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Marketing Insights: Cause Related Marketing

Cause Related Marketing


From fundraisers for the sick to cousin Fred’s stag and
doe, chances are you’ve had donation requests from all kinds of groups,
and then some. We’d like to be able to help everyone, but realistically
you can’t say yes to every charity.

From fundraisers for the sick to cousin Fred’s stag and doe, chances are you’ve had donation requests from all kinds of groups, and then some. We’d like to be able to help everyone, but realistically you can’t say yes to every charity. Simply sorting through the numerous requests for sponsorships or donations can become a full-time job in itself. It is, however, possible to be strategic about where and when you donate and in the process help a good cause and build your brand.

The fastest way to burn out is by trying to be all things to all people. On the flip side, saying “no” to everything doesn’t give back to the community. Deciding which causes to support can be such a complicated and emotional topic. Many companies never get around to drafting a strategy or a policy around giving and often the result of this inaction is a shotgun approach to giving. We say yes to some and no to others without any sense of how our gifts are benefiting the causes we give to or how the alliance is benefiting our businesses.

We can take a page from big companies who have decided to give larger amounts to fewer charities. This “purposeful” approach ensures that your financial support is making a significant impact and it allows your business to focus on those causes you’re truly passionate about. You may wish to keep the following guidelines in mind when developing a strategy around corporate gifting.

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CHOOSE WISELY
It’s your business that’s making the donation so it’s perfectly reasonable that the benefactor be an organization that supports a cause that means something to you personally. Children’s causes or cancer research may strike a chord.

It’s also important to ensure that the charities you choose to support complement your brand image and the nature of your business. It may not be a great idea to support the Heart and Stroke Foundation with proceeds from your “triple-cheese meat lover’s pizza” but a promotion around the healthy items on your menu may be a fit.

CREATE LONG-TERM PROGRAMS
Toppers Pizza has tapped into youth causes with its “Feed Your Mind” reading program. This is a great example of a long-term strategy with a strong link between the Topper’s brand and education. The program connects the reading success back to the restaurant – Toppers sponsors the class pizza parties.

Start by listing the quality of life issues that you hold near and dear. Once you’ve decided on which causes you will support, this becomes the filter through which all requests must pass.

What to seek in a charity
As business owners, pizzaiolos across the country know just how vital it is to protect their brand. Whether it’s from food safety concerns or reputation busters, it’s a non-stop task to keep your name clean.

Partnering with charitable causes has been one of the real image-boosters for many. But if you’re considering launching a new campaign of goodwill, there are a few key things you need to keep in mind.

•  Beware of charities that promise to provide an income tax receipt for more money than you’ve donated.

•  Charities registered under the Income Tax Act can issue official donation receipts for income tax purposes.

•  To verify if a charity is registered under the Income Tax Act, and to access its annual information return, you can visit the Charities Directorate Web page on the Canada Revenue Agency website at www.cra.gc.ca or call the agency’s bilingual toll-free number at 1-888-892-5667.

•  A charity that spends more than 60 per cent of its donations on administration and fundraising instead of on charitable works should start to raise alarm bells.

•  Beware of names that sound like well-known charities. Scam artists won’t hesitate to use similar wording, logos and graphics to make you believe you’re giving to a national, well-known, registered charity.

The Canada Revenue Agency plays a vital role in protecting Canadians against fraud by officially registering qualifying organizations as charities, giving technical advice on operating a charity, handling audit and compliance activities, as well as helping Canadians make informed choices about their charitable donations.

SET A BUDGET
You won’t be any help to anyone if your business over-spends on donations so, make sure you start each fiscal year with a clear idea of how much you intend to give. Ask your accountant and financial planner to advise you on how to structure the gifting to maximize the benefit for both the recipient and to your business.

DEVELOP A PROCESS
Now that you’ve identified which recipients you will be giving to, defining a procedure for responding to all other requests will make things easier. Some companies actually create an anonymous voice mailbox for all requests to be directed to by reception. The outgoing message will state your corporate policy on gifting. Specify the charities you support, ask the caller to put their request in writing.

It’s perfectly acceptable to ask that the request be written, it weeds out those groups that aren’t serious about their fundraising. Set expectations regarding speed of your response. It’s not unreasonable to allow several weeks to formally respond to a request for donation. Having a time frame for a response will also weed out those organizations wanting an answer right away.

You may wish to develop a postcard or form letter that says, “Thank you for your interest in our company. We have allotted our donations for this fiscal year but will keep you in mind for the future.” Simply pop this in the mail to answer requests you won’t be fulfilling and you will have a turnkey method for closing the loop.

ENGAGE YOUR FRONT-LINE STAFF
Make sure all of your staff knows which organizations you will be supporting and why. Tell them where the donation dollars are going so they can answer questions from customers. You should also brief them on your policies and procedures around donation requests. That way, most requests can be managed without necessarily getting you involved. Post your donation policy on your website so those looking for support can easily access the information.

KEEP FINANCIAL RECORDS
Make sure you get receipts for all of your contributions. There are tax benefits available to those who support good causes and your accountant will be able to leverage your generosity on your tax return. Our government wants to reward us for giving – having the money in your pocket will make it easier for you to continue giving in the future.

Cause Related Marketing ideally benefits the charity as well as the donor. Boston-based research firm Cone reports that 91 per cent of consumers say they have a more favourable impression of a company if it supports a cause and 90 per cent of consumers would consider switching their business to a company if it’s aligned with a cause.

Charitable giving has become more strategic as businesses choose to align themselves with key causes. Tim Hortons supports Canadian youth with its Timbits Minor Sports Programs and its Children’s Foundation. The initiatives have given back to Canadian youth while reienforcing the Tim Hortons brand as being rooted in family values.

It’s not easy to say no to people asking for help. If money grew on trees, we’d say yes to everything, but that’s not reality. Trying to be all things to all people often causes us to scatter our energies and the end result is often not very effective. By spending some time addressing the issue of charitable giving your operation will be taking that next step from local business to valued corporate citizen.•