Most corporate organizations of the contemporary age wants to be viewed as entities that has a social purpose; the reasons are not too far to seek. Not only is it good for the business’ reputation, but also has fruitful outcomes for the scope of the organization (Anderson and Bees., 2017). An organization with a social purpose attracts productive employees and retains their motivation, has more chances of attracting impact investors and most importantly, maximizes client satisfaction. The purpose of this essay is to argue for the development of reflective statement that a for-profit organization is more profitable with higher client satisfaction if it has a social purpose. The paper will center its argument on corporate social responsibility and its impact on customer satisfaction. Finally, the essay will conclude with the suitable suggestions that would help for-profit organizations to engage in activities that benefits the society.
For a thorough discussion on the topic, it becomes important to provide a clear definition of the term ‘social purpose’. In this context, I feel that social purpose refers to the purposes (one or more) of the for-profit organizations that are mentioned in the corporate’s certificate of foundation. It usually consists of promoting positive impacts on the society or the environment or of the attempts to abate the negative impacts of the organization’s activities on the environment or the so society. According to me, the activities that might lead to these impacts include providing underprivileged individuals or people from low-income background with beneficial services and products at low costs, preservation of the environment and improvement of human health, promoting sciences, the arts and the progression of knowledge.
Customer satisfaction refers to the feelings of a consumer (in terms of pleasure) after having used the product or the services of a company. A business bases its success on customer satisfaction and it is the best way to assess the growth of the business. There is a direct and proportional relationship between customer repurchase and consumer satisfaction. A company that carries out CSRs increases the chances of establishing a good reputation in the market, and consumers are automatically drawn towards products and services that has a higher purpose than making profit (Saedi et al., 2015). I think that satisfied customer are most likely to recommend the products of a socially responsible firm, patronizing their cause that goes beyond the usual profit-making motive. Additionally, firms that engage in CSRs are better positioned to create loyal customers and retain them as well. Loyal customers are those who demonstrate deep commitment towards the service and products of a particular company despite the situational influences in the marketplace that has the potential to change buyer behavior. One the central objectives of business firms is customer loyalty for surviving in the market since it ensures growth and aids competitive advantages. In general agreement, customer satisfaction is a viable strategy for retaining consumers and spreading the word of mouth through them.
The memory of the consumer contains a definite perception of the organization he/she is buys products or avails services from. I also feel that Loyalty and satisfaction among consumers is deeply influenced by corporate image and reputation. As Attitude Theory suggests, evaluation of the products and the services is the primary factor influencing corporate image. The assessment increase the value of the company and helps forming a favorable opinion in the memory of the consumer. Researchers have also found out that when consumers develop a positive outlook on a company, the chances of them moving towards satisfaction and loyalty are higher. The reputation of the corporate not only motivates the already existing customers to assume a favorable attitude towards the services/products offered by a company, but also appeals to potential customers who are capable of making wise, responsible buyer decisions (Perez., 2014). I can relate advertisement in this aspect, which serve as sources for potential customers to learn about a company and it is a viable channel for building a strong corporate image.
The importance of corporate social responsibility and its indispensability in a company’s attempt to build a strong brand reputation has become more crucial than before. In the wake of the economic and environmental awareness, customers are developing a natural inclination towards companies that involve in activities for the greater good. The conceptual framework of CSR categorizes the responsibilities into four different dimensions of operation. The dimensions are economic, legal, ethical and philanthropic. I think that the economic responsibilities are associated with profit generation, competition, continuous profitability. A responsible organization looks after the interests of stakeholders and maintains price fairness with respect to product quality. The legal dimension of CSR is associated with the company’s consistencies in maintaining regulations and laws (Elbeltagi & Agag, 2016). Firms that fulfil legal obligations and produce goods that meet the minimum legal requirement have higher chances at securing a favorable opinion in the minds of socially aware and conscious consumers. I can assume that the ethical CSR is perhaps the most valuable and impressionable of all when it comes to maximizing customer satisfaction. The ethical responsibilities are defined in terms of societal norms and the extent to which a company is willing to adjust itself for adhering to general ethics. A company that displays integrity to principles and goes beyond the legal obligations, profit-making motives, has better claims at appealing to consumers and increasing consumer satisfaction. Bowen and Cain, (2015) believes philanthropic responsibilities to be the highest CSR level and the chief determiner of customer satisfaction. A company that caters to the charitable expectations of the society is always well-received by people. Here, I am reminded of the aim, which is to engage in activities that directly or indirectly contribute to the welfare of society; and it may be carries out by multiple activities, starting from providing assistance to charitable organizations or aiding the underprivileged, any act of philanthropy adds another feather to the company’s hat.
Researchers conducted by Söderlund and Colliander, (2015) indicate that the economic duties of the CSR initiatives have a positive influence on the purchasing decision of the buyer. The positive association between economic CSR and trust level leads to retention and higher levels of customer satisfaction. Similarly, ethical practices of companies improves customer satisfaction by forming high opinions about the organization among the consumers. Fairness, integrity and honesty are intrinsically related to the CSR dimensions of ethical responsibilities. According to my opinions, commitment, level of trust and reliability mediate the relationship between customer loyalty/satisfaction and ethical behavior. Things like child-labor avoidance, environmentally conscious modes of manufacturing are directly linked with customer satisfaction. Green labelling and fair-trade practices also influences customer positively and encourages them to retain purchasing habits. Consumers have traditionally been drawn towards products and services that serve for a greater good in the society instead of meeting the profit requirements alone. The importance of ethics, principles and responsibilities towards the society and the environment is a predominant criterion for firms to emerge as entities that are regarded highly by the public.
Conclusion
The discussion clearly suggest that a for-profit organization is more profitable with higher client-satisfaction if it is associated with a social purpose. The central finding of the argument is that profit is mandatory, but CSR is indispensable for ensuring that the company keeps earning profits. Organizations are as much run for customers as they are run by them and hence it is important that their concerns and values are properly looked into. The argument strategically refers to academic theories and research findings for validating the points made in the discussion. In a rapidly developing world where organizations are primarily driven by the instinct to maximize profit, the association with a social purpose increases their value in the market by increasing the level of customer satisfaction and retaining them successfully through constant adherence to ethics.
References
Anderson, B. B., & Dees, J. G. (2017). Sector-bending: Blurring the lines between nonprofit and for-profit. In In search of the nonprofit sector (pp. 65-86). Routledge.
Bowen, J. T., & Chen McCain, S. L. (2015). Transitioning loyalty programs: a commentary on “the relationship between customer loyalty and customer satisfaction”. International Journal of Contemporary Hospitality Management, 27(3), 415-430.
Elbeltagi, I., & Agag, G. (2016). E-retailing ethics and its impact on customer satisfaction and repurchase intention: a cultural and commitment-trust theory perspective. Internet Research, 26(1), 288-310.
Martínez, P., & del Bosque, I. R. (2013). CSR and customer loyalty: The roles of trust, customer identification with the company and satisfaction. International Journal of Hospitality Management, 35, 89-99.
Pérez, A., & Rodriguez del Bosque, I. (2015). Corporate social responsibility and customer loyalty: exploring the role of identification, satisfaction and type of company. Journal of Services Marketing, 29(1), 15-25.
Saeidi, S. P., Sofian, S., Saeidi, P., Saeidi, S. P., & Saaeidi, S. A. (2015). How does corporate social responsibility contribute to firm financial performance? The mediating role of competitive advantage, reputation, and customer satisfaction. Journal of business research, 68(2), 341-350.
Söderlund, M., & Colliander, J. (2015). Loyalty program rewards and their impact on perceived justice, customer satisfaction, and repatronize intentions. Journal of Retailing and Consumer Services, 25, 47-57.
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