Abstract
Cause-related marketing (CRM) is currently considered one of the main initiatives of corporate social responsibility (CSR). CRM programs offer numerous advantages for all the parties involved: companies, non-profit organizations, and consumers. Examples of CRM programs can be found in virtually every country in the world. Although most CRM campaigns succeeded, several of them were involved in some scandals. In Spain, an example of the controversy caused by CRM campaigns resurfaced with the installation of the so-called “solidarity traffic radar.” The aim of this chapter is to offer a case study about this campaign, where a private company managed this traffic radar. Half of the money that was raised in fines was given to the Town Council, which in turn decided to donate it to needy local families, that is, it was allocated to social aid. Thus, this case study discusses if anything goes in CRM, or there is sometimes a trivialization of solidarity.
TopIntroduction
Corporate Social Responsibility (CSR), defined as “the voluntary integration, by enterprises, of social and environmental concerns in their business operations and their interaction with their stakeholders” (Commission of the European Communities, 2001, p. 7), is nowadays a key aspect for all kind of companies that integrated it into their corporate mission and organizational culture. CSR concept is an “umbrella” where different activities are included.
Cause-related marketing (CRM) is currently considered as one of the main initiatives of CSR (Kotler & Lee, 2005; Nelson & Vilela, 2017; Rego, 2017; Galan & Galera, 2018), with an important growth in the last years (Rego, 2017; Duarte & Silva, 2018). CRM is defined as “an agreement between a company and a non-profit organization to collaborate in a social cause and get mutual benefit. The commitment of the company focuses on contributing (financially or in kind) to the cause in terms of sales. Therefore, the donation will depend on consumer behaviour” (adapted from Santesmases, 1999, p. 1004; Kotler and Lee in Galan, 2012).
Thus, CRM is not social marketing (Santesmases, 1999), and its most relevant characteristics are (Galan & Galera, 2018): (1) there is a link between a for-profit organization (a company) and a non-profit organization (a NPO), in order to support a social cause, and obtaining a mutual benefit (Penelas et al., 2012); and (2) the donation is conditioned by sales (CRM ultimately depends on consumer behaviour if he/she buys the product linked to the CRM campaign).
The theoretical development of CRM is based on the evolution of the marketing concept toward the social perspective (social dimension of marketing), the emergence of non-business marketing, the importance of CSR, and the influence of paradigms such as marketing orientation, marketing relationships, stakeholder orientation, holistic marketing orientation, and sustainability (Galan et al., 2013). Theories such as stakeholder theory, resource-advantage theory (Hunt & Morgan, 1995; Ferrell, 2010), or legitimacy theory (Liu, 2013, p. 248) are considered fundamental for this development; and also approaches such as the instrumental dominant logic (that considers CRM as “a commercial marketing campaign, focused on influence consumers’ purchase intention; that is, attracting customers’ attention to generate sales” – Liu, 2013, pp. 243-244, 257) and relational dominant logic (that considers CRM as “a management strategy, focused on building relationships with the target stakeholders through the enhancement of a firm’s legitimacy” - Liu, 2013, pp. 243-244, 257).
CRM emerged in the USA in the 1980s (American Express copyrighted the term “cause-related marketing” (Varadarajan and Menon, 1988, p. 58)) and it was quickly imitated by other companies. Nowadays, examples of CRM programs can be found in virtually any country in the world.
Key Terms in this Chapter
Cause-Related Marketing (CRM): a CSR initiative that consists of an agreement between a company and a nonprofit organization to collaborate on a social cause, obtaining a mutual benefit. The company’s commitment is focused on contributing (monetary or in kind) to the cause in terms of sales (therefore the donation will depend on consumer behavior).
Controversial campaigns: ad campaigns involved in some scandals (because of the product involved in the campaign, the images or messages included in campaign ads, the social cause chosen for the campaign, etc.).
Social Cause: an idea, opinion, attitude, value, or behavior that is socially desirable.
‘Solidarity’ Traffic Radar: system that uses radio waves to control traffic (e.g. speed) and records traffic violations. Offenders receive fines later. But, in this case, the traffic radar adds the term “solidarity” because part of the money raised in fines is given for social aid, for a social cause.
Nonprofit organization (NPO): an entity whose main aim is not to obtain monetary profit (e.g. a Non-Governmental Organization – NGO – that seeks a social purpose).
Town Council: local government. It can be considered a public nonprofit organization.
For-Profit Organization: an entity whose main aim is to obtain monetary profit (e.g. a company that seeks an economic purpose).