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Fall 2005 The Coming of Age of Cause Marketing

You see them everywhere, those ribbon decals in yellow or pink or other colors that are slapped on cars and windows to proclaim the owner’s support of the troops or the fight against breast cancer. The red ribbons that came into being more than a decade ago for AIDS awareness have since moved off lapels and turned into vinyl in various colors to cling to metal or glass. They’ve evolved yet again, this time into silicone “rubber band” wristbands in a palette of colors to symbolize one’s commitment to finding a cure for cancer or diabetes, or ending world poverty, or some other good cause.

What’s it all about? Relationships. Connectedness. The human touch. And marketing. Smart, partnership-based marketing.

Good for business

“Cause marketing is the building of mutually beneficial relationships between businesses and non-profits,” says David Hessekiel, president of Cause Marketing Forum, Inc. (Rye, NY). The company began in 2002 to facilitate partnerships between the two, and each year presents the Cause Marketing Halo Awards to the most successful campaigns and events.

Although cause marketing has been in play since American Express’s 1983 Statue of Liberty Restoration campaign, it gained momentum just in the past few years. “The category has been experiencing steady growth,” says Hessekiel. “Sponsorships of this type were first measured in the early 1990s. They have risen from $120 million in 1990 to nearly $1 billion for 2004,” he says, citing the latest IEG Sponsorship Report’s $991 million in corporate spending on cause marketing programs. “More and more companies are gravitating toward this,” he adds. “The marketing services agencies that serve them recognize it’s a continuous trend, and they’re working to become good advisors.” Kevin Miller, SVP for business development and government partnerships for ABC Radio Networks, agrees. “This focus on cause marketing is absolutely growing.”

The motivation is in part a matter of social pressure: Consumers have come to expect charitable conduct from companies. According to a 2004 survey by Deloitte & Touche USA LLP, 92 percent of Americans think it’s important for companies to make charitable contributions or donate products and/or services to non-profit organizations in the community, and increasing numbers of companies are doing so.

“Not-for-profits are studying up on how to be good partners” with corporate entities and marketing firms, says Hessekiel. And consumers are paying unprecedented attention. According to Cone, Inc.’s Corporate Citizenship Study in 2004, 80 percent of Americans were able to name a company that stood out in their minds as a strong corporate citizen, compared with just 26 percent in 1993.

A number of reasons exists for the recent spike in cause marketing. “In a post-9/11 environment, people are looking for something to believe in. In a post-Enron environment, companies are extremely aware of the need to build up an image as being socially responsible,” he says. “There’s a variety of other societal reasons that, in this decade, people feel it’s important to give something back. This can mean many things to different people.”

Hundreds of products, such as cosmetics, jewelry and clothing, have a give-back component to them. “I don’t think there’s a category of products that some generous company hasn’t found a way in which to raise money for charity,” says Susan Heaney, director of communications for the Avon Foundation, the charitable organization of Avon Products, Inc. Avon began its Breast Cancer Crusade to support finding a cure and access to care, in 1992. In the past few years, “there are many more players, products and programs,” says Heaney (who, by the way, has been a judge for the Halo Awards).

Typically, companies donate a portion of sales of a product or a line of products. Many set up programs that are unique to their industry. BMW of North America, for instance, partners with BMW dealerships across the country for special test-drive days: For every mile consumers test-drive a car, the company donates $1 to the Susan G. Komen Breast Cancer Foundation. BMW has raised $8 million for the Komen Foundation over the past eight years.

Sometimes companies team with a government agency rather than a charitable orgainzation. ABC Radio Networks, approached the US Department of Health and Human Services in summer of 2001, and in partnership with them launched the “Closing the Health Gap” campaign in 2002, encouraging African Americans to visit the doctor. “We have one of the broadest networks for reaching African American listeners,” says Miller. “So we felt it was the perfect platform to give them a wake-up call regarding the tremendous health issues that impact them at higher rates than the general population.”

According to a national survey of manufacturers and retailers by PowerPact (Richmond, VA), companies today are more concerned with the bottom line when they pursue a project for a cause. The survey found that 81 percent of respondents indicated that sales impact was a top factor when deciding to adopt a cause marketing program. In a summary of the survey PowerPact CEO Alison Glander says, “When cause marketing produces sales, companies can allocate more marketing dollars toward these programs and make a bigger impact on curing social ills.”

And they enhance their company’s image at the same time. While companies are more focused on sales revenues when they’re raising money for a cause, consumers become more focused on the cause and the company. “People like to do business with companies that are doing something good,” says Miller. “Government and non-profit organizations can use the help and experience of companies in the private sector to provide them with access to an audience that they wouldn’t otherwise have.”

Conspicuous caring

You know the yellow wristbands. They’re on the wrists of kids, teens, seniors, and everyone in between. The bands bear the words “LiveStrong,” the mantra of and message from cycling star and cancer survivor Lance Armstrong. In May 2004, Nike and the Lance Armstrong Foundation launched the Wear Yellow LiveStrong campaign.

Since then, more than 50 million wristbands have been sold at $1 each through Nike and Discovery Channel stores and online—more than ten times the campaign’s original goal. Surveys conducted by the Lance Armstrong Foundation show that about 83 percent of purchasers buy and wear the yellow wristband to show support for someone they know who is living with cancer, or to support the foundation’s mission.

According to Jennifer Halpin, public relations manager for the Lance Armstrong Foundation, strong demand continues. And Macy’s began carrying the wristbands, bringing them within reach of a wider, mainstream consumer market. In mid-July, the rate of sales from all sources was averaging 70,000 wristbands a day. “Nothing else rivals the numbers of LiveStrong,” says Hessekiel.

Sonoma Pins (Sonoma, CA) sells wristbands to other companies and organizations, who have them custom-printed for a particular cause. Sonoma has sold 10 million of them since late summer 2004, and makes donations to the appropriate charities on sales of its stock wristbands such as the “Think Pink” one for breast cancer and the yellow “Support Our Troops” one. Kelly Grant, director of marketing, who tracks trends for the company, said that in July she saw no sign of the phenomenon slowing down.

And it’s not. If the palette of colors now available is any indication, it’s growing. The current array of color-coded causes seems endless. “There’s red for AIDS, blue for prostate cancer, purple for lupus—everything has a color,” says Grant. A teal “Unite to Fight” wristband for ovarian cancer is one of Costume Jewelry Wholesale’s offerings. There are wristbands with messages such as “Say No To Drugs,” “Tsunami Relief” and “Cultivate Peace,” and a white “One” wristband sold in conjunction with the Live 8 concerts to end poverty in Africa.

But supporting a cause is only part of the story behind the success of the wristband phenomenon. It’s also about following fashion—celebrity fashion. Once movie and music stars began sporting wristbands, the trend caught on. The youth market in particular began collecting wristbands in every available color, no matter what the cause—if there even is one. And at $1 or $2 each, they can. Some newer “jelly” bands, as they’re being called, raise money for a cause, and others, despite a word or two of non-specific inspiration (“Believe,” “Hope,” “Connect”) don’t. Some observers think that once the wristband moves from fashionable support of a cause to pure fashion, it’s on it’s way out. Time will tell. But right now, wristbands are still selling and raising money for their causes.

In the pink

imageAs cause-marketing markers go, pink has had remarkable long-term impact. The pink ribbon signifying breast cancer research, with us for more than ten years, is as ubiquitous as cause-marketing symbols get. “Breast cancer is far and away the number-one cause-marketing category,” says Hessekiel. “It’s been the phenomenon of the past decade, as hundreds of companies have gotten involved.”

Leading the pack of corporate partners is Avon, whose Breast Cancer Crusade has raised and donated more than $350 million in 50 countries since 1992—about a third raised through the sale of pins, mugs, bears, candles and other items at $7.50 or less. The other two-thirds has been raised through fundraising walks and other events worldwide.

The “Think Pink” collection from New Dimensions (Manlius, NY) raises money for the Carol M. Baldwin Breast Cancer Research Fund of Central New York, Inc. The collection includes a hand-painted beaded bracelet; a key chain with a ribbon and tag that says “Together we can make a difference”; an Austrian-crystal pink ribbon lapel pin; and tools in a pink toolbox. According to company owner Lois Ross, pink silicone Awareness Bracelets and pink hats with a ribbon have been the best sellers. Overall, the category has been so strong for New Dimensions that the company has added a second page to its catalog for six new items, including a cell phone charm, a handbag charm, and a new bracelet.

Also successful is Retro 1951, Inc. (Richardson, TX), offering a collection of products from which 15 percent of profits go to the Susan G. Komen Foundation. The items include ballpoint pens with a clip in the form of a pink ribbon; golf pencils with a golf ball and pink ribbon on top; the “Handbag hankie,” a pink leather tissue holder; the Elite Traveler in pink, a leather case with a pad and ballpoint pen; and a new pink-ribbon photo frame.

“The Susan G. Komen Foundation approached us about working together, but we were already thinking of doing something like this,” says Michael Bracken, a manager of special markets for Retro 1951. “It’s something we’re very proud to be a part of. Because people have either had cancer themselves or someone they care about very much has [cancer], they want to contribute in some small way.” And even though the pen has a pink ribbon, Bracken says men, too, carry it proudly “to demonstrate their support of the women they care about.”

Another company that contributes to the Susan G. Komen Foundation is Faith Creations (Cummings, GA), which produces several handmade items to benefit breast cancer research. For the past two years this company has been making donations from sales of three popular products—a bracelet, key chain, and bookmark, each packaged with a card printed with a prayer of encouragement.

Sales of these and other breast-cancer-research merchandise—including pink-ribbon US postage stamps—sell year-round, but tend to increase in October, which is Breast Cancer Awareness Month. In addition to public-service ads, discussions on talk shows, and posters in doctors’ offices and pharmacies, the October issues of national fashion and women’s magazines promote the cause, usually by spotlighting a page or more of pink-ribbon products along with purchase information and the organizations that benefit from the sale.

Artistic altruism

Art for a Cause (Birmingham, MI) creates art to generate funding for local charities while providing an attractive piece of functional art for the buyers’ enjoyment. Proceeds of sales of Art for a Cause hand-painted furniture and accessories are donated to charitable organizations for research and education.

But even more accessible are the company’s CuteTools, whose handles’ gentle floral designs are hand-painted by artists and others. The CuteTools line includes hammers and screwdrivers; a garden tool set; and kitchen tools including pizza cutters, cake servers, peelers and ice cream scoops. Schoolchildren and not-for-profit groups raise money for their organizations by helping to create and paint the tools. Art for a Cause also employs physically or mentally challenged Easter Seals clients to work on the tools.

“Everyone realizes now that we have to make a difference. By buying these tools, consumers help us to keep employing special-needs people,” says owner Lisa Knoppe-Reed. “Consumers want new and innovative products. Our hammer is $24. You can buy a hammer for $9.99 at Home Depot, but it wouldn’t be a CuteTool.”

Another cause-marketing approach comes from V’tae Parfum & Body Care (Nevada City, CA). This company donates 10 percent of its profits to environmental organizations, says general manager Alanna Haley, and mentions this donation in its marketing for Endangered Species collection, which includes Monster Moisture, Lizard Luster and Salamander Soother.

And then there’s Wild Women Enterprises (Smithfield, RI), which makes a line of clothing with positive, fun, empowering messages for women and girls. Products include T-shirts, nightshirts, ball caps, visors, flannel pants, and lapel pins. In business for 13 years, the company contributes 35 percent of proceeds to various charities throughout New England serving women who are cancer patients or victims of domestic abuse.

“Our first accountant said, ‘You’ll never stay in business if you give away that kind of money,’” said co-owner and designer Linda Hogan. “We ignored him and got another accountant.” The company’s mission, posted on its website, is “to show the business community that a business can be successfully operated on the principles of cooperation, respect and compassion.”

The retail connection

The bridge between the corporate and the consumer is the retailer. Retailers tend to emphasize cause-marketing programs with a local component, which makes sense all around. “People are particularly touched by good works that are in their community,” says Hessekiel. “Local merchants can really draw attention to themselves and build up good will.”

The cause may be global, the corporate partner may be national or international, but the retailer doesn’t have to be: the smallest seasonal cart or kiosk retailer can get involved. In fact, Hessekiel says cause-marketing items, many of which carry low price tags, are a good match for carts and kiosks. “With all the people who zip by, if you do something to touch their heartstrings and get the conversation going, it can be a very smart marketing contact.”

An unexpected benefit of cause-marketing for retailers is that it can help with staff retention. “One challenge many retailers have is keeping their part-time help,” he says. But “one benefit of getting your employees involved in this type of program is that it takes what is often a low-wage job and turns it into something exciting and fulfilling.” According to the Cone Corporate Citizenship Study, 81 percent of respondents said a company’s commitment to a social issue is important when they decide where to work. Further, the study said Americans ages 18-25 are significantly more likely to consider a company’s citizenship practices when making purchasing, employment and investment decisions.

Things Remembered, Inc. (Highland Heights, OH), with 700 stores that offer personalized engraving, involves its employees in its efforts to raise money for the Make-a-Wish Foundation, which grants wishes to children with life-threatening illnesses. The relationship between Things Remembered and Make-a-Wish began in 1997, when the company granted a wish to Elysia, a girl who wanted to give engraved items from the store to her family and friends so they’d have something to remember her by. Things Remembered created an ornament in Elysia’s honor, with sales proceeds benefitting Make-a-Wish.

“The amazing experience of granting Elysia’s wish created a very emotional connection to the cause among employees and customers, many of whom are moms,” says Suzanne Sutter, company president. Things Remembered has continued to sell products for this cause over the years; the company also asks customers if they want to make a donation, and organizes fund-raising events two days a year. “We have Make-a-Wish contribution goals throughout the year. In 2003, we raised $588,000. For 2004, our employees set the incredible goal of $1 million-and they raised $1,031,000,” says Sutter.

Our employees are extremely proud to be a part of this. It has connected their hearts to our company, and we’ve seen a reduction in turnover at all levels since we started this program,” she says. “Our associates are very connected to the outcomes of their efforts. People want to work for a company that has a heart.”

Cindy Martin, owner of Faith Creations, says retailers who sell her products usually offer a larger selection of cause-related products. “Retailers who are just starting out can request a counter card that explains that a portion of the proceeds will go to charity,” she says. “In a high percentage of cases, the retailers that carry cause-related items will donate a portion of their [overall] sales to the cause” in addition to the percentage-of-sales donations.

Or as Wild Women’s Hogan puts it, “The more you give out, the more that comes back to you. We really believe that. That’s how we run our business.”

Bernadette Starzee

Starzee, a Long Island, NY writer who covers business, sports and lifestyle topics, is a senior writer for SRR. She can be reached at .

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