Do perceived CSR initiatives enhance customer preference and loyalty in casinos?

Abstract

Purpose – This study aims to investigate how perceptions associated with corporate social responsibility (CSR) initiatives influence customers’ preference and loyalty in a controversial consumer market. The mediating effect of brand preference between perceived CSR initiatives and customer loyalty is also examined. Design/methodology/approach – The methodology in the current study involves the use of questionnaire surveys delivered to a convenience sample in the city of Macau in 2012. A total of 616 valid samples were collected among casino players in a high bet limit area in six major casinos. Regression analysis was used to test the hypotheses formulated for carrying the study forward. Findings – The findings indicated that customers’ brand preference can be enhanced by their perceptions on CSR. Two CSR initiatives (stakeholders and society) significantly increase loyalty intention, although to varying degrees. The impact of CSR on stakeholders has a stronger influence on customers’ brand preference. Another important finding of the current study is the fact that brand preference is a partial mediator of perceived CSR initiatives and customer loyalty. Research limitations/implications – This study verified the relationship among CSR initiatives perception, brand preference and loyalty intention in the context of the Macau gaming industry. Perceived CSR initiatives enhance customer loyalty. Additionally, this study found a partial mediating effect of brand preference between CSR perception and customer loyalty. Practical implications – Customer loyalty can be enhanced with companies’ appropriate investments in social responsibilities. Although a socially responsible brand image of a company is not guaranteed to be a competitive advantage that attracts more premium customers, there is a general consensus that it may result in the latter with appropriate CSR strategies involving the greatest attention directed toward improving stakeholders’ interests. From the marketing perspective, retaining premium customers with a higher brand preference level is a key to both long-term competitiveness and profitability. Originality/value – This study investigates how premium customers’ perceived CSR initiatives of a casino influence their loyalty intention, and also examines how brand preference, as a mediator, influences the relationship between perceived CSR and loyalty intention. Extending the realm of CSR study to understand the linkage between CSR and customer behaviors is also important because multiple theories predict different benefits, and assessing the value of CSR, therefore, requires multiple approaches. Finally, evidence from the research is significant for researchers and practitioners, especially when working on conflicting issues.