Cause Marketing can mean, simply, a nonprofit cause marketing itself.
But it’s also a term which is increasingly used to refer to a special type of marketing where a for-profit brand and a non-profit cause launch a campaign together for mutual benefit.
Corporate brands today are very much aware of the fact that consumers increasingly make purchase decisions which are influenced by a sense of social responsibility. One particularly well-known study done (by Cone, Inc) showed that if two identical products are put in front of a consumer of today’s millennial generation, 89% of the time that consumer will chose the brand they associate with “a good cause”. The same study showed that 74% of consumers said they were more likely to pay attention to a company’s message when they see that a company has a deep commitment to a cause.
For brands and marketers, this represents a huge consumer trend to be embraced. For nonprofit causes, this is an opportunity for them to leverage the trend for their own benefit. For consumers, it means that they increasingly have the power to change the world by voting with their wallets.
The concept of cause marketing has been around for a while and is often attributed to American Express, which used the term in 1983 for the Statue of Liberty Restoration project. A penny for each use of the American Express card (and a dollar for each new card issued) was given to the Statue of Liberty renovation program. Over a four-month period, $2 million was raised for the Statue of Liberty, while Amex’s transaction activity jumped 28 percent. The concept of “doing well by doing good” was born.
Probably the best-known cause marketing campaign today is Product Red (it is also an example of a cause marketing campaign that is a brand of its own). Product Red was created to support The Global Fund to Fight AIDS, Tuberculosis & Malaria, and includes participating companies such as Apple Computer, Motorola, Giorgio Armani, and The Gap.
According to a report published by onPhilanthropy, cause marketing sponsorship by US businesses is rising at a dramatic rate. Citing an IEG, Inc. study, $1.11 billion was spent in 2005, an estimated $1.34 billion will be spent in 2006, $1.44 billion was spent in 2007 and $1.52 billion in 2008. For 2009 the projections are that $1.57 billion total to be spent on cause marketing.
Cause marketing is a great example of a “virtuous circle” because everyone in the equation benefits. The nonprofit organization increases revenue, the brand receives the “halo effect” of associating themselves with causes people care about, and the consumers win because they’ve made a purchase and feel as if they’ve helped a worthy cause at the same time.
With most global social issues today, the watchword is “sustainability”. Part of sustainability means nonprofits moving away from relying on surviving on the whims of grants and donations alone, and instead moving toward earned income to support their work. Cause marketing can be an importantly component of this shift toward sustainable economic models for nonprofits around the world.
Tivix, of course, was founded to do just that – bring the power of cause marketing to brands and nonprofits of all sizes.
See the Tivix portfolio of custom cause marketing campaigns.
Read why social media (Facebook, etc) is especially powerful for cause marketing.
