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In 1983, the words “cause marketing” came together to describe a breakthrough promotional idea linking the American Express card to the restoration of the Statue of Liberty. Every use of the card triggered a small donation to restore the luster of our nation’s beacon of freedom.
The idea was revolutionary and marketers watched closely. Could a company partner with a cause to create interest for a product, for a brand, for an entire company? Could alignment with a social issue create a new narrative, drive preference and, ultimately, influence sales?
For American Express, it worked. The marketing experiment proved the hypothesis that the halo of a compelling cause, well-executed and broadly communicated, dramatically influenced card preference, raising an astonishing $1.7 million for the cause and double-digit increases in card use. A new marketing strategy was born. Around the time that AmEx put cause marketing on the map, a new crop of companies—The Body Shop, Ben & Jerry’s, Seventh Generation, Tom’s of Maine and Innocent drinks—were born with social and environmental causes at their core, mirroring their founders’ evangelism. They were small but mighty and their business models demonstrated a new way of business and stakeholder engagement. In today’s language, you could call these pioneers social entrepreneurs or “purpose purveyors.” At the time, it was just the “right” way to do business. Let’s call this phase Cause 1.0.
Cause 2.0 was driven by a core group of early adopters. Typically, these were larger private companies and corporations with founders or leaders who believed that social and environmental responsibility were critical to their vision. These companies included Home Depot, Timberland, Starbucks, Hasbro, Interface, Natura and Target. Cause marketing became a core dimension of their existing business models to enable a triple bottom line of people, planet and profit. This cohort of companies proved that cause marketing was more than a short-term promotional tactic. With the success of these adopters, in the new millennium came the mainstreaming of cause marketing with many new names and nuances related to the strategy: cause branding, citizenship, CSR and social responsibility, among others.
I call this phase Cause 3.0, where early-majority companies began to reap the benefit of social engagement such as differentiation, relevance and employee morale. These benefits could put the wind at a company’s back and emotion into its brands, and, in some cases, could even heal a sullied reputation. Some of today’s cause giants took on a leadership role during this phase, including Avon, Wal-Mart, Nike, Unilever, Pepsico and Tesco.
Then cause marketing began to accelerate rapidly, encouraged by the tectonic societal and cultural shifts of the last decade. The Internet and social media had flattened the world and forever upended the traditional influencer pyramid. This democratization of influence empowered people around the globe to become “citizen” consumers and demand a new way forward, defined by radical transparency. They started asking new questions: What does a brand or company stand for? Where do products come from? How are they manufactured? Are they environmentally sound? How are employees treated? Citizen consumers could now “vote” with their purchases and their commitment to an employer, and use their voices to advocate for or against brands and companies. The 2012 Edelman goodpurpose study provides additional insights to this changing marketing dynamic: 86% of citizens around the globe expect a business to place at least equal emphasis on societal interests as on business interests. And in rapidly emerging markets such as China, Brazil and India, the findings rise beyond 90%.
In this transparent, consumer-empowered marketplace, the 4 Ps of marketing have forever changed. Product differentiation and brand affinity so desired by marketers become ever harder to deliver.
This leads us to Cause 4.0, which we call purpose, the latest evolution of cause marketing. Purpose is a brand’s or company’s reason for being beyond the bottom line. Purpose, when strategically crafted to bridge relevance and engagement with core stakeholders (consumers, employees, customers, distributors and communities), provides a humanizing and compelling differentiation for a brand and a company. Purpose is expressed through the same strategies that have been pioneered by the companies listed earlier for the past 30 years: the sales-generating force of cause marketing, the powerful employee and customer loyalty of cause branding, and the operational advantages and environmental efficiencies of CSR. But it is defined by a higher-order value that sits above these strategies and is embedded in the company’s DNA.
Today’s purpose leaders address business and social imperatives through powerful, integrated organizational and marketing strategy. IBM creates a “Smarter Planet.” At GE’s core is “Imagination.” Unilever sees the future through its “Sustainable Living Plan.” Starbucks believes in a “Shared Planet.” They all understand the need for a compelling, new narrative that humanizes their organizations, and provides “North Star” guidance for operations and galvanizing inspiration to drive their organizations forward.
Since 2008, Edelman’s research has found that after price and quality, the next trigger for consumers in purchasing a product or service is purpose, soundly trumping design, innovation and even brand loyalty. This global trend has grown 26% over the past five years, leading Edelman to declare that purpose is the fifth “p” of marketing. It’s not a nice-to-do. It’s a must-do to compete on the global stage. This is quite a feat for what was once seen as a fringe activity. Profit and purpose, once considered strange bedfellows, are now inextricably linked. As we approach the 30th anniversary of American Express’ landmark campaign, the lesson for marketers and executives is this: The fifth “p” is here to stay.
Carol L. Cone is the global practice chair of Edelman, Business + Social Purpose. Follow her on Twitter at @carolcone.
Reprinted from the September 15, 2012 issue of the American Marketing Association's Marketing News.