According to a 2014 IEG Sponsorship Report, $1.92 Billion will be spent on cause marketing in 2015. As consumers become increasingly socially conscious, the opportunities for partnerships between corporations and charitable causes will continue to grow exponentially. Given increased competition, leaders can make their cause stand out by focusing on three key areas:
Consumers demand complete transparency from cause marketing efforts. In the past, campaigns have moved away from using vague language in messaging, such as saying “up to 15% will be donated to charity”. Oftentimes, that 15% represents a maximum percentage that is only reached at exorbitant levels of sales. More often than not, the actual donation is less than half of the stated maximum percentage. This sleight of hand damages the credibility of all cause marketing efforts and will not be tolerated by consumers in the future.
Transparency, however, is more than just stating what percent of sales go to charity. AmazonSmile, for example, states that they give .5% of their sales to charity, but consumers tend to not realize that they have to spend $200 to raise just one dollar. Furthermore, consumers want to know how that dollar will be used by the charitable organization. Even the most fiscally responsible charities struggle to get the most out of your donation dollar. Four star charities, representing the top 1% of charities reviewed by Charity Navigator, use at least 75% of donated funds on programs. Would consumers feel differently about AmazonSmile if they knew that spending $200 would only lead to an extra 75 cents being spent on programs?
If charities want their cause marketing campaign to stand out, they need to convince consumers that every dollar of donations will have more than a dollar of impact on the community. A great example of this is The Houston Food Bank. In addition to educating consumers through a marketing video, The Houston Food Bank uses specific language such as “$20 provides 60 nutritious meals” and “$120 feeds a family of 4 for 1 month”. As cause marketing continues to grow, consumers are going to demand a level of transparency that transcends current practices and educates consumers on how their actions will make a significant impact on the community.
Recently, a study by the MSLGROUP Future of Business Citizenship found that 69% of global millennials want businesses to make it easier for consumers to get involved in societal issues. Because millennials do not typically have the disposable income of older generations, they are generally an afterthought when it comes to serious fundraising campaigns. As innovators, it is our duty to create innovative methods for individuals of every generation to give back to the community. Future campaigns will take a multi-faceted approach to engagement, making it easier to give back through actions. My startup, Giftfluence, allows millennials to give back by through their everyday habits, such as shopping at Groupon.
In addition to Giftfluence, there are many organizations that are actively working to make it easier to give back to charity. Some of my personal favorites are Charity Miles and Givesurance, which transform simple actions such as running or renewing your insurance into meaningful contributions to charity. Just one person can raise hundreds of dollars for charity by training through Charity Miles. While millennials may not have the means to donate hundreds of dollars directly, creative organizations will continue to find innovative methods for millennials to give back.
Charities often run multiple cause marketing campaigns per year. Whether it’s asking supporters to eat at certain restaurants or directing them to shop at a specific retailer, charities are constantly tapping their network for support. As there become more methods of giving back, charities must determine which opportunities provide the greatest positive return on their effort. Can charities really justify using their limited resources promoting campaigns that only raise a few dollars?
To solve this problem, look for innovators to create a centralized platform that combines multiple methods of engagement to raise significant amounts money. A centralized platform will allow charities to simplify their marketing message and promote a singular campaign. This not only makes it easier for individuals to support charities, but also allows leaders of charities to concentrate on running their programs rather than on marketing campaigns. My goal in founding Giftfluence is to work with leaders in the space to fill this void and to help redefine the future of cause marketing.