Did you see this piece in October’s Ethical Corporation?
In it, author Peter Knight takes Tom’s Shoes and other companies to task for tying their marketing strategy to a higher social purpose—positing that society and companies were better off in the days of checkbook philanthropy focused on the CEO’s pet charities.
Well, I couldn’t disagree with him more.
Strategic philanthropy is smart investing. Companies that support social issues material to their business with dollars, time and intellectual capital are the best partners for NGOs—they can bring efficiencies and innovations to accelerate progress because the business is focused on the issue. An abundance of safe, clean water is critical for Pepsi and Coke to sell soda—it’s not a secret, and they aren’t trying to trick people into buying soda. And the fact that they leverage this expertise to help underserved communities solve local water challenges is very appealing to many of each company’s stakeholders. So, why wouldn’t they communicate about this investment? It’s not very different than sharing information about a new plant, revealing a new container or promoting a new product line.
Also, cause marketing isn’t replacing philanthropy; it’s an extension of the company’s marketing strategy. Companies like Tom’s Shoes recognize that a quality product matters most, and then you have to differentiate yourself from your competitors. These days, all stakeholders—consumers, employees, regulators, investors—expect more from companies. They want to know what your company is doing beyond turning a profit and they want to know why you’re investing in those things. Is it an issue that is material to the long-term success of the business? Does the company have a unique ability to make a difference on the issue? Is this an issue that hold significant value for a large percentage of their stakeholders?
People are also consuming information differently now—they pick and choose trusted “news” sources from both traditional media and social media outlets to develop opinions on issues, products and services. Companies can’t count on the Don Drapers of the world to develop a compelling ad campaign that reaches the masses, and companies don’t have complete control over the message anymore. Everything a company communicates now is marketing and branding, and oftentimes that original content is then modified, repackaged or co-opted by people in social networking forums.
Marketers can no longer rely on the basic box of eight crayons; they need to use all 64 now. Cause-marketing and strategic philanthropy are necessary ingredients in the marketing mix, and I’m pleased to see that more CMOs are using this tool to their advantage.