Lip service won't cut it anymore when it comes to being a good corporate citizen. The 2004 Cone Corporate Citizenship Study, released last week, shows that Americans--
now more than ever before--stand to punish firms that behave illegally or unethically. On the flip side -- whether it's acceptable for companies to involve a cause or social issue
in their marketing materials or switching to a brand associated with an issue -- Americans continue to raise their expectations for companies that take up a cause(s).
Consumer attitudes toward corporate support are changing rapidly. Eight in 10 Americans responding to the survey say corporate support of causes wins their trust in a
company, a 21% increase since 1997.
However, companies that behave badly will pay a price: 90% of the respondents would consider switching to another company's products or services, while 80% would consider
selling their investment in that company's stock; 73% would boycott.
"There's no room to hide anymore," says Carol Cone, CEO of Cone Inc. (Boston), which has specialized in cause-marketing campaigns since 1984. Cause-marketing programs
"have to be deep and credible to have a positive impact on the brand," she says. "A lot of companies are dabbling in it but they are a lot more PR-driven campaigns than societal-
changing programs."
Because the most effective cause-marketing programs are led by top management, PR pros need to align themselves with the C-suite on cause-marketing-- which is a strategy, not
a tactic.
And rather than being a one-shot deal, cause-marketing programs have to be embedded into the company's DNA.
"These programs have to be executed from the inside out," Cone says, "and reach all across the entire enterprise. Citizens are demanding it. It's not just checking off a box
or sending a check to a nonprofit."
Asked why Wal-Mart was, above all, mentioned by those surveyed in the context of community support--even though citizens and the media have been severely critical of
some of the company's business practices--Cone says the retailer is very careful to promote its caring side.
Its "Good Works" program, for example, donates $200 million a year to various causes. "It balances the equation of its bigness and keeps the company more human," Cone says,
who referred to Avon, General Mills, Home Depot and Target as other companies taking the lead on cause marketing. "Businesses today need to be more
human; they can't just be this gigantic heavy weight on society. [But] some companies are starting to recognize this." PRN
CONTACT: Carole Cone, 617.939.8302, [email protected]
Great(er) Expectations
As research results continue to demonstrate, Americans have grown to expect companies to play a more active role in addressing the needs of society:
| 2004 | 2001 | 1993 | |
|---|---|---|---|
| It is acceptable for companies to involve a cause or issue in their marketing |
72%
|
70%
|
66%
|
Americans stand prepared to punish companies they perceive as having negative practices. However, they will also reward those companies who meet their high expectations with
their business:
| 2004 | 2002 | 1999 | 1993 | |
|---|---|---|---|---|
| I am very/somewhat likely to switch from one brand to another that is about the same in price and quality, if theother brand is associated with a cause |
86%
|
84%
|
84%
|
85%
|
In addition, Americans are willing act in a variety of ways beyond product purchases:
A company's commitment to a social issue is important when I decide... |
2004 | 2002 |
|---|---|---|
| Which companies I want to see doing business in my local community |
85%
|
84%
|
| Where to work |
81%
|
77%
|
| Which products and services to recommend to other people |
74%
|
75%
|
| Which stocks or mutual funds to invest in |
70%
|
66%
|
One of the results of increased communications by certain companies is that when asked, more Americans can name a good corporate citizen. Cone's research shows a dramatic
rise in recall:
| 2004 | 2001 | 1999 | 1993 | |
|---|---|---|---|---|
| Americans who can name a company that stands out in their mind as a strong corporate citizen |
80%
|
49%
|
4%
|
26%
|
In this year's study, of those who were able to name a strong corporate citizen, Wal-Mart was mentioned most frequently and is the only company to have broken away from the
others. The retailer has experienced a significant jump in recognition during the 11 years of Cone's research:
| 2004 | 1999 | 1993 | |
|---|---|---|---|
| Wal-Mart |
12%
|
10%
|
3%
|
Source: The 2004 Cone Corporate Citizenship Study