Commentary

Corporate Social Responsibility = Profitability

People want to do good. By extension, people want their brand choices to reflect their desire to do good. Since its inception, the Internet has forced companies to reassess their corporate social responsibility (CSR) practices by increasing people's access to information about "improper" corporate behavior. Social media, which simply increases the rate at which people can publish and spread information/content, has magnified the importance of CSR. However, it is not just avoiding the "bad," but harnessing the "good" that will lead to companies doing well financially by doing good socially.

It's never been more important for brands to support the issues and causes people care about. Jack Neff's Ad Age piece, "UniLever's CMO Throws Down the Social-Media Gauntlet," quotes Unilever CMO Simon Clift as saying, "brands are now becoming conversation factors where academics, celebrities, experts and key opinion formers discuss functional, emotional and, more interestingly, social concerns."

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So we are learning that good behavior is a requirement because people are watching and, more importantly, talking. But what has yet to be tapped effectively is the ability of CSR to drive sales and profitability, by coupling it with marketing and PR strategy (cause marketing 2.0). It's like the age-old question, "If a tree falls in the woods, and there is no one there to hear it, does it make a sound?" But instead the question goes, "If a company does good and no one in social media is talking about it, does it make a sale?" It's not wrong for companies to want people to know how socially responsible actions impacts sales. After all, let's not forget that companies do a lot of good just by selling their products. They give people jobs, healthcare, retirements and great product innovations. Plus, if doing good can deliver greater bottom-line profitability, then the companies can do more good. And you know who works at companies, people. And people want to do good.


So we are back to the "how." Because it is not nearly as effective for companies to tell people about the good they are doing as it is for people to be told by their peers about the good a company is doing. This is where the line between PR and marketing is continuing to blur. Marketers and their agencies must ask themselves two very important questions:

1. How can I tell people about CSR initiatives in an authentic manner, then empower and involve people in the good we are doing through social media tools?
2. Are CSR programs driving sales and profitability?

The first question is addressed by figuring out what types of programs and platforms you are going to use both for initial message delivery (television, out-of-home, non-traditional, online display), as well as how you are going to support and reward people for sharing your CSR message.

The second question is the trickier one. "Cause marketing" tends to fall down in many of the same places that its bastard brother, "viral marketing," falls down. So what if a million people did an action, do they have a greater affinity for a brand or product? Do they know any more about a product's particular attributes? Is it going to drive sales and profitability?

Again, this is not a bad thing for companies to want to associate with CSR initiatives and cause marketing, because if it works, companies can do more good. The problem with cause marketing, and much more so with other forms of "viral marketing," is that the brand's message is lost. What people end up sharing is so cause-focused, or (in the case of viral) so funny or edgy, that in the end it doesn't affect people's purchasing behavior because they couldn't tell you what brand was helping them, or why they'd want to buy the product.

People want to do good, but it doesn't mean they will buy a razor that's going to give them razor burn because it's made in a "green" factory. It is up to the marketer and the agency to find a balance between delivery of marketing message and sharing of CSR initiative.

We are in the first inning of the social media's impact on the evolution of CSR, but it is one hell of an exciting first inning. Major corporations have the power to help cure disease by funding research, stop genocide by changing sourcing habits, save the environment by going green, feed the hungry by providing supplies -- and so much more. And through social media, corporations can turn doing good socially into doing well financially, if they know how to reach and empower people.

How does this play out? Continue the conversation by sending me a message on twitter @ http://twitter.com/joemarchese or leave a comment below. I read everyone, and get back to as many as possible.

4 comments about "Corporate Social Responsibility = Profitability".
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  1. Stephen Shearin from ionBurst Media, April 14, 2009 at 12:05 p.m.

    I am no stranger to 'CSR' (and I'm glad to know it has its own TLA now!)
    The whole conversation breaks down with:
    "2. Are CSR programs driving sales and profitability?"
    The benefits are latent at best with the exception of the odd direct sales/benefit programs which never perpetuate, no matter how cute they look on a major Telco's wireless ad.
    The point is, if you're in it for sales and profit, you are not in it for the 'responsibility' of just doing it.
    To revisit one of your corollaries, if a company does some good, and no one talks about it, good was still done. Until that's enough, it's all a charade.

  2. Craig Mcdaniel from Sweepstakes Today LLC, April 14, 2009 at 2:52 p.m.

    Joe,

    I have agreed with you on many things before. However I take a different view on this so-called - Corporate Social Responsibility (CSR). As a president of a very successful website, I have seen more corporations giving back to it patrons, clients and product buyers in the form of giving prizes through sweepstakes and contest. The major sponsors understand that many people are hurting and would rather give them a $100.00 gift card or prizes of some kind than money go to somewhere where it might not even end up going to the good cause it was intended for.

    I have many member who need the hope and encouragement of winning a prize, any prize. I recently had a lady who won money and was precious to her because she wanted to give it to her grand child before she dies of cancer. Is not doing being Corporate Responsible?

    I think it would be wise to put the needs of the people first who buy the company products and services before giving to some less worthily cause.

    Last, my major Fortune company sponsors and my members strongly back my position. Many of the members who have won big have given away their prizes to help others. This includes myself and have given tens of thousands of dollars out of my own pocket. Not to social causes, but to real people in need.

    Craig McDaniel,
    aka – Mr. Sweepy

  3. Paula Lynn from Who Else Unlimited, April 14, 2009 at 11:34 p.m.

    CSR is lovely and we all do spend enough for needs rather than wants. Let's take this another step. Example: you need another t-shirt like a hole in the head, but the Gap is selling them for more than you would pay for a plain t-shirt with a portion (very small) going to charity. Obviously, the charity will benefit. Now, instead of buying a t-shirt with 5% going to charity, in such a case $1, how about if instead of $1 going to a charity and $19 going to the Gap increasing profits and reputation, a $2 contribution went directly to the charity? mmm. And does the Gap take the entire write off $1 per t-shirt as a tax deductable charible contribution? (I am not sure.) Sooo, maybe CSR should be more...how do you say....transparent? honest? direct? to be really effective and how do you say.....meritorious? However, if you needed to buy a t-shirt, a red one could be the perfect one. It's the connection.

  4. Eric Feront, January 12, 2010 at 10:25 a.m.

    I thing Cause Marketing is to simple to talk about CSR & Green Marketing : CSR & Cause Marketing are DIFFERENTS.

    Two different actions, two different objectives

    Cause Marketing is a Commercial action, Limited in time, Consumers have a role (to buy), Little staff, It is in the business, Communication on the action, Visible results quickly.

    CSR action is an "corporate" action, Long term, Consumers have no role, but..., Enterprise is engaged, Around the business, CSR communication, Visible results after a time

    For more www.csrandmanagement.eu or www.nfpconsulting.org
    My best regards.

    Eric

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