Is there Need for more Transparency and Efficiency in Cause-related Marketing?

Abstract

The popularity of ethical consumption increases. This has motivated firms to increasingly implement Cause-related Marketing (CrM) campaigns in Germany. But research reveals that especially German consumers are sceptic with regard to the amount of money spent for the good ‘cause’ by the enterprises. This can be explained by the small share of information provided by CrM campaigns to consumers. In consequence, this can reduce consumers’ willingness to purchase CrM products. Therefore, this study analyses whether the efficiency and transparency of a CrM campaign are important for consumers. The share of money reaching the cause relative to the product price consumers’ pay is taken as a proxy for efficiency while transparency is understood as the open communication of donated amounts on the product by label. A consumer survey conducted in Germany in 2009 reveals that consumers have a great interest in the transparency of a CrM campaign. Furthermore, the study gives evidence that there is a gap between the levels of expected and requested efficiency of CrM donations. Consequently, firms should label the donation amount to meet consumers’ transparency needs. Furthermore, to create a successful CrM campaign companies also have to consider that the amount of money devoted to the good cause is of relevance for consumers.

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