New Study Reveals Why B1G1 Really Works

An October 2008 Study at the Cone/Duke University in the USA carried this title :

Consumer Behavior Study Confirms CAUSE RELATED MARKETING CAN Exponentially Increase Sales

The phrase 'exponentially increase sales' is rarely used in research reports. It points to the impact B1G1 transaction-based giving can have. Whilst the study was done in America, empirical evidence in other markets (and other global studies) confirm the trends noted in this particular research.

The study validates for the first time that transaction-based giving can significantly drive actual consumer choice.

During the first phase of the study at Duke University, 182 participants evaluated a new regional magazine and were exposed to either a cause-related or generic corporate advertisement for one of four focus brands. Afterward, they entered a mock convenience store with nearly 150 SKUs and were given real money to purchase a product in each of the four categories. Results revealed:

Substantial cause-related sales lift for two of the four consumer packaged goods categories tested

74% increase in actual purchase for a shampoo brand when associated with a cause (47% of participants who saw the cause-related message chose the brand while only 27% of those who saw the generic corporate advertisement chose the brand)

28% increase in actual purchase for a toothpaste brand when associated with a cause (64% of participants who saw the cause message chose the target brand vs. 50% who viewed the generic corporate advertisement)

Cause Related Marketing is a clear winner

Modest increases in the other two product categories tested (chips and light bulbs) - Qualitative consumer responses showed that the issue, the nonprofit and the inherent nature of products were key factors in making cause-related purchasing decisions and helped explain why movement in these categories was not significant.

In the second phase of the research, Cone and Duke validated the sales increases for shampoo and toothpaste by replicating the study online among a nationally projectable sample of more than 1,000 adults.

The cause related marketing results revealed that participants spent nearly twice as long reviewing cause-related ads versus the general corporate advertisements. This resulted in a sales increase (19 percent) similar to the lab study for the target toothpaste brand. And although the shampoo brand increased only by a modest 5 percent, sales among its target audience of women increased by nearly 14 percent.

Gavan Fitzsimons, Duke marketing professor and lead researcher on the study noted: "One thing we know for sure - consumers are paying more attention to cause related marketing messages, and as a result, are more likely to purchase. This is clearly great news for brand managers, as every percentage increase can translate to millions of dollars in revenue."

More details from the Cause Related Marketing Study

84% want to select their own cause83% say personal relevance is key80% believe the specific nonprofit associated with the campaign matters77% say practical incentives for involvement, such as saving money or time, are important65% find emotional incentives for involvement, such as it making them feel good or alleviating shopping guilt, important

Consumers Set Bar High For Companies, Even During economic downturn for Cause Related Marketing

The Study also revealed that consumers continue to have high philanthropic expectations for companies struggling amid the current economic crisis. More than half (52 percent) of Americans feel companies should maintain their level of financial support of causes and nonprofit organizations. Another quarter (26 percent) expects companies to give even more.

Fortunately for marketers, consumers are also more receptive to cause related marketing messages than ever before. They will reward companies that give back both with their goodwill and their wallets:

• 85% of Americans say they have a more positive image of a product or company when it supports a cause they care about (remains unchanged from 1993)
• 85% feel it is acceptable for companies to involve a cause in their marketing (compared to 66% in 1993)
• 79% say they would be likely to switch from one brand to another, when price and quality are about equal, if the other brand is associated with a good cause (compared to 66% in 1993)
• 38% percent have bought a product associated with a cause in the last 12 months (compared to 20% in 1993)

Priority Issues for Business and Society

The leading issues that Americans want companies to address in their cause related programs are consistent with growing domestic and global needs. These are also issues in which companies can use their business scale and resources to have the greatest impact. The issues include:

• Education - 80%
• Economic development (i.e.: job creation, income generation, wealth accumulation) - 80%
• Health and disease - 79%
• Access to clean water - 79%
• Environment - 77%
• Disaster relief - 77%
• Hunger - 77%

Americans also acknowledge that to truly drive change, there needs to be widespread collaboration among sectors. Nearly 9 in 10 Americans (89 percent) say it is important that business, government and nonprofits collaborate to solve pressing social and environmental issues.

The Crucial Point of Communication Disconnect

Almost uniformly (91 percent), Americans believe companies should tell them how they are supporting causes, but many do not feel they are getting sufficient information. Only 58 percent of Americans believe companies are providing enough details about their cause efforts. 

Buy1GIVE1 Really Works 

In Buy1GIVE1 we make the stronger point that in many, many cases, the consumer is simply not involved in CSR initiatives on a day-to-day basis. Buy1-Give1 giving solves that and it does it every second, every day and in every way.

See more and watch the video on the Home Page at the B1G1 Global Village  - a Cause Related Marketing playground.