Cause-Related Marketing

Cause-related marketing (CRM) refers to a marketing activity that involves a company forming a relationship with a particular cause or causes for mutual benefit. CRM can be characterized as a strategic marketing tool employed to achieve both social and corporate objectives; it simultaneously benefits the company and a charity or similar cause. The cause could be general, for example, a concern for the environment, or specific, for example, when a percentage of the sales of a particular product are donated to an identified charity. From the company's perspective, the benefits include the opportunity to enhance their reputation, differentiate themselves from the competition, boost employee morale, raise brand awareness, increase customer loyalty, build sales, and attract positive publicity. From the perspective of the “cause,” the benefits include increased revenue and public awareness of their activities. CRM originated in the United States, where corporate philanthropy is typically characterized as “enlightened self-interest” or as “doing well by doing good.” American Express is credited with being the first company to launch a CRM campaign in the early 1980s. Increasingly, companies are moving away from “no strings attached” donations toward joint ventures in which commercial sponsorship of charities is included within overarching corporate objectives, and it is becoming common for contributions to social causes to be funded by the marketing budget rather than a central philanthropic fund.