The Edelman goodpurpose® 2010 Study And What it Means for Companies, Cause Marketing and Corporate Philanthropy

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The Edelman goodpurpose® 2010 Study And What it Means for Companies, Cause Marketing and Corporate Philanthropy

From Report to Real Business: How to Take Action
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Summary

In Part 1 of Benevity’s take on the Edelman goodpurpose® 2010 study, we shared a conversation with Mitch Markson, Chief Creative Officer of Edelman and founder of Edelman goodpurpose.  Now in Part 2, our attention turns to helping companies make the rubber hit the road to drive forward innovative, high-engagement cause marketing and corporate philanthropy programs that leverage the data.  We call it From Report to Real Business: How to take Action.  Read on. 

So what do companies need to know about the 2010 Edelman goodpurpose® Study? And how can they take action? Keep reading to find out our take on the key findings and the key actions for companies.

Thursday, November 18, 2010 - 12:00pm

CONTENT: Blog

In Part 1 of Benevity’s take on the Edelman goodpurpose® 2010 study, we shared a conversation with Mitch Markson, Chief Creative Officer of Edelman and founder of Edelman goodpurpose.  Now in Part 2, our attention turns to helping companies make the rubber hit the road to drive forward innovative, high-engagement cause marketing and corporate philanthropy programs that leverage the data.  We call it From Report to Real Business: How to take Action.  Read on. 

So what do companies need to know about the 2010 Edelman goodpurpose® Study? And how can they take action?  Here’s our take on the key findings and the key actions for companies:

1.    Perfunctory (er, ribbon-slapping) cause marketing and checkbook charity is over: building causes and social purpose right into business models and corporate culture is integral to citizen consumers and their expectations.

Key Findings

Nearly two-thirds (62 percent) of Americans feel that it is no longer enough for corporations to simply give money away to good causes; they need to integrate them into their day-to-day business.

Global consumers demonstrate high expectations of corporations and prove that many of the traditional divisions between product & service brands and corporate conduct and issues are quickly blurring, if not eroding.

„  63% of Americans expect brands to do something to support a good cause

„  63% of Americans expect brands to donate a portion of their profits to support a good cause

„  68% of Americans have more trust in a brand that is ethically and socially responsible

Key Actions

In the face of increasingly persuasive data from Cone and Edelman (among others), it’s clearly time to step back and rethink your corporate philanthropy, community investment/CSR and cause marketing strategies (and if you don’t have any, to develop them!). 

Specifically, it’s time for companies to stop “doing things the way we’ve always done it” and examine a new cause engagement paradigm shaped by the context of the available data (and yes, this may mean changing things like: one company-one cause, no customer or employee involvement cause marketing campaigns; blindly outsourcing giving campaigns to charity aggregators; sprinkling your community investment dollars here and there hoping to meet multiple requests but ultimately satisfying (and engaging) no one, etc.). 

Instead, start really thinking about how you can integrate opportunities for your customers and employees to support causes that they care about as part of doing business with you, while also involving them in causes that you support corporately.  Consider things like: How can you tangibly and authentically make supporting causes easy, convenient and hassle-free for your customers and employees?  Can I tie these actions to other actions that also help the company do well?

At Benevity, companies are contacting us in increasing numbers (which is good, because we don’t have any salespeople!) because their customers or employees (or in some cases, their clients’ employees) are asking for ways to give back as part of their interactions with these companies.  We’ve built a software platform and some best practices that are focused on helping businesses embed giving into their existing transactions and we’ve augmented it with out-of-the box branded, flexible-choice solutions for charitable gift cards and workplace giving, based on client demand.  It’s automated, cost-effective, brand and charity agnostic, and it works!

Why wait for your customers and employees to ask? Or risk losing them as they switch to other brands/companies/employers who have already figured out how to do this well.  Our advice: start thinking about this now, on the customer-facing and employee-facing sides of your business. 

2.    Purpose is a primary purchase trigger (consumers say causes matter more than design and innovation and even deep discounts) so give people a reason to support your company by building resonant causes into your business transactions. 

Key Findings

For four years in a row, U.S. consumers rank purpose as significantly more important than design/innovation or brand loyalty as a purchase trigger when quality and price are the same.  According to the 2010 goodpurpose Study, nearly half (47%) of Americans cite social purpose as the number one deciding factor, while twenty-seven percent cite loyalty to the brand and twenty-six percent cite design or innovation when quality and price are the same.  The goodpurpose study shows that, after quality and price, the key purchase trigger is social purpose.

Nearly three out of four Americans (72 percent) report that they are more likely to give their business to a company that has fair prices and supports a good cause than to a company that provides deep discounts but does not contribute to good causes.  In fact, more than half of consumers say that they are willing to pay more for a product that donates a portion of its profits to a good cause. 

Key Actions

Whether online or bricks-and-mortar, retail or services, causes can tip prospects into customers.  People are busy and, even though there are many great destination giving sites (websites that aggregate donation opportunities in many forms) or the option to donate directly via charities web sites, this requires a higher level of motivation and more time than the ease of building giving into already-occurring activities (like doing your banking online, paying bills, redeeming your loyalty points, receiving a paycheck, making a purchase, and well, just about any transaction that happens between companies and their customers, employees, suppliers and partners). Why not use the data and your brand environment to your distinct advantage through embedded giving?

We’d like to point out a few challenges with existing transactional giving: one, donation currency rebates or POS customer top-ups typically go to a single charity that the consumer has nothing to do with selecting; two, consumers who make donations aren’t typically receiving tax receipts for their gifts; three, many programs beg the question of what the company is contributing as part of the program; and four, these programs are difficult to administer, change and track (thus the seasonal nature of many existing offers).

Giving companies an easy, cost-effective way to build optional charitable giving into their existing business transactions, under your own brands and on your terms, with or without donation matching offers, is exactly what we’re all about.  We’ve built a micro-donation platform, essentially a highly customizable giving engine, to help you do it.  And what can you do with it? See that transactional list above: you can build optional charitable giving (to any registered charity, or portfolio of charities with any degree of choice that you decide to expose) of any amount (micro-donations mean pennies could be donated or any amount above that!) into any existing transaction, with or without donation matching, and provide access to an electronic tax receipt with your brand on it.  How’s that for cool and impactful?  

3.    Be transparent and authentic: keep it real and consumers will be okay with the idea that you’re also benefiting by giving them (optional) opportunities to support causes at the same time that they are supporting your company.  

Key Findings

Consumer skepticism is rising as nearly half of Americans (47%) feel that brands only support good causes for publicity and promotion, not because they really care – up 10 points since 2008.  (As an aside, do you think if the consumers were empowered to choose the charities the number would be that high?)

And elsewhere in the study…

„  79% of Americans think it is okay for brands to support good causes and make money at the same time

Key Actions

We think that consumer skepticism is driven by two prominent problems in most current cause marketing campaigns: overexposure to certain causes (which is another way of saying they don’t like you choosing the causes for them) and lack of transparency/authenticity.

Sometimes the current state of choice in cause marketing harkens to the early days of the automobile (when Henry Ford said, “you can have it in any color, as long as its black!”).  In most current cause marketing offers, there is one company (or product) and one cause.  Typically, it is a big brand cause that has a national presence, since conventional thinking suggests that will give the greatest chance of broad engagement. Buy the item and a portion (or dollar value) goes to support the single chosen cause.  Pundits talk of greenwashing and pinkwashing, and cause fatigue, largely because the same causes are frequently selected (i.e.: breast cancer during October, heart health in February, etc).  To criticize these programs is like saying you don’t like kittens, but many just vote with their feet (or wallets) because the program doesn’t resonate.

What if companies had an easy way to enact flexible choice without the administrative burden?  That is, companies can give their customers and employees the option to support any registered charity? Or any subset of the registered charity list? Or corporate portfolios (selections of causes that the company chooses, such as Company ABC Environment Fund or Health Fund or Kid Fund noted above, or a portfolio of different causes that are local based on the location of the consumer)? That’s flexible choice and that’s what you can do with Benevity’s platform.  Using our giving engine, when it comes to selecting causes, literally, the choice is yours.

In terms of transparency/authenticity, when you ask consumers to support causes as part of a transaction or cause marketing effort, know that they will be wondering what you are doing for the cause. And are you communicating this to consumers?  One way to address this: consider real-time matching.

Matching is cause marketing’s fire-starter.  Adding a matching offer to either a consumer or employee giving opportunity is a way to increase participation as well as incent donations to charities (or cause portfolios that correspond to pillars of a corporate philanthropy strategy) that align to your company’s charitable goals.  And the great thing about it is that you only pay out when the targeted action is taken.  Heck, it’s better than pay-per-click advertising and makes the world a better place!

It’s also a resonant and relevant form of cause communication: one of the challenges that companies have told us that they struggle with in their corporate philanthropy practices is really engaging their stakeholders in giving and making them aware of all the community investment that they are already doing.  Not to mention, would a cause rather get $1 directly from you or $2 from you and your customers?  Matching is a way for companies not only to get the word out in a transparent and authentic way, but also to leverage existing budgets to greater effect.  Kind of a “put your money where your mouth is” message.  

4.    Give people a seat at the table: involve your customers and employees in giving back and they will give back to you by switching to, supporting and recommending your company.

Key Findings

A significant number of American consumers are willing to purchase, recommend and promote companies that show a commitment to good causes

„  69% of Americans are more likely to buy products and services from a company if they know it supports good causes

„  62% of Americans would switch brands if a different brand of similar quality supported a good cause

„  64% of Americans would recommend a brand that supports a good cause

„  66% of Americans would help promote products or services if there’s a good cause behind them

“Citizen consumers” are taking action to support cause brands by purchasing, recommending and promoting their products and services.  They want to work alongside brands and corporations to develop the best ideas for solving the world’s problems, then tackle them head on.

…And many are also willing to punish those that do not.  More than one-third of Americans would punish a company that doesn’t actively support a good cause by criticizing it to others (34 percent), refusing to buy its products/ services (36 percent), or sharing negative opinions and experiences (37 percent).  Nearly one-half (47 percent) would not invest in such a company.

Key Actions

We’re big on involvement.  It’s time to move beyond the big cardboard check and provide ways for your customers, employees and partners to actively participate in your social responsibility/community investment strategy.  Like what?  Well, we don’t want to take away from some of the other strategies we’ve talked about, like building charitable giving opportunities into your business transactions or using the power of matching to take it up a notch, but how about creating a number of corporate cause portfolios (a selection of causes, such as an Environment Fund comprised of chosen environmental charities or a Health Fund made of up selected health charities) and getting your customers and employees involved in selecting which charities are part of the fund?  (This is what iStockphoto, a top-250 Alexa-ranked e-commerce web site that sells stock photo, video and audio content and a Benevity client, did when it asked its 5 million plus members to determine which charities it should make donations to when clients purchase select items from the site).  We would like to have seen them make a longer list, to localize it, to let customers add it to a profile, etc., but it sure was better than a poke-in-the-eye!

When you give your consumers an opportunity to support causes they care about as part of an existing customer experience or everyday purchase transaction, you’re making it easy for them to support something that really matters to them at a core level.  Retailers who provide these opportunities are building a way to connect with customers around values as a new form of loyalty; these are emotional connections and that is powerful stuff.  But don’t be mistaken about the impact of doing it wrong.

Consider this:  on checkout, I’m asked to donate $2 to a charity selected by the supermarket, and they’ll add it to my bill.  Based on a superficial assessment of the cause data, this should help with business, right?  But let’s say your choice of charity doesn’t matter to me.  If I say no, the man/woman beside me in line thinks I’m a selfish cheapskate so I feel badly about saying no; if I say yes, I feel badly because in my mind I’m taking $2 from the animal shelter that I care about.  In fact, what I’m also really thinking is “why are you just getting two bucks from me, what are you doing for the charity”? So whether I say yes or no, I feel badly.  Are you building loyalty with me through this initiative?  [Ironically, might I prefer to go to the market where they don’t ask me to give back?]

An alternative: that swipe card that you gave me with your name on it has an introductory charitable gift of $25 on it, that I redeem on your site by completing my profile and selecting a charity.  If I pick the [insert supermarket name] Kids Fund, you will match the gift.  My profile on your site enables me to select one or more charities in a kind of virtual foundation. I discover that if I select the [insert supermarket name] Fair Trade Fund for my donations, you will match them up to a cap.  I can set it to round up my purchase amount to the nearest $1 or $2 or $5, and you will do it automatically, every time I purchase. Alternatively, you can ask me at the cash to add a fixed amount and if I say yes, it goes to my selected charities – I always say yes!  I can also generate donation currency for my little foundation by buying specific products that generate a donation rebate, and it all feeds my donation bucket.  At the end of the year, I discover that I’ve given $300 bucks to my chosen charities, and you’ve matched it with another $100.  You send me a message in November reminding me that I’ve got donation currency to allocate, and a tax receipt (with your name on it).

Which cause marketing program do you think is more effective? Hint: the second one is Powered by Benevity…

This stuff is even more powerful if the cause related offer is empowered, transparent and authentic: in other words, if the company is clear about how much and how it as a corporation will be supporting the causes.  So things like donation matching and clear communication about cause related offers can help your really engage consumers and realize the business benefits.

Also, think about creating switching costs.  If you’re helping me support my favorite cause as part of doing business with you, a decision to switch isn’t just about me deserting your brand, I’m also deserting my animal shelter… 

5.    Causes as gifts: the gifts that keep on giving, and an opportunity to engage new and existing customers through giving back.

Key Findings

More than one-third of Americans (34%) say they would prefer to receive a donation to a good cause as a gift rather than an item that a friend had picked out “knowing that you would like it.”

Key Actions

And just in time for the holiday season!

So how can you act on this and at the same time connect with consumers under your own brand (rather than sending them to a destination site to purchase a charitable gift card that has no link to your company)? 

We’ve built a charitable gift card product that enables companies to give their customers and employees a way to donate to their charities of choice from a branded environment.  The product helps companies highlight their corporately supported charities and causes (including the ability to create cause portfolios or funds that related to community investment pillars, such as the ABC Company Kids Fund, comprised of 10 kids charities or the Boston Health Fund to support health charities in a specific city).   Companies can use it to make matching offers that can incent donations to corporate funds or selected charities.  And companies can even rewards donors with gift cards and enable consumers who come to the site to purchase (or top up) donations so that the gift card recipients, who may not be your customers (yet!) come to your branded site to make their donations, and are exposed to your brand, company causes and potentially promotional offers as well.  Very viral, karma edition.   

About Benevity

Benevity has developed North America’s first embeddable microdonation platform, a highly customizable giving engine that socially responsible businesses can use to engage their customers, employees and corporate partners in optional charitable giving on their terms.

Benevity lets companies integrate user-directed, tax receiptable donations and corporate matching programs into their existing transaction environments, using their own brands and systems. The Benevity platform helps companies build authentic and impactful cause marketing, workplace giving and other social responsibility initiatives that increase engagement, brand differentiation and return on social and community investment. To find out more, visit us at www.benevity.org or view our short video at www.benevity.org/Goodness3.0.

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Keywords: Community Investment | Purpose | benevity | cause marketing | causes | corporate charitable giving | corporate matching | corporate philanthropy | social responsibility | workplace giving

CONTENT: Blog