Cause Marketing’s Still All to the Good
This week, Adweek is reporting on a recent survey by Cone LLC, an Omnicom Group, that finds consumers still want companies to be engaged with good causes and will reward those that rise to the occasion. In fact, 64 percent of respondents said they believe companies have "responded well to social and environmental issues during the recession." Which causes are important for companies to address? Economic development, health and disease, hunger the environment and a few more recieved more than 70% of consumer support. Other findings include the need for transparency by companies as well as an ongoing and authentic commitment to a given cause.
Posted September 28, 2010
Cause-related marketing came into its own when the economy was faring well. But, unlike some other fair-weather phenomena, consumers' interest in corporate support for worthy causes has not succumbed to the downturn of the past several years. A survey for Cone LLC, an Omnicom Group unit that specializes in the field, finds consumers still want companies to be engaged with good causes and will reward those that rise to the occasion.
Whatever constraint the economy has put on consumers' inclination to make purchases that are linked to a cause, the activity is far more common now than it was a couple of decades ago. In a 1993 survey (Cone's first on this subject), 20 percent of respondents said they'd bought a product or service in the previous year because it was associated with a social or environmental cause. In the new survey (conducted in July), 41 percent said they'd done so. Moreover, they expect companies to be engaged in such matters. Eighty-eight percent now say it's acceptable "for companies to involve a cause or issue in their marketing," up from 66 percent in 1993.
The survey findings also give a basis for thinking companies can do well by doing good: 85 percent of respondents agreed that "When a product or company supports a cause I care about, I have a more positive image of the product or company." Nearly as many, 83 percent, agreed that "I would like to see more of the products, services or retailers I use support worthy causes." Eighty-one percent want companies to "give them the opportunity to buy a cause-related product." A link to an appealing cause can also give a brand fresh standing with someone who hasn't previously been among its customers, as 61 percent said it would make them willing to "try a new brand or one they've never heard of."
'MORE IMPORTANT THAN EVER'
Consumers don't believe a tough economy somehow excuses companies from an obligation to look beyond the bottom line. Just 19 percent subscribed to the view that "I understand if companies give less money to support causes and nonprofits" in an economic downturn. Thirty-one percent endorsed the opposite opinion that "It is more important than ever for companies to support causes and nonprofits." (The rest said they expect companies' level of support to stay "the same" in hard times.)
Of course, it's not as though consumers' interest in supporting good causes through their purchases is of the money-is-no-object variety. While large majorities want companies to support worthy causes and think more highly of brands when they do so, just 19 percent said they're willing to "buy a more expensive brand" to support a cause themselves.
Assuming companies are attuned to consumers' attitudes in this regard, does this limit their own interest in supporting causes and making a point of letting the public know about it? "Not at all," says Alison DaSilva, evp, knowledge leadership and insights at Cone. "Cause marketing provides a competitive advantage, not a license to increase prices. And when it does come to opting for a more expensive brand, we are still talking about one in five customers who would be willing to pay more — and even more moms and 18-to-24-year-olds. If you promised a brand manager that one out of every five potential customers would consider his or her brand, even though it was a bit more expensive than the competitive set, I think they would ask where to sign."
GIVING COMPANIES A GOOD GRADE
Given the public's customary disdain for "big business" — a sentiment that has been intensified by the recession and the corporate missteps that helped cause it — one would expect respondents to give the corporate sector poor marks for its cause-related performance of late. But the survey found otherwise: 64 percent of respondents said they believe companies have "responded well to social and environmental issues during the recession."
"Admittedly, we were surprised by this finding, too," says DaSilva. "Yet, we know that even as some companies were in a tailspin, other leaders quickly stepped up to address societal and environmental needs as they unfolded, namely hunger, poverty and disaster response. Some companies restructured their charitable funding in the short term to address basic needs, and studies show many companies maintained their giving levels and/or got creative and supplemented cash donations with in-kind or other support. And certainly, the number of cause-marketing promotions and communications exploded. It was a time that allowed companies to show their true colors, and consumers were paying attention."
Which causes are important for companies to address? At least seven respondents in 10 cited "economic development" (77 percent), "health and disease" (77 percent), "hunger" (76 percent), "education" (75 percent), "access to clean water" (74 percent), "disaster relief" (73 percent), "environment" (73 percent) and "homelessness/housing" (70 percent). Another question in the survey asked respondents whether companies should give cause-related priority to "quality of life globally, in countries around the world," to "quality of life nationally, in the U.S.," or to "quality of life locally, in local communities." Forty-six percent said companies should give foremost attention to local communities, while 37 percent favored a national and 17 percent a global focus.
KEEP US INFORMED, PLEASE
Whatever a company chooses to do in its cause-related efforts, consumers expect to be kept informed. Ninety percent of respondents agreed that "Companies should tell us the ways in which they are supporting causes. A considerably smaller majority, 61 percent, agreed that "I believe companies are providing me with enough details about their cause-marketing efforts, such as amount donated, length of promotion, etcetera."
It's telling that 53 percent agreed with the statement, "I believe the government or another third party should regulate cause marketing by companies." Does this reflect distrust among consumers that companies are really doing what they claim to do in connection with causes and nonprofits? "This could reflect distrust, but more likely it just signals a sense of confusion," says DaSilva. "There are too many iterations of cause-related campaigns in the marketplace today to count. With some, a purchase triggers a donation; others are just 'raising awareness'; for others, consumers must take an extra step to activate the donation. Unfortunately, companies are not always doing a great job of communicating these details. If companies are not going to consistently provide the level of detail and transparency consumers need in order to feel comfortable answering these questions, they expect another entity to do it."
As with other sorts of marketing, social media has become part of the mix of ways in which companies pursue cause-related marketing. Are they making sound use of this tool, or have they tended so far to use it more in gimmicky ways that link them to what the report refers to as a "cause du jour"? "I think companies have done a wonderful job using social media to build awareness and buzz around causes, and to some extent, initial engagement," says DaSilva. "They have not quite cracked the bigger nut of fundraising and sustained engagement. To achieve this, the next phase will likely better unite consumers' online and offline experiences for greater impact and relevance."
WHEN THE VIRTUOUS COMPETE
With cause-related efforts having become more common in recent years, companies that are involved in this way can easily find themselves competing with one another for a consumer's patronage. So, another section of the survey asked respondents to state some preferences that would emerge when "choosing between two companies that each benefit a cause and sell the same product, similar in price and quality." In one pairing of alternatives, 54 percent would opt for the company that "Supports a cause that is relevant to them personally," while 46 percent would go with the company that "Supports a cause where it can have the greatest positive impact based on the nature of its business."
In another pairing, 53 percent would prefer the company that "Allows them to impact the donation by tying it to a purchase (e.g., Every time they purchase this product, $1 will be donated to the cause, up to $1 million)"; 47 percent would prefer the company that "Gives a lump financial donation to the cause out if its own pocket (e.g., ABC Co. is a proud sponsor of XYZ Charity and has given $1 million to the cause)."
In a third pairing, there was a distinct preference (61 percent vs. 39 percent) for "Makes a long-term commitment on its own to a focused issue it will support over time" vs. "Allows them to choose which causes it will support this month or this year (e.g., by voting for the issue/nonprofit)." Says DaSilva: "Consumers are becoming increasingly sophisticated. The hit-and-run approach may impact short-term sales, but it is not impacting long-term loyalty or brand equity. Consumers will lose attention amid other cause initiatives if a company doesn't have a long-term and authentic commitment to a cause. When an organization is dedicated to a cause, consumers make the connection. Yoplait Save Lids to Save Lives, Box Tops for Education, Avon Breast Cancer Crusade, McDonald's and Ronald McDonald House Charities, Target and Take Charge of Education . . . these are household names."