Spending With HEART

The gap between a consumer’s heart strings and a company’s bottom line is dwindling as companies such as McDonald’s, Avon and Reebok use social causes to encourage consumer purchasing. Cause-Related Marketing (CRM) wasn’t widely accepted in its early years, but has been growing in popularity. According to Cone/Roper’s Cause-Related Marketing Trends Report, about three quarters of all Americans not only find CRM acceptable, but would be willing to switch to another brand or store associated with a good cause if the price and quality are comparable.

This linking of the nonprofit and the corporate has produced Avon’s Breast Cancer Awareness Crusade, McDonald’s Ronald McDonald House Charities and General Motors’ support of the united Negro College Fund. In its Giving USA 1997 annual yearbook on American philanthropy, New York-based AAFRC Trust for Philanthropy noted that the strong economy pushed total charitable contributions to nearly $151 billion in 1996. Corporations did their part by contributing nearly $9 billion to the collection plate. Critics of CRM claim it is simply corporate self-interest masked as charity. But nonprofits that have benefited from this type of partnering give a different testimony–CRM has made believers out of them.

AREAS CONSUMERS WANT COMPANIES TO FOCUS ON
1996 Total Average 1996 African American Average

Improve Public Schools 52% 5%
Clean Up Environment 27 4
Scholarships 28 33
Drop-Out Prevention 34 29
Community Health Education 24 14
Source: Cause-Related Marketing Trends Report, Cone/Roper, Boston, 1997

GIVING 1996: $150.7 BILLION
Source of Contributions[*]

Individuals: $119.92/79.6%
Foundations: $11.83/7.8%
Bequests: $10.46/6.9%
Corporations: $8.50/5.6%
Source: Giving USA 1997/AAFRC Trust for Philanthropy, New York
* In billions of dollars
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