Is This Why Corporations Donate To Charity?

Photo (cc) by DFID - UK Department for International Development

You might not have even heard of the “benevolent halo effect,” but new research shows you’re probably subject to it as a shopper.

The effect refers to how hearing about a company’s charitable donations, or corporate social responsibility, impacts consumers’ perception of the quality of the company’s products.

As Alexander Chernev and Sean Blair of Northwestern University’s Kellogg School of Management write in a study:

Corporate social responsibility can lead consumers to believe that the products of companies engaged in socially responsible activities are better performing. We attribute this to a “benevolent halo effect” where positive attitudes toward a company translate into positive beliefs about the company’s products….

Contrary to the popular view among many executives that corporate social responsibility is unlikely to benefit their company, our findings suggest that in addition to benefiting society, corporate social responsibility can contribute to a company’s bottom line.

Chernev and Blair’s study, titled “Doing Well by Doing Good: The Benevolent Halo Effect of Corporate Social Responsibility,” was published in this month’s issue of the Journal of Consumer Research.

For the study, they tested how corporate social responsibility affected consumers’ perceptions of red wine, running shoes, teeth whiteners and hair-loss products, according to a press release from the journal. For example, consumers gave a better rating to the wine’s taste after being told that the winery donated to the American Heart Association.

The results might explain why, as Nielsen found last year, most consumers say they’re willing to pay more for products and services provided from “companies that are committed to positive social and environmental impact.”

Granted, the Nielsen study of consumers in 60 countries found that U.S. consumers are among the least likely to feel that way:

The propensity to buy socially responsible brands is strongest in Asia-Pacific (64 percent), Latin America (63 percent) and Middle East/Africa (63 percent). The numbers for North America and Europe are 42 and 40 percent, respectively.

The latest research found, however, that companies diminish the benevolent halo effect when they advertise their good deeds. Less direct channels, like social media and public relations, are better ways to share charitable contributions and still benefit from them.

Do you think corporate charity has affected your sense of product quality? Share your thoughts in the comments section below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
Avoiding These 5 Foods Could Save Your Vision as You Age
Avoiding These 5 Foods Could Save Your Vision as You Age

Millions of Americans may be able to prevent an incurable cause of blindness by making a basic change.

8 Things I Always Buy at Target
8 Things I Always Buy at Target

I grew up shopping at the original Target store and am a lifelong fan. Here are my favorite purchases.

8 Products That Make It Easier to Get Fit
8 Products That Make It Easier to Get Fit

Amazon reviewers give high marks to these tools that can help you get in shape without a gym.

7 Surprising Advantages of Downsizing as a Retiree
7 Surprising Advantages of Downsizing as a Retiree

Downsizing your home offers many benefits, including some you may not have anticipated.

This Type of Social Security Benefit Is Often Overlooked
This Type of Social Security Benefit Is Often Overlooked

The Social Security Administration is not helping certain people get money to which they are entitled, a report says.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
10 Things Frugal People Never Buy
10 Things Frugal People Never Buy

If you’re a true tightwad, the mere thought of spending money on these items gives you the willies.

10 Useless Purchases You Need to Stop Making
10 Useless Purchases You Need to Stop Making

You might as well flush your money down the loo if you spend it on these things.

7 Social Security Rules Everyone Should Know by Now
7 Social Security Rules Everyone Should Know by Now

Confusion over Social Security is a shame, considering how many of us will need this money badly.

9 Shopping Mistakes to Avoid at Costco
9 Shopping Mistakes to Avoid at Costco

Are you missing out on serious savings at your favorite warehouse club?

Why Your Next Stimulus Check Might Be Bigger Than You Expect
Why Your Next Stimulus Check Might Be Bigger Than You Expect

Your third coronavirus payment will be the biggest yet — and possibly even bigger than you realize.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

They don’t make coffee makers like this anymore.

13 Amazon Purchases We Are Loving Right Now
13 Amazon Purchases We Are Loving Right Now

These practical products make everyday life a little easier.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

14 Things You Should Stop Buying in 2021
14 Things You Should Stop Buying in 2021

These convenient household products come with hidden costs that you might not have considered.

Is Writing a Check Still Safe?
Is Writing a Check Still Safe?

Every time you pay by check, you hand your bank account numbers to a stranger.

6 Ways to Protect Your Retirement Accounts From Hackers
6 Ways to Protect Your Retirement Accounts From Hackers

Imagine having $245,000 stolen from your retirement account — and not being reimbursed.

8 Things You Should Replace to Improve Your Life Today
8 Things You Should Replace to Improve Your Life Today

Being frugal isn’t smart if you put off replacing these items.

This Is the Most Dependable Car Brand in the U.S.
This Is the Most Dependable Car Brand in the U.S.

This brand’s vehicles are least likely to give drivers repair headaches, according to J.D. Power.

7 Social Security Benefits You May Be Overlooking
7 Social Security Benefits You May Be Overlooking

There’s more to Social Security than retirement benefits.

The 6 Best Investing Apps for Beginners
The 6 Best Investing Apps for Beginners

If you’re looking to ease into investing in the coronavirus economy with just a little money, check out these easy-to-use tools.

7 Hidden Sections of Amazon Every Shopper Should Know
7 Hidden Sections of Amazon Every Shopper Should Know

These little-known departments of Amazon are gold mines for deal-seekers and impulse shoppers alike.

7 Income Tax Breaks That Retirees Often Overlook
7 Income Tax Breaks That Retirees Often Overlook

Did you realize all these tax credits and deductions exist — or that they apply to retirees?

7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

Homeowners Say These 2 Kitchen Appliance Brands Are Best
Homeowners Say These 2 Kitchen Appliance Brands Are Best

One brand takes five of the top honors, while another ranks highest in three categories.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.