What is cause-related marketing?

Cause-related marketing (CRM) is defined as the public association of a for-profit company with a nonprofit organization, intended to promote the company's product or service and to raise money for the nonprofit. CRM is generally considered to be distinct from corporate philanthropy because the corporate dollars involved in CRM are not outright gifts to a nonprofit organization, hence not tax-deductible.

The phrase "cause-related marketing" was first used by American Express in 1983 to describe its campaign to raise money for the restoration of the Statue of Liberty. American Express made a one-cent donation to the Statue of Liberty every time someone used its charge card; the number of new card holders soon grew by 45%, and card usage increased by 28%.

In their efforts to diversify and enhance their funding base nonprofits have embraced CRM. The practice has evolved to include a wide range of activities from simple agreements to donate a percentage of the purchase price for a particular item or items to a charity for a specific project, to longer, more complex arrangements. Corporations too have been drawn to CRM due to the competition of the expanding global marketplace and the need to develop brand loyalty. A number of recent studies have documented that consumers carefully consider a company's reputation when making purchasing decisions and that a company's community involvement boosts employee morale and loyalty.

CRM has become a controversial topic among grantseekers, as nonprofits entering into CRM activities debate the ethics of lending their name and reputation to corporations. Some of the common criticisms of CRM are that it undermines traditional philanthropy, that nonprofits are changing their programs in order to attract CRM dollars, and that only well-established, noncontroversial causes can attract CRM dollars.

To find and develop CRM opportunities, nonprofit organizations should expand their research efforts beyond the traditional corporate giving directories and refer to the resources in the business departments of public and/or academic libraries.

Print and Electronic Resources on Cause-Related Marketing:

• The Independent Sector's Mission & Market: The Resource Center for Effective Corporate-Nonprofit Partnerships is a resource rich site that aims to offer the resources nonprofit and corporate executives need to help them build effective partnerships that enhance both mission and business goals—and serve to build the public trust for the nonprofit sector as a whole.

• Abshire, Michael. "Consumer Product Manufacturers: Maintaining Giving in Uncertain Times." Corporate Philanthropy Report 17 (March 2002) p. 1, 11. An analysis of the degree to which consumer product manufacturers are engaging in cause related marketing, with a particular look at Gillette.

• Abshire, Michael. "The Business Case for Philanthropy." Corporate Philanthropy Report 19 (February 2004) p. 1, 4. Cause marketing continues to grow in spite of languid stock performance, and the article quotes David Hessekiel, president of Cause Marketing Forum, on the reasons for this. Also highlighted are some innovative cause marketing concepts, such as the partnership of Hollywood Video with the Starlight Children’s Foundation.

• Abshire, Michael. "When Children are the Constituents." Corporate Philanthropy Report (August 2004) p. 1, 3-4. Boys & Girls Clubs of America has forged numerous cause marketing relationships with big corporations, and this has resulted in millions of dollars of grants and in-kind support. The organization’s approach to companies is particularly successful and the article explains how they do it.

• Adkins, Sue. Cause Related Marketing: Who Cares Wins. Oxford, England: Butterworth-Heinemann, 1999.

• 1999 Cone/Roper Cause Related Trends Report: The Evolution of Cause Branding. Boston, MA: Cone, Inc., 1999.

• Cunningham, Peggy. "Sleeping with the Devil? Exploring Ethical Concerns Associated with Cause-Related Marketing?" New Directions for Philanthropic Fundaraising 18 (Winter 1997) p. 55-76.

• "Growing Your Own." Corporate Philanthropy Report 16 (May 2001) p. 1, 4. Explains some of the considerations that need to be analyzed when nonprofits anticipate strategic partnerships with corporations.

• Martin, Nita L. "You've Got Donations". Corporate Philanthropy Report 15 (January 2000) p. 1, 3-5.

• Polonsky, Michel Jay and Emma K. Macdonald. "Exploring the Link Between Cause-Related Marketing and Brand Building." International Journal of Nonprofit and Voluntary Sector Marketing 5 (February 2000) p.46-57.

• Ptacek, Joseph J. and Gina Salazar. "Enlightened Self-Interest: Selling Business on the Benefits of Cause-Related Marketing." Nonprofit World 15 (July-August 1997) p. 9-13.

• Schwinn, Elizabeth. "Constructing a Marketing Deal." Chronicle of Philanthropy 15 (7 August 2003) p. 24-27. Describes the marketing arrangement between the National Wildlife Federation and Home Depot. Discusses the merits of the partnership and raises ethical issues.

• "What Ties Them Together? Marketing for Causes and Commerce." Better Business Bureau Wise Giving Guide (Holiday issue, 2003) p. 2-6. According to IEG, nonprofits will earn $921 million from cause-related marketing arrangements with companies. This is a brief guide about how to create such an alliance.

• Wymer, Walter W., Jr. and Sridhar Samu (eds.) Nonprofit and Business Sector Collaboration: Social Enterprises, Cause-Related Marketing, Sponsorships, and Other Corporate-Nonprofit Dealings. Binghamton, NY: Best Business Books. 2003.

For other books and articles on cause-related marketing, try searching our Catalog of Nonprofit Literature (CNL), the Center's bibliographic database. You could start searching on the subjects "Cause-related marketing", "Sponsors", "Corporations, marketing", or "Nonprofit organizations, marketing".

Many of the books and articles found through CNL can be located in Center Libraries and some Cooperating Collections. It is best to call ahead to verify a specific library's holdings.

To learn more about corporate giving, attend our Introduction to Corporate Giving, a free one-hour class.

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