can use CSR to create emotional links
with these consumers and support the brand image, and how these consumers can be
persuaded through CSR to change their loyal brands.
Also, further research can be done on how to measure CSR impact in the cosmetics industry
based on CSR statistics from cosmetics companies. By analysing the CSR statistics, the affect
of CSR on consumer purchases can be measured in order to understand how significant CSR
activities are for the sales of cosmetics products. An example of statistics can be the sales
results of cosmetics products after conducting a CSR campaign.
Furthermore, another interesting topic to further analyse is the industry initiatives in terms of
CSR. As mentioned by Isabel Martin, cosmetics companies have their own CSR activities and
use these CSR activities as way of creating differentiation and competitive advantage.
However, by bundling CSR efforts and creating industry CSR initiatives, the impact will be
greater on the environment and the society. In addition, during the consumer interviews it is
observed that consumers wanted to be persuaded by cosmetics brands that they are fully
committed to CSR in order to support the environmental and society and, not just use CSR as
“green washing”. Therefore, the possibilities of CSR industry initiatives might increase the
overall credibility of the cosmetics industry in terms of CSR. This will lead to higher
credibility of the CSR initiatives of the individual cosmetics brands as well.
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