Cause-related marketing brings together nonprofits and forprofit businesses in a highly beneficial arrangement for both parties. It gives businesses a way to stand out, and it gives nonprofits new places to raise money and a way to better achieve their missions by developing business partnerships.
It has grown in popularity alongside the growing awareness of certain causes. An example is the pink ribbons, used to raise breast cancer awareness, that are placed on numerous commercial products; these serve to market both the product and the cause.
There are several types of cause-related marketing, including the following: purchase-triggered donations, in which a business donates a portion of the purchase price of a product to a charitable cause; advertising, in which a business advertises on behalf of a charitable cause; public relations, in which a business tries, through the press, to alert the public to its partnership with a charitable group; sponsorship, in which a business contributes to an event or program centered around a charity; licensing, in which a business pays a charitable organization for the right to use its logo; direct marketing, in which both parties raise money and generate brand recognition; and facilitated giving, in which a business helps its customers donate to a charity that they choose.
Public support for cause-related marketing is strong: According to a 2010 study, more than 75 percent of Americans think a partnership between a trustworthy business and a nonprofit raises the profile of a charitable cause. In turn, the cause is more likely to gain strong support once it achieves success.
Cause-related marketing means customer engagement, more money, greater attention focused on the cause, more volunteers, new audiences and markets for both sides, and access by the nonprofit to the business’s workers, suppliers and distributors.
But these arrangements don’t work for everyone. Both sides need to know what they’re getting into first. And customers can suffer from cause overload: During the holiday season, so many brands engage in the practice it can be nearly impossible to build brand loyalty among customers on the basis of cause-related marketing. It’s important to be selective and work creatively.
The most important element of a cause-related partnership between a business and a nonprofit is communication. Both sides need to be clear about what they hope to accomplish and where they stand along the way.