Doing Well By Doing Good

In the crowded gift marketplace, it takes good marketing to draw attention to a line. One smart technique that has paid off for a number of manufacturers is cause-related merchandising, in which a percentage of the retail price of a product is donated to a charity chosen by the manufacturer.

Cause-related products help build brands in two ways: First, the consumer relates emotionally to the manufacturer's sense of social conscience. Second, the name recognition of the charity often attaches itself to the product it is associated with. "Cause-related marketing is a good way to maximize brand awareness through good will," said Janice Johnson, director of corporate communications at Enesco in Itasca, Illinois. One of Enesco's cause-related products is the Precious Moments figurine Life Is Worth Fighting For, a portion of whose sales is donated to the National Alliance of Breast Cancer Organizations (NABCO). "We're getting to be known for our affiliation with NABCO," she added.

Jeff Van Slembrouck, vice president of sales for New Creative Enterprises (NCE) spoke about relationships — the relationship between a manufacturer and a good cause, and the relationship between a manufacturer and its customers. "As a company, the image that you want to portray is that you're not just in it for the almighty dollar. You have to have a human side. It shows our customers that we're willing to partner with a good cause just as they partner with us." NCE, Milford, Ohio, recently partnered with Gift for Life, the gift industry fundraising organization for amfAR (the American Foundation for Aids Research). Three percent of the proceeds from NCE's Holiday Spirit Collection by Kathy Hatch, a set of 36 decorative accessory items, will benefit Gift for Life.

In addition to building a brand, the events undertaken to promote the cause-related product and the subsequent donations made to the charity offer unparalleled opportunities for publicity. At plush manufacturer Applause, CEO Bob Solomon explained, "We speak to the end consumer through our merchandising and point-of-purchase displays. Then we create an advertising and public relations campaign so that everyone knows when you buy a Remember Bear, a portion of the proceeds goes to the U.S.S. Arizona [the Pearl Harbor memorial operated by the National Parks Association]." Woodland Hills, California-based Applause also works with the March of Dimes and several other charitable organizations, always donating a minimum of 5 percent of the proceeds from product sales.

Cause-related products also offer the opportunity for manufacturers and retailers to create synergy with a tie-in to a celebrity, an event, or a movie. Take Disney's Pearl Harbor movie, for example. Knowing that the film was in production was part of the reason Solomon came up with the Remember line. (Other reasons were a recent family visit to the Pearl Harbor site and the fact that Applause already had a National Parks Association license that included the U.S.S. Arizona.) PSC International collectibles, based in Tampa, manufactures framed reproductions of U.S. Navy war documents, and the Pearl Harbor Survivors Association receives a percentage of the retail sales. "We're not trying to benefit off the movie," explained PSC president Richard Moore. "But it's going to bring up a lot of old feelings and emotions."

Lisa Kelechava, president of Joy to the World Collectibles, Knoxville, has a unique perspective on cause-related products and celebrity tie-ins, since that's all her company does. A celebrity endorses each of its 65 Christmas ornaments, and 10 percent of the gross proceeds benefits the charity of the celebrity's choice. To date, some 30 different charities have benefited, including Lee Iacocca's Ellis Island Foundation and Michael Bolton's Prevent Child Abuse America. "It's a very emotional sell for us," said Kelechava.

The decision by a manufacturer to team up with a particular charity is often based on personal passion. For example, Enesco's recent line of Mary Engelbreit products benefits First Book. Mary Engelbreit is personally involved with the charitable organization that provides books for children of low-income families.

NCE's Van Slembrouck explains the reasoning behind his company working to benefit Gift for Life: "We're one of the number one companies in the gift industry," he said. "We have the number one artist in the industry. Let's support the number one charity in the industry." New Creative Enterprises also has plans to work with UNICEF.

Another key consideration when choosing a charity is the product's target audience. If it's a good fit, customers don't need to be educated and the emotional appeal is built in. Royal Doulton chose to benefit breast cancer charities because, "The customer buying and collecting figurines is a mature female, so … it's the cause most related to our customer base," said Kevin Moyer, the company's U.S. giftware and collectibles product manager. Funds raised from the sale of the Faith, Hope, and Charity figurines for the American Cancer Society Breast Cancer Network topped $50,000. The company just introduced a fourth figure, New Dawn, which retails for $235. Royal Doulton donates $20 from the purchase of each figure.

The bottom line in cause-related marketing is that there's more to life than the bottom line. As Solomon said, "We not only make gifts, we give gifts. If we make $1 million dollars a year and give 10 percent to charity, that would be one way to make a contribution. On the other hand, if I make $5 million and give away 5 percent by selling more product, everybody does better."

Van Slembrouck added simply, "We all have to take on some responsibility to make the world a better place."