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The Corporate Social Responsibility of Pure-Play Sites versus Brick-and-Mortar Corporations. By Juliana Muñoz and Dr. Johnny Snyder Mesa State College. Abstract. - PowerPoint PPT Presentation
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The Corporate Social The Corporate Social Responsibility of Responsibility of Pure-Play Sites Pure-Play Sites
versusversus Brick-and-Mortar Corporations Brick-and-Mortar Corporations
By By Juliana Muñoz and Dr. Johnny SnyderJuliana Muñoz and Dr. Johnny Snyder
Mesa State CollegeMesa State College
AbstractAbstract The goal of this paper is to The goal of this paper is to beginbegin to to
compare the relationships between brick-compare the relationships between brick-and-mortar companies and pure-play and-mortar companies and pure-play companies in a socially conscious setting.companies in a socially conscious setting.
This comparison will be made utilizing a This comparison will be made utilizing a model known as Carroll’s Pyramid and the model known as Carroll’s Pyramid and the business standards that have been set out business standards that have been set out for brick-and-mortar companies. for brick-and-mortar companies.
Introduction: The EventsIntroduction: The Events
The terrorist attacks of 9/11The terrorist attacks of 9/11 The Asian Tsunami of 2004The Asian Tsunami of 2004 Hurricane Katrina in 2005Hurricane Katrina in 2005 The South Asian Earthquake of 2005The South Asian Earthquake of 2005
Introduction: FrequencyIntroduction: Frequency
EM-DAT (2006)
Who was there to help?Who was there to help?
Brick-and-Mortar corporations such Brick-and-Mortar corporations such as Wal-Mart, GM, and many others.as Wal-Mart, GM, and many others.
Pure-play sites such as Amazon.com, Pure-play sites such as Amazon.com, and other Internet corporations like and other Internet corporations like eBbay, Yahoo, and many others eBbay, Yahoo, and many others
So?So?
Brick-and-Mortar companies are Brick-and-Mortar companies are expected to fulfill certain social expected to fulfill certain social responsibilities by the communities responsibilities by the communities that surround them.that surround them.
For amazon.com and other Internet For amazon.com and other Internet sites, there are no such expectations sites, there are no such expectations due to the lack of a surrounding due to the lack of a surrounding physical community. physical community.
What’s the Difference?What’s the Difference? A Brick-and-Mortar Corporation:A Brick-and-Mortar Corporation:
- has all their resources (buying, - has all their resources (buying, selling, shipping, services, and all selling, shipping, services, and all other functions), put into one or other functions), put into one or several physical locationsseveral physical locations
- is surrounded by a community of some kind- is surrounded by a community of some kind- probably has some Web presence (don’t be - probably has some Web presence (don’t be
fooled)fooled)- most importantly, has a direct impact on the - most importantly, has a direct impact on the
community which surrounds itcommunity which surrounds it
Example: Wal-MartExample: Wal-Mart
What’s the Difference? Cont.What’s the Difference? Cont.
A Pure-Play organization:A Pure-Play organization:- has physical building which serves only to - has physical building which serves only to
house employees, an IT infrastructure, house employees, an IT infrastructure,
and/or products for shippingand/or products for shipping
- conducts all day-to-day transactions and - conducts all day-to-day transactions and
activities via the Internetactivities via the Internet
- has far less of an impact on the community - has far less of an impact on the community
that surrounds it’s physical buildingthat surrounds it’s physical building
Example: Amazon.comExample: Amazon.com
The Key Element of Embedded The Key Element of Embedded CorporationsCorporations
A A direct impactdirect impact on a on a
community, society and community, society and
economy surrounding a corporationeconomy surrounding a corporation
Defining Corporate Social Defining Corporate Social Responsibility (CSR)Responsibility (CSR)
Generic definition of CSR-Generic definition of CSR-
““the concept that business should be the concept that business should be
actively concerned with the welfare of actively concerned with the welfare of
society at large” society at large”
(Brigham, 2004, p.16)(Brigham, 2004, p.16)
The Three Roles of The Three Roles of Brick-and-Mortar CorporationsBrick-and-Mortar Corporations
Wood (1991)Wood (1991)1. As an institution in 1. As an institution in societysociety 2. As a particular corporation, or 2. As a particular corporation, or organization in organization in societysociety 3. As individual managers who are 3. As individual managers who are
moral actors within the moral actors within the corporation (p. 695)corporation (p. 695)
Wal-Mart ExampleWal-Mart Example
According to CNNmoney.com, after According to CNNmoney.com, after Hurricane Katrina, one hundred and Hurricane Katrina, one hundred and twenty three Wal-Mart stores were twenty three Wal-Mart stores were closed in the gulf coast region.closed in the gulf coast region.
Wal-Mart offered all affected employees jobs Wal-Mart offered all affected employees jobs at other Wal-Mart stores…philanthropic at other Wal-Mart stores…philanthropic behavior. behavior.
Bhatnagar, P. (2005)Bhatnagar, P. (2005)
CSR on the WebCSR on the Web
After Katrina and the Asian Tsunami After Katrina and the Asian Tsunami the pure play corporations were the pure play corporations were
quick to install buttons on their sites quick to install buttons on their sites (home pages) to aid the consumer in (home pages) to aid the consumer in
donating to these relief causes. donating to these relief causes.
Note that as “best practices” are Note that as “best practices” are created, rivals tend to copy them created, rivals tend to copy them
quickly (Porter, 2001)quickly (Porter, 2001)
Justification?Justification?
The Humanist says, “Philanthropy”The Humanist says, “Philanthropy”
The Skeptic says, “PR ploy”The Skeptic says, “PR ploy”
The business person turns to a model The business person turns to a model that could help better explain the that could help better explain the possible logic behind such a move for possible logic behind such a move for both brick-and-mortar and pure-play both brick-and-mortar and pure-play sites.sites.
Carroll’sCarroll’s
The QuestionThe Question
Why should Pure-Play sites care?Why should Pure-Play sites care?
One answer could be in Porter’s model, One answer could be in Porter’s model, the the rivalry among existing rivalry among existing
competitorscompetitors (for page views). (for page views).
(Porter, 2001)(Porter, 2001)
The Debate:The Debate: To Give or Not to GiveTo Give or Not to Give
Brick-and-Mortar vs. Pure-PlayBrick-and-Mortar vs. Pure-Play
Against:Against:- Business fundamentals = maximize profitsBusiness fundamentals = maximize profits
““social policy is the jurisdiction of governments, not social policy is the jurisdiction of governments, not business” (Sexty, 2004, p. 4) business” (Sexty, 2004, p. 4)
For:For:- Society (consumers), fuel corporations, in turn a - Society (consumers), fuel corporations, in turn a
corporation should serve society corporation should serve society
- “social responsibility is in the stockholder's - “social responsibility is in the stockholder's interest…Corporate virtue is interest…Corporate virtue is
good for profits” good for profits” (Sexty, 2004, p. 3).(Sexty, 2004, p. 3).
PitfallsPitfallsBrick-and-Mortar vs. Pure-PlayBrick-and-Mortar vs. Pure-Play
Focus shifted from Focus shifted from profit makingprofit making
Possible Possible dissatisfaction of dissatisfaction of shareholdersshareholders
Could be seen as Could be seen as utilizing misfortune utilizing misfortune for pressfor press
Buttons divert Buttons divert traffic from sitetraffic from site
Customer focus is Customer focus is shifted from buyingshifted from buying
Could be seen as Could be seen as utilizing misfortune utilizing misfortune for pressfor press
BenefitsBenefitsBrick-and-Mortar vs. Pure-PlayBrick-and-Mortar vs. Pure-Play
Helps employeesHelps employees Helps community in Helps community in
which embeddedwhich embedded Promotes company Promotes company
name in positive name in positive mannermanner
Giving entails:Giving entails:• Employee timeEmployee time• Cash contributionsCash contributions• In-kind contributionsIn-kind contributions
Promotes company Promotes company name in positive name in positive mannermanner
Giving entails:Giving entails: • Employee time Employee time
(minimal)(minimal)• Addition of a button Addition of a button
to a web siteto a web site• Web page space Web page space
(minimal)(minimal)
Largest Corporate Contributors to Largest Corporate Contributors to KatrinaKatrina
Alexa (2006)
Pure Play Companies Contribute Pure Play Companies Contribute
By enabling the e-consumer to By enabling the e-consumer to contributecontribute
By facilitating easy payment optionsBy facilitating easy payment options• Pay-PalPay-Pal• Credit CardCredit Card• eGoldeGold• gBuygBuy
Users Want to DonateUsers Want to Donate
Search term on Google Trends “Hurricane Katrina Donate”
Google Trends, 2006
Online ContributionsOnline Contributions
Pearlstein (2006, February)
How Much Charities Raised Online
192525
10251435
1900
3000
0
500
1000
1500
2000
2500
3000
3500
1999 2000 2001 2002 2003 2004
Year
Mill
ion
s o
f U
S$
Contributions of Pure-Play Sites Contributions of Pure-Play Sites
Pearlstein (2006, February)
American Red Cross Disaster Fundraising
1078
568
1670
8.30
200
400
600
800
1000
1200
1400
1600
1800
2001 - 9/11Terrorist Attacks
2004 - AsianTsunami
2005 - HurricaneKatrina
2005 - SouthAsian
Earthquake
Year - Disaster
Mil
lio
ns
of
US
$
0%
10%
20%
30%
40%
50%
60%
Per
cen
t R
aise
d O
nli
ne
The Effect on Brick-and-Mortar The Effect on Brick-and-Mortar WebsitesWebsites
Alexa (2006)
Increased Page ViewsIncreased Page ViewsRank Spikes due to Hurricane Katrina
Alexa (2006)
Site 8/22 UniqueAudience (000)
8/29 UniqueAudience (000)
Growth
Advance Internet 516 1395 170%
ABCNews Digital 486 1102 127%
MSNBC 3181 6532 105%
WorldNow 558 1086 95%
Fox News 1106 2037 84%
Weather Channel 4482 7736 73%
AOL News 1833 3126 71%
AccuWeather 622 961 55%
Internet Broadcasting 1474 2140 45%
CNN 4817 6917 44%
News – Before and After News – Before and After Hurricane KatrinaHurricane Katrina
Nielsen//NetRatings (2005).Nielsen//NetRatings (2005).
The Effect on Pure-play SitesThe Effect on Pure-play Sites
Alexa (2006)
Hurricane Katrina
South Asian Earthquake
Post Holiday Slow down
Costs?Costs?
Search engine placement: $500.00Search engine placement: $500.00
Click through advertising: $2.15/clickClick through advertising: $2.15/click
A button on Google’s home page: A button on Google’s home page:
- priceless- priceless
Google’s Pioneering EffortGoogle’s Pioneering Effort
ConclusionConclusion
Pure play corporations are becoming Pure play corporations are becoming more mainstreammore mainstream
Pure play corporations are concerned Pure play corporations are concerned with their “public image”with their “public image”
Pure play corporations can react Pure play corporations can react faster than brick-and-mortar faster than brick-and-mortar corporationscorporations
Conclusion (2)Conclusion (2)
““Donate Here” buttons do not cost Donate Here” buttons do not cost much for the pure play corporationmuch for the pure play corporation
““Donate Here” buttons seem to Donate Here” buttons seem to benefit the pure play corporation in benefit the pure play corporation in the arena of Web metricsthe arena of Web metrics
Will it continue? Unfortunately we Will it continue? Unfortunately we have to wait to see…have to wait to see…
Thanks! Thanks!
Thanks for coming to the talk. Thanks for coming to the talk.
Questions? Questions?
ReferencesReferences Alexa (2006). Alexa Web Search. Retrieved 7/3/2006 from: Alexa (2006). Alexa Web Search. Retrieved 7/3/2006 from:
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Bhatnagar, P. (2005). Wal-Mart closes 123 stores from storm. Bhatnagar, P. (2005). Wal-Mart closes 123 stores from storm. CNN Money.comCNN Money.com. .
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