How CSR Affects Customer Trust, Brand Image and Behavioral Loyalty? An Empirical Study in Hotel Industry

Abstract

In the nearest six decades, the concept of corporate social responsibility was popularized in western academic area. Among the great deal of relevant studies about CSR in literatures, a portion of researches have indicated that CSR are influencing the improvement of customer loyalty (e.g., Choi and La, 2013; Martinez et al., 2014; Perez and Bosque, 2015). In terms of business practices, being capable and being ethical have been essential elements for business corporations throughout history. The concept of CSR had been coined for contemporary development, and corporations are increasingly integrating CSR programs into business strategies in an attempt to generate benefits for branding or financial positively. Recent researches have shown that Chinese consumers reacted positively to CSR information when purchasing thus indicating a higher level of support towards CSR compared with Western counterparts (Ramasamy and Yeung, 2009; Tian et al. 2011). However, there are limited studies which assess the responses of Chinese customers on CSR within a particular industry or corporate entity. This study aims to examine the relationship between various dimensional performances of CSR and customer behavioral loyalty in hotel industry of China. To be more specific, the purpose of this research is to focus on how CSR impacts on customer behavioral loyalty within the hotel industry, and examine whether brand image and customer trust have different mediation effects among the relationships. Three dimensions of CSR: Customer, Employee and Society are measured within the study, and impacts among various groups of customers are differentiated in evaluation. Investigations are approached through a questionnaire survey conducted primarily by face-to-face and online channels. This survey is targeting hotel guests who have a history of staying at hotels in China. There are a total of 259 hotel guests were eligible for the questionnaires. After data collection, relationships among the three CSR dimensions and behavioral loyalty with mediating effects by brand image and customer trust are examined. Study also analyzed the effects of customers’ demographic features; and correlated to the CSR dimensions and behavioral loyalty. Research findings indicate that hotel CSR performances of customer, employee and society produce positive effects on customers’ behavioral loyalty in China. Two mediators (brand image and customer trust) significantly affect customer’s brand perception with customer trust being more influential. The impact of CSR customer dimension has a stronger effect on behavioral loyalty. In addition, CSR’s effectiveness varies among different segments defined by customers’ characteristics. The corresponding results of this study are expected to provide practical reference for Chinese hoteliers to better evaluate their CSR strategies and enhance customer behavioral loyalty, thereby achieving sustainable competitive advantage and corporate financial growth.