October 2, 2012
Ever want to know just how much of your purchase of a bar of soap with a pink ribbon will actually benefit a charity? Curious how charities decide which products/ firms are a good fit for a cause-related marketing campaign? Well, you are not alone!
We are frequently contacted by donors who want to better understand how corporations and breast cancer charities partner to generate charitable funds and raise awareness for the cause. So we asked a few well-known breast cancer charities that engage in cause-related marketing to shed some light on this topic.
Sheila Brown, Director of Development and Special Projects, Breast Cancer Fund
Robbie Finke Franklin, Director, Marketing, The Breast Cancer Research Foundation
Jean A. Sachs, CEO, Living Beyond Breast Cancer
|"The Breast Cancer Fund requires full disclosure regarding the benefit to the organization when funds are raised through a consumer purchase on all packaging, advertising and promotional materials in clear and unambiguous terms. Vague disclosures indicating that we will receive "profits" or "net proceeds" are not in compliance."||"There are many factors that we consider in determining if a company or product is a good fit for BCRF; true passion for and commitment to curing breast cancer, compatibility with the Foundation's brand and mission, agreement to comply with BCRF's transparency requirements, and a sense that giving back is part of the companies DNA and not just a marketing or public relations line item, to name just a few factors."||"I think that many people feel that it's the corporate partner that makes out the best in a cause-related marketing campaign...in the end, it really is the charity, through the benefit of the financial resources generated by the campaign and the exposure the corporate partner can provide, that gives the benefitting organization the ability to continue its mission delivery."|
Charity Navigator: How do the relationships typically occur? Do the companies approach your charity or do you go after the companies with which you want to partner?
Sheila Brown: While many companies approach us to partner, we have strict guidelines that determine our engagement, which, after careful vetting, significantly limits the business partnerships that meet our standards. Since our mission is to prevent breast cancer by eliminating our exposure to toxic chemical and radiation linked to the disease, it is critical that the company’s products and practices align with our mission. We seek to partner with companies that want to actively join us to advance and protect the public from toxic exposures and that have strong alignment with our mission and programmatic activities.
Robbie Finke Franklin:Typically, companies approach The Breast Cancer Research Foundation® (BCRF), but we do court some companies and brands.
Jean A. Sachs: LBBC has been partnering with retail corporations for almost ten years. In most cases the initial contact comes from the company or their public relation firm and the company has a specific product they have selected to benefit a breast cancer charity. It isn’t uncommon for LBBC to be one of many breast cancer organizations the company is reaching out to. LBBC staff work hard to develop partnerships that make sense for both the company and the corporation and if possible to make it an on-going partnership. In recent years LBBC has been proactive in approaching companies though typically, this type of recruitment takes more time to yield results.
CN: In recent years, consumers have become more skeptical of these relationships and question the authentic nature of the partnerships. How does your charity determine if a company or product is a good fit? Have you ever said no?
Sheila Brown: The skepticism is warranted. Many cause marketing activities are transactions, not partnerships. There should be some meaning beyond promoting the brand of the company and the name of the organization. There should be some good that comes out of it besides money. The charity should clearly be benefitting more from the relationship.
We have often said no to partnerships or promotions that conflict with our mission. Examples include partnering with companies whose products are controversial in subject matter; seen as counterproductive to our work and identity; or created, used or fostered with toxic materials or chemicals linked to breast cancer. We have turned down partnerships with smaller, green product lines that are part of a bigger company that sells products that do not match our criteria.
Our successful partnerships have been with companies that share our commitment to protecting our health and the health of our environment. These tend to be companies committed to environmental health by promoting both healthier living and the reduction of toxic exposures. Typically the kinds of companies that fit our partnership guidelines are offering healthier food; utilizing sustainable business practices; and making safer products, be they cosmetics, household cleaning products, outdoor gear, etc. We also partner with companies that support our events and outdoor challenges and that raise funds for us both with direct and indirect contributions, such as pro-bono advertising and volunteer services.
While we believe in safe, healthy products and happily and effectively promote our partners, we partner with companies that are dedicated to our mission, not just to their own interests. We want partners who believe in the work that we do and want to be actively engaged in promoting our work.
Robbie Finke Franklin: There are many factors that we consider in determining if a company or product is a good fit for BCRF; true passion for and commitment to curing breast cancer, compatibility with the Foundation’s brand and mission, agreement to comply with BCRF’s transparency requirements, and a sense that giving back is part of the companies DNA and not just a marketing or public relations line item, to name just a few factors.
Yes, we say “No” if the product is inappropriate, if the campaign is a blatant commercialization of the pink ribbon, if the product category is covered by an exclusive agreement with another company and if we have a saturation of products in that category.
Jean A. Sachs: I think consumers are right to be skeptical and we approach each relationship with that in mind. LBBC’s corporate partners believe in our mission. We do evaluate each opportunity to make sure it is a good fit for LBBC. Yes, we have passed on proposed opportunities with more than a few we felt didn’t meet our internal guidelines of partnerships. Several potential partnerships have not come to fruition because we couldn’t agree on the terms.
CN: Once you agree to work with a product/ firm, what are your ground rules for engagement? For example, do you require a certain level of donations before you will permit the company to use your name/ logo? What do you require in terms of disclosure about the partnership on the product’s packaging?
Sheila Brown: We have a strict set of guidelines for all partnerships, including guidelines on when and how our logo can be used so that it is clear to the public what the organization’s relationship is to the product or company. We expect our partners to comply with the Better Business Bureau’s Standard 19 (note: Charity Navigator has also long advised the same standards), which states that consumers must understand exactly what amount of their purchase is a donation. The Breast Cancer Fund requires full disclosure regarding the benefit to the organization when funds are raised through a consumer purchase on all packaging, advertising and promotional materials in clear and unambiguous terms. Vague disclosures indicating that we will receive “profits” or “net proceeds” are not in compliance.
Robbie Finke Franklin: Currently, BCRF has two partnership levels. Each level requires a minimum donation which permits a company to use our name/logo. All our partners sign a Cause Marketing Agreement specifying that any use of BCRF’s Trademarks must be accompanied by all disclosure required by applicable law. The Company must agree to disclose its donation to BCRF clearly and conspicuously including the dates of the campaign, the donation amount expressed in terms of the purchase price, and any maximum donation. If it is a flat donation, the language must include “regardless of sales” so the potential purchaser understands that their purchase doesn’t influence the donation. BCRF does not permit the use of vague terms like “profits” or “proceeds”. The goal is that the consumer must understand how the product or service benefits the charity before they purchase the product, good or service.
Jean A. Sachs: LBBC’s agreements with partners are considered on a case-by-case basis. This allows us to examine the goals of the partnership both parties hope to achieve and then develop the most practical strategies for reaching those goals.
LBBC doesn’t require a certain level of monetary donation to use our logo in marketing and outreach of a product or service to benefit our organization, but we do require complete disclosure to consumers regarding the type of donation (i.e. if there is a monetary cap, what percentage of sales (gross? net?) from certain products will be donated (25%? 100%), etc. We also require a signed partnership agreement which among other things clearly states when LBBC will receive the donation for the sale of the product.
CN: How do you define success and can you provide an example of a successful campaign?
Sheila Brown: We believe that successful partnerships and cause marketing promotions are designed to be deeper than a one-time transaction. Four primary characteristics for a successful collaboration include:
- Advancing the Breast Cancer Fund’s mission and contributing resources to the organization
- Transparency to the public about the partnership and promotion
- Meeting objectives and ensuring the desired outcome for the business involved
- Absolute clarity about the nature, duration, resource commitment of both partners in all aspects of the partnership, including evaluation of the success of the effort
An example of a successful partnership is our relationship with LUNA, makers of the Whole Nutrition for Women, which has been a steadfast ally of our work since its launch in 1999. LUNA promotes prevention in every aspect of its business—from incorporating our logo into its packaging to engaging women through its community-based programs, including LUNAFEST, Team LUNA Chix and LUNA Moms Clubs. These programs provide critical fundraising and advocacy support for the organization and our work to stop breast cancer before it starts.
Robbie Finke Franklin: A successful campaign is one that engages employees enthusiastically as well as the public and increases BCRF’s awareness. Also, any campaign that exceeds the company’s expectations.
Jean A. Sachs: Any campaign that allows us the chance to introduce even one woman to the educational resources and support services we provide and that helps underwrite these resources with monetary support is a successful campaign.
CN: On the flip side, when and why has a campaign failed?
Sheila Brown: We experienced unsuccessful partnerships before we developed comprehensive guidelines, which serve to ensure that both the organization and the company understand what the partnership is and what the expected outcomes are. Some companies have unrealistic expectations, thinking that a partnership with a nonprofit will result in dramatically increased sales or brand recognition. That’s why it’s so important that we partner with companies that have a real and demonstrated commitment to our mission, and that we enter into all partnerships with clearly defined plans and goals.
Robbie Finke Franklin:Making a product pink or putting a pink ribbon on a product, doesn’t mean it will sell. Campaigns fail when a company forces a pink color wave on a product for which pink is outside of the product’s normal color palette. A good rule to follow to avoid failure is will you be able to market and sell this product in pink even if it wasn’t benefiting breast cancer?
Jean A. Sachs: Campaigns, at least in our experience, only fail when there isn’t a clear letter of agreement signed by both parties that explicitly details what each party’s responsibilities are based on the goals assessment.
CN: What do you think of campaigns that have caps on the level of money the firm will give? For example, sometimes a campaign may specify that the corporation will give $1 per purchase up until 500 items are purchased. In this scenario, the 501 customer’s purchase does not contribute to the charity’s bottom line and the customer has no way of knowing that.
Sheila Brown: It is understandable that a company may need to limit the amount of its donation, just as a nonprofit can set a minimum donation requirement to enter into a partnership. What’s important is disclosure. As discussed above, we expect our business partners to comply with the industry's best practices, which requires transparency for the consumer. The consumer needs to know that there is an upper limit to the donation.
Robbie Finke Franklin: BCRF works with companies from inception to establish that a donation cap correctly aligns with the volume of the product in the marketplace otherwise the campaign is not accepted.
Jean A. Sachs: I think that most consumers are savvy enough to know that for many nonprofits, even a capped donation can make a tremendous difference in the organization’s annual operating costs and should reach out to the organization benefiting from a capped donation to ask any questions if they want to make sure they’re participation in such a campaign is truly helping the benefiting charity and how.
CN: What do you know about the consumers who purchase a product affiliated with your charity? Do they tend to be existing donors or are they likely to become a donor after the purchase?
Sheila Brown: We are careful to partner with like-minded companies whose consumers often also share our concern over toxic chemical exposures and our interest in healthy, safe products. While it’s nearly impossible to gauge how many of these customers are already donors, nor how many are likely to become donors, we do know that these consumers will be exposed to our name, our logo, perhaps our mission and our web address. Building this recognition and trust is important. We also know that consumers who do already know and trust us will be more likely to buy a product associated with us, which is of great benefit to our partner companies.
Robbie Finke Franklin: N/A
Jean A. Sachs: I don’t think we know much about the consumers that purchase products benefiting LBBC who are not currently on our mailing list. I think those already connected to LBBC like to purchase products that support our mission and it’s why we actively include these products into our own online and social media campaigns during Breast Cancer Awareness month in October. However, I suspect most consumers of these products are not current LBBC donors. We don’t have any way to track if these consumers eventually become LBBC donors.
CN: How concerned are you that the consumers see these purchases as a substitute for direct donations to your charity?
Sheila Brown: Many people who buy these products give in many ways—they understand that buying a product where a percentage goes to a charity is not the same as directly engaging with and donating to that organization. So they do both. We engage with business partners who are committed to our mission because we know that they will educate their consumers about our organization and our work, which translates into greater name recognition, a deeper understanding of our work, and, ultimately, an increase in direct donations from their consumers.
Robbie Finke Franklin:Not at all concerned.Jean A. Sachs: This is not a major concern. Of course, we’d rather receive a direct donation so LBBC receives 100% of that donation and we can capture their information on file in the event they would like to support us at other times during the year. But, if such is not the case, if they choose to make, say, a $5 donation to LBBC that comes through the purchase of a product or service, or a direct $5 donation, it still reaches us.
CN: Charities aren’t required to specifically disclose how much money they generate via cause-related marketing projects. And this lack of transparency is an ongoing source of disappointment to consumers who want to better understand the importance of these partnerships (does their purchase of a pink piece of candy really make a difference) and academics who are interested in trends. So, in the interest of full disclosure, will you tell us what percentage of your annual revenue is derived from cause-related marketing? How has this changed in the last 5 or 10 years? And where do you see it trending in the future?
Sheila Brown: Transparency is a core value of the Breast Cancer Fund. On our website we post our financial information, along with additional information for donors, including frequently asked questions about making a charitable contribution to the Breast Cancer Fund. Twenty percent of the Breast Cancer Fund’s $3.9M budget comes from business support. Of this $780,000, roughly 62 percent is related to cause marketing and business partnerships.Cause marketing started budding for the Breast Cancer Fund in 2003-2004 when $350,000 was raised through related activities. This trend steadily increased until a slight dip in 2007, only to return strong again in 2011.
I foresee a bright future for cause marketing. In addition to more money being raised, I see partnerships evolving beyond more traditional, transactional or one-off promotions, into deeper, more meaningful and transformative partnerships. These transformative partnerships will be more relationship-based and include longer-term visions where success is measured beyond profits to include the primary goal of accomplishing the nonprofit’s mission.
Robbie Finke Franklin:The percentage varies from year to year, but most recently over 40 percent of BCRF’s revenue was derived from cause-related marketing. It has increased in the last five years, and we are forecasting the trend to remain constant.
Jean A. Sachs:Currently, about 20% of our annual income is the result of CRMCs. This percentage has increased over the last decade primarily because one of our long time retail partners has significantly increased their support. In addition, LBBC has added new retail partners every year and in the last two years the list has grown longer. It is hard to predict the future but for LBBC CRMC’s is a critical funding stream to support our educational and support services.
CN: What do you think is the biggest misconception about cause-related marketing that you want to clear up for donors/ customers?
Sheila Brown: I believe that the biggest misconception about cause marketing is that all promotions are more of a marketing tool for the company than for the good of the nonprofit. This is why I believe that now more than ever, having mission resonance between the company and the nonprofit is vital. It doesn’t make sense to have a cancer organization accepting money from a company that is including cancer-causing chemicals or harmful ingredients in its products. Consumers have really wised up to this. If the partnership doesn’t feel right, many consumers will sense it.
Robbie Finke Franklin:Just because a company states that they are giving to a charity doesn’t mean they do so. Check the charities web site to determine if the company is a partner and be careful not to buy products that state or imply that a charity will benefit from a consumer sale or transaction rather than clearly disclose how the charity benefits from the sale of products or services.Jean A. Sachs: I think that many people feel that it’s the corporate partner that makes out the best in a cause-related marketing campaign as opposed to the charity being supported. Certainly, the positioning of a corporation as a “good corporate citizen” is tantamount for a company during such an endeavor, but in the end, it really is the charity, through the benefit of the financial resources generated by the campaign and the exposure the corporate partner can provide, that gives the benefitting organization the ability to continue its mission delivery.
CN: Are there some generally agreed upon best practices in the nonprofit sector for engaging in cause related marketing relationships? If so, please outline them and where a donor might find them on the internet.
Sheila Brown: I believe that authenticity is the most important. Partnerships need to make sense and relate back to the company’s brand and the nonprofit’s mission. Other best practices include transparency; developing meaningful donation amounts; putting the “cause” before the “marketing”; and ensuring effective communications, both internally with the company and nonprofit and externally to consumers.
Robbie Finke Franklin:We have mentioned many best practices above.
Jean A. Sachs: Have a signed partnership agreement that is clear about the donation amount and date by which it will be received. Review all marketing materials to be sure the organizations message is correct. Build a strong relationship with the corporate partner because a CRMC can often lead to additional support from that company.
CN: Are you aware of any third party, non-governmental entity in existence, to monitor whether or not groups are following such best practices? If not, would you support and help to finance the creation of such an organization or the creation of a new division within an existing organization to monitor such cause related marketing relationships?
Sheila Brown: As we mentioned earlier, the BBB has addressed the issue of cause marketing practices (note: Charity Navigator has also long advised the same standards). An organization that adopts these voluntary standards is showing its commitment to openness and ethical conduct and demonstrating that its cause marketing efforts are sharply focused on its mission. We would certainly support efforts to adopt these types of standards more broadly across the nonprofit landscape.
Robbie Finke Franklin: I don’t know of any entities currently monitoring best practices. In my opinion, what is needed are national guidelines mandated at the Federal level. This would insure transparency and conformity. The problem does not lie with charities not following best practices as many charities are on top of this, the problem is gaining compliance from corporations and brands on a broad scale.
Jean A. Sachs: I am not aware of one that currently exists. I don’t think this is something LBBC would help support but if one were created it would be useful for donors and non-profit organizations.