Consumers Respond Positively to Cause-related Marketing
(Nov. 3, 2008) Companies are increasingly forming partnerships with nonprofits and supporting causes to help strengthen their brand in the eyes of customers. Research shows that people are more likely to buy products from companies that associate themselves with a cause.
Research by cause marketing agency, Cone, and Duke University shows that by affiliating themselves with a charitable cause, companies can increase brand awareness and improve sales. Participating consumers in the study were able to recall the specific cause, as well as the product being advertised.
The first phase of the study asked 182 participants to read a magazine containing standard corporate advertisements. Another group was asked to read the same magazine but with cause-related product ads. Without knowing what the study was about, the participants who read the cause-related ads were much more likely to then purchase products with cause affiliations than the control group who read only standard, non-cause related ads.
In phase one of the study, based on in-store consumer behavior, there was at least a modest increase in actual purchases of all four product categories tested (shampoo, toothpaste, potato chips and light bulbs). There was a 28 percent increase in actual purchase of the toothpaste brand associated with a cause and a 74 percent increase for the cause-related shampoo brand.
The second phase of the study tested online shopping behavior after asking a much larger group of participants (1,051 people) to take part in the same exercise—a control group exposed to standard ads and a test group exposed to cause-related marketing. The online study returned very similar results: a substantial sales lift compared to generic advertising.
The test also showed that participants spent twice as long (49 percent more time) examining ads with a cause affiliation, in each of the product categories, versus those who read just generic ads.
Cone reports that consumers continue to have a more positive image of a product if it is associated with a cause. In their 1993 study and again in 2008, 85 percent of Americans said they more favorably view a company product that supports a cause they care about.
What has changed in recent years is the number of people who approve of cause-related marketing and for whom cause-marketing is a factor of consumer choice. Eighty-five percent said it is acceptable for companies to involve a cause in their marketing in the 2008 study compared to 66 percent in 1993.
Well over three quarters of people (79 percent) said they would likely switch from one brand to another (assuming price and quantity are about the same) if the other brand is associated with a good cause. That number was 66 percent in 1993. Thirty-eight percent have bought a product associated with a cause in the last 12 months compared to 20 percent in 1993.
Related AFP ResourcesCivic Engagement: By the Numbers
Policy Update: AFP Urges Senate Committee to Support Tax Incentives for Giving
AFP Joins Coalition to Urge Obama Not to Limit Charitable Tax Deduction
Where Do Nonprofits Fit in Obama’s Plans?
Bill Calls for Tax Incentives to Aid Midwest Flood Victims