12 August 2021

The impact of CSR on brand perception: COVID’s role in the relationship

Katie Perez
Written by Katie Perez Content & Campaign Lead

Previously we shared a blog in which we explored CSR, what it is, what it involves and why organisations should embrace it. Since publishing this, the world has been rocked by COVID-19, with so much change having taken place. We set out to explore the continuing significance of CSR activities and their impact on brand perception, which has become more important than ever during the pandemic.

 

Corporate Social Responsibility (CSR) has been a business buzzword for decades now. You may also hear it being referred to as ‘corporate citizenship’. Ultimately, CSR encapsulates an organisation’s commitment to bettering social, economic, ethical and environmental aspects of a society. This may be within the organisation’s internal society, the society that the organisation works in or provides services to, or perhaps more widely and better still – across all of these! Payson Johnston simplifies this by saying “CSR is about the obligation of companies to do ‘good’ and convey to the wider public that they are a ‘good’ company with ‘good’ values”.

 

Investisdigital highlight that in the past, CSR was viewed as a management issue where companies were defensive of their reputation. Now, it is viewed as an effective marketing tool and an opportunity for business growth. The conversation surrounding CSR has grown to be consistent and constant, resulting in deep and substantial interaction across multiple platforms. CSR is no longer about your organisation’s environmental policies alone but can include global pandemic responses and prioritising diversity and inclusion within your teams.

 

CSR has been viewed as a benefit to organisations for some time. Research has shown that consumers have a positive attitude to CSR; they believe organisations have an obligation to contribute to society positively and are interested in receiving more information around CSR topics. Further research by Nielsen shows that 67% of respondents prefer to work for socially responsible companies and that consumers will even pay higher prices for products and services from organisations that make a positive impact through CSR. This further highlights the positive impact that CSR has on attracting top talent and supporting higher profits, but has this changed since COVID-19 entered our lives?

 

In 2020 the entire world was impacted and with that so were the expectations surrounding CSR. COVID-19 in some ways brought organisations closer together, and made entire industries feel much more connected. Forbes reported on the many large businesses pulling together and offering support to their smaller counterparts as part of their CSR initiatives. GWI’s research showed that 72% of consumers view companies behaving sustainably as more important because of COVID-19. In fact, for the first time, when consumers were asked what they wanted brands to put more focus on, ‘supporting people’ and ‘being eco-friendly’ surpassed ‘offering value for money’ and ‘producing high-quality products. We conducted some of our own research which highlighted how trust in organisations has improved over the pandemic. Pre-pandemic, trust was low with 62% saying their organisation shared only good news, however during the pandemic this reduced to 32%. Trust was improving because companies were perceived as being more truthful, more engaging, and more innovative with their audiences. This shift has been a positive one; it’s vital that businesses do not let this slip and continue to foster this open approach to communication.

 

It could be argued that regardless of the impact of COVID-19, CSR would have remained more important than ever due to the changing dynamics within the workforce and consumer populations. The Institute of Leadership & Management reminds us that millennials (those born between 1980 and 2000) now make up more than 50% of our workforce and Gen Z are swiftly entering the workforce too. Research shows that CSR is increasingly important to younger generations with millennials being two times more likely to invest in companies targeting social or environmental goals, and 75% of millennials willing to take a pay cut to work for a responsible company. While ultimately the importance of CSR was always going to increase across all audiences, COVID-19 has accelerated that growth.

 

How can CSR impact brand perception?

 

So, what is brand perception and why is it deemed so important? Well, brand perception is what customers and stakeholders believe about an organisation regardless of what the brand says it is or does. Brand perception is linked to the personality of that brand and is developed through interactions between the brand and its stakeholders. Your brand has the power to influence stakeholder behaviour; for example, 60% of customers will tell friends and family about a brand that they are loyal to. You can shape brand perception through every touchpoint you have with an audience and there are various strategic tools available to do so.

 

The average person receives up to 10,000 brand messages a day, so how can companies stand out from the crowd? One way is through CSR. It has become a major driver of corporate reputation and can provide a competitive edge in a very crowded marketplace. Research has found that CSR boosts brand perception which acts as a fantastic predictor of brand equity with CSR activities influencing 42% of a brand image for consumers. The key here is authenticity, we mentioned earlier the importance of audience trust in organisations. Your communications around CSR should be reactive as well as proactive, focused on being informative rather than commercial and should be holistic with collaboration throughout the organisation. CSR should sit true to your organisation’s values and if you are transparent in your communications around them, you can successfully build a legacy of trust that resonates with all your stakeholders and generates a positive brand perception.

 

CSR has always been close to our hearts at DRPG, and we are great advocates of its benefits to our brand as well as to our individual stakeholders, especially our employees. If you fancy some more inspiration you can take a look at our CSR Charter and our recent review where we outline the next steps that we have planned. Now is not the time to hold back, we implore you to act and review your CSR policies and communications!

 

Key takeaways:

  • COVID-19 has accelerated the importance of CSR and the impact it has on brand perception
  • Generally, consumers place a higher value on the importance of CSR and will hold companies accountable if they are falling short
  • Companies that communicate effectively about their CSR activities benefit by being more attractive to top talent, and have been seen to achieve higher profits and a greater influence over stakeholder behaviour
  • It is vital to remain authentic in your communications, through being truthful and transparent, reducing scepticism and developing positive brand perception

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