Four States Small Business Blog

5 Questions to Ask to Determine if Your Donation/Cause Marketing Budget is Actually Contributing to Marketing ROI

Posted by Mark Zimmer on January 23, 2017 at 8:30 AM
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iStock-494312156.jpgContributing to local causes can help bring brand awareness and show corporate social responsibility amongst your community, which is why it is worth including it in your marketing plan. According to the 2016 Edelman Trust Barometer, 80 percent of consumers think that companies should make an extended effort to improve social and economic conditions in their region while increasing their profits.

The survey also says that in the United States, 90 percent of Americans are more likely to give their business to brands that actively give back while 84 percent are happy to spread the word about one’s corporate social responsibility (CSR) program.

However, while donation marketing can be a great supplement to your marketing plan, you should not rely on it as the sole component of it because it might not have the ROI you are seeking. Do research, look at your target demographics and determine if giving back to a particular cause helps build your brand while giving back. Otherwise, you could just be wasting your money.

When building a cause marketing budget, ask yourself these five questions:

1. Is there a tangible goal that can be measured?

Setting a goal is the first step in determining whether you can get some cause marketing ROI. In an example from Cause Marketing For Dummies, Woodchuck Cider set up a campaign where they pledged to plant two trees through the American Forest Foundation per every Facebook “like.” By the end of the campaign, Woodchuck pledged 13,618 trees! Not only did Woodchuck Cider choose a cause that was closely associated with its name, customers and employees responded favorably to it and were more likely to continue business with them.

2. How many coupons or codes were redeemed?

If you launch a campaign with the right tone and authenticity, then your customers will take notice. One way to validate cause marketing ROI is to attach a coupon or code to a product or service with the message, “[Our company] will donate X amount of proceeds to [charity of your choice] when you buy [this product or service].” If you see an increase in sales of the products that have a cause promoted along with it, then you know the campaign worked.

3. Did you take the promotion out of the store?

General Mills, the makers of Honey Nut Cheerios, is very aware that honey is one of the main ingredients in its cereals. So when it noticed the declining bee population across the country, the company took action. Through a social media push and its packaging, General Mills made its mascot Buzz the Bee “disappear” to raise awareness about the problem while also teaching consumers about its commitment to sustainable agriculture.

Think about any issues you have in the supply chain in producing your product or service. Is there any action you can take to fix it on a bigger scale? Then let your customers know what you are doing to help.

4. Did you get your money’s worth?

This is an important question that leads back to whether you have correctly chosen a cause that aligns with your company’s values and products. For instance, if you sell eyeglasses to people ages 65+ then it might not make sense to sponsor a college sorority fundraiser. Any ROI would be a shot in the dark since those two demographics have nothing to do with each other.

Try to find a cause that aligns with your business, one that makes someone immediately see the connection and encourages them to buy something with you. When you see increased loyalty and active engagement from new and returning customers after launching your campaign, then you know you’ve gotten your money’s worth.

5. Have you gotten new customers?

CauseGood reported that when choosing between two similar products of equal price and quality, 90 percent of US consumers will choose the cause branded product. For example, Dog Adventures of Tahoe is a business that offers dog-sitting services and gives your four-legged friends a good time while you are at work or out of town. There are plenty of dog services around, but 10 percent of a Dog Adventures booking goes to help save street dogs of India. This gives Dog Adventures of Tahoe an edge against its competitors by offering a service and pulling at the heartstrings of those who love dogs.

More and more businesses are looking at implementing a cause marketing budget because getting involved is now viewed as a valid business strategy more than just a philanthropy effort. In an age of mass consumerism, people want to believe that their money is going towards something good so it’s worth trying to figure out how to get on board.

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Topics: Marketing Strategy, Marketing ROI