The impact of retailer’s CSR activities on formation of

loyalty to organic products under the private label

Done by: Ekaterina Nazarenko,

2-year MiM student

Scientific advisor: Sergey A. Starov,

Professor of Marketing Department
 01 Theoretical & practical
background

02 Justification of the chosen

retailer & food category

Agenda 03 Methodology justification

04 Main research findings

05 Recommendations &
limitations
Research goal & objectives
Research objectives
Research goal
Find out whether there is a
connection between CSR
activities of the retailer and
consumer loyalty to organic food
products under private label
Objective 1
Analyze and highlight the main trends of
organic food market in Russia
Objective 2
Test the validity of the model that links the
loyalty to organic food under private label
and CSR activities of retailer
Objective 3
Identify consumer segments of organic
food under private label
Objective 4
Develop recommendations on 4P to
retailers that sell or have intention to sell
organic food under private label and are
involved into SCR activities
Objective 5
Develop recommendations to retailers
about communication with consumer
segments of organic food products under
private label
 About research
Research gap Research Object & Subject
• The market of organic food just has started to develop
(1% of total Russian food market)
Object: consumers of organic product under
• CSR activities among retailers are poorly private labels
communicated in Russian market

• Sustainable labeling (eco, organic, bio) are perceived

Subject: formation of loyalty to organic food under
as synonyms by many consumers private label via SCR activities

• The model will work on particular consumer segments

or will not work at all

• The segmentation is based separately only on

sociodemographic or phycological characteristics

• There is lack of research in Russian market about

organic PL

Theoretical value Practical value Field of study Scope & Market

• There will be modified and • There will be developed • Brand management Scope: Dairy and
tested the model that links managerial implications Meat products
SCR activities and loyalty for retailers that sell • Consumer Behavior
to the organic food organic products under Market of Russian
products under private private labels in Russia • CSR Federation
label in Russian market
• Better STP marketing
• Consumer segments will could be developed
be identified in order to based on identified
support the model segments
About research

1
The research is done in collaboration with professors of Department
of Marketing in GSOM during one year

Nazarenko E.А. is a co-author (Cherenkov V.I., Starov S.A., Gladkikh I.V.,

Kirukov S.I.) of the article «The transformation of a retail chain's private

2 label of eco-products into a sustainability brand – the way to responsible

consumption», which is accepted for publication and will be published in
the journal «Marketing and Marketing Research» (№3, 2021).

3
Nazarenko E.А. successfully delivered a scientific report «The study
of the impact of associations with the retailer's CSR on the trust and
loyalty of consumers to the private labels of organic products» at the
scientific seminar, which was held on May 15, 2021 at the GSOM.
The content of the paper
CHAPTER 1. THEORETICAL AND PRACTICAL BACKGROUND OF THE
TOPIC
1.1. SCR in retailing
1.2. Origin and types of private labels
1.3. Overview of the models that measure loyalty to organic food under private label
1.4. Justification of the chosen model for research
1.5. Consumer profiles of organic food
1.6. Analysis of organic food market in Russian Federation

CHAPTER 2. METHODOLOGY AND CUNSUMER RESERCH

2.1. Justification of chosen retailer
2.2. Justification of food category for research
2.3. Methodology justification
2.4. Main findings

CHAPTER 3. DEVELOPMET OF RECOMMENDATIONS

3.1. General recommendations for retailers that sell organic food under private label
3.2. Recommendations to retailers about consumer segments of organic food under private label
3.3. Limitations of the research
Theoretical background. Private label
Private labels (PL), [Wu et al., 2021]
• are characterized as products that
have a brand name of a choice of
retailer and entirely possessed,
regulated, and marketed exclusively
in a particular retailer
Premium PL [Gielens et al., 2021]
• are PL of high quality, functionality
but have less social risks and
priced comparable/more than
National Brands and target less
price sensitive consumers
Transformation of Premium PL to
National Brands [Starov et al., 2020 ]
• Constant process of development
• Financial power of retailer to have own or
contract production
• Provision of additional value to consumers
Organic products under PL
[Perrini et al., 2020]
• Could be considered as Premium PL
since they offer additional benefits
(health, environment)
• Are credence goods -> the need for
organic certification in order to build trust
and loyalty
Theoretical background. CRS activities of retailers
Corporate Social Responsibility is part of the
strategy of many companies today
[Yurina, 2019]

Tipple Bottom Line model [Elkington, 1994]

is represented by 3 dimensions: economic,
environmental and social

SCR activities [Wiese et al., 2015]

There are External & Internal SCR activates
[HR Director, 2021]
• Focus on External SCR activities since they are more
visible for consumers
• External SCR activities: charity, quality control,
protection of environment, interactions with public
organization
• Provide competitive advantage to retail
• Retailers could all 3 dimensions from Triple bottom
line model
• SCR could increase consumer WTP, trust, loyalty,
store image
The most important SCR activities of retailers
• Provision of high quality of products to consumers
• Ecological initiatives
• Charity events
 Justification of the chosen model
Place Your Picture Here
Analysis of the alternative models Perceived
Consumer
• There were reviewed about 100 models
CSR activities
• The majority of the contained the following variables: Brand loyalty
innovativeness, in store experience, perceived quality,
perceived value, attitude Trust in
• The common variable of all models: perceived SCR private label
activities, trust, brand loyalty, intention to recommend,
intention to buy Trust in organic
dairy product
under private
The model was chosen and label
WTP price
modified because: Trust in premium
organic
• It provides division between Social and Environmental products
SCR activities of the retailer
• It tests the pure impact of SCR activities on consumer Perceived
trust and loyalty Environmental
• It includes trust in PL, trust in organic products and trust CSR activities Source: [Perrini et al., 2010]
in organic product under private label

Modifications
• Loyalty is divided into two types of affective loyalty: Variables Background Methods
Intention to recommend (NPS) and WTP price premium
• Affective loyalty is interest of consumer to purchase • COOP is Italian retailer
• All variables are latent • EFA
• Biologici is brand of
certain brand but not the other one [Starov 2007] • Measured Likert 5-scale • CFA
• NPS is measured from 0 to 10 organic yogurt
 Modified model
Hypotheses Place Your Picture Here

H1: The perceived consumer CSR activities of a

retailer correlates positively with trust in the PL Perceived
Intention to
products of the retailer. [Du et el., 2007, Bousch, Consumer
recommend
2008, Perrini, 2010, Doney, 1997] CSR activities H1
(NPS)
H2: The perceived environmental CSR activities of a
retailer correlates positively with consumer trust in
Loyalty to organic H7
organic products [Magnusson et al., 2003; Chen, Trust in food products
2009]
private label H3
under private label
H3: Consumer trust in a retailer’s PL products
correlates positively with consumer trust in organic Trust in organic H6
meat and dairy products under PL meat and dairy
[Du et el., 2007, Ellen et al., 2000, Pivato 2007, Baur products under H5
et et al., 2013, Larceneux et al., 2012] private label WTP price
Trust in premium
H4: Consumer trust in organic products correlates
organic
positively with trust in organic meat and dairy products H4
products under the PL [Pivato, 2008, Jonas, 2005]

H5: Consumer trust in the organic meat and dairy Perceived

organic product under PL correlates positively with Environmental H2
loyalty to organic food products under PL [Van CSR activities
Doorn, 2015; Girard et al., 2017, Singh, 2000, Oliver
1999, Pivato 2007, Baur et et al., 2013 ]

H6: Loyalty to organic food products under PL has

positive connection with WTP for organic meat and Variables Background Methods
dairy products under PL [Baur et et al., 2013,
Bezawada, 2013, Van Loo et al., 2013; Zander, 2010, • VkusVill is Russian retailer • EFA
• All variables are latent
Krystallis, 2006]
• Dairy and Meat products • CFA
except NPS
• PL is private label • Cluster analysis (to show
H7: Loyalty to organic food products under PL has • Measured Likert 5-scale
on which consumer
positive connection with intention to recommend • NPS (measured 10-scale)
(NPS) organic meat and dairy products under PL segments the model will
[Zeithaml et al., 1996; Berger, 2011, Reichheld, 2003] work)
Portrait of consumers of organic food in the literature

General traits of organic food consumers

In the literature: Higher education, females, 18-35 years old

1 with kids, have positive attitudes towards organics
[Aslihah 2014]

In Russia : females, 25-45 years old, middle- and upper-class,

2 higher education, high income, residents of Moscow and St Favorable
Petersburg [Vedomosti 2019]
-Positive attitude
towards organic food
Main reasons to by organics in Russia: health benefits, no
-Young females
3 artificial ingredients or preservatives, natural taste and safety
-High education
[Vedomosti 2019]
- Perceive organic food to
be healthier, rich in
Barriers to buy organics in literature: lack of availability, vitamins, has less
4 mistrust, poor presentation, extra time needed to search for chemicals
organics [Aslihah 2014] -Think that organics are
limited in the store and
not easy to get
Barriers to buy organics in Russia : higher price, lack of trust
5 in health benefits or manufacture, lack of knowledge about
-Health orientation
-Follow the principals of
organics [Food market 2013] sustainable
consumption
-frequently buy organics
The majority of studies focuses on segmentation only on
6 sociodemographic or psychographic factors separately
Neutral Unfavorable
-Neutral attitude towards -Negative attitude
organics towards organics
- Young and middle aged - Males and females
- 18-35 years old
males
- High education - Perceive organic food to
- Perceive organic food to be less healthier, rich in
be healthier, rich in vitamins
vitamins - Believe that organics is
- Appearance of organic fresh
food is attractive - Do not perceive the price
- The price of organics is is high
high - Less health oriented,
- Environmentally socially responsible
responsible and environmentally
- Buy organics less often conscious
[Aslihah 2014]
Organic food market in Russia
Organic food
Reasons to buy organics in Russia
• Vegetables/fruits and meat/milk
• Produced in accordance to
Fashion 1.3%
standards
• Could not be kept and transported Religious stances 1.6%
with non organics Certified by
• Genetically modified additives are government Absence of trust to mass producer 33.0%
forbidden
• Plastic package is forbidden Since 2020 Life stance 33.9%

Ethical aspects of production 49.8%

Benefits for health 62.4%

Saving of the environment 65.4%

Main trends 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

• Increase by 10% since 2010 Main players

• Market is 2% full (growth potential)
• In 2018 44% of healthy food
market
• In 2019 volume growth by 46,3 %
• 80 producers are certified
• Main factors that affect
development: popularization of
healthy lifestyle, lack of trust to
genetically modified food and
possible health problems
VkusVill retailer
as base of analysis
• Established in 2009 as «Izbenka» brand of dairy
products
• Mission is to offer its consumers natural healthy
products, honest attitude and positive emotions, while
enjoying their work and helping partners to develop
together
• Offers diverse assortment with short shelf life
• Positions itself as a store of healthy food
• Presented in 17 Russian cities (900 stores)
• Mini-market format (100-200 m2)
95% of the assortment is private label
• Mainly uses umbrella branding strategy
• Mitigates higher prices with explanation of the values
• Presents premium private labels (with additional meaning and message)
Sells certified organic products under private label
• «Ugleche pole» is certified private label (dairy and meet products)
• The other products in the process of getting organic certification
• VkusVill private label promoted as product with pure and natural content,
locally produced and without harmful additives
Highly involved into CSR activities
• Various environmental activities (waste collection, tree planting,
plastic cards and bottle cups collection )
• Different social events ( meticulous quality control, collaboration with
charity funds)
Interacts with the base of loyal consumers
• With audio announcements
• Visual banners
• Mobile application (loyalty cards «Let us be friends»)
Justification of the food category (meat and dairy)
1st
Dairy & meat products
The retailer basically started with
these food categories and has
established trust towards them over
the time
2nd
Ugleche pole products
There are certified organic dairy and
meat products
3rd
Based on customer reviews
Meat and dairy products are favorite
ones among VkusVill clients (ranked
4.5-5)
4th
According to manager of VkusVill
Dairy and meat products are the most
popular food categories (Top-10 of
favorite products)
Methodology
Expert interview,
in-depth interviews with Survey EFA CFA (SEM) Cluster analysis
consumers and personas

STEP STEP STEP STEP STEP

1 2 3 4 5
●To understand ●Based on literature ●Required step ●Is used to create ●Used to divide
general picture of review before CFA and test the studied consumers into
the consumer model distinct groups
attitudes ●Created via ●Checks whether
platform Anketolog new latent ●Check the total ●Helps to obtain
●To obtain
variables could be goodness of fit of described
consumer insights ●Is held online segments of the
created the model
consumers
●Personas is
●Consists 7 ●Proves the validity ●Tests the
method of ●Basis for
sections and reliability of hypothesis of the
visualization of recommendations
factors that would research
interview results ●Helps to get be included in the
●Basis for further statistically model
significant results
creation of survey
Interview with expert from «VkusVill»*
Quality control
Social SCR • Multi-step control of production on daily basis
• The control of quality and quantity
• Large number of personnel that involved into quality control
• The company has its own laboratory for quality checking

Active works with consumer reviews

Social SCR • Consumers could send their reviews in various messengers, Social media and official website
• Consumers could rank the products in online application and on official website
• Consumers receive bonuses for ranking certain types of products every month
• Change the content of products or replace them based on consumer’s reviews

Actively involved into eco initiatives

Environmental SCR
• Introduces organic certification of dairy and meat products «Ugleche pole»
• Promotes eco-initiatives in the store, social media and via mobile application
• Provides incentives and bonuses for environmentally conscious behavior
• Take into account proposals of consumers about eco-initiatives

Loyalty card «Let us be friends»

Loyalty program
• Multi-functional mobile application
• Various discounts and bonuses
• Free delivery
• Technical support of consumers
• Promote social and environmental SCR activities

*Grocery Director in Moscow - Kuznetsova Larisa Vladimirovna

 Sample description
Respondents reside in Moscow Different age groups: 18-25, 26-30,
and Saint Petersburg 35-40 and 41-50 years old

87% Respondents including 22% males Respondents including 5 males and Age
and 78% females 19 females

S I
N
U T
360 R E 24
R
V V
E I
E
Y S
Marital
86% status

Respondents are constant 71% Occupation Both married and

consumers of VkusVill not married,
with and without
children
Respondents are Students and
18-30 years old employed people
Buyer personas
01 03
Peter, 27 y.o., Saint Elena, 40 y.o., Moscow
Petersburg, IT-specialist region, economist
• Married/no children
• Follows healthy life style • Married, 1 child
• Finds organic food tasty and more • Tries to eat healthy and stay active
natural • Thinks that organics has good
• Motivation: fresh food & excellent quality but quite expensive
service • Motivation: natural and quality food
• Barrier: high price, suitable not • Barrier: high price, far from
for all occasions home/office

02 04
Maria, 24 y.o., Moscow, Alexander, 48 y.o., Saint
student Petersburg. businessman
• Not married/no kids
• Healthy conscious, does sport, • Married, 2 children
consumes vitamins • Lives in eco apartment complex,
• Likes taste, freshness and quality of prefers to eat only healthy and
organic food quality food
• Motivator: care for health, try new • Consumes all types of organic
products food
• Barrier: high price • Motivation: care for family
• Barrier: do not have any
Scales of latent variables
Perceived Consumer SCR
• VkusVill satisfies my needs in purchasing products with natural content and
short shelf life
• I believe that VkusVill carefully checks the origin of the products it sells
• I’m sure that VkusVill protects consumer rights in relation to quality
assurance
• It is important for me that VkusVill is engaged in charity
Perceived Environmental SCR
• I think VkusVill cares about environment
• It is important for me that VkusVill is involved into recycling
• It is important that VkusVill provides consumers with information about
importance of caring for the environment on the official website
• It is important that VkusVill encourages consumers to sort garbage, refuse
plastic and hazardous waste by providing them various incentives (discounts)
• It is important that VkusVill is engages in preserving environment by tree
planting
Trust in private label
• I think that you can be sure of the quality of products under PL VkusVill
• than other products
I can trust the quality of good under PL VkusVill
• Customers of VkusVill can rely on the its products for the naturalness of content
• time I make purchase
Products under PL VkusVill always keep their promises in terms of quality, taste
and composition
Trust in organic products
•
Buyers can always be confident in quality of organic food
• I can trust the quality of organic food
• I think you can count on organic products for natural composition
• Organic products always deliver their promises in terms of quality, taste and
composition
*Modified questionnaire from [Perrini et al., 2010] based on
«VkusVill» peculiarities
Trust in organic products under private label
• You can be sure in quality of organic products under PL VkusVill
• I can trust the quality of organic food under PL VkusVill
• Customers of VkusVill can rely on the its organic products under PL VkusVill for
the naturalness of content
• The organic products under PL VkusVill always keep their promises in terms of
quality, taste and composition
Loyalty to organic products under Private Label
• I prefer organic products under PL VkusVill among other products
• I will definitely buy organic products under PL VkusVill
• I would prefer to buy organic products under PL VkusVill the next time I make
purchase
• With the same characteristics of organic products from other companies, I will
still prefer organic products under PL VkusVill
WTP price premium for organic products under PL
• I consider buying organic product under PL reasonable, even If it costs more
• I’m willing to pay higher price for organic products under PL VkusVill the next
• With same characteristics of organic products from other retailers, I still prefer
organic products under PL VkusVill
Intention to recommend organic food under PL VkusVill
How is likely is that you will recommend the purchase of organic food under PL
VkusVill to your friends, acquittances, relatives or colleagues? Rate from 0 to 10
 Item Factor loading Cronbach Alpha Item Factor loading Cronbach Alpha
All latent variables and items
Consumer CSR_1 0, 774 Trust in PL VkusVill_1 0,917
Satisfy the following criteria
Consumer CSR_2 0,845 Trust in PL VkusVill_2 0,922 • Factor loading > 0,5
0, 706 0, 914
• Cronbach Alfa > 0,7
Consumer CSR_3 0,854 Trust in PL VkusVill_3 0,887 • Kaiser Measure > 0,7
• Bartlett’s test < 0,05
Consumer CSR_4 0,541 Trust in PL VkusVill_4 0,847

Could be included in further analysis

Latent construct Kaiser-Meyer Measure = 0,715 Latent construct Kaiser-Meyer Measure = 0,821
indices Bartlett’s Test < 0,001 indices Bartlett’s Test < 0,001

Item Factor Cronbach Alpha Item Factor Cronbach Item Factor loading Cronbach Alpha
loading loading Alpha

E Environmental CSR_1

Environmental CSR_2
0,625

0,866
Trust in organic products_1

Trust in organic products_2

0,893

0,94
Brand loyalty_1

Brand loyalty_2
0,917

0,922

F Environmental CSR_3 0.832

0, 89
Trust in organic products_3 0,942
0, 914
Brand loyalty_3 0,887
0, 861

A
Environmental CSR_4 0,874 Trust in organic products_4 0,896 Brand loyalty_4 0,847

Environmental CSR_5 0,816 Latent construct indices Kaiser-Meyer Measure = 0,822 Latent construct Kaiser-Meyer Measure = 0,816
Bartlett’s Test < 0,001 indices Bartlett’s Test < 0,001
Latent construct indices Kaiser-Meyer Measure = 0,864
Bartlett’s Test < 0,001

Item Factor loading Cronbach Alpha Item Factor Cronbach Item Factor loading Cronbach Alpha
loading Alpha

Consumer CSR_1 0, 774 Trust in organic products under 0,925 WTP_1 0,902
private label VkusVill_1

Consumer CSR_2 0,845 Trust in organic products under 0,945 WTP_2 0,901
private label VkusVill_2 0, 863
0, 706 0, 965
Consumer CSR_3 0,854 Trust in organic products under 0,93 WTP_3 0,859
private label VkusVill_3

Consumer CSR_4 0,541 Trust in organic products under 0,913 Latent construct Kaiser-Meyer Measure = 0,727
private label VkusVill_4 indices Bartlett’s Test < 0,001

Latent construct Kaiser-Meyer Measure = 0,715 Latent construct indices Kaiser-Meyer Measure = 0,851
indices Bartlett’s Test < 0,001 Bartlett’s Test < 0,001
CFA (SEM) Index

Chi-square/ df
Executed value

3,05

GFI 0,836

TLI 0,905

CFI 0,922
Intention to
Perceived
recommend
Consumer CSR
(NPS) RMSEA 0,076
activities 0,52
PCLOSE 0
Loyalty to 0,51
Trust in organic food
private label 0,32 products under Index AVE Composite Critical Ratios
private label Reliability (items)
Trust in organic
meat and dairy Consumer CSR 0,5 0,68
products under
0,48 0,38
private label Environmental CSR 0,52 0,71
Trust in
organic Trust in private label 0,67 0,89
0,56 WTP price
products VkusVill
premium
Trust in organic products 0,67 0,89
Perceived
Environmental Trust in organic products 0,68 0,9 > 1,96
0,82
CSR activities under private label
VkusVill
Loyalty 0,511 0,72

WTP 0,54 0,733

NPS 0,56 0,7

Main consumer segments
Active users (20%)
Uses loyalty card & mobile application
Visit the store
Know about eco initiatives via loyalty card
Mainly female, 18-45 years old
Married with kids
Medium + income
Full-time or freelancers
Moscow, Saint Petersburg
NPS = 5
Organics: attractive appearance
WTP: 3000- >10 000 RUB per month
Visit the store almost every day
Uses Instagram more often
Overpacking is a problem
Natural resources should be
conserved
Healthy conscious
Pleasure in what I do
Advertising seen in Social media
Distance 0-30 min from home/office
8 3
Clusters
Involved Customers (18%)
Uses loyalty card & mobile application
Visit the store
Does not know about eco initiatives via loyalty
card
Mainly female, 18-35 years old
Not married, without kids
Medium+ income
Student or full-time
Moscow, Saint Petersburg
NPS=10
Organics: pleasant taste
WTP: 3000- >10 000 RUB per month
Visits the store every 2,3 day
Uses VK more often
Overpacking is a problem
Attentive to health
Plastic bottles should be banned
Security
Pays attention to the sign of the store
Distance 0-15 min from home/office
Segments
Neutral Сonsumers (17%)
Uses loyalty card & mobile application
Visit the store
Does not know about eco initiatives via loyalty
card
Mainly female, 18-35 years old
Not married, no or 2 kids
Medium income
Moscow, Saint Petersburg
NPS=5
Organics: healthy
WTP: 3000- 10 000 RUB per month
Visit the store almost every day
Uses VK more often
Person could protect environment
Health conscious
Government should subsidize
Self-esteem
Pays attention to the sign of the store
Distance 0-15 min from home/office
 Implementation of Social SCR activities
01 • Smart collaboration with suppliers (thoughtful choice and control)
• Charity activities (collaborations with funds, food collection, charity goods, involve
consumers)
• Work with consumer reviews on quality of products
Implementation of Environmental CSR activities

02 •
•
•
Smart choice of the well-known partners
Arrange collection (waste, batteries, plastic cards, electronics, cans)
Bonuses for waste sorting for customers
• Planting trees activity
• Introduction of eco-bags, mobile application Wallet

General 03 Certification adaptation

• Choose suppliers with certifications
• Explain the benefits of organics and the meaning of certification

Recommendations • Provide incentives to organic producers (governments)

to retailers 04 Communications in offline channels about organic PL

• Sales promotion (special section, audio and video announcements, additional
information about loyalty card, testing in the store)
• Direct sales (trained personnel, encourage to download the application)
• PR ( in trustworthy journals about SCR activities and organic PL)
• Fitness centers and medical clinics

05 Communications in online channels about organic PL

• Official website (CSR activities, organic certification, additional information – cooking tips)
• Social media (Personal discounts, CSR activities, organic certification, additional information )
• Mobile application (CSR activities, organic certification, additional information – cooking tips)

New channels of sales

06 • Vending machines in medical clinics
• Vending machines in fitness centers
 Recommendations for Active users

Product Price Place Promotion

-Promotion via application and social

- Explain the value via media (Instagram)
social media, mobile
-Provide more variety of application and official -Sales in the store (audio -Enhance the way the product look
organic private label website and video (pure and smart design)
announcements)
-Provide special food for -Provide discounts if -Inform about the organics and its
kids people delivered used -Arrange special section difference from the other labels
packaging with organics food
-Invest in the way the -Support self-esteem of the
product look -Family discounts for -E-commerce customers
bundles
-Offer healthy snacks - Vending machines in -Ensure that the product is safe
- Provide discounts for medical clinics and
milk and dairy products gyms -Use the family image in the
(cottage cheese, cheese promotion
and chicken)
-Enhance the pure content of food
 Recommendations for Involved Customers

Product Price Place Promotion

Promotion via application and social

media (VK)
-Sales in the store (audio
-Inform about new SCR events and
and video
- Provide more variety of -Provide discounts if discounts
announcements)
organic private label people delivered used
packaging -Add more audio and visuals in the
-E-commerce
-Make sure that the taste store
of the product is -Discounts of socially -Arrange special section
excellent responsible activities -Enhance the taste value
with organics food
(bottles recycling)
-Offer healthy snacks -Inform about the organics and its
-Vending machines in
- Provide discounts for difference from the other labels
medical clinics and
milk products (cottage gyms
cheese, cheese and -Provide information about organic
milk/cream) certification

-Ensure that the product is safe

-Enhance the pure content of food

 
 Recommendations for Neutral Consumers
Product Price
-Explain the value via
social media, mobile
-Provide more variety of application and official
organic private label website
-Provide special food for -Provide discounts if people
kids delivered used packaging
-Pay attention to the -Family discounts for
content and provision of bundles
information about
content -Provide discounts for
milk products (cottage
-Use more white and cheese, milk/cream,
green color in packaging cheese, yogurt
Place Promotion
-Promotion via application and social media
(VK)
-Inform about CSR events and discounts
-Add more audio and visuals in the store
-Sales in the store -Enhance value for health
-Arrange special section -Inform about the organics and its difference
with organics food from the other labels
-E-commerce -Provide information about organic certification
-Vending machines in -Encourage to use more functions of the
medical clinics and mobile application
gyms
-Support self-esteem of the customers
-Ensure that the product is safe
-Use the family image in the promotion
-Enhance the pure content of food
 Limitations
Socio demographic
• The majority of respondents are women, not married, without kids, who
live in Moscow or Saint Petersburg
• Further research: include more man, married people with kids and
habitats of other regions of Russia

Research is based only on VkusVill retailer

• Retailer that sell organic products under PL could differ from each other
• Further research: include more Russian retailers that sell organic food
under PL and arrange SCR activities

Only two food categories were studied

• Due to regulations of organic only meat and dairy products were chosen
• Further research: include more food categories (snacks, drinks, fruit
and vegetables)

Employee dimension in as part of SCR was not included

• The model did not include employee dimension in the Social SCR
activities because of complexity and literature review
• Further research: include employee dimension as a part of the Social
SCR or separately
The impact of retailer’s CSR activities on formation of
loyalty to organic products under the private label

Done by: Ekaterina Nazarenko,

2-year MiM student

Scientific advisor: Sergey A. Starov,

Professor of Marketing Department
Question 1. Criteria for final dimensions in structural model
Goal of the study
• was to test the pure relation between SCR activities
of the retailer and formation of consumer trust
without any addition influence
Perceived Consumer & Environmental SCR
• CSR activities could be the source of competitive
advantage to retailer
• According to literature, external SCR activities (quality
control, eco-initiatives and charity) are considered to be
the most important ones since they are more visible for
consumers
• Retailer that succeed in consumer CSR activities will
develop trust in its private-label products (cognitive and
calculative trust)
• If retailer actively implement environmental CSR
activities and introduces private label to organic
products, the consumer trust in its organic products as a
category will be increased (cognitive trust)
Consumer trust
• The phenomenon of trust has gained popularity
in researches in marketing and management fields
• It is pre-step of formation of consumer loyalty to
04 the any product and service
03
• Is response of consumers that is the key of
success of marketing activities
• Trust should be built to credence goods that is
organic food under PL
Consumer loyalty
• Is response of consumers that is the key of success of
01 marketing activities
02 • Refers to the preference of consumers of organic food
under PL
• Affective loyalty (WTP and NPS) is connected with
interest of the consumer to purchase certain brand but
not the other one.
• WTP price premium was chosen because organic food
is marketed at a premium higher than the other non-
organic products.
• NPS score shows how many people are loyal to the PL
and are ready to promote it to inner circle
Question 2. The form of provided recommendations
Limitation 2
Because of complexity there was focus only
on one retailer «VkusVill» that fullfeed the
studied phenomenon of the link between SCR
activities and consumer loyalty to organic food
products under PL
Limitation 3
Because of obtained organic certification only
dairy and meat product were chosen
VkusVill was chosen as an example
because it fulfilled certain criteria
• 95% of the whole assortment is presented
by PL
• The other retailers have max 42-45% of PL
• The retailer has certified organic products
«Ugleche Pole»
• VkusVill is actively involved into SCR
activities and involve consumers into them
(quality control, eco-initiatives, charity)
Further research
• Will be held with the Department of Marketing
• It will include more retailers (Lenta, Magnit,
Perekrestok, Azbuka Vkusa etc.) for
comparison and more varied
recommendations
• It will comprise the other food categories in
order to provide better recommendations for
consumers that do not purchase organic dairy
and meat products under PL
Appendix 1. Survey sections

Filter questions Questions in response to consumer clusters

01 05
04 Questions on marketing communication
Food category selection. Certification
02 knowledge. Behavioral questions 06

Loyalty card usage Sociodemographic characteristics

03 07

Questions in response to tested

04 model
 Appendix 2. Cluster Analysis

Variables for clustering

• Loyalty card usage
• Convenient way of making purchases
• Knowledge that eco initiatives are promoted
via loyalty card
   1 (20%) 2 (18%) 3 (17%) 4 (14%) 5 (10%)
NPS 5 10 5 1 4
Brand loyalty 88% 59% 61% 42% 64%
WTP 69% 59% 46% 36% 50%
Income Medium+ Medium+ 70% 77% 88%
Appendix 3. Choice of consumer segments

Awareness of organic  69%  68%  57%  71%  75%

characteristics
Understand difference 88%    87% (all+some)  94%  92%
between labels 89%
Trust in organic labeling  organic  organic  organic    
no no
WTP (monetary  57%  37%   27%   -   25%
expression in RUB)
Awareness about          
requirements 88% (organic) 85% organic 78% organic 65% organic 78% organic
Attention to certification 38% (sometimes) 48% (sometimes) 41% (sometimes) 29% (sometimes) 38% (sometimes)
Trust in seen certification          
68% 63% 62% 47% 75%
 Loyalty card function -Favorite product -Favorite product -Favorite product -Favorite product -Favorite product
usage -Bonuses -Bonuses -Bonuses -Bonuses -Bonuses
-Diverse food -Diverse food -Diverse food -Food delivery
-I am in the store -I am in the store -I am in the store
-Food delivery -Yellow price tags
-Food delivery
Data source (application) 81% 89% 89% 59% 25%
Period of time being a          
customer 94% 74% 89% 76% 83%
(1-4 years)
Frequency of visiting 69% 60% 75% 59% 39%
VkusVill (every 1,2,3 day) (every 2,3 day) (every 1,2,3 day) (every 2,3 day) (every 1,2,3 day)
         
Appendix 4. Justification of the chosen model
[Pivato et al., 2008]

[Konuk 2019]

[Perrini et al., 2010]

[Louis et al., 2019]

[Batista-Foguet et al., 2012]

[Konuk 2018] [Polonsky 2019] [Mejri & Bhatli 2014]

 Appendix 5. «Ugleche pole products»

Organic kefir Organic cottage cheese

 Appendix 6. Organic products

Requirements for Requirements for

vegetables and fruits: vegetables and fruits:

• natural soil • free range on pastures

• natural fertilizers • fields without
• crop rotation agrochemicals
• nutrition is natural in its
composition

Forbidden to use: Forbidden to use:

• artificial soil • antibiotics
• pesticides • cloning

Common requirements :

• could not be kept and transported with products that are not organic
• not allowed to utilize genetically modified additives
• industrial companies could not be placed near the manufacture of
organic food
• plastic packaging is forbidden to be utilized
Appendix 7. The price of getting organic certification

Service Price There are 3 accredited

(RUB\day) organizations that issue organic
certificates
Preliminary estimate 40 000
On-site audit 40 000 • "Organic Expert",
Analysis of documentation, assessment, 40 000 • "Rosselkhoztsentr"
decision making • Roskachestvo

Organization of work, paperwork 15 000

Travel expenses, accommodation Could vary
Laboratory research of taken samples Could vary
Total ≈ 135 000

[Organic expert, 2021]

Appendix 8. In-depth interviews

Intensive method
In terms of duration of the processes
Disadvantages required after interview was conducted

Need for trained interviewer

Comprehensive data
To make respondent calm and
It could help to obtain complex
confident in order to get valuable
information form respondents
insights

Better & deeper understanding Results are not statistically significant

Due to face-to-face interactions that Because of the small number of respondents
could bring more sincere results

More flexible method

No data generalization provided
And less costly methods even if it is held via Advantages
phone The researcher has to do it for himself
 Appendix 9. Buyer personas

Could not be reliable

Since it is based on typical belief about
Disadvantages consumer groups

Better understanding of the customer journey Could not provide any result
But the time and efforts would be made
Could be used in promotion formulation

Understanding customer needs Attitude-behavior gap

Helps to create better marketing Aspirations and beliefs could not lead to
content certain behavior

Could be used at any level of marketing

And help to organize better target for
consumers
Become outdated very fast
Advantages
Since consumer beliefs could change over
the time and fashion
Appendix 10. Survey

Helps in decision making False data gathering

Efficient tool in decision-making procedure Because of not sincere answers that could
Disadvantages harm the quality of the data

Availability of large scope Too much varied information

Because of inattentive respondents
It allows with huge amount of information

Validity check Disorder in results

Of the scientific theories on practice Happens when people do not have a desire
as well as provision of comparison in in providing true answers
data

Easy to manage
Because software technologies and special Advantages Time consuming
services for survey creation As well as effort consuming method
Appendix 11. EFA

Procced data results into theory

Because it is inductive and theoretical
Disadvantages

It is pre-step Implies subjective

And heuristic rules
In factor analysis that allows to check
whether observed variables are related to
latent variable

Responsible for covariance

Between observed variables

Helps to find factor loading

That shows the best correlation between Advantages
variables
 Appendix 12. CFA (SEM)

Model and parameter identification

The model will work only if empirical data
Disadvantages provide enough information

Tests validly of the model Estimation of method and problem

Since optimal solution could not be found
So clear conclusion could be made
or result is optimal but parameters do not
make sense

Could deal with measurement of error

Requirement to meet assumptions
Constructs are not biased by measurement Normal distribution and large sample size
of error could take place

Test complex model

Interpretation of results
Without use of separate analysis -> time saving Advantages
Could be challenging
as well as it tests specific assumption
Appendix 13. Cluster analysis

There is a need for additional data

processing

Disadvantages In order to interpret the gathered data

Easy to implement Special requirement should be met

With special tool like SPSS the process is quite Such as sample size
fast

Not difficult to interpret results Could produce no result

Since the program automatically Time consuming for searching for right
divides the data on clusters the variables to cluster
number of which could be managed

Helps in decision-making process Advantages

Especially in STP marketing
Appendix 14. Matrix of correlations between latent variables

Variable Mean S.D. 1 2 3 4 5 6 7 8

1. Consumer SCR 4,052 0,91 1
2. Environmental SCR 4,04 0,89 0,85 1
3. Trust in products 3,651 0,9 0,76 0,33 1
under PL
4. Trust in organic 3,74 0,92 0,63 0,43 0,66 1
products
5. Trust in organic 3,97 0,91 0,52 0,39 0,413 0,82 1
products under PL
6. Loyalty in organic 3,6 0,93 0,25 0,26 0,143 0,54 0,57 1
products under PL
7. WTP 3,56 0,96 0,45 0,25 0,53 0,56 0,55 0,64 1
8. NPS 3,42 0,98 0,32 0,41 0,74 0,721 0,44 0,22 0,72 1