Assistant Professor Angela Eikenberry has written a thoughtful and provocative article for the Stanford Social Innovation Review entitled The Hidden Costs of Cause Marketing. In it, Professsor Eikenberry makes her case against cause marketing or "consumption philanthropy," as she calls it.
Consumption philanthropy individualizes solutions to collective social problems, distracting our attention and resources away from the neediest causes, the most effective interventions, and the act of critical questioning itself. It devalues the moral core of philanthropy by making virtuous action easy and thoughtless. And it obscures the links between markets—their firms, products, and services—and the negative impacts they can have on human well-being. For these reasons, consumption philanthropy compromises the potential for charity to better society.
On both Twitter and in the comments section to her article, Professor Eikenberry and I debated the benefits of cause marketing, something I'd like to expand upon here.
First, Professor Eikenberry argues that cause marketing distracts our attention from the neediest causes. This no doubt seems the case from the St. Jude's, the Komen's, the American Heart's of world that seem to monopolize the public's attention with their campaigns. But I believe cause marketing reflects a reality more than it contributes to it.
The fact that some causes get more attention than others is simply an unavoidable fact. Before cause marketing arrived on the scene in the early 1980's there wasn't a philanthropic Eden where charities were given equal time and equal resources. Causes like The Muscular Dystrophy Association had star power and network agreements that raised tens of millions of dollars for a relatively obscure disease, all at the cost of funding more important causes. Nevertheless, star power and TV ruled the day.
Also, doesn't the money that flows to a major fire, earthquake or other disaster scene sometimes come at the expense of funding more worthy, but less media-worthy, charities?
In short, cause marketing doesn't create a rivalry among charities. It reflects that reality.
Yet another reality about cause marketing is that while it may enhance it doesn't create powerful brands. As a matter of fact it's usually just the opposite. Brands like St. Jude, Komen and AHA had already overshadowed other causes before they ever took up cause marketing. The fact that they were so well known to begin with was their main reason for entering the cause marketing space.
Second, Professor Eikenberry chides cause marketing as "making virtuous action easy and thoughtless". I have to admit that when I'm shopping and someone asks to give a buck at the register I don't give it much thought beyond that I know I'm helping a good cause. But does all charitable giving have to be moving and thoughtful? If so, the good news is that most is. A nonprofit generally raises only 5 to 15% from corporate giving, INCLUDING money raised from cause marketing. So even if cause marketing is "easy and thoughtless," and that’s making a big assumption for all those people who carry their cause items to or donate at the register, it really doesn’t represent that much. Even cause marketing powerhouse Komen that raises close to $40 million from cause marketing raises ten-fold that amount from other sources.
Finally, Professor Eikenberry says that cause marketing obscures the link between markets and consumers in ways that can be harmful to human beings. Like all the "cause crap" I see in stores that ends up in landfills. This bugs me too, Angie. Fortunately, many cause items are useful parts of everyday life. Like you, I have an iPod (which I would be hard pressed to live without!). I bought mine in red to benefit Product RED. I like soup. I buy the brand with the pink ribbon. I needed a new vacuum cleaner. What the hell, no one will see me: I bought a pink one from Oreck that supports Komen. The point is that there is a lot less waste out there than you think.
Also, cause marketing just isn’t percentage of sale, it’s also point of sale, which involves selling pin-ups at checkout, and licensing. Now, pin-ups are wasteful, but folks like St. Jude are leading the push with paperless point-of-sale program. And, well, licensing is a great area of cost- and consumption- effective growth for nonprofits, as the folks at the Arthritis Foundation have shown us with their easy-to-open medicine bottles.
Yes, we need to raise awareness of the plight of the neediest charities. I know, I work for one: a safety-net hospital that is blessed with grateful patients, but not the grateful patients with money most hospitals have. But removing cause marketing from the toolbox of fundraising tools isn't going to help. It's the right tool for too many situations.
There's room out there for the easy gift--for the buck or two at the register or the ten bucks that goes to Product RED when you buy a red iPod. There's plenty of thoughtful giving that happens within and without cause marketing. Finally, the wasteful side of cause marketing is small and societal pressures are pushing it toward less not more. (Believe me, I hear it from my own sponsors and one way we've responded is with smaller pin-ups and more targeted shipments to conserve resources.)
Professor Eikenberry calls her article The Hidden Costs of Cost Marketing, but cause marketing is a lot more transparent than other forms of philanthropy. Gifts aren't negotiated behind closed doors, in someone's posh office or over a t-bone steak at some swanky restaurant. Cause marketing gifts are given, generally anonymously, by consumers like you and me at registers across America in full view of the world. They are open, public and optional.
Like jazz and baseball, cause marketing is distinctly American. Born from Wall Street capitalism and heartland generosity, it reflects our market culture and is a natural way to support our favorite causes. And while Professor Eikenberry shows the ways to making cause marketing better, there's one thing she can't hide: the costliest thing would be not to do it at all.