A study of 300 college students by a professor at the University of Michigan shows that cause related marketing programs had the effect of reducing the amount of money these consumers gave to charity.
"Consumers may think of the firm's donation as theirs since it is facilitated by their act -- in fact, this type of thinking is 'rational' since it allows consumers to spend less to meet their donation goals," said Aradhna Krishna, the Dwight F. Benton professor of marketing at UM. "This suggests that even if cause-marketing purchases are costless, consumers think of their purchase as a charitable act and decrease subsequent acts. The higher the cause-marketing expenditure, the lower was the individual charitable giving."
The same programs also seem to leave consumers less happy with their charitable giving.
"Consumers appear to realize that participating in cause marketing is inherently more selfish than direct charitable donation, reducing their subsequent happiness (versus a direct donation)," said Prof. Krishna. "Unfortunately, this doesn't prevent them from substituting it for charitable giving, which reduces the overall charitable donation."
While Prof. Krishna's research provides some evidence of unintended consequences, cause related programs continue to be popular with marketers and consumers.
According to Cone's 2010 Cause Evolution Study:
- Eighty-three percent of consumers want more of what they buy to benefit causes;
- Eighty-five percent have a more positive view of companies engaged in cause related marketing efforts;
- Eighty percent are likely to switch brands assuming all other attributes are equal.