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Purpose Marketing
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Purpose marketing evolved from philanthropy has

entered into the corporate world in big strides. With the
objective of earning and supporting the society at the
same time helps in the sustained development of the firm
as well as society. Today’s consumer also give more
preference to brands which are responsible
Purpose Marketing
Introduction
Purpose marketing or Purpose-related marketing refers to a type of marketing involving the
cooperative efforts of a "for profit" business and anon-profit organization for mutual benefit. The
term is sometimes used more broadly and generally to refer to any type of marketing effort for
social and other charitable causes, including in-house marketing efforts by non-profit organizations.
Purpose marketing differs from corporate giving (philanthropy) as the latter generally involves a
specific donation that is tax deductible, while Purpose marketing is a marketing relationship
generally not based on a donation.

Corporations have long been involved in supporting community, but when the first Purpose-
marketing programs were successfully implemented, it signalled a dramatic shift in non-profit–for-
profit relationships: one that recognized corporate community support could be positioned at the
intersection of business objectives and societal needs.
Purpose marketing was initiated over 35 years ago. At the time many nonprofit professionals viewed
it is a fledgling idea, one that should not be considered part of any serious fund development or
nonprofit program. As well-constructed programs reaped benefits for companies and nonprofits
alike, the number of programs continued to grow. Now more than two decades later, Purpose
marketing has evolved and developed into a firmly established practice, a new way for corporations
and nonprofits to achieve significant bottom-line results and community impact.

Purpose Marketing: One step ahead of Philanthropy

Purpose marketing was officially launched by American Express in the early 1980s. Between 1981
and 1984, American Express used this approach to support more than 45 local causes. Jerry Welsh, a
senior vice president of American Express at the time and the architect of the cause-related
marketing concept, believed that by giving people a local cause to rally around, it would encourage
card members to use their American Express for local purchases.
The early success of their local San Francisco cause-marketing initiatives led the company to coin and
trademark the term “cause-related marketing” in 1983. That same year American Express pioneered
the concept at a national level when it launched a three-month marketing campaign around the
Statue of Liberty Restoration project. American Express donated one cent for every card transaction
and one dollar for every new card application. The company also made donations based on
purchases of their travelers’ checks and travel packages, excluding airfares, sold through its vacation
stores.
American Express supported the promotion with a $4 million advertising campaign to reach existing
customers and encourage new ones. The results were impressive. In just three months, the
Restoration Fund raised over $1.7 million, and American Express card use rose 27%, while new card
applications increased by 45% compared to the previous year. These examples show the utility of
the Purpose marketing.
Purpose-marketing is uniquely different from traditional corporate philanthropic gifts or
sponsorship. Building the case for support and making the “ask” is the focus of philanthropic
corporate giving. Philanthropic support is often centered on specific areas such as education, health
care, or arts and culture and strategic in its approach—giving in specific geographic regions or to
matters that are of interest to the company or their employees.

Purpose marketing, the new third way, is the intersection of the two- Philanthropy and Marketing, a
step from pure profit-earning approach towards society giving approach. In Purpose marketing the
emphasis is on an deriving value, how to grow the business and earn more and at the same time give
back to the society: self-interest combined with altruism; marketing combined with corporate social
responsibility. Occasionally, Purpose marketing is called different names—from philanthropic
marketing to values-led marketing to gift-based marketing to corporate citizenship. Corporate
support is being tied to company marketing and business objectives geared to affecting the bottom
line.
Purpose marketing is a combination of philanthropic benefits, support for a cause, and tangible
business benefits focused on driving profitability- all at the same time. Sometimes the benefits are
overtly commercial, designed to increase sales and market share; other times they are more subtlety
focused on positioning and building the reputation of a product, brand, or company. Either way, the
goal is clear. Companies are seeking to strategically align their support of a cause with critical
business objectives to achieve mutual benefits of creating social and shareholder value; connecting
with key stakeholders, including employees and consumers; and publicly communicating values and
contribution to community.
Often confusion exists between sponsorship and Purpose marketing. There is a subtle difference
between them. Purpose marketing is not about sponsorship. It is about a partnership that advances
and forwards a community based objective, and at the same time marketing that allows firms to
enhance their core profitability, service, and product.

Own a social cause, Generate Revenue, and Other Benefits

Purpose-marketing benefits go well beyond a traditional donation. Take the example of IKEA
contributing to the UNICEF’s Right to Play program. They could make a direct cash donation that is a
direct contribution to the program. Rather, by selling a specially designed Brum Bear with a portion
of the proceeds going to the program, their public values are communicated; IKEA’s message about
the program is more broadly disseminated, and revenue is contributed to the program; individual
consumers purchasing the bear feel they have made a contribution; and IKEA’s staff has a sense of
pride in (and knowledge of) their company’s community commitment.
Purpose marketing allows a corporation to put its brand, marketing might, and people behind a
nonprofit cause that can provide significantly more benefits than a straight philanthropic gift. In fact,
these other mission-based benefits can be more important than the financial contribution. First and
foremost, every Purpose-marketing initiative must be done because it advances a nonprofit mission.
Some easy to follow social cause actions
 If you cannot offer a bio-degradable bag, you could reduce the size of your packaging — making
it not only eco-friendly, but cost effective — or make your distribution routes more efficient.
 Instead of just donating for a social cause, own a cause. The more different it is more better.
 Coming up with green-products is the best way. But if one can’t develop green products, try to
reduce your carbon-footprints by reducing transportation cost and using less resource.

Strategic vs non-Strategic Purpose Marketing

If you’re a sponsor, ensure that your sponsorship of the cause bears some rational relationship to
your business.
The effort (shown in annexure) from Montblanc, the fountain pen maker, pretty much passes
muster. When you bought this special edition pen, called the Meisterstruck Signature for Good
Edition, 10 percent of the purchase price went to a UNICEF education programs because “The ability
to read and write is a fundamental human right and the most important asset to children.”
For this campaign, Montblanc set a minimum donation of $1.5 million.Such initiatives are completely
strategic in essence. It’s easy to see the relationship between Mont Blanc and UNICEF’s educational
programs.
But there’s plenty of successful cause marketing that goes on between sponsors and charities that
share almost no strategic relationship.
Ford Warriors in Pink, which benefits Susan G. Komen for the Cure, is a good example. Ford Warriors
in Pink sells merchandise, little of it car related. Profits go to Komen. In 16 years, Ford has donated
$105 million, a number which may also include Race for the Cure sponsorship dollars.
just because the campaign is successful for Komen doesn’t mean it’s a strategic choice for Ford. By
rights, the thinking goes, Ford should be doing cause marketing for environmental organizations.
Ford vehicles and the fuel they run on, deplete and pollute the earth’s resources and no matter what
else it does Ford to mitigate that it should also do so with its cause marketing efforts.

So it is possible to support a non-strategic cause and make it a success but such collaborations are
not fruitful for the organisation in the long run. The difference between the objectives of the firm
and the adopted cause creates a lack of interest and no value add in terms of establishing the firm

Purpose Marketing Initiative across the globe

Purpose marketing is wide-spread throughout the world. In India, there are a few firms only who
engaged in these activities

 Tata Tea’s Jaago Re! Campaign

 Lead India by Times of India
 Coca-Cola’s bottle recycling project
 Product Red
 Tide’s Loads of Hope Program
 Make-A-Wish Foundation by JWT, New York

Consumer Preference
Do the consumers pay any heed to all these activities by companies? This can only be answered with
some hard data.

 Edelman released the 2010 Goodpurpose Study. The study conducted in 13 countries (Brazil,
USA, UK, UAE, The Netherlands, Mexico, Japan, Italy, India, Germany, France, China and Canada)
with 7,259 consumers, reports that 86% of consumers globally believe that companies need to
place at least equal weight on society's interests as they do on business' interests.
 In Canada, 67 per cent of consumers say they are more likely to buy products and services from
a company if they know it has brands that support good causes – up 7 points from 60 per cent in
2009. 

Conclusions

When Purpose marketing was launched over 35 years ago, it was viewed as a fledgling idea. Today,
Purpose marketing is a global phenomenon that has developed into the new way for businesses.
Purpose-marketing partners a societal cause with the power of a corporation’s brand, marketing,
and people to achieve social and shareholder value while communicating values.
Purpose marketing has come a long way from its early days, has become increasingly sophisticated,
and now includes everything from one-off cause sale promotional activities to broader, longer term
marketing relationships to companies that make long-term commitments to causes that eventually
become part of their corporate identity, culture, and corporate social responsibility palette. Today,
Purpose marketing can include product sales, promotions, and program-driven collaborations
between companies.
Done right, Purpose marketing can help achieve mission, generate additional revenue, extend
reach, get out important messages, change behaviors, and enhance awareness of the company and
the cause.
Purpose marketing is augmenting traditional corporate philanthropic support and becoming the new
way corporations. Different from philanthropy or sponsorship, Purpose marketing combines the two
—the community benefit associated with philanthropy and the business value tied to sponsorship—
self-interest combined with altruism.
Annexure

Ford Warriors in Pink Meisterstruck Signature for Good

Edition
 Project Red

Feeding America