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Companies Putting the “Giving” in “Thanksgiving”

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The holidays are often characterized as a “time for giving.” During this time, people feel more compelled to show their generosity. For friends and families, it is often the exchange of gifts. For companies and organizations, it becomes the optimal time to pull on the heartstrings of society and encourage volunteer efforts and charitable donations. Predominantly during the holidays, companies will market their charitable priorities by linking them to promotions. A portion of these promotions is oftentimes donated to charities chosen by the corporations. Some companies have been so generous as to donate up to 10 percent of their annual profits back to their communities annually (the highest percentage for 2011: 10.9 percent by Kroger).

According to a study conducted by the Committee Encouraging Corporate Philanthropy in July of 2012, the average amount donated to charities by the 144 surveyed companies stood at $24.4 million. Unfortunately, driven by the recession of 2008, philanthropy was one of the first things downsized in many company’s budgets. While figures are still 7 percent lower than their pre-recession levels, progress is being made, as there has been a noticeable climb in charitable activity over the past three years.

This month we will explore and evaluate the marketing aspect of supporting and running charitable organizations. Themes we will touch upon include: how charities promote awareness about their cause, how advances in technology are changing the way we can help and how donating to charities can benefit other aspects of a company and its brand image.

Studies have shown that non-profits have been gun-shy when it comes to pulling the trigger on big-budget marketing. Part of the reason for this may be that the general public expects money donated to go straight to the cause and would judge a non-profit if they knew what went into marketing. A 2006 estimation by consulting firm Changing Our World announced that charities providing health and human services spent about $1.5 billion on marketing, while marketing in the rest of the economy totaled about $730 billion. We are all used to seeing the typical “donate now” commercials on television, or charity sponsored events, but does this really encourage the everyday person to do something? If non-profits cannot get an equal share of the market due to perception then perhaps it’s time to look into other ways to get the message out – and many have…

It goes without saying that advancements in technology are making it easier for people to communicate. For charities, the act of volunteering and donating has become even more efficient. Whereas years ago making a difference could take substantial time and effort, calls to action are becoming more simple than ever when it comes to charity. For example, when Hurricane Sandy devastated the Northeast three weeks ago, NBC held a benefit concert featuring performers the likes of Bruce Springsteen, Jon Bon Jovi and Billy Joel to help raise money for the American Red Cross relief effort. Technology has now brought charity to a point in which the general public does not even need to speak to another human being to make a difference. By texting “REDCROSS” to 90999 a $10 donation was automatically made to the Red Cross organization.

Taking one of Conversation’s own case studies, our client dressbarn has made it a point to contribute to breast cancer awareness every year. Last month, we launched “Paint the Country Pink,” a site in which users could visit a map of the U.S. and virtually “paint” their state. The more brush swipes, the pinker the state became. Most importantly, $1 was donated to the American Cancer Society for each swipe that a state received. The convenience of virtually contributing allows for those who many not have the means to volunteer their actual time the ability to still support their chosen organizations.

When executed correctly and tastefully, retailers can use charity to affect their bottom line. Target invests around 5 percent of its pre-tax operating profit back into communities in which its stores are located. In addition, the Minneapolis-based retailer involves consumers in charitable giving through the use of social media. In 2009, the company encouraged consumers to vote for which organization they deemed most worthy of a donation through a special Facebook app. Each time a user voted they could share their activity with Facebook friends, therefore exposing more people to the Target brand and its non-profit relationship.

Non-profits will always be present. However, the way in which they make their name and their efforts known – and how other companies can contribute – is constantly changing. The thing that makes it so fascinating is that these companies aren’t the same as other companies, even if they try to compete with them for a share of space. This month we look forward to examining the non-profit sector, as well as keeping our readers and subscribers informed about the latest innovations in marketing charities. I hope you enjoy our observations and the different directions that our agency members choose to steer this topic. And of course, we invite you to contact us or contribute to the discussion through Conversation’s Facebook and Twitter.

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