Companies operating in the current era are taking corporate social

responsibility much more seriously than they did in the past. One reason
for this is the clear link between CSR and competitive advantage.

Advantages of corporate social responsibility

 Brand awareness

• Research has shown the positive relationship between CSR and brand awareness.
In fact, according to Harvard Business Review, over 42 academic studies have
shown positive correlations between social enterprises and financial
performance. As one report from Havas Media Group notes, these “purpose-
driven” brands– those whose functions go beyond just making money–
outperform the stock market by 120 percent.

• Corporate social responsibility can be used not only as a powerful marketing tool,
but also a sharp brand positioning tool. The best types of CSR engrain initiatives
into the brand story and become part of the business.
  Customer trust and loyalty

• Consumer trust for and loyalty to brands isn’t what it used to be (hence the
success of popular reviews sites like Amazon, Yelp, and TripAdvisor for third-party
opinions). According to a study done by Nielsen, however, 62 percent of global
consumers see brand trust as one of the top sustainability factors for making
purchasing decisions. For brands to be able to elicit trust and loyalty, CSR
initiatives can help raise the bar of trust.

• It found that while just 32 percent of people trust a brand, 54 percent trust the
ones that are socially or environmentally responsible. This trust includes things
like transparency about where the products came from (Starbucks), the
environmental impacts of the company’s production (Innocent Drinks), or the
calculable results of the company’s CSR efforts (Apple).
 Customer engagement

Customers want to feel like they’re contributing to the greater good,

even if they’re just buying a product or using a service. By having a
socially responsible company, customers can feel as if they are
participating in the charitable efforts that the company supports,
whether actively or passively.
 Customer advocacy

• As social media continues to play a big role in advocacy marketing, corporate

social responsibility acts as fodder for customers who want to spread the word
about their responsible and sustainable purchases. This is especially true for
customers who are willing to spend more on products from companies with a
notable CSR strategy.
• Running campaigns to help promote CSR initiatives can be an especially effective
way to encourage customer advocacy. Environmentally friendly plant-based
cleaning company Seventh Generation has done a good job of creating customer
advocacy with its #ComeClean campaign.