Cause Marketing versus Sponsorship – What’s the difference?

By Jocelyne Daw

heart_cogsAt JS Daw & Associates, multi-stakeholder partnerships are core to our business. Partnerships come in many different forms and can be applied across a wide range of situations. The relationships between partners can have varying degrees of depth and length.

A question I often get asked is “What is the difference between cause marketing partnerships and sponsorship?” I am happy to share my insights into these two mutually-beneficial, but more commercial forms of business-community partnerships. In my perspective, the difference between the two is simple. It’s in the tactics and the benefits of each execution.

Let’s look at cause marketing…pampers_unicef_652x540

I define cause marketing as a mutually beneficial business and nonprofit partnership that sees a company put the power of its brand and marketing behind the cause to generate profits for both. In cause marketing, the company uses the cause as the focus of its marketing tactics. Think the traditional 4 P’s of marketing: product, price, promotion and place. Product ties to cause. Price includes a donation or percentage that goes to the cause. Promotion focuses on the cause connection. Place reaches consumers in an untraditional manner with cause messages often supported by in-store point of purchase advertising.

The company’s expectation is that it will directly earn profits from the affiliation. The cause tie helps the product and company to stand out in the crowded marketplace.  It demonstrates an alignment with the company and customers’ values. Research proves that if price and quality are equal, the cause differentiator will (in more cases than not) result in a sale.

Sponsorship on the other hand…

Sponsorship sees companies providing financial contribution to a nonprofit event or program.  In return, the nonprofit uses its marketing and communications tools to promote a company’s involvement and support of the cause. The tools could include featuring the company’s logo on a poster, t-shirt, brochure or other nonprofit marketing and communications material.   In the end, it’s really just another marketing and promotional tool for the company.  Similar to the way TV advertising or social media allows company’s to reach a distinct target audience.

Profits, on the other hand for the nonprofit are less ambiguous. They receive a payment – in the form of a non-tax receipted contribution. It is essentially an advertising expense paid in a commercial exchange for a corporate recognition tied to the cause. Benefits for the company come in the form of reaching their target audience in a unique way and fostering community goodwill. Neither is seen as a competitive advantage that will guarantee a sale. Generating corporate profits are less direct than in the case of cause marketing.

 

The difference is clear, but can still be blurry

While my definition clearly differentiates between the two business-cause partnerships, there are occasionally blurry lines.  Take Susan G. Komen Foundation’s Race for the Cure® and Yoplait’s involvement.

Yoplait has been the main sponsor of the race for a number of years. Komen promotes their support through the organization’s various race marketing and communication vehicles. Yoplait’s logo appears on the Susan G. Komen Foundation’s Race for the Cure® t-shirt, as well as on promotional posters and the banner pictured here.

However, during the month of October, Yoplait parallels its race support with a cause marketing in-store promotion – “Save Lids, Save Lives.” It is an innovative in-store promotion that encourages people to send in their Yoplait lids to trigger a donation to Komen for the Cure.  Over $30 million dollars has been raised since the inception of this cause marketing initiative.

People see both. Some call their support “sponsorship” and others call it “cause marketing”.  In fact, it’s a creative use of both that leverages Yoplait’s cause involvement in the breast cancer movement.  By doing so, it turns the entire involvement into something that is bigger than the sum of individual parts.

In the end, both cause marketing and sponsorship are commercial, mutually beneficial relationships between companies and causes.  We know both are growing. When done right, they can provide powerful shared value for the organizations involved and a unique opportunity for the community to participate.