The Rise of Cause-brand Alliances

By March 5, 2020From the DAIS Studio

In an age where consumers are increasingly viewing brands that are aligned with social causes more positively, should more brands be implementing cause-brand alliances?

The recent bushfires in Australia, dubbed the ‘black summer fires’, saw the destruction of homes, businesses and our native wildlife. They also sparked a wave of Australian and international brands pledging donations and running sales-based fundraisers, showcasing the influence of brands to bring together social causes and consumers. With more than $100 million in donations and funds raised from these initiatives, it is clear cause-brand alliances are a powerful tool [6;4].

What is a cause-brand alliance?
Cause-brand alliances, or cause-related marketing, involves brands affiliating with a social cause or non-for-profit organisation to gain economic or brand reputation benefits [3]. Corporate social responsibility (CSR) has become a pillar of business strategy and can be used to influence brand perception [2;3]. Only 13.4% of Australian consumers are loyal to brands, meaning customer retention is a major issue for businesses. Brands are wanting to improve customer loyalty and brand reputation amongst a population of consumers who don’t want to commit [9]. Cause-brand alliances are highly influential and could provide a solution for struggling customer retention.

The Black Summer Fires
During the black summer fires some brands chose to donate money or their own products or services to the bushfire relief. For example, Airbnb reopened their Open Homes Program to offer a place to stay for residents and emergency service workers displaced by the fires and Coles donated $3 million worth of their gift cards [4]. Other brands chose to run fundraisers, like The Iconic donating 100% of profits from sales on January 9th or Tennis Australia donating $100 for every ace served over the summer [7;8]. These brands have recognised the importance of cause-brand alliances, hoping to make a difference while simultaneously earning trust and loyalty from consumers [2].

How does the brand benefit?
Several studies indicate cause-brand alliances are highly effective. Specifically, they can attract new consumers, improve consumer and employee loyalty and overall brand reputation [3;5]. According to Cancer Council Australia, 24% of Australians in the past year have altered purchasing decisions based on the brand’s alliance with a cause [12]. Additionally, two-thirds of Australians view a brand more positively when they are affiliated with a charity or cause [10]. This indicates that there is a clear opportunity for Australian brands to utilise cause-brand alliances.

How does the cause/charity benefit?
Some research suggests consumers who purchase from brands linked to causes are less likely to independently donate [1], however, cause-brand alliances have proven to increase funds and awareness of the partnering cause. The National Breast Cancer Foundation’s (NBCF) annual pink ribbon campaign is affiliated with over 80 Australian brands. The funds raised from this initiative count for 20-25% of their annual donations [1], showing the significant impact of this particular cause-brand alliance. Causes that are not familiar to consumers largely benefit from an alliance with well-known brands, leading to improved awareness [5].

If you’re wanting to implement a cause-brand alliance strategy, here are some key tips:

Be Authentic: Choose a cause or charity that you are passionate about and is relevant to your brand. It is easier to develop a strong and long-lasting alliance when it is authentic.

Be Smart: Understand your consumers and target market so you can align with the causes they care about. This will improve customer loyalty, as they will recognise your brand as having similar values to them.

Be Timely: Thoughtfully respond to current events and issues in a timely manner to establish your authenticity. Or, strategically plan a partnership to align with a relevant time of year, month or event, e.g. breast cancer awareness month [4;2].

Consumers are wanting brands to align with their own personal values and a brand’s corporate social responsibility initiatives are becoming more and more influential on consumer’s purchasing decisions. A cause-brand alliance, or lack of, may soon be as important as a brand’s mission statement or major annual campaign.

 

References:

[1] https://www.choice.com.au/shopping/packaging-labelling-and-advertising/advertising/articles/cause-related-marketing

[2] https://www.forbes.com/sites/onmarketing/2017/07/10/heres-how-cause-marketing-can-make-a-difference/#71c8ce3c38d4

[3] https://www.middlemarketcenter.org/expert-perspectives/the-pros-and-cons-of-cause-marketing

[4] https://brandmatters.com.au/whatmatters-blog/brand-action-in-times-of-crisis-3-things-brands-must-keep-in-mind-to-succeed

[5] https://www.sciencedirect.com/science/article/abs/pii/S0148296303001863

[6] https://www.news.com.au/national/bushfire-relief-donations-pass-100-million-as-celebrities-corporations-and-communities-dig-deep/news-story/88f1d4fbe4798191d6d317ec9f4088cc

[7] https://www.marieclaire.com.au/brands-donating-profits-australian-bushfires-2020

[8] https://ausopen.com/articles/news/aces-bushfire-relief-tennis-massive-fundraising-effort

[9] https://www.nielsen.com/au/en/insights/article/2019/the-itch-to-switch-drives-brand-disloyalty-in-australia/

[10] https://probonoaustralia.com.au/news/2018/01/australians-express-strong-support-csr/