Holiday 2010 Cause Marketing: 6 Key Trends (Part 1)

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Holiday 2010 Cause Marketing: 6 Key Trends (Part 1)

Cause Marketing that Really Gives Back for the Holiday Season and Beyond: What Companies Need to Know
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Summary

Doing well by doing good: it’s not just a corporate catch phrase or nice-to-do anymore, it’s a must do for a growing number of businesses. With Pepsi cancelling its 23 year stint of Super Bowl commercials to instead invest $20 million in a philanthropic social media project, it is safe to say that social responsibility has gone mainstream.
 
A growing number of consumers expect businesses to not only “do good” but to provide opportunities for them to give back to causes that resonate with them.  And to be more open, innovative and collaborative about how they do it.  Cone recently found that 83% of consumers (85% of those aged 18-24 years) wish more of the products, services and retailers that they use would support causes and 80 % of consumers (85% of millennials) would switch from one brand to another (all else being more or less equal) if the other brand was associated with a good cause. (Source: 2010 Cone Cause Evolution Study).  And Edelman’s recent goodpurpose study found that 69% of Americans are more likely to buy products and services from a company if they know it supports good causes. (Source: 2010 Edelman goodpurpose Study). 
 
Following are the final 3 trends (and underlying support) for companies to consider around building authentic cause marketing programs to engage consumers and to offer their customers a convenient way to support causes they care about as part of existing customer experiences:
Monday, November 22, 2010 - 12:30pm

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1.    The outlook for cause marketing in the 2010 holiday season (and beyond): more creative, collaborative campaigns, more transactional & mobile programs.

All the available evidence suggests that not only will there be more cause marketing during the 2010 holiday season, but also that incorporating cause incentives and social responsibility initiatives into commercial operations is a long term trend.

The increased prevalence of cause marketing campaigns in consumer-facing businesses is an incident of the fact that increasingly (and perhaps happily for society) social responsibility and community investment are more top of mind with corporations and individuals than ever before.  This is evident in consumer demand: American consumers want more cause related offers.  Recent research from pioneering cause marketing consultancy Cone noted that despite the growth in cause related offers, 83% of consumers wish more of the products, services and retailers they use would support causes.  And Edeleman’s 2010 goodpurpose Study reported that purpose is a key purchase trigger: 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.

The research suggests that in a largely commoditized environment where other factors are more or less equal, consumers will choose the product or company that gives back over the one that doesn’t.  Further, the likelihood of people changing their behavior because of the cause offer increases with the level of relevance that the cause has with consumers.  In short, companies are figuring out that cause marketing – if done properly - works in terms of incenting purchases, switching behavior and forging stronger connections with customers.  The fact that many of these companies would be making the cause-related investments anyway but can now tie them to drivers of their businesses, effectively increases the ROI on those investments in a genuine win-win way.

For retailers, embedding the opportunity for customers to have an optional, convenient way to support causes that they care about as part of existing customer experiences is a compelling way to engage people around their products, their brand and the issues that people care about – and not just during the holiday season.  Augmenting microdonations with corporate funds to extend matching offers to customers (i.e.: if you make a donation to Charity X or the ABC Health Charity Fund, then Company ABC will match your donations up to $x million) is a way for companies to both incent giving (matching increases participation by 20%) and to communicate and actively involve customers in supporting company-chosen charities that they have partnered with. 

What we think we’ll see more of, both this holiday season and into 2011, are more transactional and embedded giving offers (that is more offers where supporting the cause is tied to the purchase of an item or other transaction and where customers are offered optional giving opportunities as part of a purchase transaction), more mobile cause marketing offers (as mobile shopping platforms like CitiShopper grow and as more consumers use location-based services like Foursquare, Gowalla and Facebook Places, there are more opportunities to retailers to make geo-specific promotions with a cause element to consumers) and more offers where companies are matching customers’ donations (i.e.: more transparency and customer intimacy in terms of how the company is helping, in additional to facilitating customer donations).

2.    Causes and brand connections: yes it matters, but what matters most is the connections with your customers.

The conventional wisdom of cause marketing has been to try to create an affinity between one’s corporate brand and a cause that aligns strategically with the product or company in hopes of creating brand lift.  While that is still a prevalent approach, more progressive companies are recognizing that in today’s world of the uber-web, social media and mass personalization, the consumer’s orientation of “Me in the Moment” suggests a different perspective; one that is more consumer-centric or bottom-up.  From Benevity’s perspective, what’s more important than the connection between the cause and the brand is the connection between the cause and the customers, or, in other words, the extent to which the cause (or causes) resonates with the retailers’ consumers.  If the goal is to create an emotional connection through the cause affiliation, it would follow that the cause needs to be resonant with the target audience (and that the more it is, the more effective will be the bond created).

So generally speaking, as more people get involved in giving back, it becomes less likely that corporate chosen causes will have broad enough appeal to cut across the retailer’s targeted segments or cohorts.  In order to be effective, the cause needs to matter to the customers of the brand.  Sometimes, even though there is a direct or logical connection between the brand and the cause, the cause doesn’t really appeal to the company’s customers: in such a case, the company is missing out on the opportunity to build brand and reputational benefits, and, even more importantly, the chance to connect with their customers around something they care about.  This can limit both the uptake of the cause marketing program as well as the benefits for the company. That is not to say that a direct connection cannot work (Tom’s Shoes is a successful example) but that the greater probability of success follows from greater customer alignment to the cause, rather than brand alignment.  One conclusion that can be drawn is that the alignment of the brand with the cause isn’t necessarily a guarantee of success (since it is not a given that the cause will resonate with customers) but the flip side, a misaligned cause and brand, is a pretty good predictor of failure (as an example, see the controversy over KFC’s parternship with Komen called Buckets for a Cure). 

The reality is that, in many cases, companies don’t really know which causes matter most to their customers.  And that leads to cause marketing offers that companies think are aligned with their brand and matter to their customers but which may not play out in reality.  It also leads to market saturation of certain causes (and pejorative labels such as “causewashing” and “pinkification”).  An example is breast cancer: there is absolutely no doubt that there are many great charities out there focused on breast cancer and that they benefit from corporate partnerships but the fact is that there are also many companies that think, simply because they are a cosmetics company or a women’s clothing company, that they should develop a “pink” product or donate a portion of sales to a breast cancer charity.  And although none of their customers would deny that breast cancer is a great cause and one that (unfortunately) touches everyone in some fashion, there are also many other great causes out there and a range of causes that matter to female consumers. 

That’s a big part of why we’re seeing more companies trying to actively involve their customers in cause marketing by doing things like crowdsourced cause programs, where they try to get people involved in selecting the causes to donate to.  Examples of well-known crowdsourced cause marketing programs include Pepsi Refresh, Chase Community Giving and Target Bulls Eye.  The challenge with these is that they are often voting-based programs (where consumers vote on which charities or projects to which the company should donate) that occur on social networks outside of customer experiences with the company and that can be de-motivating to those who care enough to vote but whose causes aren’t selected as winners.  It’s also a reason why we’re seeing such interest in our technology at Benevity: companies are looking for an easy and cost-effective way to embed flexible, choice-driven giving into their existing customer experiences, under their own brands and using mechanisms that not only empower choice, but still enable the company to create bias toward chosen charities or pillars that are strategic to them through donation matching offers.

3.    The Cone and Edeleman studies show that consumers are willing to switch brands, buy more expensive brands or spend more with brands who support causes.  Here’s our take on why this trend is:

We think it is because, when companies give consumers an opportunity to support causes they care about as part of an existing customer experience or everyday purchase transaction, they are making it easy for them to support something that really matters to them at a core level.  “I might be donating my time or money to this cause anyway, so if this company or product is helping me do that through the convenience of buying their product or service, it’s worth it to me to pay a little more for it”, is the likely logic.  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.  It is even more powerful if the cause related offer is 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 companies really engage consumers and realize the business benefits.

Look for part two in this series and learn about three more trends that are shaping the way that companies build authentic cause marketing programs for the holidays and beyond.

 

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: benevity / cause campaign / cause marketing / charitable gift cards / corporate giving / corporate philanthropy / holiday giving / mobile donations / online donations / micro donations

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