The Message Effect

Reflecting back on last week’s Cause Marketing Forum and Social Innovation (SI) Summit – which discussed cause marketing and corporate philanthropy, respectively – can we predict that one of these approaches will eclipse the other?  I’ll discuss this question by comparing these tactics on three central business goals: customer engagement, benefits to bottom line, and reputation.

Customer Engagement

Perhaps because it was born of marketers, cause marketing wins this one hands down. As Melanie Healey, Procter & Gamble Group President for North America noted in her CMF keynote, “Consumers want to be involved in solving problems, not just watch companies do it.” For example, leveraging social media channels to not just inform, but engage audiences in a cause was central to every campaign referenced at Cause Marketing Forum.  Meanwhile, one of my colleague’s key takeaways from SI Summit is that traditional CSR practitioners are still struggling with how to evolve their use of social media beyond a channel just for news sharing.

Bottom Line Benefits

Cause marketers have an easier time demonstrating these benefits, particularly when the campaign is focused on a particular product.

However, done right, corporate giving or CSR programs can yield huge benefits to the organization.  For example, Microsoft’s* generous employee match supported by an innovative and well-resourced annual giving campaign engenders corporate pride and loyalty.  Starbucks’ multi-faceted approach to sustainability helps them attract customers who might otherwise be turned off by their size or corporate environmental impact.

Reputation

This one breaks down by audience – customers and government. Customers are more likely to be aware of–and therefore, impressed by–cause marketing efforts than corporate philanthropy due to the inherent nature of the approach.  However, government officials–a top priority audience for most CSR programs–have historically been more impressed by corporate giving and skeptical of activities that directly drive product sales.

Public relations is an essential vehicle for building reputation, and media coverage is increasingly challenging for both camps.  Most media outlets have cut philanthropy coverage and redeployed those beat reporters.  Just this week, GOOD Magazine announced significant layoffs.  Traditional corporate philanthropy is becoming fodder for the blogosphere except when it achieves the magic combination of high dollar value (think $Bs, not $Ms) and demonstrable impact.  News outlets will report about cause campaigns in a business context or cover a particular stunt, but their primary concern in the realm of public good is government, so they are most interested in efforts that lead to government action.  Public-private partnerships are the purview of the type of CSR programs represented at SI Summit, which would explain, in part, the high media turnout there compared to the lack of traditional news outlet representation at CMF.

The Winner Is…

Rather than one replacing the other, I believe we’ll see more companies blending the two.  Changes in the traditional media landscape and the rise of social media are causing corporations to reconsider their tried and true approaches to CSR.  Because it is becoming increasingly difficult for companies to generate the kind of earned media interest in their programs that could lead to reputation benefits which translate into increased sales, program marketing investments will need to grow.

For a cost center, big marketing dollars can be hard to come by, so linking to specific products or services via cause marketing is likely to become increasingly attractive for CSR executives.  At the same time, aligning to existing corporate philanthropy causes will make it easier for cause marketers to build a coherent narrative around their brand.  The internal organizational challenges to this alignment are not insignificant within large companies, but when the right thing to do also yields the most bang for your buck, change becomes more likely.

*client

Also posted at http://waggeneredstrom.com/blog/2012/06/07/cause-marketing-v-corporate-philanthropy/.