Corporate Social Responsibility and Customer Loyalty: The Mediating Role of Co-creation and Customer Trust

Abstract

In this era of competition, the service sector is highly concerned about retaining customers and focusing on factors that can enhance customer loyalty. Therefore, this research aimed to investigate the influence of corporate social responsibility on customer loyalty. Moreover, it examined the mediating role of co-creation and customer trust in the relationship between corporate social responsibility and customer loyalty. The explanatory and cross-sectional research design was utilized in this study while primary data were gathered from customers of Chinese commercial banks and 235 responses were gathered. To achieve the research objectives a model of six hypotheses was developed and tested via structural equation modelling by using AMOS 24. It was found that corporate social responsibility significantly and positively affects client loyalty. Moreover, it has an indirect impact on client loyalty via co-creation and client trust. The indirect effect is stronger than the direct effect which suggests that implementing co-creation activities and increasing client trust can make it simple for socially responsible organizations to improve client loyalty. Furthermore, the results revealed that there is a positive and significant direct impact of co-creation on customer trust. The study is limited to the service sector and has ignored product brands that require more investigation. Therefore, in the future, the study model can be replicated to compare product and service brands.