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…)
Posts Tagged: Commercial Co-Ventures
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…)
Commercial co-ventures are a form of cause-related marketing that have proliferated in recent years. Commercial co-ventures between a company and a charity not only help charitable causes, but also tend to increase a company’s bottom line. Indeed, market studies have shown that most people will opt to purchase a product associated with a charitable cause over a competitor’s product. Commercial co-ventures are highly regulated, so carefully planning and must be taken to avoid any legal pitfalls.
What is a commercial co-venture?
Generally, a commercial co-venture is a charitable sales campaign where a brand advertises to the consumer that the brand will donate a portion of the purchase price to charity. (more…)