Cause marketing campaigns are in their heyday. Grander in scale and more sophisticated than ever, these campaigns are producing significant return on investment (ROI) for businesses and charities willing to invest the time, money, and effort.
Fortunately, bigger doesn’t have to mean more difficult to activate and manage. Well-structured campaigns generate positive brand recognition, increase sales and charitable donations, all while providing consumers an easy way to engage in collective social impact one small action at a time. These large-scale cause marketing programs are achieved through several structures, including the following four major types: Multi-Activation Cause Alliances; National Localized Campaigns; Franchise Structures; and, Multi-Supplier Campaigns.
Multi-Activation Cause Alliances
For-profit businesse leaders seeking to make a bigger impact with a cause are moving away from smaller, isolated, short-term campaigns and toward finding a single charity with which to strategically align their brand in multi-year, multi-million dollar, and multi-channel campaigns. These campaigns might include peer-to-peer events, charitable sales promotions, educational awareness campaigns, social media tie-ins, customer donations, product donations, and employee volunteer opportunities.
Developing a successful and robust alliance requires significant communication and planning to ensure that both partners’ key objectives are met and that all material legal and compliance requirements have been addressed. Specific contract provisions that require close attention include those involving exclusivity, renewal, termination, minimum guarantees, donation caps, and use of funds.
Because of the long-term nature of such relationships, the contracts are often structured as master sponsorship agreements, which outline the overall framework and goals of the relationship, together with contract addenda reflecting the specific terms of each “sub-campaign,” which will be added on throughout the relationship. This flexible contract structure allows the parties to experiment with new ideas while building toward a larger overall commitment.
National Localized Campaigns
Another trend in cause marketing is a branded campaign that permits managers of each store within a national retail chain to choose a local charity to support within a unified marketing framework. This shift toward support of community-based charities is reflected in the findings of the 2013 Cone Communications Social Impact Study in which 43 percent of Americans want companies to support local quality of life issues.
When a national business invites small, community-based nonprofits to participate in a cause marketing campaign, it is incumbent on the business to ensure that the charities understand the compliance obligations arising from their participation. Conducting a national localized cause marketing campaign can mean dealing with dozens, if not hundreds, of charitable beneficiaries.
Leaders of small nonprofits are often not aware they need to be registered to solicit funds or benefit from a cause marketing campaign. Building a detailed compliance schedule and streamlined process, along with easily customizable contract templates, can help ensure a smooth roll-out of the campaign across retail stores nationwide.
Managers at companies are beginning to look at possible strategies to further simplify compliance efforts for complex multi-party campaigns, including using a donor-advised fund as the primary charitable beneficiary.
Emerging franchise businesses are a major growth area for the economy, as highlighted in social good consultancy Good Scout Group’s 2015 Cause Alliances Trends Report. When a national franchise seeks to support a cause through its franchise-model business structure, it involves hundreds of independent, local franchises nationwide coming together under a unified campaign structure to support a single, national charity. In some ways it’s the inverse model of the national localized campaign structure.
Legal considerations for franchise businesses include determining which entity within the franchise structure will be responsible for certain compliance requirements applicable to cause marketing campaigns, and clearly outlining the roles, responsibilities, and overall logistical flow of the campaign. Franchisees often have the opportunity to further support the cause by hosting a local event with the charity, such as a pet adoption event, or having the franchisee match the franchisor’s sales-triggered donations. It is important to note that these franchise-specific components could trigger additional legal considerations.
It’s not often that companies get together to support a cause. But increasingly there is proof that such collaborations can generate even greater brand visibility and raise more funds and awareness for a cause.
Whether it’s the produce industry collaborating to support healthy eating for kids, or a big box retailer bringing together several key suppliers to support an important cause, multi-supplier campaigns require disciplined planning to ensure that all of the legal and logistical issues are managed. Considerations to be addressed are similar to those of the franchise structures, specifically in terms of clarifying roles and responsibilities between the various parties involved.
During a recent Cause Marketing Forum event, DoSomething’s chief operating officer, Aria Finger, highlighted three hallmarks of any successful cause marketing campaign: they should be BIG, LOUD, and EASY. In 2015, “big,” “loud,” and “easy” sometimes means a complex internal structure.
With careful planning and execution, these large-scale campaigns can really catch the attention of consumers and the public, and produce major impact in communities throughout the country and the world. NPT
Karen I. Wu is a partner, Perlman & Perlman, LLP, a New York City law firm specializing in charitable solicitation and cause marketing regulation. Her email is [email protected]