Cause-Related Marketing: Consumer Perceptions of Philanthropic Activity

Introduction

Consumers today are eager to patronize businesses that share values and ethics. For-profit companies are pairing with non-profit organizations allowing a consumer to donate funds to a charity through an event, purchase, or activity sponsored by their corporate counterparts. This relationship is called cause-related marketing and offers a unique opportunity for big business and not-for-profits to share a mutually beneficial experience. Varadsrajan and Menon define the cause-related marketing movement as “the process of formulating and implementing marketing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause when customers engage in revenue-providing exchanges that satisfy organizational and individual objectives.” (1988, p. 60). Cause-related marketing is established by a corporation that wishes to continue its philanthropic efforts by choosing one organization, or cause, with which to associate. Simply, it is a partnership between a corporateorganization and a non-profit where there is a mutually beneficial relationship encouraging sales of a product or positive attitude for an organization and fundraising opportunities for a charity. However, the role of philanthropic activity as a part of corporate strategy is still evolving. While not all companies have fully integrated philanthropy into their overall corporate strategy most recognize its strategic importance (Smith 1994; Tokarski 1999).