This week, our research articles consider whether luxury brands can be ethical in terms of CSR actions, and whether this works in the eyes of the consumer.
Can luxury brands be ethical?
Past research suggests that consumers may negatively evaluate luxury brands that engage in corporate social responsibility (CSR) because they do not perceive a consistency between luxury and ethical consumption (sophistication liability).
As luxury is an increasingly relevant industry, it is important to understand how to promote ethical luxury consumption and cleaner production practices in luxury. This article extends previous findings and provides a framework that shows the conditions under which luxury and ethical consumption can be compatible. In particular, the authors find that consumers perceive sophisticated brands as less ethical than sincere brands when their social identity goals are salient (i.e., they focus on their social relationships); however, when consumers personal identity goals are salient (i.e., they focus on themselves), they perceive sophisticated brands as equally ethical as sincere brands.
Finally, the authors also show that luxury brands’ CSR actions should focus on the firms’ own consumers whereas sincere brands’ CSR actions should focus on society in general.
Costa Pinto, Diego, Herter, Márcia Maurer, Gonçalves, Dilney & Sayin, Eda. 2019. Can luxury brands be ethical? Reducing the sophistication liability of luxury brands.
How high-net-worth social media influencers reconcile ethicality and living a luxury lifestyle
Drawing from a multi-sourced data corpus (in-depth interviews and Instagram posts) gathered from high-net-worth (HNW) social media influencers, this article explores how these individuals reconcile ethicality and living a luxury lifestyle through the enactment of three types of personas on Instagram: (1) Ambassador of ‘True’ Luxury, (2) Altruist, and (3) ‘Good’ Role Model.
By applying the concepts of taste regimes and social moral licensing, the authors find that HNW social media influencers conspicuously enact and display ethicality, thereby retaining legitimacy in the field of luxury consumption. As these individuals are highly influential, they could leave a potentially significant mark on public discourse and, consequently, on their audiences’ construction of ethically responsible luxury consumption.
In this vein, this article offers significant managerial insights into professional influencers and discusses ethical managerial practices to ensure ethical collaborations between influencers and managers.
Marina Leban, Thyra Uth Thomsen, Sylvia von Wallpach & Benjamin G. Voyer. 2021. Constructing Personas: How High-Net-Worth Social Media Influencers Reconcile Ethicality and Living a Luxury Lifestyle.
CSR actions, brand value, and willingness to pay a premium price for luxury brands
Sustainable luxury is a strategic issue for managers and for society, yet it remains poorly understood. This research seeks to clarify how corporate social responsibility (CSR) actions directly and indirectly (through brand value dimensions) affect consumers’ willingness to pay a premium price (WTPP) for luxury brand products, as well as how a long-term orientation (LTO) might moderate these relationships.
A scenario study presents fictional CSR actions of two brands, representing different luxury products, to 1,049 respondents from two countries (France and Tunisia). The results of a structural equation modeling approach show that the luxury brands’ CSR actions negatively affect customer WTPP overall and for each brand. The luxury brands’ functional and symbolic value dimensions positively mediate the effects of CSR actions on WTPP, whereas social value does not. The effects of CSR actions and brand symbolic value on WTTP do not differ between countries. The effect of functional value on WTPP differs across countries, such that it is stronger for high-LTO than low-LTO cultures. Inversely, the effect of social on customer WTPP is stronger for low-LTO than high-LTO cultures. These findings have theoretical and practical implications for luxury brand managers.
Mbaye Fall Diallo, Norchène Ben Dahmane Mouelhi, Mahesh Gadekar & Marie Schill. 2021. CSR Actions, Brand Value, and Willingness to Pay a Premium Price for Luxury Brands: Does Long-Term Orientation Matter?
Effects of pride and gratitude appeals on sustainable luxury brands
This study synthesises research on evolutionary psychology, emotional appeals, and viral advertising in order to develop a novel perspective on how sustainable luxury brands can be effectively promoted on social media.
The results of two experiments show that the emotional appeals of pride and gratitude increase consumer intentions to spread electronic word-of-mouth (eWOM) about sustainable luxury brands via two discrete mechanisms. Study 1 establishes that featuring the pride appeal increases eWOM intentions by heightening the luxury dimension of sustainable luxury brands, whereas featuring the gratitude appeal increases eWOM intentions by heightening the sustainability dimension of sustainable luxury brands. Study 2 shows that these discrete effects of emotional appeals influence consumers to adopt different types of eWOM behaviours toward sustainable luxury brands.
Specifically, the pride appeal increases consumer intentions to broadcast eWOM via status attainment motives. In contrast, the gratitude appeal increases consumer intentions to narrowcast eWOM via affiliation seeking motives. The findings offer novel theoretical insights and provide managers with tools to promote sustainable luxury brands in a digital environment.
Felix Septianto, Yuri Seo & Amy Christine Errmann. 2021. Distinct Effects of Pride and Gratitude Appeals on Sustainable Luxury Brands
How do nationalistic appeals affect foreign luxury brand reputation?
Drawing from cognitive learning theories the authors hypothesise that exposure to nationalistic appeals that suggest consumers should shun foreign brands for moral reasons increases the general belief in consumers that buying foreign brands is morally wrong. In parallel, drawing from the theory of psychological reactance the authors posit that such appeals may, against their communication goal, increase the reputation of foreign luxury brands.
The authors term the juxtaposition of these apparently contradictory effects the “Ambivalence Hypothesis.” Further, drawing from prior research on source-similarity effects the authors posit that foreign luxury brands that communicate cultural proximity to target consumers (i.e., a local brand positioning) reinforce psychological reactance (“Clean Conscience Hypothesis”). The authors test these hypotheses experimentally in the context of luxury car brand advertising in China, a market that is heavily dominated by foreign brands, and therefore provides a breeding ground for ambivalent consumer reactions.
Results show that exposure to nationalistic appeals enhances consumers’ national identity dispositions (patriotism, local identity), which results in higher levels of consumer ethnocentrism. Further, nationalistic appeals enhance the social responsibility associations that consumers hold for foreign luxury brands and their countries of origin, which results in a higher brand reputation. Finally, effects of nationalistic appeals on foreign luxury brand reputation are positively stronger for brands using a local vs. a foreign or a global positioning. These findings suggest that nationalistic appeals are a double-edged sword with important implications for ethics in political communication and luxury brand marketing.
Boris Bartikowski, Fernando Fastoso & Heribert Gierl. 2021. How Nationalistic Appeals Affect Foreign Luxury Brand Reputation: A Study of Ambivalent Effects.