January 24, 2010
In an effort to demonstrate their caring side, corporate brands are moving away from traditional cause-related marketing to 'co-donation' projects that combine
consumption with philanthropy.
"Doing good" seems to be the new slogan for many brands in 2010. After a year of economic misery and banking crises, research suggests that consumers are demanding companies demonstrate they are about more than profit.
Indeed, 79% of consumers would switch to a brand associated with a good cause, up from 66% in 1993, and 38% have bought a product associated with a cause, compared with 20% in 1993, according to research carried out last year by Cone Inc.
Nevertheless, the move by PepsiCo to invest $20m (£12.3m) in its new Pepsi Refresh programme instead of purchasing a high-profile Super Bowl spot - which it has done for the past 23 years - has raised a few eyebrows. Pepsi has spent $142m (£87.1m) on Super Bowl ads over the last decade. The Pepsi Refresh website asks people to vote for community projects and the company expects to sponsor thousands of local initiatives, with grants ranging from $5,000 (£3,000) to $250,000 (£153,400).
The Pepsi project is not only notable for the fact the consumer goods giant has moved money usually earmarked for flashy advertising towards cause-related marketing, but also the "co-donation" nature of the project. Anyone can donate their ideas, while PepsiCo comes up with the cash.
Reinier Evers, founder of trends service Trendwatching, foresees collaboration being an integral part of how cause-related marketing will evolve in 2010. He envisages lots of corporate giving schemes that will involve consumers by letting them co-donate (see below) or co-decide, as with Pepsi Refresh.
Evers says this fits into what he describes as "embedded generosity" - a "crucial consumer trends for 2010". "The main driver is the public's desire for a more just, more generous society," he says. "But a large proportion of the general public is also quite lazy, so no-hassle generosity is a winner.
"For brands, it's an excellent way to show they care, taking the lead with innovative "giving back" schemes. But the caveat is if it's an uninspired, one-off gimmick, the impact for recipients, customers and the brand itself will be nil."
Other examples of brands following the co-donation trend include Ikea, which donates a solar lamp to Unicef every time it sells a Sunnan low-energy lamp with solar panels. The company aims to donate 1 million lamps to the inhabitants of refugee camps and remote villages during the year-long campaign.
Other business are being run entirely on the premise of co-donation. Australian clothing manufacturer Baby Teresa donates a babygrow to a child in need somewhere in the world for every one it sells. Meanwhile, etail business Toms Shoes donates a pair of footwear to a child in need for every online sale it makes.
On the largest scale, it seems beneficial for brands to have a partner in initiatives. Procter & Gamble has been operating cause marketing strategies of varying kinds for many years. P&G UK & Ireland external relations director Lee Bansil explains: "We work with partners to make a genuine difference, where we can use our processes and our brands to work in collaboration with our partners, having listened to our consumers."
Bansil's colleague at P&G, Isabelle Bjarnason, who is project leader on Pampers' Unicef campaign, echoes this: "We have worked together really closely and have integrated what Pampers wanted to do and what Unicef wanted to achieve. I think lots of organisations are becoming really professional and are understanding much better how companies work as well. So, after sharing objectives, we can work together towards a common goal."
P and G brands Pampers and Fairy are working with Unicef
Bansil agrees that some brands are more suitable than others for this kind of collaborative strategy. "You have to make sure it's got the appropriate reach and the cause is relevant to the brand. There is a synergy with Pampers and Unicef.
"You want it to be a success for your partner and if you set it up and it's not a success for them, then that's crushing."
Bansil stresses that P&G has learned that projects work best as partnerships, rather than simply sponsorship. He adds: "You've got to be in this for the long run, this isn't speed dating. You have to focus on long-term partnerships with a goal that is mutual."
As the number of cause marketing programmes increases, so does public scrutiny of them. Transparency has been one of the watchwords of the last decade and good deeds are not immune. The Product (RED) campaign, which was started in 2006 and asks consumers to buy goods to help fund the fight against Aids, has been criticised for the opacity of its operations and spending too much of its income on marketing, rather than the end cause.
Transparent mechanics, such as simple "buy one-give one" schemes that involve brands donating each time the customer spends would seem to go some way towards providing clarity to the consumer and may account for their increasing popularity.
But some critics claim that despite these benefits, the possible longer term negative effects of cause marketing and co-donation include hidden costs.
Dr Angela Eikenberry, author of Giving Circles: Philanthropy, Voluntary Association and Democracy, claims there are "disturbing consequences of combining consumption and philanthropy". "Consumption philanthropy can distract attention and resources from the neediest causes and the most effective interventions," she says and argues: "It individualises solutions to what are collective social problems."
Eikenberry also claims it "devalues the moral core" of philanthropy by making virtuous action easy and thoughtless for consumers and thereby obscures the link between markets (companies, products and services) and the negative impact they can have on human well-being.
Bansil says P&G has considered these difficult questions and is sure the same is true for partner organisations. "It is important to bear in mind, certainly in the programmes P&G is working on today, that these originated from us listening to stakeholders, our partner organisations and our consumers, so we know it resonates," he says.
"Everyone wants to make a difference and this goes some small way in allowing us all to make a contribution. Yes, it is shopping. Yes, it is advertising. No one is saying it's the answer to everything, but it's a small step that allows all of us to make a difference."
Moreover, Bansil adds that co-donation and cause-related marketing help promote competition, which in turn leads to corporate innovation. He believes this is essential for developing sustainable products and promoting sustainable consumption.
P&G is adamant co-donation is not a marketing gimmick but one way in which responsible companies can use advertising and buying to help play their part in promoting sustainable behaviour. Bansil concludes: "It's not nirvana, but I think it's a great contribution in which consumers, stakeholders and companies can take small steps to improving lives."
Procter & Gamble baby brand Pampers has been running a campaign in partnership with charity Unicef that aims to tackle maternal and neonatal tetanus. What began as a UK-only promotion in 2006 has grown into a global drive with the grand ambition of completely eliminating the disease by 2012.
Isabelle Bjarnason, project leader of the Pampers Unicef campaign, explains: "We approached Unicef because it shares Pampers' mission of promoting the development of babies.
"With Unicef, we identified the issue of maternal or neonatal tetanus, which is still killing thousands of babies throughout the developing world. Once we had identified this, we put together a simple mechanic - for every pack of Pampers bought, one dose of vaccine is donated."
In its first year, it was a UK campaign, then was broadened to encompass Europe and has now extended across all Pampers' markets and across the nappy brand's other products, including baby wipes. P&G's laundry brand Fairy Non-Bio is also now operating the scheme. Since the start of the campaign, the programme has vaccinated more than 45 million women and their babies against tetanus. The goal now is to protect a further 33 million women in at least 32 counties around the world and completely eliminate the disease by 2012.
Bjarnason recently returned from Angola, where she got to see the project in action. "It was an eye opening experience," she says. "There is a lot of education on top of vaccination and that was really interesting."
Bjarnason was accompanied by actress Natasha McElhone, herself a mother, who fronted the 2009 marketing campaign for the project. Bjarnason says the trip was designed to leverage editorial coverage for the initiative. "Because it is a long-term campaign, we can now tell people what we have achieved."
Alongside the editorial content, P&G also ran an extensive tactical marketing campaign. This activity included on-pack promotion, a television campaign, online activity and a relationship marketing programme where direct mail is sent out with extensive information and followed, at the end of the campaign, by a thank you message.
Bjarnason says that everyone at P&G who is involved with the project "feels like they can make a difference" and morale has been further buoyed by the campaign's success at 2009's MCCA awards last year.
Bjarnason concludes: "We try to use the power and scale of the Pampers brand to reach our consumers."