Can Coffee Shops That Have Become the Red Ocean Win with ESG?

Purpose: This study aims to investigate the relationship between ESG activities (Environment, Social, Governance) of coffee shops and their brand image, purchase intention. Research design, data and methodology: To test the hypothesis, a survey was conducted for about one month from May to June, 2021, and a total of 311 people responded to the survey, and the responses from 311 copies were used for the analysis. Validity and reliability analysis were performed, and the relationship between latent variables was empirically analyzed using the structural equation modelling. Results: The results of the study are as follows. First, among the ESG activities of coffee shops, the environmental and social sectors had a significant positive (+) effect on the brand image, but the governance aspect showed no significant effect on the brand image. Second, it was found that the symbolic image and the empirical image had a significant positive (+) effect on the purchase intention, but the functional image did not have a significant effect on the purchase intention. Conclusions: The results of this study suggest that as the number of coffee shops and the heated competition are increasing, it is possible to build a differentiated brand image through ESG activities rather than relying on the functions and services of competing products.