According to IEG, North American companies will spend about $1.55 billion on cause marketing efforts in 2009, a roughly 2% increase over 2008. That is down from previous year-on-year increases in the cause marketing arena, but in the current economic climate, any increase in a marketing program is worth noting, says Dan Kowitz, vice president of IEG Sponsorship Consulting.
"As consumers, if there's anything we want to see a company spend money on, it's a cause that's important to us," Kowitz tells Marketing Daily. "And marketers know that."
As evidence of consumer interest in sponsorship, Kowitz cited a Performance Research survey from February 2009 in which 41% of Americans said companies should increase their spending on cause marketing, compared with 13% who said they should increase spending on sports sponsorships and 20% who said they should increase sponsorship of cultural events.
Plus, cause marketing is generally cheaper than sports sponsorships, Kowitz says. Mott's, for instance, has said it will contribute up to $134,000 (the equivalent of feeding one million people through the Feeding America non-profit), which is much less expensive than the many millions it might cost to put a company's name on a sports arena.
"When you talk about subjects outside of sports, they come at a much more cost-effective price-point," Kowitz says.
Cause marketing, however, can be tricky, particularly among a public that has grown jaded and cynical, Kowitz says. The key for marketers boils down to one thing: authenticity."
"Companies have to do this in an authentic way," he says. "You can't claim to be a green sponsor just by putting your logo on a recycling bin."
And with consumers more empowered than ever to find and call out companies on how their business practices don't live up to their cause-marketing initiative, companies have to put a lot of time and effort into their chosen programs, Kowitz says. The good news is that many marketers have caught on and are living up to their promises.
"Companies have done a better job [with cause marketing] than in the past 12 months," Kowitz says. "What they could have gotten away with six years ago, for instance, was to throw money at something and say they're supporting it."