Canvas- Edition 3


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We present to you the Third Edition of IIM Rohtak's Marketing Club's Newsletter- Canvas

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Canvas- Edition 3

  1. 1. MARQUE! 20 NOVEMBER 2011 CANVASCause MarketingThe art of Giving...and Winning... A cold in the head causes less suffering than an idea. - Jules Renard Sneak Peak • Where Philanthropy Ends... - Bharadwaj Battaram • Cause Marketing: What it is and what it will be - Team Megarth • Just do it for the cause! - Harsh Gupta • Is it the Answer? - Kushal Lokhande! PAGE 1
  2. 2. MARQUE! 20 NOVEMBER 2011WHERE PHILANTHROPY ENDS... Consumers’ growing expectations of companies make corporate philanthropy more important thanever. Corporate philanthropy can be an effective tool for companies that are trying to meet consumers’rising expectations of the role businesses should play in society, say respondents to a McKinsey globalsurvey. Corporate philanthropy or corporate giving is the act of corporations donating some of their profits,or their resources, to nonprofit organizations. But it should not be mistaken for Cause related Marketing.They are distinct in that the corporate dollars involved in Cause Marketing are not outright gifts to anonprofit organization, so they are not treated as tax-deductible charitable contributions. Nonprofitspotentially benefit from increased fundraising and exposure. Likewise, corporations that are sociallyinvolved potentially benefit from increased brand loyalty and employee morale. According to cause marketing consultant Jocelyn Daw, cause related marketing is a mutually beneficialcollaboration between a corporation and a nonprofit in which their respective assets are combined to: • create shareholder and social value • connect with a range of constituents (be they consumers, employees, or suppliers) • communicate the shared values of both organizations In this new era of social responsibility, what a corporation doesnt do can cost it. "Cause marketing" isnow the norm, and customers who visit the website and see the advertising want to know that thecompany shares their desire to make the world a better place by supporting an important cause. Kim T Gordon lists five important steps necessary in the mastery of this marketing challenge: 1. Give from the heart Cause marketing works best when the company and the employees feel great about the help they are providing to a nonprofit group. What matters most to the company, the team and the customers? Everyone works hard to make a difference when they give from the heart. 2. Choose a related cause A solid cause-marketing campaign often starts with the right affiliation. So while going through the nonprofit selection process, look for a cause that relates to the company or its products. 3. Contribute more than dollars For many types of businesses, cause marketing involves donating products or services and not simply writing a check. This can help form even stronger consumer associations between what is offered and the good work done. 4. Formalize your affiliation To make the affiliation a win-win for everyone, the company must work with the nonprofit to define how it will help the business increase its visibility, brand or company awareness. 5. Mount a marketing campaign Success in cause marketing often means motivating an audience to take action, such as making a donation or participating in an event.. Using a dedicated marketing campaign, one can reach and persuade the target group while also raising awareness for the business and its commitment to social responsibility. Like Wade Boggs once said, we live in a world where a positive attitude causes a chain reaction ofpositive thoughts, events and results. It is a catalyst and sparks extraordinary results. - Bharadwaj Battaram Canvas - Editor IIM Rohtak! PAGE 2
  3. 3. MARQUE! 20 NOVEMBER 2011CAUSE MARKETING - WHAT IT IS AND WHAT IT WILL BE People, not customers or consumers but people bottom-line and community impacts, paving theare what Marketing is all about. What they like way for businesses to create blended value.doing, what they don’t and more importantly why Though it is a well established concept in thethey choose what they choose? What is it that developed world, it still has to find a decent footingpeople base their choices on? in the developing world. For many years in India, Be it Apple’s, “Think Different” campaign or community development goals were philanthropicAudi’s, “Never Follow” ad series, the power behind activities that were seen as separate from businesssome of the world’s most recognized brands has objectives, not fundamental to them. Times arebeen the bond that businesses establish with changing fast.people – bond not of a promise or a product but ofactive participation, of collective purpose. Purpose is what drives people, engages themand ultimately transforms their lives. People seekmeaning. People recognize businesses that resonatewith their values, start responding in little ways andsoon these little ways turn into big ways –meanings become movements, businesses becomebrands. Tata Tea experienced a phenomenal growth inits market share from 19.1% to 23.5% after theJaago Re campaign. The campaign touched peopleand mobilized them to cast their votes, Recently, Pfizer and Times of India launched anestablishing Tata Tea as a brand working towards initiative on the World Diabetes Day in 60the cause of democracy – a people’s purpose. different cities across India. Walkathons, street plays, nutrition camps and several other events were organized with experts advising people to maintain an active lifestyle to avoid diabetes and other diseases. Around 50 top monuments and buildings across the country were lit up blue under the Abbott Diabetes Blue Footprint – 2011 Initiative. Internationally, marketers see cause marketingas the concept that builds brands by promotingtheir affiliation to social causes people care about.Increasing social awareness and the urge to be apart of social change motivates people to identifythemselves with businesses that advocate socialcauses. Cause Marketing has established thatcommunity development and support could bepositioned at the intersection of businessobjectives and societal needs with significant! PAGE 3
  4. 4. MARQUE! 20 NOVEMBER 2011 The Standard Chartered Marathon held At Megarth, we create opportunities forannually in Mumbai helps nonprofits to not only businesses and nonprofits, we create opportunitiescreate awareness about their particular cause but for people to seek meaning, to define a purpose inalso raise money through the effort. life and to invite more people into active Aircel recently launched the Save Our Tigers participation. We create action zones aimed atcampaign, which is aimed to encourage people to serving the needs of people. We call this People’sblog about the decreasing tiger population and stay Marketing.up-to-date with tiger facts. People can also donate There is no turning back now. As Causemoney to nonprofits working for the cause. Marketing continues to evolve, “why do you exist – Businesses have started realizing that it is no your purpose in life?” will become one of the mostlonger about being loosely associated with a cause commonly asked questions by people across theor partnering with nonprofits – it is now about world leading to a global phenomenon – People’sintegrating the concern and commitment for a Marketing.cause into business strategy. This shift can be seenas a step towards creating value based businessesthat lay emphasis on investing in initiativesdirected towards pressing social issues. Founded in August 2010, Megarth stands at thedoorsteps of change with a belief in people,purpose, creating actions and transforming lives.Our beliefs represent everything that Megarth is. - Team Megarth To avail avenues for Community Investment and Cause Marketing contact -  Pushkina Nautiyal ! PAGE 4
  5. 5. MARQUE! 20 NOVEMBER 2011JUST DO IT FOR THE CAUSE! Cause related marketing basically revolves 100 percent of the proceeds from Nikes entirearound the good we can do for the society and get Livestrong collection go to the Lance Armstrongsome good back. It makes it possible for a brand to Foundation and this association is growingemotionally connect with the people because we all stronger year by year!want to do good in our own way and if someone Social cause marketing helps a company createelse is doing that we want to be part of that and a differentiated brand positioning, develop acause marketing makes that happen. stronger customer bond, goodwill, drive sales, It’s possible to run a one-off cause marketing increase market value and enhance brand image incampaign, but companies need to be clear with the market. What else does a brand need? So, Justwhat their goal is: To make a difference in the Do It!!world? To sell more product? To improve theirbrand image? Businesses love cause marketing, andthe belief is that supporting a good cause translatesinto stronger sales. Social-Cause Marketing is, nodoubt a very powerful communication tool for thebrands to stand out in the clutter. The partnershipsbetween brands and charities can increasecustomer loyalty and help the brands stay inconsumer’s minds. It is a way of communicatingcompany’s Corporate Social Responsibility throughmarketing communications. One crucial point to note is that in any causemarketing campaign, it’s not enough to say thatyour actions have triggered a donation “to help ahungry child”.  Which hungry child?  Where? How will this donation help, specifically?  Thistypically comes down to providing compellingstories.  Coincidentally, these stories are the onesthat take hold and can spark the coveted sharingaspect. And Nike is probably one of the fewcompanies in the international arena which havecarried this style of marketing in a nearly flawlessway. They have been able to create a ‘larger thanlife’ image of their brand ‘LIVESTRONG’.  Nikes LIVESTRONG is associationbetween Nike and Lance Armstrong Foundation,‘LiveStrong’. This collection is to increase thepartnership’s innovative efforts to raise awarenessfor the cancer fight globally and expand salesinternationally. It started with the iconic yellowrubber bracelets, which since 2004 have generatedmore than $80 million for the Lance ArmstrongFoundation. An example being set by Nike is that - Harsh Gupta IIM Rohtak! PAGE 5
  6. 6. MARQUE! 20 NOVEMBER 2011CAUSE MARKETING - IS IT THE ANSWER? We all are aware of the criticism that the environment, Cause Marketing is something whichCapitalists of the world are being subjected to, is cutting through it and reaching its targetafter the 2008-09 screw-up of the world audience.economies. Critics argue that the corporate have But have we been successful in establishingchanged paths and now are exercising profiteering. another channel of resource flow in the form ofOne can find out the difference between ‘Cause Marketing’ to develop our society? I seeprofiteering and profit making. In a capitalist another problem here that arises from the fact thatworld, profit-making is a factor of utmost the term ‘development of society’ is itself a termimportance if the society is to be developed. encompassing a lot of things. There is a range ofHowever, it needs to be understood that the things to be done in this society for its bettermentconcept of ‘Society’ is of aggregate nature here. or holistic development. Here again we face aThe profit-making society will develop for sure but problem of scarcity; scarcity of funding from thethe benefits generally get allocated profit-makers. Scarcity welcomes economicdisproportionately. When we delve deeper into this principles with open hands and again establisheswhole system of profit generation and the society laws of so called ‘best utility providing allocations’benefitting from it, we find that the traditional which heavily depend on the resource master andchannel of benefit transfer to the constituents of his/her perception of derived utility from thatthe society touches the few who may be termed as particular expenditure of resource. So if there are‘best to get the benefits’. This system has a defect three causes which a company is considering to getthat it goes on allocating the benefits to the ‘best’ involved with as a part of its CSR activity, whichand gives little chance to other ‘not-so-best’ one would it choose? What will be the basis ofconstituents of the society and the society is weighing these causes? Will it seek the overalldeveloped at a rate less than optimal and in a way society’s benefit or will it again get carried away bywhich cannot be termed to be holistic. the notion of getting most for itself out of this Cause marketing has turned out to be a activity? The answer is pretty straight consideringchannel connecting the profit-generator’s benefits the premise on which the capitalist world works.and the ‘not-so-best’ constituents of the society, An example of a non-deserving cause gettinggiving them a chance. The effectiveness of this funded at the expense of other important but lesschannel or link is still under question as there has interesting causes is the 1980’s money raisingnot been a major organized initiative in this sector. exercise of the Muscular Dystrophy Association. It From the business’ point of view, merely raised tens of millions of dollars despite it havingdonating funds to a cause through an NGO does lesser developmental chances as the muscularnot ensure that they will register themselves with dystrophy is a genetic disorder. In such a situationtheir target customers. People are wise enough to again, the neediest charities don’t get the fundssee through a ‘hey look at me’ campaign. Most of they deserve. Again a problem of channel touch.the campaigns, if you would see today, are subtle in The Solution? Introducing anothertheir approach. But be too subtle and you will lose intermediary in the chain? Governmentmoney. This is how corporate views cause regulations? Government watchdog? Nobody inmarketing. the capitalist world will work for anything else but It makes business sense for the corporate to get generating profits in whatever form they value:involved in Cause Marketing. Whirlpool and tangible or intangible. So does that mean noHabitat for Humanity’s initiative deserves a intermediary can tackle this problem? Hasmention here. Whirlpool provided a refrigerator government intervention in certain sectors beenfor each Habitat home built in the US. It used this successful in bringing about desired results?as a major driver of brand loyalty with the RebaMcEntire campaign. Corporate needs something tomake people talk about its brands to increasesomething called as TOMA (top of mindawareness). In today’s cluttered communication! PAGE 6
  7. 7. MARQUE! 20 NOVEMBER 2011 Resources abound, the issue boils down to population, a practice followed by every business,allocation, allocation which is done by valuing the common knowledge range is again drasticallyutility. Whether we can come up with a better reduced. The corporate again use the marketingallocation strategy will, in my opinion, decide the principles of getting involved with the causes thateffectiveness of this new channel of benefit an average person in their target population istransfer, as in the existing channel of benefit aware of so that they can establish a better brand-distribution also, the so called ‘best’ is allocated the connect with their customers while spending asmost. less as possible because educating the target Another major problem that I perceive with customer about a certain thing she doesn’t knowthe whole win-win concept of supporting the requires money and time.causes is of the person driving all these efforts. Cause Marketing, they say, is benefitting ourLet’s take a look at the driver of these cause society in many ways. They say it is a channel offunding activities: the target customer. Is she aware resource flow to the real, meaningful societalof the cause she is supporting by buying an development. They say that people are happy thatassociated brand? How does a person find out by buying a particular brand associated with awhich cause to support and which not to? An cause, they are doing their bit to develop theiraverage human being does not even think while society. They say it is a win-win for the society andbuying some brand supporting a cause X whether its major constituent, the corporate. I ask all suchthat cause deserves funding or not. He is limited by people, Is it so?his ken and when you form segments out of a - Kushal Lokhande IIM Rohtak! PAGE 7
  8. 8. MARQUE! 6 NOVEMBER 2011Canvas Write to Canvas: Follow Canvas on Twitter: @CanvasTalesMarque - IIM Rohtak Official Website: Visit Marque: Join us and follow us on Facebook and Twitter!/marqueiimrohtak Connect with us on LinkedIn