The Difference Between Transactional, Transformative Cause Marketing

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The Difference Between Transactional, Transformative Cause Marketing

Written on January 25, 2012 in Cause Marketing 101

I’ve been talking to a lot of people about the difference between transactional cause marketing and transformative cause marketing. I’ve concluded that I’m not being very clear on the difference and need this post as much as the people who ask me to explain it to them.

I did what I usually do when I don’t understand something: I talked to someone smarter than I am. In this case, someone A LOT smarter: Kristian Darigan Merenda, Senior Vice President of Business + Social Purpose at Edelman. Kristian is also one of the four talented women, including my cause marketing “mom” Carol Cone and Jocelyne Daw, who co-authored my favorite book on cause marketing: Breakthrough Nonprofit Branding.

At an airport restaurant in Cleveland between flights she explained the difference to me on two napkins. Unbeknownst to Kristian, she wiped her mouth on the back of one so so I guess I have her DNA if I ever need to clone her. Added bonus.

Here’s the back of the napkin explanation.

Everything I need to know about cause marketing on two napkins. I may frame them.

What is Transactional Cause Marketing?

Transactional cause marketing is a marketing strategy that’s defined by:

One-off promotions that are generally reactive to opportunities in the marketplace.
First generation partnerships that have a short promotional cycle.
Single platform programs.
Dominance of transactions over relationships to maximize immediate giving.
Promotions that aren’t central to or defined by the brands of either partner.
Primary goal is to raise money and build awareness for the nonprofit partner.

It doesn’t sound fabulous, but transactional cause marketing is the norm. I would say that over 90% of the cause marketing programs in the marketplace have the attributes I listed above.

Nevertheless, my experience is that few organizations start a cause marketing program with the sole aim of raising a few bucks and building some general awareness.

There are exceptions.

In 2009, I blogged about the Charles River Conservancy (CRC) and how they stumbled on a pot of cause marketing gold thanks to Absolut Vodka. Absolut has produced several “city” vodkas and in 2009 it chose the CRC to receive a portion of the proceeds from sales of Absolut Boston Vodka (as they had in other cities, most notably New Orleans which received $2 million after Hurricane Katrina).

The program was a one-off as Absolut had no plans of continuing its support for CRC. Indeed, their selection of CNC in the first place seemed pretty random.
This program was active for just a few months.
The major platform was the purchase-triggered donation from vodka sales. Absolut did set up a Wall of Pride of famous Boston sports moments outside the Prudential Center. But beyond CRC reaping the proceeds from this program, the wall had no connection with the nonprofit or water conservation.
Absolut led the promotion with the “city” vodka theme, not water conservation.
There wasn’t much rhyme or reason to Absolut supporting CRC or the Conservancy working with Absolut. This was about a brand giving a cause some money and generating some general awareness for them. Simple.
The partnership ended and the promotion didn’t spur the CRC to do more cause marketing. However, Absolut has since then done other city vodkas, including Brooklyn. Once again, New York is second to Boston.

This promotion is the very definition of transactional cause marketing.

Most nonprofits have bigger aspirations. Transactional cause marketing is kind of like a career in sales. No one stares up at their parents as a kid and says “I want to sell!” No one goes to college to prepare for the rigors of cold calling and pitching prospects. But a lot of people end up doing just that.

Of course, there’s nothing wrong with being in sales – I proudly call my myself a nonprofit salesman – or just doing transactional cause marketing. Being happy and fulfilled with what you’re currently doing and making money from it is a good thing. The challenge arises when you decide that your position is holding you back and you really want something more.

In the case of cause marketing, most organizations want to succeed at transformative cause marketing, but are unsure of what that is, how it differs significantly from what they’re currently doing or how to achieve it.

What is Transformative Cause Marketing?

Before I tackle transformative cause marketing I want to clarify that I’m still talking about cause marketing, not cause branding or corporate social responsibility. Cause marketing is a tactical activity between a nonprofit and a for-profit and that doesn’t change. What does change is the focus, role and purpose of cause marketing.

One-off promotions are replaced with strategic signature programs that are proactive, brand-centric and long-term.
Multi-platform programs reflect the shift from a transactional to relationship mindset between partners.
Raising money and building awareness becomes secondary to an overarching priority: accomplishing the nonprofit’s mission.

I’ve spent most my career doing transactional cause marketing. It seems more common at the local level where I’ve worked. But that doesn’t mean local nonprofits can’t do transformative cause marketing. They do all the time. It just doesn’t get the press the big national programs get.

One moment of transformative glory for me occurred with Halloween Town, a signature cause marketing program I ran for five years.

Kristian explained to me that “signature” means you own it. It’s the flag a nonprofit waves, regardless of promotion or partner. We certainly owned Halloween Town. We created it with iParty Stores to help accomplish our mission, attract consumer-facing companies and throw one hell of a Halloween party for the kids of Boston.
Halloween Town had more than one platform. It involved in-store cause marketing but also a two-day Halloween event that attracted 15,000 people.
Unfortunately, we lagged on mission. Halloween Town was ultimately about fall fun and the powerful demographic it spoke to: moms with kids. Perhaps that’s why it only lasted five years before we decided it had done it’s primary job of attracting just as many cause marketing partners as possible.

Better examples of transformative cause marketing include St. Jude Children’s Research Hospital’s wildly successful Thanks and Giving and the American Heart Association’s Go Red for Women, of which Kristian and Carol were key architects. These signature programs better reflect the mission driven nature of transformative cause marketing.

These transformative players don’t raise another’s flag or change their colors on demand. They have a higher calling. Conversely, transactional cause marketers are hired guns that follow the money and wave flags red from tragedy and soaked in tears. I know this firsthand. I used to be one of those gunslingers.

Ralph Waldo Emerson said that “Our chief want is someone who will inspire us to be what we know we could be.” Transformative cause marketing is the product of leaders who empower us to make this leap.

So, did I explain the difference well? What did I miss? What would you add, change, delete? Here’s your chance to think transformationally and plant your own flag.

Book Review: Breakthrough Nonprofit Branding

Written on December 6, 2010 in Cause Marketing News

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Before I get to my review of Breakthrough Nonprofit Branding (BNB) go now and learn more about the contest the authors are hosting for nonprofits. The deadline of December 10th is quickly approaching!

To help put the book’s teachings into practice, the authors are launching a contest for nonprofits based in North America. To enter to win one of the top ten prizes, nonprofits must answer five short essay questions and submit sample creative that best represent their organization’s brand meaning. If selected as one of the top 25 semi-finalists, the organization must submit proof of nonprofit status. The sample creative for the ten finalist organizations will be posted for public voting for one week.

The prize is worth the visit. Two ¼ page black and white national advertisements in USA TODAY, which has 3.3 million readers. The prize is valued at $100,000.

Now on to the review!

I don’t read many books anymore. Social media has ruined me. Give me the 140 character summary. But I knew I would read a book by Jocelyne Daw and Carol Cone. I’ve been learning from these two women for years.

You know from reading my blog that I’m a local, transactional cause marketer. If you’re a cause with a corporate partner I’ll show you how to raise money with register programs and cause products. I’ll help you enhance those efforts with special events, social media and location-based services.

But what I do has limits. And through the years I’ve grappled with how nonprofits can shift to truly transformative cause marketing. I even posted about this recently and enviously explained how some cause brands are like magnets that attract power, partners and money to pursue their worthy missions.

But how do they do it?

Breakthrough Nonprofit Branding has a lot of good answers.

BNB identifies seven principles for evolving a cause brand from something ordinary that has no pull to something powerful and really serves the cause. The best part is the 11 case studies the authors use to illustrate the principles, which really bring them to life.

My two favorite causes profiled were UNICEF and the Food Bank For New York City because they both reminded me of my own organization in some way.

UNICEF reminded me of my hospital because the initial research done on the brand revealed that people were unsure what UNICEF stood for. I think the same is true of my hospital. Sure, we’re New England’s largest safety-net hospital, but what does that really mean? Some key takeaways for me from this section were:

Research is key. If you have to figure out where your brand stands before you can chart a course for it.
The value proposition of your brand has to be simple and actionable. UNICEF: Whatever it takes to save a child.
Identify and label your core supporter community. For UNICEF it was empathetic globals, “people who care about the developing world and feel very strongly that people and the government should do much more to help those in need.”

The Food Bank For New York City had me thinking of our food pantry that this year will serve 90,000 men, women and children–nearly double the mouths we fed just two years ago. Again, as with UNICEF, research revealed that external audience just weren’t sure what the food bank did (its original name was Food for Survival). Two of the key lessons from their rebranding included:

This process begins at the very top of the organization. The board and senior management must be fully engaged for the rebranding to be successful. I really admire the food bank for the courage it took to admit that things weren’t working and the cause needed a change.
To be a breakthrough brand you have to be bold in your goals. It wasn’t enough for the food bank to focus on food delivery and 1,000 food pantries and soup kitchens they supplied across New York City. As the authors note they had to shift to the “higher-order, more compelling cause of addressing hunger and food poverty for New York City system wide.” Yeah, the vision thing that stirs donors’ ideals and giving.

After learning all seven principles and seeing them in action with 11 causes I gained a new appreciation for just how important (and demanding) rebranding is for a cause. It’s a pilgrim’s journey full of meaning, reflection and uncertainty. The trip is not for the fainthearted nor for the solitary traveler.

Fortunately, in the uncertain waters of nonprofit branding, we finally have a compass and a companion in Breakthrough Nonprofit Branding.

Tags: breakthrough nonprofit branding, carol cone, cause marketing, food bank for new york city, jocelyne daw, rebranding, unicef

Product Red’s Bono Learns the Hard Way: Don’t Put the Cause Before the Horse

Written on October 18, 2010 in Cause Practices

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Last month the WSJ profiled U2′s Bono and and his wife Ali Hewson’s efforts to launch a fashion line with clothes made in sub-Saharan Africa. (Hat tip to the good folks at Cone for the lead).

Edun got off to a rough start because Bono and Ali had the best of intentions, which, unfortunately, didn’t top the list of reasons consumers would pay $800 for a jacket. Design and fit mattered more.

“We focused too much on the mission in the beginning, ” explained Hewson. It’s the clothes, it’s the product. It’s a fashion company. That needs to be first and foremost.”

Edun is just another business that learned you can’t put mission before margin. The best way for a business to help a cause is to be a great business first, and an advocate for causes second.

At the Beyond Cause Marketing summit ten days ago my industry’s mom Carol Cone told me that even cause leader Timberland had seen sales erode a few years ago when consumer interest in their styles waned. Cause couldn’t save them. Ultimately, Timberland would rise or fall on their shoes.

Businesses are still making the mistake of putting mission before margin. Causeworld, Panera Community Cafe and Causeon are just three examples.

I’ve written on Causeon, spoken to the founder–a good man with good intentions–and like the idea. But the premise of Causeon is that consumers will choose it over Groupon and 200 copycats because Causeon supports greats causes. But consumers are looking for great deals first and to help causes second.

The real opportunity is when you take a great business and activate it for good.

Take Groupon, which will hit a billion dollar in sales faster than any other company in history. In May, when DonorsChoose.org was the featured daily deal on Groupon they raised $162,000.

Should we wait for cause-centric businesses like Causeon to take hold, or should we double our efforts to work with great businesses of all sizes to raise money for causes?

You know what side I’m on. What about you?

One last point. Next to developing a magnetic cause brand that sucks in great businesses, nonprofits should focus on finding great businesses to stick themselves to. Nonprofits spend too much time on fundraising strategy and ideas when what they really need is the horsepower drive them.

Given the choice between a great idea or a great partner, I’ll take the latter. With a great business anything is possible, and even the most basic cause marketing tactic can be given new life with the right partner.

It’s not enough to right your cart and put the horse in front where it belongs. You have to hitch your wagon to a star.