All are welcome! How power distance belief and religiosity impact consumer responses to corporate racial equity initiatives

Purpose This paper aims to investigate consumer responses to diverse racial representation (DRR). DRR is a policy of ensuring that employees from racial minority groups are fairly represented in a company's teams and it is one way brands could promote marketplace equality. Although researchers have begun to investigate DRR's implications for marketing, little attention has been paid to the roles of power distance belief and religiosity in this domain. Design/methodology/approach This research reports three experimental studies examining consumer responses to the adoption (vs non-adoption) of DRR. Moreover, these studies explore the moderating role of power distance belief and religiosity while establishing the mediating role of perceived altruism. Findings The results demonstrate that a brand’s DRR adoption (vs non-adoption) decision increases willingness to pay and advocacy intentions. Furthermore, the positive effect of the brand’s DRR adoption on willingness to pay and advocacy intentions is stronger among consumers with lower power distance beliefs driven by perceived altruism. This research also identifies religiosity as a boundary condition, such that the interactive effect between DRR adoption and power distance belief is attenuated among consumers with higher levels of religiosity. Research limitations/implications This study provides valuable avenues for future research. The authors found that cultural and religious values are critical in consumer responses to racial equity initiatives; future research should explore other cultural variables not examined. Additional research is needed to investigate other factors that impact consumer reactions to racial equity initiatives from different settings to extend the research findings. Practical implications The authors found that consumers value and could punish brands failing to promote racial equity. This effect is more pronounced among consumers with low (vs high) levels of power distance belief or religious ones. Thus, managers operating in different locations should consider their customers’ dominant cultural and religious values when deciding whether to adopt racial equity initiatives to avoid adverse consumer reactions. The authors show that managers can leverage consumers’ religious values to improve brand outcomes following the adoption of racial equity. Originality/value The findings of this research demonstrate the crucial roles of power distance belief and religiosity on consumer decisions, thus enriching the literature and providing guidance for managers wishing to adopt equality-based initiatives.