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Social Cause Marketing - The Regis Group Inc

Social Cause Marketing - The Regis Group Inc

in exchange for being

in exchange for being associated with the cause, as well as many businesses with lower contribution levels. Anyone who doubts the lure of breast cancer awareness as a marketing tool need only visit any department, grocery, or drug store during the National Breast Cancer Awareness Month each October. The sheer number of manufacturers who adorn their products with pink ribbons and offer to donate a share of their sales to the cause is astonishing. As new technologies emerged, cause marketing efforts have followed. One example is the ëgiving mallsí that have sprung up on the Internet during the past decade, catering to customers who prefer to spend their money with businesses that ëdo goodí. For example, iGive.com, links customers with more than 700 affiliated merchants willing to donate anywhere between 0.4% to 26% of every transaction to over 24,000 nonprofit groups selected by registered iGive members. The chance to be associated with a good cause is not lost on retail giants such as Amazon.com, L.L. Bean, Barnes & Noble, Office Max, eBay, and Dell. During its first nine years of existence, iGive.com distributed nearly $2 mn to charitable causes. But, as iGive itself acknowledges, the arrangement is ìmore than shopping for a cause,î because members have access to exclusive coupons, free shipping deals, and sales alerts. Although it is difficult to assess the level of consumer participation in the many cause-related efforts, consumers report a high degree of satisfaction. A Cone/Roper study conducted in 1993- 94 found that 84% of respondents had a more positive image of a company if it did something ìto make the world better.î In addition, 78% of adults said that they would be more likely to buy a product associated with a cause they cared about, 66% would switch brands in order to support a cause they found to be important, 62% would switch retail stores to support a cause they believed in, and 64% thought that cause marketing should be a standard part of a companyís activities. The impact of cause marketing was found to be strongest on people who had attended at least some college and earned more than $30,000 annually. A follow-up survey among young people conducted in 2006 showed an even stronger consumer endorsement of cause marketing, with 89% of those interviewed indicating a preference for a brand associated with a good cause if the product did not differ in price and quality from that of its competitors, and 83% claiming to have more trust in a company that came across as socially and environmentally responsible. 7 Cause Marketing: Who Really Benefits? At first glance, cause marketing appears to be a win-win situation for businesses and nonprofits alike. The latter are able to obtain the funds they need, while the former get to reap the benefits of performing good deeds. Judging from the increase in cause marketing, it seems businesses have clearly embraced the concept, and few charitable organizations are turning the private sector away. This does not mean, however, that the practice of merging marketing and social causes is without problems. While cause marketing can do a wonderful job of collecting funds for the affiliated nonprofit organizations, it should not be forgotten that charities in desperate need of funding may venture into partnerships that are far from equal and may even have the potential to cause more harm than good. Because cause marketing is an attempt to increase a firmís return on its investment, it goes without saying that causes are not always selected on the basis of the potential good that can be achieved; rather, the focus is often on the free publicity and increased sales that a particular affiliation might bring to a company. In fact, and this is particularly true when it comes to business alliances with the larger Cause Marketing nonprofits, cooperation can generate free publicity and many PR opportunities, thus saving advertising and promotional expenses for the business involved. In their eagerness to reach and impress affluent consumers, companies have started to poll this group in order to determine their charitable preferences and, consequently, where to focus future cause marketing efforts. In February 2006, for example, the Luxury Institute, a research group that claims to be ëthe sole independent voice of the wealthy consumerí, surveyed households with more than $5 mn in personal wealth and $200,000 in annual income to identify their favorite nonprofit organizations. Habitat for Humanity, Americaís Second Harvest, and St. Judeís Hospital topped the list, followed by numerous healthand research-related charities. 8 Nonprofit groups that serve a valid social function but fail to fit a corporate pro- Relying on a market-driven system in which support for social causes hinges on whether they can complement a sales message leaves much to be desired and gives business too much power file or to appeal to the customer groups that businesses want to reach risk being ignored, while causes that serve as better marketing vehicles may receive a disproportionate amount of interest. Relying on a market-driven system in which support for social causes hinges on whether they can complement a sales message leaves much to be desired and gives business too much power. All too frequently, the true nature of a businessís contribution is not explained to the public. How, for example, is ìa portion of the profitsî translatable into dollars and cents for the cause, and who benefits more from a transaction, the business or the nonprofit organization? 7 Cone/Roper; http:/ www.causemarketing forum.com/page.asp?ID=473. 8 http://www.causemarketingforum.com/ page.asp?ID=434. SEPTEMBER 2009 36 EFFECTIVE EXECUTIVE

SBH SEPTEMBER 2009 37 EFFECTIVE EXECUTIVE

THE Mclaren GROUP CORPORATE SOCIAL RESPONSIBILITY ...
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