Posts Tagged: Advertising

Cause Marketing Lessons from the Wounded Warrior Project Scandal

Your company just made a major announcement that it is partnering with a charity that you now find is involved in a scandal. What can you do?

The recent ousting of The Wounded Warriors Project CEO and COO amid allegations of lavish spending on travel, conferences and public relations requires a company to examine their cause marketing campaigns. While there is no need to throw the baby out with the bath water – recent studies still confirm that consumers, and in particular Millennials, strongly support buying from companies associated with a cause* — picking the right charity is critical.

*For example, according to the 2015 Cone Communications Millennial CSR Study, “More than nine-in-10 Millennials would switch brands to one associated with a cause (91% vs. 85% U.S. average).” (more…)

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I Said Your Product was Great, Now Gimme a Prize: The FTC Enforces Its Endorsement Guidelines

Yesterday, the FTC settled a deceptive advertising lawsuit against the creators and marketers of the Lumosity “brain training” program. For those of you not smart enough to know, the “brain training” program claimed to not only boost your performance at work or school, but also slow down those pesky cognitive impairments we all seem to experience as we get older.

What was I saying? Oh, yeah. As part of its marketing campaign, Lumosity ran an “Athlete Testimonial Contest” inviting entrants to share their story of how “Lumosity has helped them take their athletic abilities to the next level for the chance to win a Lifetime Subscription, the new iPad, and more!” (NB: Apple frowns upon giving away iPads.)

With this call to action, burgeoning athletes took time away from their snatch and jerks to post their stories online to gain entry into the (sic) “contest”. (more…)

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“All Profits to Charity” – How Much is That? A Brief Commercial Co-venture Lesson

You’ve heard this sales pitch before. Its cousins are “A percentage of proceeds to charity” and “A portion of the proceeds to charity”. Do you really know how much will be donated? The short answer is no. I’ve read estimates that net profits on a pizza pie are typically 4% to 8%, on new cars around 1-2%, and in the clothing industry profit margins range from 4% to 13%.  The Wall Street Journal has reported that McDonald’s makes 6 cents on a one-dollar hamburger. So if a brand tells you it’s giving “all of its profits to charity,” you need to know where’s the beef. (more…)

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Show Me the Money – When Taxes Can Turn Your Dream Home Into a Nightmare

It’s that time of year again, the 20th annual HGTV Dream Home 2016 Sweepstakes began December 29th. As the sponsor of this promotion has recognized, winning a mansion could put you in the dog house when you are socked with a hefty tax bill. I’ve written about this issue of the tax consequences of giving away expensive prizes in an article published in the Connecticut Post.

To avoid cooking Ramen noodles and mac and cheese on your brand-new Thermador® 36 inch Professional Series Pro Harmony standard depth dual fuel range (i.e., “oven”), you have the option of taking $900,000 instead so that your dream home doesn’t become a financial nightmare. (more…)

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Cause Marketing by the Numbers – What’s In It for Me?

There is a common belief that corporations must do everything with an eye to producing profits for shareholders. But that is not so. In fact, in its opinion in the Hobby Lobby case, the U.S. Supreme Court stated: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.” Brands can (and should) include cause marketing in their promotional campaigns. (And you don’t need to tell anyone, but doing so will probably increase your product awareness and bottom line!)

Consumer studies have shown: (more…)

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FTC Addresses Nativ(ity) Advertising Just in Time For Xmas

On Tuesday, the FTC issued an Enforcement Policy Statement on Deceptively Formatted Advertisements — a/k/a “native advertising”, along with guidelines for businesses. Simply put, native advertising is generally advertising that takes the form and style of the platform in which it appears in order to promote a product. Think of a BuzzFeed quiz on “5 Random Questions To Determine What Type of Sandwich You’d Be if You Were Reincarnated” that just happens to be sponsored by Subway.

In general, the FTC wants to make sure that consumers know that advertisements and promotional messages are just that, and do not imply or suggest that they’re independent, impartial, or from a source other than the sponsoring advertiser. The FTC’s expressed watchword is transparency.

Best practices include: (more…)

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