by Teri Robnett
(Published in Brainstorm! November 2005)

Are you looking for a way to add some new life and pizzazz to your marketing efforts? Do you want to increase sales and loyalty from customers and employees? Cause-related marketing may be the answer.

The phrase "cause-related marketing" (CRM) was first used by American Express in 1983 to describe its campaign to raise money for the restoration of the Statue of Liberty. American Express made a one-cent donation to the Statue of Liberty every time someone used its charge card; the number of new card holders soon grew by 45%, and card usage increased by 28%. The campaign generated $1.7 million for the restoration efforts.

Cause-related marketing is more than simply writing a check to your favorite charity. It is a strategic partnership between a for-profit business and a nonprofit organization designed to achieve specific goals for both parties. This strategy is intended to promote the company's products or services while raising money for the cause.

Many companies have benefited by implementing cause-related marketing strategies. Here are a three examples.

Coca-Cola: In 1997, Coca-Cola donated 15 cents to Mothers Against Drunk Driving for every case of Coca-Cola bought during a 6-week promotion in more than 400 Wal-Mart stores. Coke sales in these stores increased 490% during the promotion.

Calphalon Corporation: The Calphalon Corporation co-branded several of its poorly-selling pans with the Share Our Strength name and logo and donated $5 to the nonprofit for every such pan sold. Sales of these pans increased 250%.

Dollar-Rent-A-Car: In 1993, Dollar-Rent-A-Car joined forces with the Special Olympics, donating $1 to the nonprofit for every car booked during the 6-week campaign. Bookings by travel agents increased 25% during the promotion.

You don't have to be a big company to put CRM to work for you. You can design a program that works for your business.

• A local realtor donates a percentage of every commission on the sale of a house to a local charity. He's seen his listings and sales increase since he started promoting this to customers.
• A jeweler partners with the Denver Affiliate of the Susan G. Komen Foundation, designing jewelry to raise money for breast cancer research.
• Each year a small technology firm holds a friendly competition among employees to raise money for a local food bank.
• Businesses around the Denver area partner with Metro Volunteers for help with events and activities such as A Visit from St. Nicholas.
• Restaurants nationwide donated proceeds from sales on October 5 to the Red Cross Disaster Relief Fund in the Dine for America program.

How do cause-related marketing campaigns impact consumer perceptions and behaviors?

• Almost 90% of teenagers said they would switch to a brand affiliated with a good cause, if price and quality were equal.
• 60% of consumers surveyed planned to buy a product during the 2004 holiday season through which a portion of the purchase price would be donated to a cause.
• 48% of American and British consumers surveyed reported that, in the past, they had been motivated by a cause-related marketing campaign to change brands, use a product more, try new products, or get information about new products.

How does cause-related marketing impact employees?

• Assuming equal location, pay, benefits, and responsibilities, 72% of Americans say they would choose to work for a firm that supports charitable causes over one that does not.
• A 1999 survey reported strong loyalty toward their employers from 87% of employees at companies with cause-related marketing programs, compared to two-thirds of employees at firms without such programs.

Unfortunately, not all CRM efforts are successful. Benefits can be limited or even offset when risks associated with partnerships are not clearly defined or negotiated, are executed poorly or are conducted in ways that lack integrity.

When considering the possibility of entering into a marketing relationship, a nonprofit organization should consider the following:

• Know who you are and what you're about. Have an organizational policy in place before you sit down with a company.
• Select your partnerships carefully. Consider the company's and your organization's images and missions. Is there a good fit?
• Be clear about how the partnership will benefit both organizations. Remember, this is a business decision. Develop a contract that outlines the specifics of each party's responsibilities and expectations.
• Apply ethical behavior standards and always maintain good two-way communications with your business partners.

Because this is a long-term relationship, a company should address the following questions when considering partnering with a nonprofit organization.

• How does the organization's mission and image fit with my business? Is this a cause I feel comfortable supporting?
• Will my customers, potential customers and employees connect with the message? In other words, it may be a great cause but may not be one that resonates with your customers.
• How will my company benefit from this partnership and for how long? Be clear about the responsibilities of both parties and get it in writing.
• How will the money or other resources I provide be used?
• Who else is partnering with this organization? Are these businesses I want to be associated with?
• What opportunities do I have to promote this relationship? How will this marketing strategy be implemented by both parties?

Cause-related marketing efforts are built on shared or complementary strengths of companies and nonprofit organizations. Activities may include information exchanges, research, contributions of company personnel or resources, promotional efforts, and the development or strengthening of community services and capabilities. We encourage you to consider putting this powerful strategy to work for your company.

For more information on cause-related marketing, please visit these web sites:
The Foundation Center
Expert Magazine
Business for Social Responsibility
PSA Research
Cause Marketing Forum
Susan G. Komen Foundation

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