Cause Donations to Enhance Business Credit

In cause-related marketing, you address social responsibilities by making charitable contributions. For example, you announce to your target markets you’ll donate a certain amount of money based on purchases from your store.
     Researchers at Washington University in St. Louis point out that another example consists of donating goods rather than money. Their studies conclude this is a better alternative if consumers view your business as lacking warmth. You’ll earn more credit in consumers’ minds by contributing items, with the monetary value of each donation stated as what the cost to your business is.
     The explanation is that people are prone to attribute hidden, exploitive motives to low-warmth organizations. Donations of appropriate goods instead of money show warmth via you attending to the distinctive needs of others. In the studies, donors lacking warmth were defined as those low in the communal characteristics of friendliness and trustworthiness.
     The researchers muse that charities probably prefer monetary contributions to donations of merchandise, since the money gives the charity more flexibility. So it could be in the interest of all parties for a business experiencing perceptions of low warmth to improve these perceptions. In the meantime, though, give goods. Still another alternative is to pay your employees to do work at the charity. Donations of time by the employees of a business might give impressions of the business warmth.
     Another issue is what charity to contribute to. It would seem you’d want to choose a recipient consistent with your store’s brand image. But studies at North Carolina State University and University of South Carolina make a case for including charities which don’t fit the personality of the store operations. The reason is that this has been found to give the consumers more of a sense of personal participation in helping the cause through their purchases. They feel noble, and a sense of nobility facilitates buying intentions.
     If you follow this advice, the specific mission of the charity probably differs from the specifics of the mission of your business. Therefore, your business may want to give merchandise different from what your store usually carries. This is because studies at National Sun Yat‐Sen University, Nanjing University, and CTBC Bank verify how the match between the charity’s mission and the nature of the donation is most important in leading consumers to consider the motives of the business to be genuinely altruistic. It is this consideration which maximizes intentions to buy from the business.

For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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