Home
As we enter what is expected to be one of the worst holiday shopping seasons in nearly two decades, we are finally able to utter that dreaded word in mixed company: ahem, recession. So why, amidst this financial turmoil and uncertainty, are PR power figures at the helm of some of the world’s leading brands talking more adamantly than ever about “purpose branding” (-formerly- P&G’s Jim Stengel) and urging companies to “go forth and reputate” (Johnson & Johnson’s Ray Jordan)?
Because these leadership companies and others like them recognize that the health of business and society are intrinsically linked. The financial meltdown truly highlighted the interconnected nature of the world. Only when people and communities are educated, healthy and productive, can business truly thrive. Companies, therefore, have a unique challenge and an opportunity to make a positive impact on society, one that will be rewarded with short-term sales, long-term reputation gains and stakeholder loyalty.
Cone’s recent research shows that consumers continue to have high philanthropic expectations for companies struggling amid the current economic crisis: more than half of Americans feel companies should maintain their level of financial support of causes and nonprofit organizations. Another quarter expects companies to give even more. Clearly, difficult times call for companies to reinforce, not retract, their commitments to society and their stakeholders, but what will help companies invigorate and sustain their cause branding and citizenship initiatives in the coming years?
- Reputation management: There will be a renewed focus on reputation management as a core objective for cause programs as companies seek to build trust, competitive advantage and license to operate amid an environment of growing corporate distrust.
- Sales generation: Companies will take a “back-to-basics” approach to cause marketing and other sales generation promotions in which they will embed cause-related purchasing opportunities into everyday products. Companies cannot sustain or gain loyalty solely by cutting prices (after all, how low can the discount go?), so providing fairly priced products of good quality that are also tied to a cause will be a great value proposition for weary consumers.
- Investment in long-term shared value: The social and business investments companies make are an investment in the communities that will ultimately sustain their business in the future. Companies will increasingly make investments that are aligned with issues material to their business growth, such as training future workforces, fostering economic development in emerging markets, developing efficient vaccine distribution models, securing license to operate and preserving the environment.
- Strategic philanthropy 2.0: Companies may have less money to give, so now is the time to achieve greater focus and value from their assets. This requires introspection and planning to identify other resources – employees, in-kind, professional services and expertise, for example – they can leverage to help meet their social commitments. Now is also the time to get tactical. Companies will assess their matching grants and dollars for doers programs and either lower or restructure these to better align with their corporate giving focus. With greater clarity of their giving, they will craft exit strategies to bring some non-aligned relationships to a close, taking care not to damage relationships developed over the years. Giving may again move toward localized causes and basic needs, whether in a local town, region or overseas market, as companies strive to support the communities in which they have a presence during tough economic times and where license to operate is critical for long-term success.
- Tapping employees: To reinforce morale amid potential layoffs, companies should use their societal commitments as an opportunity to engage employees and foster a purposeful work environment, enabling them to continue supporting critical social issues without significantly impacting the bottom line. Examples may include: skills-based volunteering, employee loan programs to nonprofits, sabbaticals and day-of-service programs.
- New fundraising models: This may take the form of traditional point-of-purchase paper icon programs or innovative models like the (RED) campaign. Either way, the intention is to use widespread distribution channels, such as social media, to tap the power of many through small, but impactful donations.
- Widespread collaboration: We will see a surge in collaboration both within and across industries as organizations, recognizing no company can do it alone, consolidate assets to address societal problems. Partnerships will be redefined as organizations accept that social issue leadership requires the collaborative expertise of many powerful voices, including competitors, inter-industry alliances and representatives from government, media and academia.
- Shift in communication: Companies will reprioritize their communications, granting increasing prominence to social media and public relations with the goal of establishing viral initiatives. The messages themselves will also be refined to become more transparent (consumers will want to know the details of the program, specifically, the amount going to the cause and that they are not paying a premium) and to highlight the benefit of purchasing cause-related items not only for society, but also the consumer.
As some companies will inevitably shift their focus away from cause branding, there is a renewed opportunity today for the staunchest supporters to reaffirm their commitments to social and environmental issues and break through the cause clutter. Consumers recognize that their wallets may be tighter, and while they may be buying less, they will be buying better. As a result, the value of cause goes far beyond the dollar in troubled times like these. Cause programs can serve to boost morale, unify consumers and arguably lend the corporation an emotional role as a "helping neighbor," here to offer a glimmer of hope and an infallible conscience even when times are tough. These are the companies to whom consumers will return.
About Cone:
Cone LLC (www.coneinc.com) is a leading expert in cause branding and corporate responsibility strategy and communications. Cone helps companies such as Western Union, Pfizer and Timberland build business value and enhance reputation while realizing societal gains. To learn more about Cone’s cause branding, corporate responsibility and other services, please visit www.coneinc.com or call 617-227-2111.