Cause Marketing, Part I
Is your business aligned with a cause or considering doing so? In this two-part piece based on the Mintel Study, Cause Marketing, we look at its beginnings, consumer attitudes toward it and ways your business can use cause marketing to increase customer loyalty and, ultimately, profit.
Cause Marketing Definition and History
When a business attempts to gain favor with consumers through charitable efforts, it’s engaging in cause marketing. For example, donating a percentage of your sales to benefit diabetes research or fight childhood cancer would be considered cause marketing.
The first instance of cause related marketing occurred in 1977, when the Marriott corporation joined forces with the March of Dimes charity to promote its Great America theme park. The effort netted millions for the charity and resulted in the highest turnout ever for Marriot.
Other pioneering cause marketing examples include the Famous Amos Cookies Literacy effort in 1979 and the American Express Statue of Liberty restoration project in 1983.
Consumers and Cause Marketing
According to the Mintel Study, 181 million Americans are influenced to some extent by cause marketing. The split between men and women is roughly half and half, which is noteworthy since women are generally seen as more empathetic.
Within this group, Millennials – those born from 1977 to 1994 – are most likely to take cause marketing under consideration when deciding what to purchase (69% of moms, 81% of dads). However, Millennials are less likely to buy sight unseen and more likely to research the validity and motives of the company behind the cause.
While Millennials may be more in tune with cause marketing, there is less consensus within the group on which causes are worthy to support compared to Baby Boomers and Generation X.
This isn’t surprising since Millennials are the most diverse adult population in the US: nearly one quarter of the group is non-White (compared to 18% of Boomers). This diversity extends to ideals and values, including support of various causes.
Skepticism, Cause Fatigue and Backlash
More than half (55%) of those surveyed in the study agreed that most companies engage in cause marketing to enhance their public image. This implies that they’re skeptical about cause marketing motives and know that they’re sometimes being manipulated.
Combatting skepticism is complicated, and consumers seem prepared to punish or praise companies for their efforts, depending on how they’re perceived.
Beyond skepticism, cause fatigue can also kick in. More than four in ten (44%) say that there are so many companies supporting different initiatives that they’ve gone “cause blind,” and have blocked them out. So while the idea of many businesses supporting many causes might seem like a good thing for everyone, saturation has led to an opposite effect.
Another potential landmine? The potential backlash that can occur when businesses support – or decline to support – a cause that’s controversial. Issues such as gay rights can polarize consumers, leading them to align themselves with or boycott brands that take a stand on these issues.
Pros Still Outweigh Cons
While cause marketing can be complicated and risky, it’s still a valuable marketing tool for businesses looking for a competitive edge. In our next piece, Cause Marketing, Part II, we’ll look at ways to successfully avoid the pitfalls and succeed as a cause marketer.
Want to know more about Cause Marketing? Check out part two of this article here.