Wednesday, January 27, 2010

Cause-Related Marketing

In the last couple of years more and more companies have been implementing cause-related marketing strategies. Cause-related marking is a strategy in which a “for-profit” organization aligns itself with a worthwhile cause (pg. 84). There are several incentives for a company to use a cause-related marketing strategy. First a company can improve its public image by showing that it is interested in more than just making profits. Second, a company can also increase demand for its goods and gain a competitive advantage. For instance, consumers would be more willing to purchase something from a company that they know donates a portion of their proceeds to a charity than from a company that just keeps all the profits for itself. A good example of a company that implements this strategy is Johnson&Johnson. For the past five years this company has been working hard toward becoming more environmentally friendly by: reducing generated hazardous waste, decreasing water use, and using alternative sources of energy for production. This is a smart move for Johnson&Johnson, because they were one of the first one to recognize the environmentally friendly social movement that’s been happening all around the world. Another way that Johnson&Johnson is improving its image is by partnering with organizations such as UNICEF to provide medical care for women and babies in India and by contributing millions of dollars each year to humanitarian works all around the world. Even though companies that implement cause-related marketing strategy exercise their social responsibility, some critics see this as “cause-exploitation” (pg. 85). This is because cause-related marketing allows a company to improve its image, increase sales, and gain a competitive advantage; some companies may choose to implement this strategy not to exercising their social responsibility, but just to have its benefits.

Olga Fedorovskaya
Section E

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