Marketing and selling in tough economic conditions:
Corporate responsibility and marketing strategy
CSR or CR is now a buzz word in corporate circles in Sri Lanka. Many
organizations engage in CSR/CR activities in order to gain business
mileage and build corporate brands. I have been asked many times my
views relating to CSR/CR being used as a marketing strategy. In this
brief article, I will endeavour to shed some light into this aspect.
Prasanna Perera, Marketing and
Management Consultant, Chartered Marketeer, CIM U.K.
Q: Has CSR changed to CR?
Yes, that is correct. CR or Corporate Responsibility incorporates not
only the social dimension but the community and environment aspects as
well. Hence, CR is a better suited term.
Q: Why do organizations carry out CSR/CR activities?
There are certain organizations that carry out CSR activities, to
build corporate image, reputation and goodwill. There is nothing wrong
about it, as long as cheap publicity is not the motive. The purpose of
CSR/CR is to provide a meaningful contribution to society, as a
responsible corporate citizen. Hence, creating a PR blitz will create
the wrong impression, about the motive. Other organizations carry out
CSR activities, in the true spirit of the word i.e. to provide a service
to society and the community. Hence they do not want undue publicity and
Either way, CSR/CR should be carried out primarily to provide a
service to society. If some publicity is obtained, it is of secondary
Q: Can CSR be incorporated into the marketing strategy of an
Yes, it is possible. CSR can be incorporated into the corporate and /
or marketing communications strategy of the organization. CSR could be
incorporated into the product strategy as well.
Q: How can CSR initiatives indirectly help in marketing products and
services of a given organization?
Although marketing primarily targets customers and consumers, other
stakeholders are indirectly targetted.
In the case of CSR, it is targetted at all stakeholders.
Hence, CSR activities are noticed and if appreciated, creates
enormous goodwill for the organization and the products / services
This goodwill results in consumer loyalty and trust, and increased
Q: Shareholders are generally against CSR initiatives, since they
believe that unnecessary resources are utilized, at their expense. Your
thoughts on this?
Yes, this is correct. Shareholders' prime motive is profit
maximization and the dividend. Hence they do not see the need to engage
in CSR activities.
However, if CSR initiatives are planned based on the organization's
vision and mission, then shareholders will reap greater benefits in the
medium to long term. This is as a result of the goodwill that is created
and the enhancement of corporate brand value.
Q: How should an organization select CSR activities to engage in?
Any CSR initiative should be in-line with the vision, mission and
values of the organization. For example if a company is operating in the
knowledge business, then all CSR activities should be related to
education. In this way, the company can easily reject CSR initiatives
that are outside their core business.
Once the CSR initiatives are identified, all stakeholders must be
educated and informed.
This will enable the company to execute the CSR initiatives without
Q: Do CSR activities add value to the corporate brand or product
In fact CSR adds value to both. Generally the corporate brand is
enhanced, followed by the product brands. As the brand equity increases,
customer loyalty starts to grow, resulting in high sales volumes and
profits. The ultimate beneficiary is the shareholder. (In the medium /
Q: Who is responsible for CSR/CR activities in an organization?
In larger organizations, CSR Managers are responsible. In the case of
smaller organizations, Marketing Managers take responsibility. Either
way, there has to be leadership and planning to carry out CSR activities
Q: Is CSR the same as the TBL (Triple Bottom Line)?
TBL refers to economic, social and environmental initiatives, that
are engaged in simultaneously. It is currently a kind of balanced
scorecard that captures in numbers and words the degree to which any
company is or not creating value for its shareholders and for society.
Since, TBL addresses social concerns, CSR activities can be aligned to
it. However, CSR is not the same as TBL.
Q: Any advice to organizations engaging in CSR/CR initiatives
Do not carry out CSR activities in an ad-hoc manner. Develop a clear
plan with budgets allocated. (This should include the objectives to be
attained). All CSR initiatives should be measured to judge their
effectiveness. Surveys amongst all stakeholder groups should be
conducted. Do not advertise and make commercial value of CSR
initiatives. Let WOM (word-of-mouth) do the talking, supported by
limited PR initiatives.