You’ve no doubt heard of “cause marketing.” It’s a term used to describe the joint efforts by a for-profit business and a non-profit entity to market (and possibly to sell) something for mutual benefit.
So let’s explore cause marketing a bit more, the whys and hows, and the possible advantages and concerns. We’ll also offer up some examples of well-executed, successful cause marketing campaigns.
What is Cause Marketing (Or Cause-Related Marketing)? Where Did it Come From and How Does it Work?
A bit of history will help explain cause marketing more fully, so here goes:
Hard to believe (considering how ubiquitous it is), but cause marketing really only began in the early 1980s; its first big public appearance was when American Express teamed up with a non-profit group to raise funds for restoration of the Statue of Liberty. The partnership provided a certain dollar amount to the restoration fund when someone signed up for an American Express card, and even donated a small portion of every card purchase to the non-profit group.
American Express pushed the fundraising aspect considerably over a three-month marketing campaign, making the collaboration a true win-win; it raised $1.7 million for the restoration project and AmEx saw its card use increase by 27 percent. Applications for new cards also increased by 47 percent.
AmEx won in two ways: it gained new customers, increased revenue and earned a reputation as a socially conscious business.
How Does It Work?
In simple terms, a non-profit and a business agree to raise money and awareness for a particular cause. The business makes sure the public knows it’s doing this and is interested in the things its customers find important. The non-profit receives money as well as a higher public profile due to its cause marketing partner’s efforts.
The different types of cause-marketing efforts could include:
- Purchase plus, which takes place at the checkout counters in grocery and retail stores with customers adding a bit more to their bill as a donation.
- Product sales, which has companies selling specially branded products (clothing, hats, technology, etc.) to interested consumers, with a portion of the selling price going to the non-profit.
- Cobranding programs and/or events. (Think of the Susan G. Komen “Race for the Cure.”)
- Licensing the nonprofit entity’s assets, brand and/or logo on t-shirts, mugs, credit cards, etc. The American Heart Association’s endorsement of certain heart-healthy products is an example.
- Public service marketing programs that are designed to encourage some type of behavior change in a certain audience. Think of the American Cancer Society’s partnering with different companies over the years for its Great American Smokeout.
What are Some Advantages?
The non-profit raises funds and is able to hitch its star to the well-known business (as well as benefit from the business’ marketing efforts).
The business earns points with its audience, positioning itself as a socially conscious enterprise, often resulting in a new customer base, increased revenue and brand awareness.
What are Some Concerns?
The main concern is that a for-profit business will partner with a non-profit entity or other cause-related enterprise only to earn the public’s goodwill for being socially responsible. In other words, a business risks being seen as participating only for the good PR; the public may view the company’s motive as an “insincere effort” to attract more customers or more customer loyalty.
Who Has Done/Done it Well?
TOMS, for one! The shoe manufacturer’s well-known One for One® campaign provides shoes, eyewear, coffee and more whenever a customer purchases a pair of shoes, bag, and other TOMS products. Buy one pair of shoes, and the company donates a pair to a child in need. You may not know that TOMS’ efforts help to ensure safe births in poverty-stricken areas.
How Cause Marketing Can Matter to Your Company or Non-Profit
When done well and with sincerity, cause marketing can be a true win-win for both the business and the charity. Yet like any marketing campaign it takes a savvy strategy and focused execution to ensure its success.