Why Cause Marketing Matters

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.

Michigan digital marketing agency Ingenex Digital Marketing can help you and your partner create an effective cause marketing campaign. Contact us to learn more.