AdAge asked me to write a column about cause marketing and branding in a tough economy. Here it is. Please join the discussion.
Marketing's True Survivor
Why Advertisers Should Turn to Cause Strategies When Times Are Tough
If you compare our current economic abyss to a game of "Survivor," with marketing programs vying to avoid being voted off the island, it appears we have a winner. Cause-related marketing might just be the true survivor in this economy.
Anecdotal evidence is everywhere. Entire ad campaigns by major brands range from simple hints about the good they are doing for society to entire campaigns centered on causes and giving back. At Barkley, we have two clients that made cuts in their marketing budgets but did not stop the development of cause programs set to launch later this year.
The primary reason is consumer demand. Giving back is part of the consumer mind-set now. A perfect example is a study from Opinion Research Corp. telling us that 76% of consumers are willing to pay more at the cash register for environmentally friendly products. This debunks the perception that consumers will buy green only if it doesn't cost them.
Our most recent Barkley cause survey, done in partnership with PR Week, brings consumer support for cause marketing into even sharper focus when you consider the female consumer. Since women are responsible for more than 80% of all spending, what women want matters to marketers. Two of three women have purchased a brand because it supports a cause they believe in, and three of four have recommended a brand to others for the same reason.
The headlines tell us that philanthropic giving is down during the economic slump. So why is cause marketing surviving? It's simple: As a person's disposable income drops, his or her ability to make philanthropic donations drops as well. Cause marketing provides outlets for consumers of all financial means to give back, since most programs carry a modest level of donation.
Simply stated, cause marketing is surviving in this economy because consumers not only want to give back but also can afford to do it through cause-marketing programs. And since we see the mountain of evidence telling us consumers will reward companies that offer cause-marketing programs, the reasons not to make cause a part of the marketing mix are dwindling.
The benefits are numerous for a brand that commits itself to cause marketing. One of the most important is the internal impact of support for a cause. When consumers put on their employee hats, they want to work for companies that care. Two out of three CMOs Barkley surveyed in late 2008 said their cause programs resulted in improved employee morale and retention. That was especially true for employees in their 20s and 30s.
A second benefit is directly linked to the troubled economy. We all know that value pricing has its limits. A competitor can always undercut a price point. Think of value a different way. A brand can hold steady on some prices when it adds value to the purchase, such as support for a cause. Consumers will be willing to pay a bit more if they know the product they purchased will support a good cause.
With consumers living their lives more and more online today, marketers can offer a year-round cause-marketing presence, thus reinforcing their status as brands that care. It also makes it easier for consumers to engage with the brand. Our client Lee Jeans has experienced this firsthand through Lee National Denim Day, which supports the fight against breast cancer. Denim Day began 14 years ago as a workplace program using traditional methods of marketing and communication to spread the word. Today, the entire program exists online atdenimday.com, where anyone can form a team, make donations and learn new ways to get engaged in this grass-roots cause program.
Finally, brands engaging in cause marketing can fill a big need in today's economy. Nonprofits are being hit hard right now, which means the people they serve are being hit harder. Nonprofits are being squeezed from all sides. They have less help from government, foundations, direct donations and volunteers.
Combine that with the fact that companies today are searching for any edge they can find to drive business and grow their brands, and it will bring you to a simple conclusion: Cause marketing will give a brand the edge it is looking for and will help the nonprofits collect much-needed dollars to support their missions.
Brand marketers need to ask themselves a question right now: If your best customer asks you what you stand for, do you have an answer? Cause marketing will help give you that answer.