Cause marketing is on the rise. With added pressure from consumers, even small brands are giving back big amounts.
When done right, cause marketing can positively impact your business, your customers, and the organizations that your customers care about. But cause related marketing is complex, with plenty of pitfalls (like time-consuming management and gimmicky marketing).
In this guide, we walk you through the main types of cause marketing campaigns and how to manage your own campaign in a way that is ethical, effective, and still profitable.
What is cause marketing?
Cause marketing is when a company transparently shares about the causes and organizations they give back to, in order to build a deeper relationship with their customers and inspire brand loyalty.
If your company plans to give back anyways, why not communicate about your efforts and strategically drive even more revenue? After all, more money in the right hands is good for people and the planet.
By advocating for causes that align with your brand, you can stand out in crowded marketplaces and pull on the emotional heartstrings of your target customer.
Does cause marketing work? (plus interesting statistics)
Cause related marketing can grow your customer base, impact, and revenues. Giving back is more important than ever, and these cause marketing statistics prove that. While 42% of Millennials seek out socially responsible companies, 70% of Generation Z consumers do the same. As more and more Gen Z shoppers come of age, the need for greater social responsibility will grow.
Consumers are increasingly optimistic about the change that private companies can bring. 62% of consumers believe that companies can help to normalize conversations about social justice. Meanwhile, 90% of Gen Z believes that companies should help with environmental issues.
With mounting consumer pressure, it’s no wonder that the growth of corporate giving has outpaced individual giving 5 to 1, having risen by 15% in the past two years alone.
There are plenty of benefits for companies that give back. One study found that high-purpose brands double their market value 4x faster than low-purpose brands. Plus, 73% of consumers are less likely to “cancel” a company after a mistake if it is purpose-driven.
What are the 4 main types of cause marketing campaigns?
As an ecommerce brand, there are different ways to approach cause marketing. You can give a percentage of every sale, require a minimum order value to trigger a donation, offer one-for-one incentives, or donate a percentage of profits.
Let’s take a look at these options in more detail. For each type, we list the pros and cons and provide cause marketing examples.
1. Requiring a minimum order value to donate a flat rate
You can set up a system to only donate when customers reach a certain cart order value. This allows your brand to create holiday and event campaigns that don’t require discounts in order to succeed. In fact, you can replace discounts directly. For example, H&M used Givz to donate money to frontline workers during the height of the Covid-19 pandemic. For every $60 spent on hm.com, customers could allocate $10 to a charity of their choice, with charities serving frontline workers featured on the donation page.
At Givz, we’ve proven time and time again that this type of cause marketing campaign leads to higher conversions, cart order values, and campaign sales than discounts.
In their campaign, H&M saw a 15% conversion rate from their emails for this campaign. When compared to the industry average of 2%, that’s quite a jump.
TB12 Sports, created by Tom Brady, also uses this strategy. They created a campaign to donate $12 to the charity of the customer’s choice when they spent $100 or more. The result? Orders that were over $100 increased by 14%.
If you manage a similar campaign with Givz, you don’t have to be in charge of diverting the money to the right non-profit. Givz partners with hundreds of organizations to give your customers the choice, and our software sends the donations for you.
Pros of requiring a minimum order value with Givz:
- Increases your average cart order value
- Allows you to market without discounts
- Lowers the amount that you spend on promotions (not all customers will finish the process and choose an organization)
- Easy to communicate to customers
Cons of requiring a minimum order value with Givz:
- You can’t choose what organization customers will donate too (but you can feature orgs to increase the likelihood of customers choosing an org that aligns with your brand values)
2. Giving a small percentage of sales
One common way to give back is to donate a percentage of your annual sales or revenue. Most companies who use this method donate between 1-3% of their profits.
For example, Ethique, a sustainable and ethical brand of personal care products, donates 2% of sales to conservation and evironmental groups. On their impact page, they clearly list the non-profit organizations that they are currently supporting.
Cotopaxi is a brand of outdoor gear and clothing that is sold directly to consumers, and at popular retailers like REI. The company donates 1% of all profits to the Cotopaxi Foundation, which prioritizes humanitarian, environmental, and childrens’ educational initiatives. At the end of each year, the Cotopaxi Foundation releases an impact report detailing what was achieved.
Pros of giving a percentage of sales:
- Gives your company control over what you are donating to
- You can set a reasonable and sustainable percentage
Cons of giving a percentage of sales:
- Customers have no control over what you are donating to
- Difficult and time consuming to manage
- Requires extensive vetting of partner organizations
3. Donating substantial profit percentages
Instead of donating a percentage of sales, you could donate a percentage of profits. In this case, the number should be higher (at least 5%).
Toms shoes began with the one-for-one giving model, which we discuss below. The company had been creating a bigger impact beyond donating shoes for a while, and decided to update their cause marketing communications to reflect this.
Today, the company donates 33% of their profits and releases detailed impact reports each year, showing what countries they gave in and what organizations they gave to.
Pros of donating a percentage of profits:
- Gives your company control over what you are donating to
- You can set a reasonable and sustainable percentage
Cons of donating a percentage of profits:
- Customers have no control over what you are donating to
- Difficult and time consuming to manage
- Requires extensive vetting of partner organizations
4. Delivering one-for-one product donations
You can also take a one-for-one approach to cause marketing. If your product is something that falls in the necessity category, such as glasses, shoes, kids backpacks, food, or personal hygiene products, this might be a great fit for you.
Warby Parker is a prime example. For over a decade, the company has given one pair of glasses to someone in need every time a pair was purchased. The Covid-19 pandemic brought new distribution challenges to this program however, and they’ve focused on a revenue percentage model for the time being.
Bombas follows the one-for-one model, but they do it a little differently. Instead of donating one pair of socks for every purchase, they donate one clothing item for every purchase. In addition to socks, they also give underwear, pants, shorts, t-shirts, and other essentials.
The company partners with 3,500 non-profit organizations across all 50 US states, with the majority of clothing items donated to homeless shelters.
If you can’t afford to give one product for every product sold, you could come up with a more creative solution. The food bar company This Saves Lives gives one bar to a hungry child for every 12-pack box of bars that is purchased.
Pros of the one-for-one model:
- Clear mission that customers can get behind
- Can help create PR buzz
Cons of the one-for-one model:
- Keeps you stuck to one way of giving
- Expensive to execute on, because there are product and distribution costs
Should campaigns be ongoing or temporary?
Some cause marketing campaigns are ongoing, while others are timely in nature. The answer to which one is right for your brand depends on your target audience and brand values.
If you want to create a brand that is recognized for its positive impact, then an ongoing campaign is the best fit.
Thinx sells re-usable period underwear. By nature of its product, the target audience is one who cares about sustainability and corporate social responsibility. It makes sense for the brand to appeal to their target audience even further with a meaningful give back campaign. Their program offers reproductive education and period products to youth who don’t have access to either.
But ongoing campaigns aren’t a fit for every company. Many large brands are placing a lot of emphasis on sustainability and lowering their carbon footprint, but when it comes to giving back, they use a flexible approach in order to give back to a variety of causes. For example, during the holiday season, they might feature non-profits that feed the hungry.
During Pride month, H&M used Givz to encourage customers to donate to LGBTQ+ charities. H&M Loyalty Members who spent $60 or more between June 4 – June 14, in one or more transactions got the opportunity to donate $10 to the charity of their choice in support of Pride.
Here are some holidays that can inspire successful cause marketing campaigns:
- Pride Month
- Black History Month
- Women’s History Month
- Christmas
- Thanksgiving
- Earth Day
- Valentine’s Day
Cause marketing tips for Millennial and Gen Z audiences
Millennials and Gen Z are clearly leading the way when it comes to pressuring companies to act responsibly. Cause marketing that’s directed at these generations of consumers should be transparent and aligned. Check out these important tips.
Match the cause to the brand
Uncommon Goods offers home products and accessories with a natural aesthetic. And some of their products are sustainably sourced. Because of the appeal of their products, it makes sense that their giving back campaign prioritizes environmental causes.
Beware of coming across as gimmicky
Fortunately, when you match your causes to your brand, this has the added benefit of reducing the likelihood that your cause marketing campaign will look like a gimmick.
If you never feature LGBTQ+ models on your website, then a Pride-focused campaign could cause a lot of fallout. If you don’t offset carbon emissions or take other measures to reduce your environmental impact, then an Earth Day-inspired campaign could also be seen as a money grab.
But if you choose causes that align with values that you’re already focused on, then customers and followers will see the move as a natural extension of your brand.
Be as transparent as possible
Millennials and Gen Z expect complete transparency. Loli, a natural and sustainable line of beauty products does this well. With their cause marketing campaign, they give 10% of all sales. And on their promise page, they clearly state their purpose: sustainability. More importantly, they back it up with specific details about how their products are made. This helps their cause marketing campaigns feel more organic and like part of the brand. Plus, on their give back page, they transparently state their motivation for giving and their goal.
Think big
If your target audience truly cares about certain social causes or the environment, you need to do as much as you can to help them make an impact with their purchases. For purpose-driven consumers, donating 1% of your profits won’t be enough. Instead, a larger percentage or a flat-rate amount (such as $25 donated for every $200 spent) will come across as more meaningful.
How to manage cause marketing (effortlessly)
Managing a cause marketing campaign could be a full time job, if you vet partner non-profits and donate to them directly. Fortunately, it doesn’t have to be that way. You can partner with a platform that will help you manage your purpose-driven campaign.
1. Choose a software that handles charitable donations for you
The first step is to choose a software that is built for cause marketing.
With Givz, you can set up flat-rate giving campaigns that allow customers to choose an organization to donate to. Customers will receive a receipt for their donation, which is an amazing form of transparency and proof. The organizations will receive the donations without anyone from your team having to lift a finger.
2. Create an ongoing or temporary campaign
With the right software at hand, the next step is to set up your campaign. You’ll want to choose something that makes sense for your average cart order values, and how much you can afford to give. Keep in mind that when using Givz, not all customers will actually choose an organization to donate to (although it only takes a minute). This means that not every order that qualifies will actually cost you anything.
Here are some common schemes:
- $10 to donate for every $60 spent
- $10 to donate for every $100 spent
- $25 to donate for every $200 spent
You could also set up the campaign to be triggered if someone buys a certain product or product line.
3. Drive traffic to that campaign
Next, it’s time to drive traffic to the campaign. A sticky bar at the top of your site is a great way to make sure that all site visitors know about the opportunity to give back.
The best ways to drive traffic to a cause marketing campaign include:
- Email marketing
- Organic social media marketing
- Paid social media marketing
- PR
- Influencer marketing
Check out this example of a Pride campaign from activewear brand Terez:
4. Communicate your brand's impact
It’s so important to communicate your company’s impact on causes that matter. If you don’t spread the word, customers won’t know about all of the good things you’re up to.
The Givz giving page is shown only after a customer makes a qualifying purchase (so it doesn’t impact cart functionality). You can use this page as a way to share why you have setup a Givz campaign. Because you can feature organizations on this page, it’s also wise to share why you chose them.
Depending on the size of your company, you might have multiple efforts towards corporate social responsibility. It’s wise to set up an impact page to provide details about everything your company is doing, from product sourcing to delivery to donating.
5. Measure results
And finally, you’ll want to measure the results of your cause marketing. If you’re using a flat-rate giving incentive to replace discount campaigns, then you can compare the results. You might compare your flat-rate giving campaigns and discount campaigns for these metrics:
- Email click through rates
- Average cart order values
- Percentage of orders that fall above the threshold to trigger the donation/discount
- Cart/website conversion rates
If you’re using one of the other cause marketing methods, it can be a bit hard to measure results directly. You could compare email campaigns that mention your purpose-driven donations versus ones that don’t.
Ultimately, the question isn’t whether you should do cause marketing, but rather what type? Use this as your guide to creating a cause marketing campaign that aligns with your goals and deepens your bond with your customers.
