Cause Marketing

Two professors at the Ohio State University have a new take on the benefits of cause marketing; it helps keep supplier pricing in check. Their paper, called “ A Supply-Side Explanation for the Use of Cause Marketing ” by Anil Arya and Brian Mittendorf, starts with the proposition that, “firm profits under simple(non-strategic) corporate philanthropy wherein the firm pledges a donation amount to charity. The paper then demonstrates that the firm can achieve the same donation level while also cutting supplier costs by tying donations to sales. Such a cause marketing tie-in intrinsically undermines the per-unit profitability of each product by adding a new marginal cost of sales. As such, the cause marketing pledge makes the firm's input demand much more sensitive to supplier pricing. This increased sensitivity to pricing persuades the supplier to charge a lower price so as to boost demand for its input. In effect, by engaging in cause marketing, the firm is able to make the supplie...

A new survey of corporate communicators finds that most companies spend no more than 10 percent of their communications budget telling the world about their CSR efforts, and fifty percent of their communications outreach is media relations and internal audiences like employees. The survey comes from London-headquartered Grayling , the world’s second largest independent PR agency with annual billings of $148 million. Among other findings: Just 12 percent of companies use social media to talk about CSR/sustainability efforts. Only 52 of companies believe that the media is interested in covering CSR issues. Thirty percent believe that impact of their CSR is to their corporate reputation; just 6 percent think that it positively affects sales. Companies say the main drivers for CSR/sustainability are a genuine sense of responsibility (31 percent); staff morale (16.6 percent); government regulation (12.4 percent). The top three areas of focus for CSR/sustainability are ...

A recent study finds that your Facebook posts are more memorable than individual sentences from books, or even human faces. One possible reason is that people remember Facebook posts is that they're more like dialogue and less like dry prose. The paper published in the January 2013 issue of Memory and Cognition and called Major Memories for Microblogs and it details several experiments involving how well people remember Facebook posts. The paper’s authors were Laura Mickes, Ryan S. Darby, Vivian Hwe, Daniel Bajic, Christine R. Harris, Nicholas J. S. Christenfeld of the University of California at San Diego, and Jill A Warker of the University of Scranton. Professor Mickes has a new appointment at the University of Warwick in Coventry. In the first, they tested for how well people remembered the status updates of strangers in Facebook. Study subjects were randomly assigned to see on a screen either Facebook posts or sentences from books for a brief flash. Immediately after...

In this season of the year, it’s easy for a retailer to be involved in two or three or even more cause promotions at the same time. But when you activate these promotions should you aggregate them together, or spread them around? Case in point is this recent weekly flyer from a local grocery chain with 24 outlets called Fresh Market. On the top left is their paper icon campaign, which is meant to deliver a holiday meal to families in need. To its right is an announcement that Fresh Market stores serve as a drop-off point for Toys for Tots. Below that is a vendor program from Kraft that Fresh Market participates in and which benefits local food banks. Now, plainly, someone from Fresh Market decided to group all these cause promotions together on one page, since the full flyer was six pages long. But is aggregating them the right approach? So much of what this blog is about is activating cause marketing promotions. But I confess that I have no idea whether Fresh Market got this right o...

A public opinion survey published Nov. 1, 2012 by Ottawa-based Abacus Data finds Canadians very supportive of the basic practices and premises of cause marketing. The Internet survey of 1208 Canadians found the following: 82 percent say they would switch brands to support causes they care about. The same number of people say that companies should donate to causes. Canadians would be more likely to donate at checkout if the company would match their donation (67 percent), if offered a bounceback discount on their next purchase (61 percent), and if allowed to choose the cause their purchase supports from a list of charities (51 percent). Most Canadians want to know more about the specific impact of their contributions. 82 percent say that a company’s commitment to social and environmental issues helps them to decide where to buy or shop. 65 percent say such considerations inform how they invest. As a whole, Canadians are willing to travel an extra 18 minutes to...

Bloggers's note: Today's post comes from guest blogger Erin Palmer, a writer and editor for University Alliance. She writes about nonprofit and public sector topics, Master of Public Administration online degree programs, analytics, metrics and other tools. In its 2012-13 Occupational Outlook Handbook, the U.S. Bureau of Labor Statistics projects that organizations and institutions across both public and private sectors “will … increasingly use market research to ensure that program resources are being used effectively.” And for good reason: without good data, there is no good marketing. Cause marketing, in particular, relies on sound information, strategy, and data analytics. Here are three ways effective research can help you create better cause marketing campaigns. 1. Research provides vital data about your efforts and impact. Specifically, market data about political and other external influences, macro- and socioeconomic trends, and industry or cause-related conting...

You, you’ve got thousands of followers on Twitter, hundreds of Facebook friends and an enviable Klout score as a result. And, according to some early research from Professor Kimberley Scharf at the University of Warwick in the UK, you’re probably a selfish SOB when it comes to donating to charities! Scharf’s thinking is highlighted in her theoretical research paper, “ Private Provision of Public Goods and Information Diffusion in Social Groups .” Scharf is an economist at the University of Warwick’s Centre for Competitive Advantage in the Global Economy. “Information transmission about giving opportunities is undermined by free-riding incentives,” Scharf said in a press account. “I count on other neighbours to convey information and so save on the effort of doing it myself,” she said. “As well as relying on others to pass on information, it may also be true that people are even relying on others to donate.” In economics a free-rider is someone who receives benefits from an activi...

A press account in Nonprofit Quarterly reports that a new academic study finds that when cause marketing campaigns give consumers the opportunity to determine which cause receives support that consumers are more likely to buy and have a more positive attitude toward the company than when no choice is offered The study, found in the current issue of the Journal of Marketing , was authored by Stefanie Rosen Robinson from North Carolina State University and Caglar Irmak and Frances Hipp of the University of South Carolina. I haven’t seen it yet, so I don’t know the methodology. But Rick Cohen writes on the Nonprofit Quarterly website that, “according to the study, three factors affect the content and potential success of consumer-driven cause-related marketing campaigns: collectivism, cause-brand fit, and goal proximity. The article abstract offers the following explanation:” “’Noncollectivists’ value choice because it allows them to choose their own individual preferences. However...

In April 2012 the Boston Consulting Group released its study called “ The Millennial Consumer: Debunking Stereotypes ” which found that for many in this generation causes and cause marketing is an important and animating force. In the United States Millennials…aka Generation Y… now number 79 million. Compare that to the 76 million Boomers still alive. Millennials are defined as the generation between the ages of 16 and 34. BCG subtitled the report ‘Debunking Stereotypes’ because Millennials are often portrayed as being shiftless, lazy and spoiled. The word cloud at the left from BCG's report gives you a sense of that. But BCG instead finds a generation that… while it has a healthy self-regard… is nonetheless responsive to the needs of causes as they fulfill their missions and to the practice of cause marketing. Here’s some key findings: Of the 34 percent of Millennials who make direct donations to causes, almost half donate using their mobile device. That’s three times the numb...

What do affluent travelers want from airlines, hotels, resorts, tour operators and cruise lines when it comes to corporate social responsibility? Conde Nast Traveler , whose magazine has about 810,000 affluent subscribers asked its readers some of those very questions and more and published the results in September 2011. Here are responses to select Conde Nast Traveler questions: Ninety-three percent said travel companies should be responsible for 'protecting the environment.' What might protecting the environment look like according to Traveler readers:? 63 percent said building energy-efficient buildings. 76 percent said using solar power 69 percent said reuse towel (there’s the low-handing fruit for any hotel or resort) 63 percent said install low-flow toilets and showers 54 percent said use less air conditioning 51 percent said reuse wastewater 12 percent said provide carbon offsets through fees The long-hanging fruit there is plainly reusing towels. Likewise, ...

Academic research in cause marketing has long centered around the degree to which the practice affected things like reputation, goodwill, consumer loyalty, or how cause marketing could preserve pricing power. A new study finds that a corporation’s ‘pro-social activities’ positively influence how consumers feel about how their actual products perform. The study, called ' Doing Well By Doing Good: The Benevolent Halo of Social Goodwill ' featured a series of four experiments by Sean Blair, a PhD candidate at Northwestern University, and Alexander Chernov, and associate professor of marketing at the Kellogg School of Management at Northwestern. In the first experiment attendees at an executive education seminar were given wine to taste in plastic cup. A card accompanied the wine that described the winery that made the wine. Some of the tasters read a card with a sentence that explained that the wine donated 10% of sales to the American Heart Association. Other tasters saw no s...

Scarcely a week goes by that someone doesn’t release a study or survey about cause marketing. And yet there’s still some research I’d like to see. Since the New Year I’ve seen studies, findings or surveys related to cause marketing from the following: IEG projects cause marketing spending to grow in 2012 by 3.1 percent to $1.73 billion. Among other findings, the fourth Edelman Good Purpose Consumer Study found that the emerging markets of Mexico, Brazil, China and India were most willing to buy a brand that supports a cause. Landor Associates released its annual Global Corporate Reputation Index and highlighted the cause marketing work of Google and Ford. An outfit called Wide Angle surveyed its consumer panel and found them more willing to give $1 from a purchase rather than winning a meal at restaurant they’ve been wanting to try. Nielsen surveyed Vietnamese consumers and found that 80 percent prefer to do business with companies that seem to be giving back. That’s a reasonably broad...