The Dangers of Cause Marketing

By Steve McKee

Children’s Miracle Network Hospitals was one of the big winners of the 2014 Cause Marketing Forum “Golden Halo” Awards, which recognize companies and nonprofits that successfully link charitable purposes with for-profit enterprises. The charity has raised billions of dollars over the past three decades for more than 150 children’s hospitals across North America and has developed partnerships with dozens of Fortune 500 companies to do so. It’s an outstanding organization that continues to develop innovative approaches to furthering its mission.

That said, it may be a bit unfair for Children’s Miracle Network to be competing for an award with the likes of MasterCard, Walgreen, Kellogg, H&R Block, and thousands of other brands small and large across the nation that participate in cause marketing.

The reason? There’s a difference between being a cause, as Children’s Miracle Network is, and supporting a cause, as the vast majority of brands involved in cause marketing do. The distinction is significant, and it offers warnings for companies of any size considering a leap onto the cause marketing bandwagon.

There is no shortage of those. According to a recent Cone Communications/Echo Global CSR study, more than 9 in 10 consumers are likely to switch brands to one associated with a good cause, assuming comparable quality and pricing. Those are compelling reasons for companies to tie their marketing to feel-good charities.

But the numbers tell only part of the story. The study also said that 70 percent of consumers are confused by the messages companies use to talk about their corporate social responsibility initiatives. And there have been a few high-profile cases of cause marketing backfiring that companies considering the approach should examine as cautionary tales.

One example is KFC’s “Buckets for the Cure” tie-in with the Susan G. Komen Foundation, which encouraged people to fight breast cancer by buying pink buckets full of fried chicken. If press coverage was one of the goals of the campaign, KFC achieved it in spades, though not in the way the company would have liked.

The brand was pilloried as hypocritical for using fried chicken to raise money to fight cancer and accused of “pinkwashing,” with one blogger calling it “another sad example of commercialism draped in pink ribbons.” Yoplait ran into a similar problem with its sponsorship with the Komen Foundation because one of its products contained a hormone associated with cancer. (The hormone has since been removed.) They say no good deed goes unpunished, and this is how the folks at KFC and Yoplait must have felt.

That’s one danger of using a cause for marketing, as opposed to marketing a cause. For Children’s Miracle Network, it is impossible to separate the cause from the mission; not so with everyday brands that partner with charities to sell their products. Brands can easily be perceived as self-serving or disingenuous, using a charitable front for commercial ends, and suspicious (and often self-righteous) advocacy groups will always be ready to pounce on those they perceive are doing so.

Even noncontroversial cause marketing efforts may have a downside: They could confuse customers. As with hiring a celebrity spokesperson, teaming up with a celebrated cause makes use of borrowed equity; the brand benefits from the charity’s halo effect. But borrowed equity is just that—borrowed. It may rub off on the brand, but in the long run it belongs to the cause.

Another, more subtle danger of cause marketing is that it may represent a distraction for company management. Tying a brand to a popular cause may be one way of ignoring the more existential threat of underperforming products or services. If a brand needs a cause in order to feel relevant, credible, or accepted, it has a bigger problem. Better to make the brand the cause and focus on it than to use an unrelated cause to prop up the brand.

The first cause of any company must be its own: to succeed by making the lives of its customers and employees better through the products or services it provides. If you wish to support a cause with your brand, fine, as long as it makes strategic sense and is well-vetted. But don’t think you need to support a nonprofit of some kind to legitimize your profit-making venture. By achieving as much success as you can by doing what you do best, you’ll be better able to support whatever causes you wish to.

Originally published on Bloomberg Businessweek

Steve McKee

Co-founder and author, Steve specializes in addressing the most meaningful problems. Call Steve when you want to change the world. He’ll have a thought (and some research) on that.

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