Cause Marketing Revisited: When Does Conscious Capitalism Work?

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When we get a morning coffee or take a trip to the grocery store, doesn't it make us feel even better about our purchases when they support charitable causes? These days, it seems like almost every brand has a charitable initiative that allows consumers to “shop for a cause” — which we think is great. 

We examined social impact, “cause marketing” and their corporate and societal benefits nearly a year ago. Yet much has changed since then, as cause marketing tactics have become more and more commonplace. Simon Mainwaring, author and founder of We First, explains the popularity of cause marketing in an article in Forbes,

“…in the social business marketplace, in which brands must increasingly establish why they’re meaningful to the lives of their customers if they want them to buy their products, cause marketing is now one of the most effective strategies for business-building and positive impact.”

Millennials, who now account for nearly $200 billion of spending annually, are the largest force behind this conscious capitalism movement, often choosing to support brands that help them contribute to a charitable cause through their purchases. Christie Garton, founder of UChic (and a graduate of SparkLabKC!), explains in an Entrepreneur article,

“Millennials… demand a 'participation economy' that allows them to contribute, co-create and shape the giving behaviors of brands they love.”

Many companies are now harnessing the power of cause marketing, and they're using it to simultaneously improve both their image and society. Let's examine a few of these campaigns to determine how cause marketing can be an effective tool for our brands.

Creating Happy Feet: SparkStart

New Balance has spent the last century carving and fortifying their niche in the super-competitive shoe retail business. Competing with brands such as Nike and Adidas is never easy, but New Balance has built their brand on concepts of reliability and healthful well-being. Over the last few decades, New Balance has adopted a secondary mission to improve society by embracing causes that align with its company's goals.

Last year, New Balance partnered with The Boys and Girls Club of America to launch SparkStart. SparkStart is a global initiative that promotes healthier living and active lifestyles in children across the globe. For nearly two months in the summer of 2014, New Balance donated 30 percent of every pair of kids shoes sold to The Boys and Girls Club — in the form of shoes (a model proven by the success of Tom's one-for-one brand).

In its first year, the initiative was a resounding success! New Balance sold almost 50,000 more pairs of kids shoes during the back to school period in 2014 than in 2013, while its profits increased nearly 31 percent from the previous year during that same period. Just as importantly, New Balance donated over 11,000 pairs of shoes to underprivileged children across America.

Why it was successful? New Balance found an issue that was aligned with its company's goals and values, and it made the children of The Boys and Girls Club the focal point of the campaign. Both groups promote healthier lifestyles and active living, and through teaming up, both organizations provided children in need with items that could improve their quality of life. New Balance was able to tap into the capitalism-with-a-conscience mindset to build on their branding, help out children in need, and increase profits — all at the same time.

A World of Difference: Matter to a Million

Much like New Balance, The HP Company Foundation had its core values in mind as they searched for a non-profit partner. As a company, HP believes in the philosophy that their work should drive progress across social, economic, and environmental sectors alike. Knowing this, a partnership with Kiva.Org — a peer-to-peer lending site for third-world entrepreneurs — only seemed natural, and in 2014, Matter to a Million was launched. Together, the companies worked to combat poverty and help society progress worldwide. 

Each of HP's 300,000 employees was given a $25 credit to be used to fund a micro-loan through Kiva's site. The employee response was phenomenal because the mission resonated so strongly with HP's core values. In the program's first nine days, HP employees loaned over $1 million and, since the program's inception, HP employees have loaned nearly $6 million in total.

Why it was successful? It was clear that all levels of HP management supported Matter to a Million. HP's leadership heavily bought into the campaign and budgeted a large sum of money to ensure the project's success, and as a result, employees embraced the opportunity to support others. Cause marketing campaigns like this one can only be successful if the leaders fully believe in their potential. Without support from all levels of both parties in the campaign, the initiative would not have achieved such remarkable success. 

Find Your Cause!

As millennials continue to harness a large share of purchasing power, companies will continue to look for ways that their branding can incorporate social responsibility. When crafting these campaigns, we would do well to partner ourselves with efforts that align with our own core values and principles. In this way, we're able to continue building relationships with the customers for whom our brand resonates and do right by the communities that need it most. A great cause marketing campaign can launch our brand to new heights and encourage new customers to embrace our products, all while making the world a better place.

Do you have your own stories about the impact of cause marketing? We'd love to hear about them! Tweet them to us @EidsonPartners!

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