When Shopping for a Cause, Be a Tough Customer

From cereal boxes to BMWs, from mortgage brokers to Major League Baseball, cause-related marketing is now a commonplace strategy for capturing consumer attention. Now more than ever, when we choose where to spend our money, at least one option will have a charity attached. For the most part, this growing trend is great news for the nonprofit industry. As long as we choose companies and products that support a meaningful cause, everyone wins, right?

The answer is that not all cause marketing programs are created equal, but if the consumer knows what to look for, then yes — everyone can win. Here are some ideas to consider when buying in this new environment.

First, Understand the “Why”

Have consumer industries adopted a cause marketing strategy out of the goodness of their hearts? No — they are responding to emerging consumer attitudes and survey statistics. In this post-9/11, post-Enron world, the American consumer demands that businesses they interact with be socially responsible, and consumers embrace opportunities to “save the world” with Internet clicks and trips to their grocery store. A recent Cone, Inc., study showed that 89% of so-called “Generation Y” shoppers will switch brands, assuming no difference in price or quality, to support a cause. Consumers are more planet-conscious and more charitable than ever, and marketing strategists are banking on it. So be aware — and understand that the product is being partnered with the cause to influence your perception of the brand, to appeal to your generosity, and to get you to buy.

Expect Transparency

There is no reason for companies to hide the amount or the recipient of the donation associated with your purchase. When the support is described as a “portion of proceeds” or “a donation will be made,” a customer should require that the company be more specific about who the recipient is and how much the donation will be. When we launched Giveline — an online store that donates to a customer’s selected nonprofit or cause — we decided early on that every product page should display the exact dollar amount that will be given to the charity when that product is purchased. We also report these exact amounts to the charities in real time through online reports.

Open-book transparency should be a requirement, and if consumers continue to pressure cause marketers to be specific about their numbers, then those vague and mysterious references to an unknown “portion” will ultimately disappear.

Question Fees & Unnecessary Middlemen

Technology has opened the door for a wide range of cause-oriented business models. Not all of these models make sense, and the easiest way to separate the good from the bad is to look for middlemen, unreasonable or hidden fees, and other forms of “take” that reduce the amount of your “give.”

Charity malls (cause-driven shopping portals), for example, take an unknown cut of third-party retailer affiliate payments. If you look around, most of these same retailers have partners that will give the entire affiliate fee (or more) to charity, or offer donations directly from their site, without the middleman. On the positive side, a relatively new website in the world of charity donation gift certificates, TisBest, seems to have the best to offer in terms of quality of service and the lowest fees compared to its competitors.

Follow the Money

Some cause marketing is less than specific about where the money goes (a pink ribbon, for example, does not always represent who you think it does). Be sure to find out the name of the charity and ask how the money will be used — Guidestar is a good place to find out more information about charities that are unfamiliar to you.

Better yet, find consumer or philanthropic websites that give you the flexibility to choose the cause or charity or specific program being supported by your money (at Giveline, for example, we have over 19,000 causes in our network). Consumer demand for choice will continue to drive the trend, and new ideas are emerging that embrace this simple concept of customer control.

Consumer industries spent $1.3 billion on cause-related marketing campaigns in 2006, up 20% from the previous year. This is a spectacular trend with powerful potential — as long as consumers keep cause marketers honest and demand that the giving is done right.

Brian Cruver is CEO of Giveline, Inc., a social venture he co-founded in 2004 that now serves more than 19,000 nonprofit clients. With a 12-year background in consulting and finance, Cruver has designed and marketed e-business systems for both start-ups and Fortune 500 companies. He also frequently speaks on business ethics and socially responsible business to top-tier business schools and leadership organizations.