2013-03-15

Co.Exist

3 Ways To Moneyball Cause Marketing To Make It Actually Work

Every brand these days has a cause attached to it, but the return seems limited to a general sense of good feeling, without really helping the brand or the cause. But being more tactical with data and analytics could turn cause marketing into something more solid.

Companies are increasingly turning to purpose-driven marketing with the hope of cultivating loyalty among their key customers. In fact, IEG estimates that cause marketing spend will increase 4.8% from last year to a new high of $1.78B in 2013 alone. To merit this growing investment, corporate executives must be seeing a positive return on their investment (ROI).

Right?

Probably not, argues Rance Crain. In an AdvertisingAge article (Is the Era of Purpose-Driven Ads (Finally) Over?) Crain astutely asks whether marketing executives have become deflated from pumping social causes into their marketing messages. He cites lost market share as the catalyst for Pepsi to abandon the Pepsi Refresh Project as a standalone marketing strategy. Pepsi made the choice to ditch a purpose-driven campaign in favor of the tried and true marketing strategies that they know to be effective. Companies are facing choices like this every day: Should we stand for a purpose or should we continue our traditional marketing? The question marketers should be asking is in fact buried towards the end of Crain’s article: How do we optimize our purpose-driven marketing investments?

Look no further than the tried and true lessons of Moneyball. The popular book by Michael Lewis highlights how innovative insights and analytics can inform resource allocation, in this case for a financially constrained professional baseball team. The team had a business goal (win championships), well-resourced competition (New York Yankees), and difficulty retaining its most critical value creators (baseball players). At its core, the Moneyball way of thinking is focused on using data to achieve the highest ROI from a pool of limited resources.

This sounds eerily similar to the current corporate landscape. Marketers are facing audacious business growth goals, increasing industry parity, and challenges with developing customer loyalty. To overcome these challenges, corporate marketers must not assume purpose-driven marketing is totally futile; it may simply require better data requirements and smarter execution. Corporate marketers can take away three lessons to make this shift:

1: Find the right customers

Corporations consistently use proprietary segmentations to find their most valuable targets. Segments are groups of customers that share some kind of behavioral, attitudinal, or demographic characteristic that affects their buying behavior. Yet, purpose-driven marketing campaigns are often targeted at the mass market. Therefore, one purpose may not appeal to everyone and diluting an entire campaign to appeal to the mass market may in fact threaten its content and value-creating ability. The first step to crafting a high-value, purpose-driven campaign is to find the customer segment whose buying behavior would be most receptive to such a campaign. Marketers need to understand who these people are, where they are, how to reach them, and, perhaps most importantly, how valuable they are.

2: Deliver value through social impact

Walk down the aisle of your local grocery store and you’ll see all kinds of brands are associated with all kinds of tangential purposes. Delivering the "feel-good" halo by telling customers you’ll donate to a cause if they buy your product or other forms of association is no longer a competitive advantage. Savvy marketers know why customers buy their products be it quality, price, convenience or a variety of other reasons. Why not align purpose-driven marketing investments to tap into the reasons customers are already buying your product? For example, rather than promoting a cause association on yogurt lids, market the health benefits of a probiotic yogurt which can command a premium price point. Relying on a purely emotional customer connection (yogurt lids with a purpose), without delivering the benefits that drive purchase (customer health and wellness) puts marketers in danger of fleeting sales and inefficient resource allocation.

3: Measure marketing effectiveness

Marketers spend significant resources to quantitatively measure how well their trade promotion strategies actually drive sales and influence buying behavior. Investments made in purpose-driven marketing should be held to this same level of rigor. If the goal of marketing is to drive sales, measure the contribution of that strategy to sales. If the goal is to enhance loyalty, measure how well these strategies contribute to customer loyalty. Purpose-driven marketing may create a short-term bump in sales but such strategies can be easily replicated by competitors. To develop a resource allocation strategy, marketers need data that measures the performance of their purpose-driven marketing campaigns in terms of sales and customer behavior.

Corporate marketers who currently engage in purpose-driven marketing shouldn’t simply abandon their efforts. Looking at marketing with a Moneyball lens can offer the tools needed to effectively allocate resources. The future of optimized purpose-driven marketing is ripe with opportunity, as long as your competitors don’t get there first.

Add New Comment

7 Comments

  • Christopher Mance II

    You are spot on with #1: Find the right customers...This comes down to the the most basic tenet of  marketing... segmentation.   To drill down a little deeper, segmenting the demographics of a cause is even more nuanced than taste.  People are also much more discerning of the brands they will trust when they are  attaching themselves to a cause they are passionate about.

    With that said, as it relates to your point #3 (measuring effectiveness), I think going forward the brands that get the greatest benefit from cause marketing will commit to a cause over multiple years working with multiple different non-profits all serving the cause.  They will also find tighter brand cause fit  (i.e. Reebok's support to fight childhood obesity or Home depot and their support of veterans’ housing initiatives).  By focusing over multiple-years with multiple non-profits that have great brand cause fit, set measurement goals will be much easier.

    Christopher Mance II
    Cause Marketing Blogger
    casuemarketing.us

  • cmcornet

    Great article Shawn. I totally agree.

    It's amazing to me how quickly brands forget the rules when the word cause is placed in front of marketing. Brands are most successful with they authentically focus on the individual needs of customers and delivering a flawless customer experience. 

    If done right, purpose-driven marketing provides brands with the opportunity to add to the customer experience by providing an additional point of relevance and brand differentiation. Done wrong, it can be alienating and have a neutral and at worst negative impact. 

    I recently left the agency/consulting world in Chicago to work for a company called PlanG (www.MyPlanG.com). I think you'll find what we're doing both exciting and applicable to your article. PlanG gives brands the opportunity to partner with philanthropy vs. individual causes. We believe giving is an individual experience and that brands should empower givers with personal choice to increase relevance in their efforts. PlanG offers brands a model to incorporate purpose-driven efforts more authentically into their brand DNA. 

    We launched in September and have seen very successful results from the brands we've worked with to-date. I would love to hear your thoughts about what we're doing. 

    Thanks again for the article...well-written and extremely relevant. 

    Chase Cornett
    Director, Marketing and BrandPlanG
    @cmcornet:twitter @My_PlanG:twitter 

      

  • Cause Mktg Forum

    Well-written and well-conceived post, Shawn, thank you!

    You are SPOT ON with your assessment that the majority of companies are not dedicating the appropriate resources to measure their cause efforts. Unfortunately, cause is often seen as a low budget way to create a differentiation in a crowded marketplace. As you've astutely pointed out, this isn't enough and one-off campaigns seldom work.

    At the Cause Marketing Forum, we repeatedly hear that companies aren't budgeting for the thorough post-initiative evaluation to which these types of campaigns (or any marketing campaign, for that matter) should be subjected. There are, of course, exceptions to this rule. Savvy cause marketers (both on the corporate and nonprofit side) understand that campaign design also plays a role in proper evaluation. Don't have a call to action? It's going to be tricky to track anything. Not linking these campaigns to clear objectives? Hard to measure nebulous goals.

    By and large, our Cause Marketing Halo Award winners stand out as exceptions. Most of these excellent cause marketing efforts DO track business benefit and DO have measurable results for both the cause and the brand (hence the reason we do these awards...to bring attention to best practice).

    Thanks again for a terrific post - you hit the nail on the head!

    Megan Strand
    Communications Director
    Cause Marketing Forum
      

  • Shawn Basak

     Hi Megan,

    Thanks so much for your comment.  I've also seen companies who are effective in this space use cause and purpose-driven marketing to deliver some kind of benefit to their customers, consumers or employees.  By using these investments more intentionally, measuring the business value of such strategies becomes less of an uphill battle.

    Thanks,
    Shawn

  • Ed Holme

    Agree with Lissa! One of these days a company will just do the right thing, because it's the right thing to do. And yes, there is a place for the true support of a cause in the corporate world. Employees respect it and align with it and the market will respect it and reward it, if it's real. But it should never be used as just another way to get people to buy your stuff.
    Just another example of integrity being absent from the thought process.

  • Lissa Boles

    I'd add one more possibility into the mix: a consumer pool smart enough to know when cause-marketing's more tactical ploy than true reflection of genuine sense of purpose or any care for or commitment to cause. Especially if you're marketing to women. Cause-marketing that's little more than an empty gesture designed to persuade the desired into bed is a tactic women've had a bead on for a good while now. To carry the metaphor further, they know the feel-good-glow (if Mr. Feel Good's been anywhere near good enough to give them one in the first place) doesn't last and something more tangible & real needs to be behind it, or the whole exchange is rigged from the get go & the seductive promise of real relationship little more than BS. Reducing the dynamics of cause-based, relationship-marketing to typical tactics & blinkered ROI measurements that don't take relationship dynamics into account confirms an objectified use of a market's genuine hunger for meaning & service to get her business - and folks, that's just a different kind of 'numbers game' the market's seeing thru & doesn't want to play. In other words, If the truth behind the tactics are transparently bait-to-buy, bye bye ROI. And any relationship that does exist from that point on will be at the pleasure of your customer. Nothing more.

  • Shawn Basak

     Hi Lissa,

    Thanks for your comment.  I think your perspective underscores the need to effectively demonstrate social impact behind such initiatives using compelling data.  And consumers are becoming more and more savvy to know what is and isn't real impact.  Demonstrating and measuring this impact doesn't need to be complex; it just needs to be right.  In fact, one of my colleagues has a recent article that cites a study showing moderate investment in CSR (when there isn't a strategic focus) can actually do more harm to a company's business performance compared to companies that either invest significantly, or not at all, in CSR: http://www.ssireview.org/blog/...

    Thanks,
    Shawn Basak