Makalah DR Sabrina Oktoria Sihombing, M Bus

MODELING AND TESTING
THE EFFECTS OF CAUSE RELATED

MARKETING, CORPORATE REPUTATION,
AND BRAND IMAGE ON BUYER ATTITUDE
AND PURCHASE INTENTION
SABRINA OKTORIO
Simposium Riset Ekonomi II

Surabaya, 23-24 November 2005
Modeling and Testing the Effects of Cause Related Marketing, Corporate
Reputation, and Brand Image on Buyer Attitude and Purchase Intention
ABSTRACT
This research developed a model to analyze the effects of

cause related marketing (CRM), corporate reputation, and
brand image on buyer attitude and purchase intention. The
research shows that the CRM can have positive influences
on corporate reputation and brand image. However, CRM
does not effect on buyer attitude. Implications for both
theoretical as well as managerial are presented.
Key Words: CRM, Corporate reputation, Brand image, Attitude, Intention
Introduction
Corporate social responsibility (CSR) has become a significant phenomenon in
today’s business condition. The phenomena is emerged from several key factors such
globalization, consumer movement, investors, and communities (van den Berghe, Baeten,
& Somers, 2005; Hirschhorn, 2004; Raynard & Forstater, 2002; Assael, 1998). Those key
factors require that corporate should concern not only to their shareholder, but also to
stakeholders, such as employees and society (Ruggie, 2005). Moreover, CSR has become
a standard for corporate in running their business (Cronin, 2001).
There are many ways in which companies can apply CSR. For instance, CSR can be
applying in the context of marketing. Specifically, companies can link with a charity for
the benefit of itself as well as addressing social issues. This activity is known as cause
related marketing (CRM) (Adkins, 1999).
This research was inspired by a cause related marketing program, that is, Lifebuoy
Sharing Health. The program was a purchase-triggered donation, that is, a purchase of
Lifebuoy soap from July to August 2004 resulted in a donation to help building better
sanitation in several parts of Indonesia. Thus, there are two main objectives of this
research: (1) to understand LHS program as an implementation of CSR activity, and (2)
to model and test the effects of cause related marketing, corporate reputation, and brand
image on buyer attitude and purchase intention. The model developed should contribute
to understanding consumer behavior.
This paper is organized into five sections: justifications of the research, a review of
the relevant literature and hypotheses, the research method, the discussion of the results,
and conclusions of the research.
Justifications of the Research

This research can be justified on these two grounds as follows: (1) the importance of
cause related marketing to solve social problems, and (2) potential outcomes for
marketers and corporate.
The importance of cause related marketing to solve social problems. The increased
attention of CSR has influenced corporate to involve in the environment in which they
operate. Thus there is a change in the application of the marketing concept. The
marketing concept then include more than just the profit goals of marketing program but
also the awareness of social needs. That is, social problems can be coped with marketing
program (Maignan & Ferrell, 2004; Adkins, 1999; Lazer & Kelley, 1973).
The corporate concern on social issues has increased the practice of CRM. In other
words, corporate concern on their communities, whilst at the same time promoting their
products and brands, based on mutual benefit relationships (Adkins, 1999). For example,
American Express card campaigned ‘Share Our Strength’ in 1993 to 1996. The company
donated 3 cents per card purchase and other transactions to reduce hunger. Another
example is Coca-Cola, which donated 15 cents to Mothers Against Drunk Driving for
every case of Coca-Cola bought during a 6-week promotion in more than 400 Walt-Mart
stores in 1997. Similarly, Persil, a great Britain’s leading laundry detergent created an on-
pack promotion to fight poverty and injustice in 2001 (onPhylanthropy.com, 2005:
Adkins, 1999). In short, CRM activities can solve social problems.
Potential outcomes for marketers and corporate. CRM is a commercial activity by

which corporate and charities form a partnership for mutual benefit (Suter, 1995; Adkins,
1999). Furthermore, CRM is a strategic not tactical (Pringle & Thompson, 1999). The
implementation of CRM give benefits for corporate such as positive corporate reputation,
brand image, and positive consumer attitude toward brands (Skory & Repka, 2004;
Adkins, 1999). However, marketers’ responses to CRM appear to have neglected to
understand consumer attitudes (Endacott, 2004). Moreover, limited empirical works has
been conducted to examine CRM and its effects on buyer decision-making (Suter, 1995;
Maignan & Ferrel, 2004), especially in Indonesia. On the other hand, information about
consumers is a powerful tool in any business (Kardes, 1999). Therefore, this research
aims to testing the influences of CRM on several factors (i.e., corporate reputation, brand
image, buyer attitude, and purchase intention) in Indonesia. The result of this study may
contribute to the increase of CRM practices in Indonesia.
Literature Review & Hypotheses
Corporate Social Responsibility

Corporate Social Responsibility (CSR) is defined as defined as companies’
responsibility to range of stakeholder groups that include: customers, employees,
suppliers, shareholders, the political arena, the broader community, and the environment
(Adkins, 1999). The CSR concept can be considered as a company’s willingness to not
just fulfill stakeholder obligations but to do more (Commission 2001, cited by Cronin
2001). In other words, CSR also can be considered as “putting something back into the
community” (Worthington, Ram, & Jones, 2003).
The awareness of social responsibility has been recognized in marketing context. In
particular, Kotler and Levy (1969) and Lazer and Kelley (1973) pointed out social roles
in marketing concept. Thus, the field of social marketing has emerged and has focused in
Ikatan Sarjana Ekonomi Indonesia (ISEI)
Cabang Surabaya Koordinator Jawa Timur 3
the contribution of marketing activities to the society and environment (Lazer & Kelley,
1973).
In communicating social marketing, cause related marketing (CRM) can be a visible
activity to demonstrate corporate social responsibility whilst at the same time building the
business (Adkins, 1999). Moreover, Adkins (1999) pointed out that CRM is an effective
marketing tool in addressing social issues. In short, the CRM concept can be applied to
maximize marketing contribution to its society.
Cause Related Marketing

CRM is a marketing activity (Vadarajan & Menon, 1988). It is defined as the process
of formulating and implementing marketing activities that are ‘a commercial activity by
which business with a product, service or image to market builds a relationship with a
cause or a number of causes for mutual benefit’ (Adkins, 1999, p.11). Furthermore, the
CRM is the ‘win-win-win’ scenario, which is, the charity or cause and business win and
where the benefits go to consumer and other stakeholder (Pracejus, Olsen, & Brown,
2005; Adkins, 1999; Suter, 1995). In other words, mutual benefit is the bases of the
partnership. It is the main objective of CRM.
CRM is the alignment of corporate social responsibility and business practices (Suter,
1995). It is a form of demonstrating the organization’s corporate social responsibility. In
other words, CRM can bring the words and vision of the corporate to life; to demonstrate
the values through action, ‘to walk the talk’ and to ensure that all internal audiences and
partners buy into and feel part of that vision, believe it and believe in it (Adkins, 1999,
p.32).
CRM can be applied in several forms such as advertising, sponsorship, public
relations, direct marketing, and sales promotion (Adkins, 1999; Suter, 1995). However,
CRM is often applied in the form of sales promotion, that is, donations to causes is
triggered by purchase (Adkins, 1999). For example, PT Unilever Indonesia launched a
program called ‘Lifebuoy Sharing Health’ which the company donated Rp 10,- from
every purchase of Lifebuoy in July – Augustus 2004. The donation was planned to
hygiene education and build health sanitation.
Corporate Reputation
Corporate reputation is defined as a stakeholder’s overall evaluation of a company
overtime (Gotsi & Wilson, 2001). It is formed by the company’s various publics on the
basis of information and experience (Caruana, 1997).
The role of corporate reputation has been emphasized in marketing and consumer
behavior research. More specifically, corporate reputation is a crucial factor in consumer
decision-making (Endacott, 2004; Einwiller, 2001). For company’s perspectives, a
company with a good reputation owns a valuable asset (Caruana, 1997). Furthermore, a
good reputation provides a competitive advantage (Burke & Logsdon, 1996, cited by
Husted, 2001).
CRM activities are an effective way of enhancing corporate reputation, differentiating
products and increasing both sales and loyalty (Cadbury, 1996, cited by Pringle &
Thompson, 1999). Several research summarized by Endacott (2004) suggests that
consumers are influenced their buying decision by CRM activities. In other words,
consumers have favorable opinions and more likely to buy a product from companies that
support good cause. Furthermore, companies that act in socially responsible ways have
positive reputation and also their products and services.
Thus, it is hypothesized that:
H1 : The CRM activity will be positively related to the consumer perception of corporate
reputation.
Brand Image
Research on brand has continued to be an important topic for both researchers and
managers (for example, Del Rio, Vazquez & Iglesias 2001; Low & Lamb 2000; Keller
1993). For managers, a brand is a valuable business asset that can be used as a core
component of a company’s strategy (del Rio, Vazquez & Iglesias 2001; Calderon,
Cervera & Molla, 1997; Urde, 1994). It is also a critical factor to the success of the
companies in the competitive market (Urde, 1994). In addition, a company image can be
built by brands because brands advertise the quality and the size of the company (Kotler
2000). For researchers, a relationship between brands and customers has advanced the
researchers in order to understand whether, why and in what form consumers buy brands
(Webster, 2000).
The understanding of brand image has become important themes for marketing and
consumer behavior domains. Brand image is defined as the perception about a brand in
the consumer memory (Keller, 1993). It is the consumers’ perceptions of the brand’s
tangible and intangible associations (Engel, Blakwell & Miniard, 1993) and it is a main
physical features and appearance (Ataman & Wengin, 2003).
CRM has the potential to have direct impact on brand image. CRM can enhance brand
image of products or services (Adkins, 1999). Furthermore, a research conducted by
BITC (cited by Adkins, 1999) pointed out that CRM activities had a highly positive
impact on consumer perceptions of a product or service.
Thus, it is hypothesized that:
H2: The CRM activity will be positively related to brand image.
Consumer Behavior
The understanding of consumer behavior is a main key to company marketing
program (Assael, 1998). In specific, the awareness and understanding of consumer
behavior contribute to the success of the companies’ product and services.
In marketing, brand image and corporate reputation stimulate purchase by simplifying
decision rules (Andreassen, 1994). Specifically, brand image influences consumer
attitude. Furthermore, individual with little or no experience on specific brand may base
their attitude on corporate reputation. Thus, reputation and brand image as important
factors in influencing consumer attitude (Cretu & Brodie, 2005; Andreassen, 1994).
Based on discussion on CRM, corporate reputation, and brand image, it is
hypothesized that:
H3: The CRM activity will be positively related to buyer attitude towards buying the
product.
H4: Corporate reputation will be positively related to buyer attitude towards buying the
product.
H5 : Brand image will be positively related to buyer attitude.
According to theory of reasoned action (TRA; Fishbein & Ajzen, 1975; Ajzen &
Fishbein, 1980), person’s purchase intention is determined by person attitude. Attitude is
overall evaluation persons have toward objects, events, or people. Thus, it is
hypothesized that:
H6 : Buyer attitude will be positively related to buyer purchase intention.
Figure 1. Proposed Main Research Model
Corporate
H1 Reputation H4
H3 H6
Cause-Related Attitude Purchase
Marketing Intention
H2 Brand Image H5
Research Method
Method. This research was a triangulation study, that is, the research used qualitative and
quantitative data (Olsen, 2004). The use of multiple data resulted in a richer description
(Olsen, 2004). Furthermore, triangulation is as convergent validity (Bryman, 2003; Olsen,
2004). Qualitative method, involving one-on-one depth interviews with brand manager
and brand personnel of PT. Unilever Indonesia, were conducted to better understand on
LHS program.
Research Instrument. The process of questionnaire design as outlined in: (1) buyer
perception of cause related marketing program, (2) buyer perception of corporate
reputation, (3) brand image, (4) attitude toward buying the brand, and (5) intention
toward buying the brand.
Cause related marketing, corporate reputation, and brand image were viewed from the
perspective of the consumer (Einwiller, 2001; Caruana, 1997). Specifically, exploratory
research was initiated to identify the attributes that determine cause related marketing,
corporate reputation, and brand image. The exploratory research sought to develop a set
of items about cause related marketing, corporate reputation, and brand image. Then,
most items were subject a survey in order to develop an instrument as recommended by
Churchill (1979).
Data Collection. This research applied purposive sampling, that is, respondents of this
research should ever buy Lifebuoy soap in the last of 6 months of the research. A total of
216 students participated. This survey used a student sample for three reasons. The first
reason is the convenience in recruiting the subjects. The second reason was that
university students are an appropriate sample for this research. The third reason was that
using one group such as a student group decreases the possibility of sample heterogeneity
(Kerlinger & Lee, 2000; Calder, Phillips, & Tybout, 1981).
The sample size played role in the data analysis technique of structural equation
modeling. A sample size of 200 and above but not exceeding 500 as suggested by Hair et
al. (1995) was applied in this research.
Cause Related Marketing. In this study, the CRM concept is measured by buyer
perceptions to a specific marketing program (i.e., Lifebuoy Sharing Health). More
specifically, respondents were asked about their perceptions on seven statements. For
instance, their perceptions toward the benefits of CRM to the society and the poor, the
impact of the activity toward the growth of people solidarity, and the impact of the
activity on environment quality.
Brand Image. This research applied the definition of brand image as suggested by
Timmerman (2001) that brand image should: (1) as representative of the brand
understudy and present in the respondent’s memory, and (2) relevant to the brand. Based
on this definition, the researcher. Respondents were asked about their perceptions on five
statements, for example: the fragrance of the product, the soap for health, and the price of
the product.
Company Reputation. As with brand image, this research applied a customized measure
of corporate reputation (Caruana, 1997). Specifically, this research applied exploratory
research to identify the attributes that determine corporate reputation (i. e., PT. Unilever
Indonesia, Tbk), such as the company concern toward the social problems and
environment.
Attitude. The attitude toward buying the brand was assessed as a function of behavioral
beliefs and outcome evaluations. A measure of attitude toward buying the brand was then
computed by multiplying together each pairs of belief and evaluation.
Intention. Purchase intentions were measured with two items. The first item was worded
as follows: “I will buy that shoe”. The second item was as follows: “I intend to buy that
shoe”.
Pretesting. The purpose of the pre-testing was to refine the questionnaire before using it
in the actual survey (Malhotra, 2002). Respondents were asked to indicate their degree of
agreement or disagreement on a five-point Likert scale that ranged from 1 (strongly
disagree) to 5 (strongly agree). Items that exhibited corrected item-total correlations
below 0.3 were eliminated (Azwar, 1999). Then, item-total statistics were again
computed to achieve value greater than 0.3. The questionnaire was also assessed in terms
of reliability and validity. The cut-off point 0.7 (Hair et al., 1995; Bagozzi, Davis &
Warshaw, 1992) was applied as the cut-off point for coefficient alpha and composite
reliability. The threshold value for average variance extracted (AVE) should achieved
value greater than 0.5 (Hair et al., 1995). Regarding with validity of measures, this
research applied factor analysis as a powerful and indispensable method of construct
validation (Kerlinger & Lee, 2000, p. 679). The VARIMAX rotation was applied because
this method gives the best results concerning the distinction of the extracted factors (Hair
et al., 1995).
Data Analysis. To test research hypotheses, structural equation modeling (SEM) analysis
was applied in this research. This method was used because SEM has ability to assess the
relationships comprehensively (Hair, Anderson, Tatham, & Black, 1995). Maximum
likelihood (ML) was applied as an appropriate estimation method in this research. The
major reason was the method is robust to violation of the normality assumption
(Tabachnick & Fidell, 1996; Hoyle & Panther, 1995). However, on non-normal data, χ2
and standard error cannot be trusted (Bagozzi & Baumgartner, 1994). Therefore, the ML
estimation applied in this research used χ2 adjusted which termed as CMIN/DF
(Steenkamp & Van Trijp, 1991; Bentler & Chou, 1987).
The research model shown in Figure 1 represents the structural model being
examined. The model showed the relationships among theoretical constructs. The test of
measurement model intends to verify the reliability coefficients of the measures and the
convergent and discriminant validity of the measures. This research used several indices
to evaluate the measurement model, that is, the individual item reliability, latent variable
composite reliability, the average variance extracted (AVE), discriminant validity, and
convergent validity.
Competing Model. A competing model represents the comparison of models in order to

determine the best-fitting model from a set of models (Hair et al., 1995). Furthermore,
Hair et al (1995, p.667) pointed out that the importance of competing models for all
structural equation models to assure the researcher that the proposed model is the “best”
model available. The proposed model is as shown in Figure 1. Three competing models
were developed for testing. The first competing model suggests that CRM is not only as
predictor of buyer attitude but also as a predictor of purchase intention (Figure 2). The
second competing model suggests that brand image is added as a predictor of purchase
intention (Figure 3). Finally, the third competing model that shows that corporate
reputation is a predictor of purchase intention (Figure 4).
Figure 2. Competing Model 1 (compmod1)
Corporate
Reputation

Marketing Intention
Brand Image

Corporate
Reputation

Marketing Intention
Brand Image
Corporate
Reputation

Marketing Intention
Brand Image
Results
Findings from the In-depth Interview

PT. Unilever Indonesia and Corporate Social Responsibility
PT. Unilever Indonesia (PT. UI) has been operating in Indonesia since 1933. The
company produces a range of products such as soaps, shampoos, tea, ice cream and
others. PT. UI applies and demonstrates the corporate purpose by engaged in four major
themes: SME development, a clean campaign, sustainable fishing, and sustainable public
health education (Pranatadjaja, 2004). Furthermore, PT. UI set up the PT. ULI Peduli
Foundation in 2000, to implement corporate social responsibility.
PT. UI believes that as a business, the company depends on a healthy environment.
One important part in an environment is water. The need of water for the company can
be described as follows:
“We need water to produce our products and the consumer needs clean water to
use and consume them. No water: no washing, no cooking, no tea. It’s simple as
that.”
In relating with health issues, PT. UI uses the Lifebuoy brand in order to address
health problems and social challenges. Lifebuoy campaigns focus on the importance of
cleanliness. In specific, washing hands is one important message that is campaigned by
Lifebuoy in order to reduce the incidence of diarrhea significantly, one of the main causes
of mortality in Indonesian children.
Lifebuoy and Cause Related Marketing

One newest Lifebuoy program is known as ‘Lifebuoy Sharing Health’. The program
is a sales promotion type approach where a percentage of the product price is donated to
charity. In short, donations to a cause are triggered by consumer purchase.
The main theme of the program is health education. However, health improvement is
linkage with a healthy environment. In specific, the program focuses on sanitation and
water supply as crucial factors that related to health education. One theme in health
education is the importance of cleanliness, that is, washing hands.
Washing hands can reduce the incidence of diarrhea significantly. Diarrhea can be
transmitted by several factors such as dirty hands, flies, and inadequate sanitation. All of
the transmission can be blocked by changes in hygiene attitude and behavior. Improved
sanitation can also contribute to preventing transmission. In short, PT. UI believes that
the development of sanitation infrastructures do not and will not by itself improve health.
Thus, in order to get maximum benefits out of improved and development of sanitation
infrastructures, people need to be supported with hygiene education. Box 1 provides the
key features of the program.
Box 1. Key Features of Lifebuoy Health Sharing

Name of the program Lifebuoy Sharing Health
Fund PT. UI donated Rp 10,- for every

purchase Lifebuoy soap in
July – Augustus 2004
Program duration 10 months (2004-2005)
Main objectives * Hygiene behavior

* Improved sanitation
infrastructures
Primary target * Mothers

* Children
Channels of communication * Advertising (television, maga-

zines, radios, newspapers)
* Hygiene education in primary
school (school visit)
Partners * Coalition for Healthy Indonesia

* Coalition for Healthy West Java
* Indonesian Doctor Organization
* Care International Indonesia
Source: personal interview with Lifebuoy Senior Brand Manager

Actual Survey
In this research, a questionnaire was administered to a total sample of 250
respondents. The usable sample after eliminating incomplete questionnaire consisted of
216 respondents. The 216 usable questionnaire lead to 86.4 % response rate.
The instrument was assessed for reliability and validity. Evidence of reliability was
found as shown in Table 1. Composite reliability, which is analogous to Cronbach α
(Fornell & Lacker, 1981 cited by Netemeyer, Durvasula & Lichtenstein, 1991), were over
0.70. The Cronbach α were also over 0.70. Average variance extracted (AVE) was also
computed. According to Hair et al. (1995), a level of 0.50 or greater supports the
consistency among items in a scale. Furthermore, an assessment of the corrected item-to-
total correlation resulted in the range 0.3112 to 0.8285.
Table 1. The Cronbach α, Composite Reliability and AVE of Variables

Cronbach α Composite AVE
Reliability
CRM 0.7457 0.754 0.987

Company Reputation 0.7138 0.733 0.988
Brand Image 0.7112 0.712 0.996
Buyer Attitude 0.7615 0.790 0.695
Purchase Intention 0.9060 0.906 0.975
Table 3 show the variable correlation ranged from 0.261 to 0.671 and significantly
different from one, showing discriminant validity. In addition, a consistent pattern
between criterion and predictors is supporting for the nomological validity (Cronbach &
Meehl, 1955, cited by Netemeyer et al., 1991).
Table 3. Correlation among Variables

Comp.
CRM Rep. Brand Attitude Intention
Image
CRM 1
Comp. Rep. .297** 1
Brand Image .298** .314** 1
Attitude .380** .354** .671** 1
Intention .327** .261** .448** .632** 1
** Correlation is significant at the 0.01 level (2-tailed)
Table 4 shows the comparison of the four models on goodness-of-fit measure.

Competing models were examined in this research to assure that the proposed model is as
the best model. The results show that the proposed model is the best model compares to
other competing models. Furthermore, the overall fit of the model was reasonable fit.

Table 4. Comparison of Goodness-of-Fit Measure for the Proposed Model and
Competing Models
Level of Proposed Competing Models

Goodness-of-Fit Measure Acceptable Fit Model Compmod1 Compmod2 Compmod3
Absolute Fit Measures
CMIN/DF >5 2.919 2.933 2.929 2.939
GFI >0.90 0.823 0.823 0.822 0.823
RMSEA <0.80 0.094 0.095 0.095 0.095
Incremental Fit Measures

AGFI >0.90 0.770 0.769 0.767 0.768
TLI >0.90 0.797 0.796 0.796 0.795
NFI >0.90 0.762 0.762 0.763 0.762
Parsimonious Fit Measures

PNFI Higher values indi- 0.650 0.646 0.647 0.646
cate better fit
PGFI Higher values indi- 0.632 0.628 0.627 0.628
cate parsimony
To examine the structural relationships, the hypothesized paths were estimated and
most hypotheses (H1, H2, H5, H6) were supported as shown in table 5.
Table 5. Parameter Estimates for Structural Paths

Hypotheses Path Standardized CR Hypotheses
regresion Verification
weight
H1 CorpRep <-- CRM 0.413 3.969 Yes

H2 BI <-- CRM 0.4230 3.981 Yes
H3 Att <-- CRM 0.126 1.538* No
H4 Att <-- CorpRep 0.133 1.869* No
H5 Att <-- BI 0.746 5.780 Yes
H6 Int <-- Att 0.707 10.006 Yes
CRM = cause related marketing Att = attitude
CorpRep = corporate reputation Int = intention
BI = brand image
* not significant

Hypothesis 1 stated that the CRM activity will be positively related to the consumer
perception of corporate reputation. This hypothesis was substantiated (CR = 3.969).
Furthermore, hypothesis 2 stated that the CRM activity will be positively related to brand
image. This hypothesis also was substantiated (CR = 3.981).
Hypothesis 3 stated that the CRM activity will be positively related to buyer attitude.
On the other hand, this hypothesis was not substantiated because the loading of attitude
Å CRM was not significant (CR = 1.538). Again, hypothesis 4, the relationship between
corporate reputation and attitude, was also not substantiated because the loading of path
was not significant (CR = 1.869).
Finally, this research supported hypothesis 5 (brand image will be positively related to
attitude, CR = 5.780) and hypothesis 6 (buyer attitude will be positively related to buyer
purchase intention, CR = 10.006).
Discussion
This research attempted to model and test the effect of cause related marketing,
corporate reputation, and brand image on buyer attitude and purchase intention. The test
results were mixed. Two hypotheses were not substantiated (that is, the relationship
between CRM activity and buyer attitude and the relationship between corporate
reputation and attitude). In relating with modeling the models, the finding from the data
suggests that the proposed model fits the sample data better than other models.
The rejection of the third hypothesis (that is, the relationship between the CRM
activity and buyer attitude toward buying the brand) may result from the brand chosen for
this research, Lifebuoy. Lifebuoy is one of the oldest and well-known soap brands in
Indonesia. Therefore, respondents may have their attitude toward the brand. This attitude
that formed by respondents was not influenced by CRM activities.
The relationship between corporate reputation and buyer attitude was also not
confirmed in this research. Though PT. Unilever Indonesia is a well-known company but
respondent in this research may not linked the company reputation with their attitude
toward buying the brand. The result in this research showed that brand image influenced
their attitude toward buying the brand.
Conclusion and Limitations

The understanding of consumer behavior is one key of organizational success. Thus,
this research examined the effect of CRM, corporate reputation, and brand image on
buyer attitude and purchase intention. This research has one main limitation, which signal
caution the generalisability of the results. This research was restricted to the examination
of one type of marketing program and one product.
Theoretical and Managerial Implications

The result of this research has both theoretical and managerial implications.
Theoretically, this research tested and supported that CRM as one marketing strategy that
can influence consumer perceptions on corporate reputation and brand image.
Furthermore, this present research applied the structural equation modeling method. The
result supports the convergent and discriminant validity of the scales.

Practically, this research supports that companies who adopt CRM may endeavour to
win support from consumers. Cause related marketing program could be a viable
promotional strategy for companies in order to enhance their company reputation and
brand image. Hence, the understanding of consumer behavior and its dynamics is crucial
for practitioner. The results of this study may offer an understanding the effects of CRM
to consumer purchase decision.

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CURRICULUM VITAE
Name : Sabrina Oktoria SIHOMBING
Address : Perum. Gedong Kuning Jl. Jeruk B8 Yogyakarta
Telephone : 0274 – 556757 (home)

0815 6851152 (mobile phone)
Office : Magister Manajemen STIE STIKUBANK

Jl. Kendeng V Bendan Ngisor
Semarang
E-mail address : sabrinasihombing@hotmail.com
Date of birth : October 16, 1970
Education
1999 – 2004 : DOCTORAL PROGRAM (MARKETING
MANAGEMENT) (Dr.)
Gadjah Mada University
Yogyakarta, INDONESIA
1994 – 1995 : MASTER OF BUSINESS (MARKETING

MANAGEMENT) (M.Bus.)
Queensland University of Technology
Brisbane, AUSTRALIA
1989 – 1993 : SARJANA EKONOMI (MARKETING

MANAGEMENT) (S.E.)
Satya Wacana Christian University
Salatiga, INDONESIA

Published articles
Sihombing, S.O. (2005). An Assessment of the Reliability and Validity of the

CETSCALE in Indonesia, Manajemen Usahawan Indonesia, 7, Juli, 23-28.
Sihombing, S.O. (2005). The Influences of Country-of-Origin, Consumer Ethnocentrism,

and Consumer Attitude Toward Purchase Intention of Domestic and Foreign Brand.
Jurnal Bisnis and Ekonomi, 12, 1, 1-22.
Sihombing, S.O. (2005). Predicting Intention and Behavior of Choosing a Brand: A

Comparison Between the Theory of Planned Behavior and the Theory of Trying. The
Journal of Accounting, Management, and Economics Research, 5, 1, 23-50.
Sihombing, S.O. (2004). Analisis Hubungan Sikap dan Perilaku Memilih Satu Merek: Uji
Theory of Trying. Jurnal Ekonomi, 3, 13, 53-68.
Sihombing, S.O. (2003). Perluasan Theory of Planned Behavior: Aplikasi pada Niat dan
Perilaku Memilih Satu Merek. Empirika, 16, 2, 187-213.
Sihombing, S.O. (2002). Paradigms in Consumer Behavior. Gadjah Mada International

Journal, 4, 2, 149-176.
Sihombing, S.O. (2002). Predicting Behavior from Attitudes: A Comparison between the
Theory of Planned Behavior and the Theory of Trying. Wahana, 5, 1, 19-34.
Sihombing, S.O. (2002). Teori Keunggulan Sumberdaya: Suatu Teori Kompetisi Baru,
Kajian Bisnis, 25, 97-109.
Sihombing, S.O. (2001). Pengaruh Sikap terhadap Iklan (Aad) dan Sikap terhadap Merek
(AB) terhadap Pilihan Merek: Suatu Analisa Empiris. Daya Saing, 2, 1, 31-53.
Sihombing, S.O. (2001). Empirical Generalizations and Lawlike Generalization in

Marketing Science. Economic Journal, 16, 2.
Sihombing, S.O. (2001). Memelihara Komitmen dalam Mengimplementasikan Strategi.

Manajemen, No. 153, pp. 8-9.


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MODELING AND TESTING

THE EFFECTS OF CAUSE RELATED

Simposium Riset Ekonomi II

This research developed a model to analyze the effects of

Key Words: CRM, Corporate reputation, Brand image, Attitude, Intention

Justifications of the Research

Potential outcomes for marketers and corporate. CRM is a commercial activity by

Literature Review & Hypotheses

Corporate Social Responsibility

Cause Related Marketing

Figure 1. Proposed Main Research Model

Competing Model. A competing model represents the comparison of models in order to

Figure 2. Competing Model 1 (compmod1)

Cause-Related Attitude Purchase

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Cause-Related Attitude Purchase

Figure 4. Competing Model 3 (compmod3)

Cause-Related Attitude Purchase

Findings from the In-depth Interview

Lifebuoy and Cause Related Marketing

Box 1. Key Features of Lifebuoy Health Sharing

Fund PT. UI donated Rp 10,- for every

Program duration 10 months (2004-2005)

Main objectives * Hygiene behavior

Primary target * Mothers

Channels of communication * Advertising (television, maga-

Partners * Coalition for Healthy Indonesia

Source: personal interview with Lifebuoy Senior Brand Manager

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Table 1. The Cronbach α, Composite Reliability and AVE of Variables

CRM 0.7457 0.754 0.987

Table 3. Correlation among Variables

Table 4 shows the comparison of the four models on goodness-of-fit measure.

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Level of Proposed Competing Models

Incremental Fit Measures

Parsimonious Fit Measures

Table 5. Parameter Estimates for Structural Paths

H1 CorpRep <-- CRM 0.413 3.969 Yes

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Conclusion and Limitations

Theoretical and Managerial Implications

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Bagozzi, R. P, Davis, R. P. and Warshaw, P. R. (1992). Development and Test of a Theory of

Cronin, C. (2001). Corporate Social Responsibility in Australia: A Select Review of the

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Ferrel, O. C. and Margnan, I. (2004). Corpores and Marketing. An Integrative Framework.

Girod, S. and Michael, B. (2005). Branding in European retailing: a corporate social

Gotsi, M. and Wilson, A. M. (2001). Corporate Reputation: Seeking a Definition, Corporate

Hemingway, C. (2002). An Exploratory Analysis of Corporate Social Responsibility: Definitions,

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Korchia, M. (1999). A New Typology of Brand Image. European Advances in Consumer

Malhotra, N. K. (2002). Basic Marketing Research: Applications to Contemporary Issues. NJ:

Olsen, W. (2004). Methodological Triangulation and Realist Research: An Indian Exemplar. In

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Ikatan Sarjana Ekonomi Indonesia (ISEI)

Name : Sabrina Oktoria SIHOMBING

Address : Perum. Gedong Kuning Jl. Jeruk B8 Yogyakarta

Telephone : 0274 – 556757 (home)

Office : Magister Manajemen STIE STIKUBANK

E-mail address : sabrinasihombing@hotmail.com