Cause marketing: good CSR or just advertising?

You are familiar with cause marketing; it's those products stamped the logo of a foundation or nonprofit, which gets x% of your purchase- from a few pennies to a dollar or so. The idea is, with volume sales, NGOs raise money for causes while firms sell products. Win-win-win? Hmmm … maybe. Cause marketing is certainly a powerful idea with a record of success, but it also raises questions and is less than transparent.

Cause Marketing not for donors

Cause marketing does not make sense for people seeking to make a big fiscal impact for NGOs; the best option there is to just donate money. However, having causes attached to products may add value for consumers who are going to buy a widget anyway, and who are choosing among a variety of widget options. In that case, if the purchase is inevitable, cause marketing is helpful in differentiating products. Cause marketing is also helpful to firms, who get sales customers wouldn't have made otherwise, but who purchase in order to benefit a cause. It's these customers, that are trying to donate by purchasing products they otherwise wouldn't, that would be better off just donating and not purchasing.

On the other hand, cause marketing can be great for organizations. NGOs are able to make powerful connections with wealthy firms, and do benefit from a high volume of small donations.

Consumers assume NGO product approval

There are problems with cause marketing that have to do with transparency to the consumer. NGOs must understand that when consumers see a NGO label on a product, they will believe that the NGO approves that product. They may assume the NGO screened the product. This lending of brand value is dangerous where the products contradict the NGO mission, or are not as awesome as they seem.

For example, the Susan G. Komen/ KFC partnership is unholy. Susan G. Komen is probably the organization that takes the most advantage of cause marketing- they almost singlehandedly popularized pink ribbons for breast cancer. However, recently they teamed with KFC, whose big-ag chicken products are among the least healthy fast food options in the nation. Considering breast cancer is in part caused by obesity, weight gain and fat, slapping tacit approval from a breast cancer organization onto some of the worst fried chicken in the United States is a improvable idea.

It makes sense for the American Heart Association to endorse a product like Cheerios; eating that product reduces heart disease; that's science. It makes no sense for Susan G. Komen to lend its brand to a product that contributes to causing the problem it seeks to address, like fried chicken and breast cancer.

No Transparency on Deal

Another thing that bugs about cause marketing is that there is no transparency on the deal that NGOs and firms sign to arrange their marketing collaboration. Are NGOs getting money out of it? Is it a flat "donation", or is it per unit? How long does it last for? What are the loopholes for the parties to break it? Comprehensively, it's troubling.

I would prefer for firms to just donate to NGOs, no marketing strings attached. That's why firms' grantmaking programs are a more valuable form of CSR to me. However, if a firm's products help accomplish an NGO's mission, cause marketing is appropriate. But the Susan G. Komen Foundation (and similar organizations) that lend their branding to any product that will lead to money deserve IRS scrutiny, and create cynicism about the public sector.