Companies are no doubt very interested in knowing the degree to which their corporate social responsibility activities drives their business success. The case for supporting causes is particularly interesting because the activity takes place outside of its core business (e.g. Tim Horton’s is not in the business of providing kids camps). Contributing a portion of sales to a charity or contributing in-kind assistance stand out as activities which are more than just sponsorship (read advertising).
Brands should be concerned about the leverage or efficiency they get from this giving, since it takes away from other productive uses of resources, and they need to understand what types of giving deliver the most bang for the buck.
Market research can be used to explore these issues but asking people about the importance of corporate giving is fraught with challenges.
Consider the results of a survey of Canadians released by IPSOS in the Fall of 2015 that found that “95% agree that it is a good idea for companies to support causes” [press release]. In addition, 84% would “switch to brands affiliated with a good cause if price and quality were similar.” More importantly, IPSOS found that there has been an increase over time in the proportion who consider themselves to be loyal to brands that support good causes (from 39% to 45% of Canadians).
The purpose of this note is not in any way to offer an indictment of the research but it raises the question of how best to understand public opinion on these kinds of issues. Arguably, the responses may be more an expression of values than they are a concrete indicator of the importance of corporate giving.
When we ask people about something for which there is no cost to them for their answer, we are inviting them to express a value, which when it comes to actual purchase decisions may never be activated.
Almost everyone agreed that it is a good idea for companies to support causes but respondents were not given any reason why this would be a poor idea. When subsequent questions probed about choosing a brand affiliated with a good cause if price and quality were similiar, there is also a high level of agreement. Again, however, there is no tradeoff here for respondents. Corporate giving as a point of importance when costs and quality are similiar means that the corporate giving has relatively little leverage in the buying decision, especially since information about corporate giving must be communicated to buyers. At time of purchase, cost and quality are likely to be key.
One telling finding in the study is that marketing of causes that have a local connection are preferred over efforts that are more national or international. This is interesting because it reinforces the idea that when it comes to giving customers and potential customers need to value the giving — giving in and of itself may not be enough.
I expect rather than guiding decision-making corporate giving primarily is effective in building good will and positive impressions that will be the context in which future purchase decisions take place, especially when so many companies are involved in supporting good causes that there is little room for it to be a differentiator, especially compared to the power of price.