When firms and customers share social responsibility, profits rise but donations can fall

Firms sharing social responsibility for the social good with customers is generally seen as a win-win - more patronage from socially responsible customers and larger benefits to society. A forthcoming study in the INFORMS journal of Marketing Science, a leading academic marketing journal, however, questions the premise. The study finds that when a firm shares social responsibility with customers by asking them to "pay what you want," promising a certain percentage of revenues to be donated to charity, consumers respond to whether firms give, but very little to how much they give. A firm only needs to donate very little for customers to open up their wallet - a win for firms, but not for charities and society.

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