What’s next?

Causes–perhaps more than any other group we encounter–seem obsessed with the future. What will be the next pink ribbon, the next yellow wristband, the next...?

This isn’t a question reserved for staff whose time is dedicated to cause-related marketing (CRM) or corporate partnerships. It’s coming from executive directors, board members and just about every other person invested in a cause’s organizational success.

Below we discuss what’s next for CRM in four key areas:

Role Within Causes
Cause marketing as we know it has been around for about 25 years, so it’s safe to say it won’t be leaving us anytime soon. But its function within organizations has changed dramatically over time as the platform has matured.

At one point CRM was the result of being a successful cause. Build the audience, build the brand, build the corporate relationships, and then reap the benefits of CRM. This follows the traditional model for sponsorship, which tends to reward properties with established track records.

What’s next? As CRM has gained a foothold in the plans of corporate marketers, the model seems to have been flipped, as CRM has become a way to build a cause. Companies are actively seeking cause partners, and a long track record isn’t required. A savvy marketer can leverage the mission–autism, childhood obesity, conservation, etc.–without much assistance from the organization itself. A savvy cause can take advantage of the free promotion and new funds to broaden its base of support.

Using CRM as a building block seems likely to continue and increase. While charitable walks and social events will always have a place in the cause development toolkit, such efforts require significant investments of money and time–both of which are in short supply, particularly for new organizations. CRM programs, on the other hand, require minimal infrastructure to manage in their initial stages of development and are proven profit centers.

Growing Revenue
Even for causes with successful CRM programs, one of the primary challenges is growing CRM revenues.

With a sponsorship, a property can increase its asking price by growing its audience or adding new benefits to a package. But the revenue generated by a CRM program is based on actual consumer response; so adding new opportunities doesn’t necessarily translate into higher revenues.

Moreover, once a cause enters into a CRM agreement, it has already deployed its most valuable benefit–the ability to use its marks and logos to leverage consumer support.

To date the typical tactic for growing CRM has been to sign more CRM partners. However, in an increasingly competitive environment, such a strategy isn’t likely to be sustainable. There are only so many companies that can commit fully to a CRM program; plus, an excessive number of partners could dilute the value of the opportunity and end up driving away both existing and prospective partners.

What’s next? A new option for causes is to focus on increasing consumer participation in CRM programs.

A cause can attack the effort on multiple fronts. It can enhance its brand-building efforts to boost consumer awareness and perception. A cause also can mobilize its supporters through CRM education and active promotion of its CRM programs.

The structure of CRM agreements also can be addressed. Causes can make it easier for companies to commit to higher minimum guarantees or to expand the scope of their programs.

For example, rather than requiring a separate minimum for each CRM program a company develops, a cause can allow the company to use multiple promotions to meet a higher overall minimum as part of a longer campaign.

Local Relevance
The success of major national CRM campaigns has fed the perception that CRM is the domain of national causes. In fact CRM is often most effective when it supports local efforts–whether through a local nonprofit or a national organization’s local chapter or affiliate. To date the gap between national and local CRM efforts has been caused primarily by disparities in expertise and organizational wherewithal.

What’s next? Local causes are increasingly recognizing the cost-effectiveness of CRM both as a fundraiser and awareness generator. As these causes integrate CRM into their strategic plans and build their CRM competency, local programs are more likely to flourish.

What remains to be seen is whether local businesses can match the pace. National brands enjoy an economy of scale that makes a CRM campaign easier to integrate and promote.

A small local business generally doesn’t have the luxury of experimenting. As a result, local causes will need to allocate even more time than their national counterparts to educating partners and helping them develop effective CRM concepts.

CRM Platforms
Familiarity can breed contempt. Just as consumers may tire of being solicited for charitable walk pledges at home and at work, they also may grow weary–if not downright skeptical–of products offering percentage donations back to a cause.

What’s next? CRM is shifting toward the participatory. The trend really isn’t that new, considering that Yoplait has turned saving yogurt lids into a cultural institution. However, the vehicles for such participation are growing.

Online applications in particular have empowered individuals to build extended support networks for their favorite causes. For example, during September Aflac made a $1 donation to the Aflac Cancer Center in Atlanta for every new member who joined the Aflac Cancer Center Facebook cause; the program attracted more than 850,000 new members and generated more than $1.1 million.

Another shift sees brands allowing consumers to choose where their CRM dollars go.

Southlake, Texas-based upstart Project 7, Inc. has built participatory CRM into the business model for its bottled waters, mints and gum, which are branded with one of seven causes, bearing names such as House the Homeless and Feed the Hungry.

Project 7 will donate 50 percent of its profits based on the percentage of sales represented by each brand, with each cause receiving at least $15,000. Small nonprofits are invited to apply to be the recipients, with consumers choosing one from among three finalists per cause in online voting at the end of the year.